<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 20, 2000
REGISTRATION NO. 333-32236
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
AMENDMENT NO. 2
TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------------
UBIQUITEL INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C> <C>
DELAWARE 4812 23-3017909
(State or Other Jurisdiction of (Primary Standard (I.R.S. Employer
Incorporation or Organization) Industrial Identification No.)
Classification Code Number)
</TABLE>
1 BALA PLAZA, SUITE 402
BALA CYNWYD, PENNSYLVANIA 19004
(610) 660-9510
(Address, Including Zip Code, and Telephone Number, Including Area Code,
of Registrant's Principal Executive Offices)
--------------------------
DONALD A. HARRIS
UBIQUITEL INC.
1 BALA PLAZA, SUITE 402
BALA CYNWYD, PENNSYLVANIA 19004
(610) 660-9510
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
--------------------------
COPIES OF COMMUNICATIONS TO:
<TABLE>
<S> <C> <C>
REBECCA R. ORAND, ESQ. LEE R. MARKS, ESQ. MICHAEL A. SASLAW, ESQ.
GREENBERG TRAURIG, P.A. ERIC W. COWAN, ESQ. WEIL, GOTSHAL & MANGES LLP
1221 BRICKELL AVENUE GREENBERG TRAURIG, LLP 100 CRESCENT COURT, SUITE
MIAMI, FLORIDA 33131 1750 TYSONS BOULEVARD 1300
TELEPHONE NO.: (305) TYSONS CORNER, VIRGINIA DALLAS, TEXAS 75201
579-0500 22102 TELEPHONE NO.: (214)
FACSIMILE NO.: (305) TELEPHONE NO.: (703) 746-7700
579-0717 749-1300 FACSIMILE NO.: (214)
FACSIMILE NO.: (703) 746-7777
749-1301
</TABLE>
--------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
As soon as practicable after this Registration Statement becomes effective.
--------------------------
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. / /
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
--------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the various expenses and costs (other than
underwriting discounts and commissions) expected to be incurred in connection
with the issuance and distribution of the securities to be registered. All of
the amounts shown are estimated except for the Securities and Exchange
Commission registration fee, the NASD filing fee and the Nasdaq National Market
listing fee.
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee......... $ 56,925
NASD filing fee............................................. 15,500
Nasdaq National Market listing fees......................... 95,000
Printing and engraving expenses............................. 300,000
Legal fees and expenses..................................... 500,000
Accounting fees and expenses................................ 300,000
Transfer agent and registrar fees........................... 100,000
Miscellaneous expenses...................................... 232,575
----------
Total....................................................... $1,600,000
==========
</TABLE>
ITEM 14. INDEMNIFICATION OF OFFICERS AND DIRECTORS
Upon completion of this offering, the Restated Certificate of Incorporation
of UbiquiTel Inc. ("UbiquiTel") will provide that the liability of the directors
and officers of UbiquiTel to UbiquiTel or any of its stockholders for monetary
damages arising from a breach of their fiduciary duty as directors and officers
shall be limited to the fullest extent permitted by the General Corporation Law
of Delaware. This limitation does not apply with respect to any action in which
a director or officer would be liable under Section 174 of the General
Corporation Law of Delaware, nor does it apply with respect to any liability in
which a director or officer:
- breached his duty of loyalty to UbiquiTel or its stockholders;
- did not act in good faith or, in failing to act, did not act in good
faith;
- acted in a manner involving intentional misconduct or a knowing violation
of law or, in failing to act, shall have acted in a manner involving
intentional misconduct or a knowing violation of law; or
- derived an improper personal benefit.
UbiquiTel's bylaws provide that UbiquiTel may indemnify any person who was
or is a party or is threatened to be made a party to any threatened, pending, or
completed action, suit, or proceeding, whether civil, criminal, administrative
or investigative (other than an action by or in the right of UbiquiTel) by
reason of the fact that he is or was a director, officer, employee, or agent of
UbiquiTel, or is or was serving at the request of UbiquiTel as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise, against
II-1
<PAGE>
expenses (including attorney's fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred in connection with such action,
suit, or proceeding. The power to indemnify applies only if such person acted in
good faith and in a manner he reasonably believed to be in the best interest, or
not opposed to the best interest, of UbiquiTel and with respect to any criminal
action or proceeding, had no reasonable cause to believe his conduct was
unlawful.
The power to indemnify applies to actions brought by or in the right of
UbiquiTel as well, but only to the extent of defense and settlement expenses and
not to any satisfaction of a judgment or settlement of the claim itself and with
the further limitation that in such actions no indemnification shall be made in
respect of any claim, issue or matter as to which such person has been adjudged
to be liable to UbiquiTel unless the court, in its discretion, believes that in
light of all the circumstances indemnification should apply. To the extent that
any present or former director of UbiquiTel has been successful on the merits or
otherwise in defense of any action, suit or proceeding referred to above, or in
defense of any claim, issue or matter therein, he shall be indemnified against
expenses (including attorneys' fees) actually and reasonably incurred by him in
connection therewith.
Reference is made to the Form of Underwriting Agreement, to be filed as
Exhibit 1.1 to this registration statement, which provides for indemnification
by the Underwriters under certain circumstances of the directors and officers of
UbiquiTel signing the registration statement and certain controlling persons of
UbiquiTel against certain liabilities, including those arising under the
Securities Act.
UbiquiTel has purchased directors' and officers' liability insurance
covering its directors and officers in amounts customary for similarly situated
companies.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers or persons controlling UbiquiTel
pursuant to the foregoing provisions, UbiquiTel has been advised that in the
opinion of the Securities and Exchange Commission, such indemnification is
against public policy as expressed in the Securities Act and is therefore
unenforceable.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES
The information set forth in this Item 15 does not give effect to a
two-for-one split of UbiquiTel's outstanding common stock to be effected as of
the date of the prospectus, which forms a part of this registration statement.
Since its inception on September 29, 1999, the Registrant has entered into
agreements to issue the following unregistered securities:
1. 3,417,000 shares of its Voting Common Stock for an aggregate purchase
price of $3,417. The purchasers of the shares and the amount purchased are
listed on the table below.
<TABLE>
<CAPTION>
NAME OF PURCHASER NUMBER OF SHARES
<S> <C>
The Walter Group, Inc.................................. 1,281,375
Donald A. Harris....................................... 994,500
James Parsons.......................................... 443,700
Paul F. Judge.......................................... 401,625
US Bancorp............................................. 295,800
</TABLE>
II-2
<PAGE>
2. 16,000,000 shares of its Non-Voting Common Stock subject to forfeiture
under certain events, for an aggregate purchase price of $16,000. The purchasers
of the shares and the amount purchased are listed on the table below.
<TABLE>
<CAPTION>
NAME OF PURCHASER NUMBER OF SHARES
<S> <C>
The Walter Group, Inc.................................. 6,000,160
Donald A. Harris....................................... 4,656,640
James Parsons.......................................... 2,077,600
Paul F. Judge.......................................... 1,880,480
US Bancorp............................................. 1,385,120
</TABLE>
3. 17,008,500 shares of its Series A Preferred Stock at an aggregate
purchase price of $17,008,500. The purchasers of the shares and the amount
purchased are listed in the table below.
<TABLE>
<CAPTION>
NAME OF PURCHASER NUMBER OF SHARES
<S> <C>
Brookwood UbiquiTel Investors, L.L.C................... 4,668,999
CBT Wireless Investments, L.L.C........................ 2,701,350
New Ventures, L.L.C.................................... 2,001,000
Stephen C. Marcus...................................... 1,800,900
SpectraSite Communications, Inc........................ 1,666,500
Lancaster Investment Partners.......................... 1,000,500
Donald A. Harris....................................... 1,000,500
Porter Partners, L.P................................... 900,450
Ballyshannon Partners, L.P............................. 500,250
Mark Buechly........................................... 300,150
Barry Porter........................................... 250,125
Richard C. Walling, Jr................................. 166,750
Robert Berlacher....................................... 50,025
</TABLE>
4. employee stock options to Donald A. Harris to purchase 1,275,000 shares
of Voting Common Stock at $1.00 per share.
5. warrants to Paribas North America, Inc. to purchase 574,402 shares of
its Non-Voting Common Stock in connection with a Credit Agreement for a
$25 million line of credit.
6. warrants to BET Associates, L.P. to purchase 2,489,075 shares of its
Voting Common Stock and issuance of 12% Senior Subordinated Notes due 2007 to
BET Associates, L.P. for an aggregate purchase price of $8,000,000, and
2,489,075 shares of its Voting Common Stock upon exercise of such warrants.
7. 2,148,848 shares of its Series B Preferred Stock to DLJ Merchant Banking
Partners II, L.P. for an aggregate purchase price of $25,000,000.
II-3
<PAGE>
8. 68,379 shares of the 16,000,000 shares of Non-Voting Common Stock
originally issued in November 1999 vested in April 2000. The holders of these
shares and the amount issued to these holders are listed in the table below.
<TABLE>
<CAPTION>
NAME OF PURCHASER NUMBER OF SHARES
<S> <C>
The Walter Group, Inc................................ 25,642
Donald A. Harris..................................... 19,901
James Parsons........................................ 8,879
Paul F. Judge........................................ 8,037
US Bancorp........................................... 5,920
</TABLE>
9. employee stock options to purchase, in the aggregate, 455,000 shares of
Voting Common Stock at $1.00 per share.
10. an employee stock option to purchase 30,000 shares of Voting Common
Stock at the initial public offering price per share.
11. 14% Senior Subordinated Discount Notes due 2010 and warrants to purchase
2,117,402 shares of its common stock at $22.74 per share in connection with its
units offering.
None of the foregoing transactions involved any public offering. All sales
were made in reliance on Section 4(2) of the Securities Act, Rule 701
promulgated under the Securities Act and/or Regulation D promulgated under the
Securities Act. These sales were made without general solicitation or
advertising. The recipients in each such transaction represented their intention
to acquire the securities for investment only and not with a view to sell or for
sale in connection with any distribution thereof. All recipients had adequate
access, through their relationship with us, to information about us.
II-4
<PAGE>
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
<C> <S>
*1.1 Form of Underwriting Agreement
*3.1 Restated Certificate of Incorporation of UbiquiTel Inc.
*3.2 Bylaws of UbiquiTel Inc.
*4.1 Specimen Common Stock Certificate.
*5.1 Form of opinion of Greenberg Traurig, LLP, regarding
legality of the Common Stock being issued.
+10.1 Sprint PCS Management Agreement, as amended, dated as of
October 15, 1998 by and between Sprint Spectrum, LP,
WirelessCo, LP and UbiquiTel, LLC.
10.2 Sprint PCS Services Agreement dated as of October 15, 1998
by and between Sprint Spectrum, LP and UbiquiTel, LLC.
10.3 Sprint Trademark and Service Mark License Agreement dated as
of October 15, 1998 by and between Sprint Communications
Company, LP and UbiquiTel, LLC.
10.4 Sprint Spectrum Trademark and Service Mark License Agreement
dated as of October 15, 1998 by and between Sprint Spectrum,
LP and UbiquiTel, LLC.
+10.5 Asset Purchase Agreement dated as of December , 1999
by and between Sprint Spectrum, LP, Sprint Spectrum
Equipment Company, LP, Sprint Spectrum Realty Company, LP,
Cox Communications PCS, LP, Cox PCS Leasing Co., LP, Cox PCS
Assets, LLC and UbiquiTel Holdings, Inc.
10.6 Registration Rights Agreement made as of November 23, 1999
by and among UbiquiTel Holdings, Inc. and the shareholder
signatories thereto.
10.7 Amended and Restated Registration Rights Agreement made as
of February 16, 2000 by and among UbiquiTel Holdings, Inc.
and the shareholder signatories thereto.
**10.8 Shareholders' Agreement dated as of February 16, 2000 by and
among UbiquiTel Holdings, Inc., DLJ Merchant Banking
Partners II, L.P. and the several shareholders named
therein.
**10.9 Stockholders' Voting Agreement dated November 23, 1999 by
and among UbiquiTel Holdings, Inc. and the shareholder
signatories thereto.
**10.10 Credit Agreement dated as of December 29, 1999 by and
between UbiquiTel Holdings, Inc., UbiquiTel LLC, the
financial institutions party thereto from time to time and
Paribas, as agent, for a $25,000,000 credit facility.
10.11 Amended and Restated Consent and Agreement dated as of
April 5, 2000 by and between Sprint Spectrum, LP, Sprint
Communications Company, LP, WirelessCo, LP, Cox
Communications PCS, LP, Cox PCS License, LLC and Paribas.
**10.12 Warrant Agreement dated as of December 28, 1999 by and
between UbiquiTel Holdings, Inc. and Paribas North America,
Inc.
</TABLE>
II-5
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
<C> <S>
**10.13 Series A Preferred Stock Purchase Agreement dated as of
November 23, 1999 by and between UbiquiTel Holdings, Inc.,
The Walter Group, Donald A. Harris, Paul F. Judge, James
Parsons, U.S. Bancorp and the individuals listed on
Exhibit A thereto.
10.14 Purchase Agreement dated as of December 28, 1999 among
UbiquiTel, L.L.C., UbiquiTel Holdings, Inc. and BET
Associates, L.P. relating to $8,000,000 principal amount of
UbiquiTel, L.L.C. 12% Senior Subordinated Notes due 2007 and
Warrants to Purchase 9.75% of the Shares of Common Stock of
UbiquiTel Holding Co.
**10.15 Preferred Stock Purchase Agreement dated February 16, 2000
between UbiquiTel Holdings, Inc. and DLJ Merchant Banking
Partners II, L.P.
**10.16 Form of 2000 Equity Incentive Plan.
10.17 Employment Agreement dated as of November 29, 1999 by and
between UbiquiTel Holdings, Inc. and Donald A. Harris.
10.18 Credit Agreement dated as of March 31, 2000 by and between
UbiquiTel Inc., UbiquiTel Operating Company, the financial
institutions party thereto from time to time and Paribas, as
agent, for a $250,000,000 credit facility.
10.19 Purchase Agreement dated April 4, 2000 between UbiquiTel
Inc., UbiquiTel Operating Company and Donaldson Lufkin &
Jenrette Securities Corporation, Paribas Corporation and PNC
Capital Markets, Inc.
10.20 Indenture dated as of April 11, 2000 between UbiquiTel
Operating Company, UbiquiTel Inc. and American Stock
Transfer & Trust Company.
10.21 Warrant Agreement dated as of April 11, 2000 between
UbiquiTel Inc. and American Stock Transfer & Trust Company.
10.22 Registration Rights Agreement made as of April 11, 2000 by
and among UbiquiTel Operating Company, UbiquiTel Inc. and
Donaldson Lufkin & Jenrette Securities Corporation, Paribas
Corporation and PNC Capital Markets, Inc.
10.23 Warrant Registration Rights Agreement made as of April 11,
2000 by and among UbiquiTel Inc. and Donaldson Lufkin &
Jenrette Securities Corporation, Paribas Corporation and PNC
Capital Markets, Inc.
**21.1 Subsidiaries of UbiquiTel Inc.
**23.1 Consent of Arthur Andersen LLP.
**23.2 Consent of Ernst & Young LLP.
*23.3 Consent of Greenberg Traurig, LLP (contained in legal
opinion filed as Exhibit 5.1).
**24.1 Powers of Attorney.
*27.1 Financial Data Schedule.
</TABLE>
- ------------------------
* To be filed by Amendment.
** Previously filed.
+ Confidential treatment has been requested on portions of these documents.
II-6
<PAGE>
(b) Financial Statement Schedules:
No financial statement schedules are filed because the required information
is not applicable or is included in the consolidated financial statements or
related notes.
ITEM 17. UNDERTAKINGS
The undersigned registrant hereby undertakes to provide to the underwriters,
at the closing specified in the underwriting agreement, certificates in such
denominations and registered in such names as required by the underwriters to
permit prompt delivery to each purchaser.
The undersigned registrant hereby undertakes that:
(1) The undersigned registrant hereby undertakes to provide the underwriter
at the closing specified in the underwriting agreements, certificates in
such denominations and registered in such names as required by the
underwriter to permit prompt delivery to each purchaser.
(2) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part
of this Registration Statement in reliance upon Rule 430A and contained
in a form of prospectus filed by UbiquiTel pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.
(3) For the purpose of determining any liability under the Securities Act of
1933, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new Registration Statement relating to the
securities offered therein and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
II-7
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, UbiquiTel Inc.
has duly caused this Amendment No. 2 to the Registration Statement to be signed
on its behalf by the undersigned, hereunto duly authorized, in the City of Bala
Cynwyd, State of Pennsylvania, on the 20th day of April, 2000.
<TABLE>
<CAPTION>
<S> <C> <C>
UBIQUITEL INC.
By: /s/ Donald A. Harris
-----------------------------------------
Donald A. Harris
President and Chief Executive Officer
</TABLE>
Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 1 to the Registration Statement has been signed by the following persons in
the capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C>
/s/ Donald A. Harris Chairman of the Board and Chief April 20, 2000
- -------------------------------------- Executive Officer
Donald A. Harris (Principal Executive Officer)
/s/ Paul F. Judge* Senior Vice President--Business April 20, 2000
- -------------------------------------- Development and Finance
Paul F. Judge (Principal Financial Officer and
Accounting Officer)
/s/ Peter Lucas* Director April 20, 2000
- --------------------------------------
Peter Lucas
/s/ Robert A. Berlacher* Director April 20, 2000
- --------------------------------------
Robert A. Berlacher
/s/ Eve M. Trkla* Director April 20, 2000
- --------------------------------------
Eve M. Trkla
/s/ Joseph N. Walter* Director April 20, 2000
- --------------------------------------
Joseph N. Walter
</TABLE>
<TABLE>
<S> <C> <C> <C>
*By: /s/ Donald A. Harris
---------------------------------
Donald A. Harris
ATTORNEY-IN-FACT
</TABLE>
II-8
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
<C> <S>
+10.1 Sprint PCS Management Agreement, as amended, dated as of
October 15, 1998 by and between Sprint Spectrum, LP,
WirelessCo, LP and UbiquiTel, LLC.
10.2 Sprint PCS Services Agreement dated as of October 15, 1998
by and between Sprint Spectrum, LP and UbiquiTel, LLC.
10.3 Sprint Trademark and Service Mark License Agreement dated as
of October 15, 1998 by and between Sprint Communications
Company, LP and UbiquiTel, LLC.
10.4 Sprint Spectrum Trademark and Service Mark License Agreement
dated as of October 15, 1998 by and between Sprint Spectrum,
LP and UbiquiTel, LLC.
+10.5 Asset Purchase Agreement dated as of December , 1999
by and between Sprint Spectrum, LP, Sprint Spectrum
Equipment Company, LP, Sprint Spectrum Realty Company, LP,
Cox Communications PCS, LP, Cox PCS Leasing Co., LP, Cox PCS
Assets, LLC and UbiquiTel Holdings, Inc.
10.6 Registration Rights Agreement made as of November 23, 1999
by and among UbiquiTel Holdings, Inc. and the shareholder
signatories thereto.
10.7 Amended and Restated Registration Rights Agreement made as
of February 16, 2000 by and among UbiquiTel Holdings, Inc.
and the shareholder signatories thereto.
10.11 Amended and Restated Consent and Agreement dated as of
April 5, 2000 by and between Sprint Spectrum, LP, Sprint
Communications Company, LP, WirelessCo, LP, Cox
Communications PCS, LP, Cox PCS License, LLC and Paribas.
10.14 Purchase Agreement dated as of December 28, 1999 among
UbiquiTel, L.L.C., UbiquiTel Holdings, Inc. and BET
Associates, L.P. relating to $8,000,000 principal amount of
UbiquiTel, L.L.C. 12% Senior Subordinated Notes due 2007 and
Warrants to Purchase 9.75% of the Shares of Common Stock of
UbiquiTel Holding Co.
10.17 Employment Agreement dated as of November 29, 1999 by and
between UbiquiTel Holdings, Inc. and Donald A. Harris.
10.18 Credit Agreement dated as of March 31, 2000 by and between
UbiquiTel Inc., UbiquiTel Operating Company, the financial
institutions party thereto from time to time and Paribas, as
agent, for a $250,000,000 credit facility.
10.19 Purchase Agreement dated April 4, 2000 between UbiquiTel
Inc., UbiquiTel Operating Company and Donaldson Lufkin &
Jenrette Securities Corporation, Paribas Corporation and PNC
Capital Markets, Inc.
10.20 Indenture dated as of April 11, 2000 between UbiquiTel
Operating Company, UbiquiTel Inc. and American Stock
Transfer & Trust Company.
10.21 Warrant Agreement dated as of April 11, 2000 between
UbiquiTel Inc. and American Stock Transfer & Trust Company.
10.22 Registration Rights Agreement made as of April 11, 2000 by
and among UbiquiTel Operating Company, UbiquiTel Inc. and
Donaldson Lufkin & Jenrette Securities Corporation, Paribas
Corporation and PNC Capital Markets, Inc.
10.23 Warrant Registration Rights Agreement made as of April 11,
2000 by and among UbiquiTel Inc. and Donaldson Lufkin &
Jenrette Securities Corporation, Paribas Corporation and PNC
Capital Markets, Inc.
</TABLE>
- ------------------------
+ Confidential treatment has been requested on portions of these documents.
<PAGE>
Exhibit 10.1
SPRINT PCS
MANAGEMENT AGREEMENT
BETWEEN
SPRINT SPECTRUM L.P.
WIRELESSCO, L.P.
AND
UBIQUITEL L.L.C.
SEPTEMBER __, 1998
<PAGE>
TABLE OF CONTENTS
Page
----
1. MANAGER..................................................................2
1.1 Hiring of Manager.................................................2
1.2 Program Requirements..............................................2
1.3 Vendor Purchase Agreements........................................2
1.4 Interconnection...................................................3
1.5 Seamlessness......................................................3
1.6 Forecasting.......................................................3
1.7 Financing.........................................................3
1.8 Ethical Conduct and Related Covenants.............................3
2. BUILD-OUT OF NETWORK.....................................................3
2.1 Build-out Plan....................................................3
2.2 Compliance with Regulatory Rules..................................4
2.3 Exclusivity of Service Area.......................................4
2.4 Restriction.......................................................4
2.5 Coverage Enhancement..............................................4
2.6 Purchase of Assets by Manager.....................................6
2.7 Microwave Relocation..............................................6
2.8 Determination of pops.............................................6
3. PRODUCTS AND SERVICES; IXC SERVICES......................................6
3.1 Sprint PCS Products and Services..................................6
3.2 Other Products and Services.......................................6
3.3 Cross-selling with Sprint.........................................7
3.4 IXC Services......................................................7
3.5 Resale of Products and Services...................................7
3.5.1 Mandatory Resale of Products and Services................7
3.5.2 Voluntary Resale of Products and Services................7
3.6 Non-competition...................................................8
3.7 Right of Last Offer...............................................8
4. MARKETING AND SALES ACTIVITIES...........................................9
4.1 Sprint PCS National or Regional Distribution Program
Requirements....................................................9
4.1.1 Territorial Limitations on Manager's Distribution
Activities.............................................9
4.1.2 Settlement of Equipment Sales............................9
4.1.3 Use of Third-Party Distributors..........................9
4.2 Sprint PCS National Accounts Program Requirements................10
4.3 Sprint PCS Roaming and Inter Service Area Program Requirements...10
4.4 Pricing..........................................................10
4.5 Home Service Area................................................11
5. USE OF BRANDS...........................................................11
5.1 Use of Brands....................................................11
5.2 Conformance to Marketing Communications Guidelines...............11
5.3 Joint Marketing With Third Parties...............................11
5.4 Prior Approval of Use of Brands..................................12
5.5 Duration of Use of Brand.........................................12
i
<PAGE>
Page
----
6. ADVERTISING AND PROMOTION...............................................12
6.1 National Advertising and Promotion...............................12
6.2 In-Territory Advertising and Promotion...........................12
6.3 Review of Advertising and Promotion Campaigns....................13
6.4 Public Relations.................................................13
7. SPRINT PCS TECHNICAL PROGRAM REQUIREMENTS...............................13
7.1 Conformance to Sprint PCS Technical Program Requirements.........13
7.2 Establishment of Sprint PCS Technical Program Requirements.......14
7.3 Handoff to Adjacent Networks.....................................14
8. SPRINT PCS CUSTOMER SERVICE PROGRAM REQUIREMENTS........................14
8.1 Compliance With Sprint PCS Customer Service Program
Requirements...................................................14
9. SPRINT PCS PROGRAM REQUIREMENTS.........................................14
9.1 Program Requirements Generally...................................14
9.2 Amendments to Program Requirements...............................14
9.3 Manager's Right to Request Review of Changes.....................15
9.4 Sprint PCS' Right to Implement Changes...........................16
9.5 Rights of Inspection.............................................16
9.6 Manager's Responsibility to Interface with Sprint PCS............16
10. FEES....................................................................16
10.1 Fees and Payments................................................16
10.1.1 Fee Based on Collected Revenues.........................16
10.1.2 Payment of Universal Service Funds......................16
10.1.3 Inter Service Area Fees.................................17
10.1.4 Interconnect Fees.......................................17
10.1.5 Outbound Roaming Fees...................................17
10.1.6 Reimbursements..........................................17
10.2 Monthly True Up..................................................17
10.3 Taxes............................................................17
10.4 Collected Revenues Definition....................................18
10.5 Late Payments....................................................19
10.6 Setoff Right If Failure To Pay Amounts Due.......................19
11. TERM; TERMINATION; EFFECT OF TERMINATION................................19
11.1 Initial Term.....................................................19
11.2 Renewal Terms....................................................19
11.2.1 Non-renewal Rights of Manager...........................19
11.2.1.1 Manager's Put Right............................19
11.2.1.2 Manager's Purchase Right.......................20
11.2.2 Non-renewal Rights of Sprint PCS........................20
11.2.2.1 Sprint PCS' Purchase Right.....................21
11.2.2.2 Sprint PCS' Put Right..........................21
11.2.3 Extended Term Awaiting FCC Approval.....................21
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11.3 Events of Termination............................................21
11.3.1 Termination of License..................................22
11.3.2 Breach of Agreement: Payment of Money Terms.............22
11.3.3 Breach of Agreement: Other Terms........................22
11.3.4 Regulatory Considerations...............................22
11.3.5 Termination of Trademark License Agreements.............22
11.3.6 Financing Considerations................................23
11.3.5 Bankruptcy of a Party...................................23
11.4 Effect of an Event of Termination................................23
11.5 Manager's Event of Termination Rights and Remedies...............24
11.5.1 Manager's Put Right.....................................25
11.5.2 Manager's Purchase Right................................25
11.5.3 Manager's Action for Damages or Other Relief............26
11.6 Sprint PCS' Event of Termination Rights and Remedies.............26
11.6.1 Sprint PCS' Purchase Right..............................26
11.6.2 Sprint PCS' Put Right...................................26
11.6.3 Sprint PCS' Right to Cause A Cure.......................27
11.6.4 Sprint PCS' Action for Damages or Other Relief..........28
11.7 Determination of Entire Business Value...........................28
11.7.1 Appointment of Appraisers...............................28
11.7.2 Manager's Operating Assets..............................28
11.7.3 Entire Business Value...................................29
11.7.4 Calculation of Entire Business Value....................29
11.8 Closing Terms and Conditions.....................................30
11.9 Contemporaneous and Identical Application........................30
12. BOOKS AND RECORDS; CONFIDENTIAL INFORMATION; INSURANCE..................30
12.1 Books and Records................................................30
12.1.1 General.................................................30
12.1.2 Audit...................................................30
12.1.3 Contesting an Audit.....................................30
12.2 Confidential Information.........................................31
12.3 Insurance........................................................32
12.3.1 General.................................................32
12.3.2 Waiver of Subrogation...................................32
12.3.3 Certificates of Insurance...............................32
13. INDEMNIFICATION.........................................................33
13.1 Indemnification by Sprint PCS....................................33
13.2 Indemnification by Manager.......................................33
13.3 Procedure........................................................33
13.3.1 Notice..................................................33
13.3.2 Defense by Indemnitor...................................33
13.3.3 Defense by Indemnitee...................................34
13.3.4 Costs...................................................34
14. DISPUTE RESOLUTION......................................................34
14.1 Negotiation......................................................34
14.2 Unable to Resolve................................................34
14.3 Attorneys and Intent.............................................35
14.4 Tolling of Cure Periods..........................................35
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15. REPRESENTATIONS AND WARRANTIES..........................................35
15.1 Due Incorporation or Formation; Authorization of Agreements......35
15.2 Valid and Binding Obligation.....................................36
15.3 No Conflict; No Default..........................................36
15.4 Litigation.......................................................36
16. REGULATORY COMPLIANCE...................................................36
16.1 Regulatory Compliance............................................36
16.2 FCC Compliance...................................................36
16.3 Marking and Lighting.............................................38
16.4 Regulatory Notices...............................................38
16.5 Regulatory Policy-Setting Proceedings............................38
17. GENERAL PROVISIONS......................................................38
17.1 Notices..........................................................38
17.2 Construction.....................................................38
17.3 Headings.........................................................38
17.4 Further Action...................................................38
17.5 Counterpart Execution............................................38
17.6 Specific Performance.............................................39
17.7 Entire Agreement; Amendments.....................................39
17.8 Limitation on Rights of Others...................................39
17.9 Waivers..........................................................39
17.9.1 Waivers--General........................................39
17.9.2 Waivers--Manager........................................39
17.9.3 Force Majeure...........................................39
17.10 Waiver of Jury Trial.............................................40
17.11 Binding Effect...................................................40
17.12 Governing Law....................................................40
17.13 Severability.....................................................40
17.14 Limitation of Liability..........................................40
17.15 No Assignment; Exceptions........................................40
17.15.1 General.................................................40
17.15.2 Assignment Right of Manager to Financial Lender.........41
17.15.3 Change of Control Rights................................41
17.15.4 Right of First Refusal..................................42
17.15.5 Transfer of Sprint PCS Network..........................43
17.16 Provision of Services by Sprint Spectrum.........................43
17.17 Number Portability...............................................43
17.18 Disclaimer of Agency.............................................43
17.19 Independent Contractors..........................................43
17.20 Expense..........................................................43
17.21 General Terms....................................................44
17.22 Conflicts with Other Agreements..................................44
17.23 Survival Upon Termination........................................44
17.24 Announced Transaction............................................44
17.25 Additional Terms and Provisions..................................44
17.26 Master Signature Page............................................44
17.27 Agent Authorization..............................................45
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SPRINT PCS MANAGEMENT AGREEMENT
This SPRINT PCS MANAGEMENT AGREEMENT is made September _____, 1998,
between Sprint Spectrum L.P., a Delaware limited partnership, WirelessCo, L.P.,
a Delaware limited partnership, and UbiquiTel L.L.C., a Washington limited
liability company (but not any Related Party) ("Manager"). The definitions for
this agreement are set forth on the "Schedule of Definitions."
RECITALS
A. Sprint Spectrum L.P., a Delaware limited partnership, WirelessCo. L.P.,
a Delaware limited partnership, SprintCom, Inc., a Kansas corporation, American
PCS Communications, LLC, a Delaware limited liability company, APC PCS, LLC, a
Delaware limited liability company, PhillieCo Partners I, L.P., a Delaware
limited partnership, PhillieCo, L.P., a Delaware limited partnership, Cox
Communications PCS, L.P., a Delaware limited partnership, and Cox PCS License,
L.L.C., a Delaware limited liability company, hold and exercise, directly or
indirectly, control over licenses to operate wireless services networks.
B. The entity or entities named in Recital A that execute this agreement
hold, directly or indirectly, the Licenses for the areas identified on the
Service Area Exhibit and are referred to in this agreement as "Sprint PCS."
Because this agreement addresses the rights and obligations of each license
holder with respect to each of its Licenses, each reference in this agreement to
"Sprint PCS" refers to the entity that owns, directly or indirectly, the License
referred to in that particular instance or application of the provision of this
agreement. If Sprint Spectrum does not own the License, it will provide on
behalf of Sprint PCS most or all of the services required under this agreement
to be provided by Sprint PCS.
C. The Sprint PCS business was established to use the Sprint PCS Network,
a nationwide wireless services network, to offer seamless, integrated voice and
data services using wireless technologv. The Sprint PCS Network offers the
services to customers under the Brands.
D. This agreement, therefore, includes provisions defining Manager's
obligations with respect to:
o The design, construction and management of the Service Area Network;
o Offering and promoting products and services designated by Sprint
PCS as the Sprint PCS Products and Services of the Sprint PCS
Network;
o Adherence to Program Requirements established by Sprint PCS to
ensure seamless interoperability throughout the Sprint PCS Network
and uniform and consistent quality of product and service offerings;
o Adherence to Program Requirements established by Sprint PCS to
ensure seamless interoperability throughout the Sprint PCS Network
and uniform and consistent quality of product and service offerings;
o Adherence to Customer Service Program Requirements established by
Sprint PCS to ensure consistency in interactions with customers
(including billing, customer care, etc.); and
o Adherence to Program Requirements relating to the marketing,
promotion and distribution of Sprint PCS Products and Services.
E. The Sprint PCS Network is expanding with the assistance of "managers"
(companies such as Manager that manage Service Area Networks that offer Sprint
PCS Products and Services under a license owned by
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Sprint PCS or one of the entities named in Recital A) and "affiliates"
(companies that manage Service Area Networks that offer Sprint PCS Products and
Services under a license owned by the affiliate).
F. Manager wishes to enter into this agreement to help construct, operate,
manage and maintain for Sprint PCS a portion of the Sprint PCS Network in the
Service Area. Sprint PCS has determined that permitting Manager to manage a
portion of the Sprint PCS Network in accordance with the terms of this agreement
will facilitate Sprint PCS' expansion of fully digital, wireless coverage under
the License and will enhance the wireless service for customers of Sprint PCS.
G. All managers of a portion of the business of Sprint PCS, including
Manager, must construct facilities and operate in accordance with Program
Requirements established by Sprint PCS with respect to certain aspects of the
development and offering of wireless products and services and the presentation
of the products and services to customers, to establish and operate the Sprint
PCS Network successfully by providing seamless, integrated voice and data
services, using wireless technology.
AGREEMENT
In consideration of the recitals and mutual covenants and agreements
contained in this agreement, the sufficiency of which are hereby acknowledged,
the parties, intending to be bound, agree as follows:
1. MANAGER
1.1 Hiring of Manager. Sprint PCS hires Manager:
(a) to construct and manage the Service Area Network in compliance
with the License and in accordance with the terms of this agreement;
(b) to distribute continuously during the Term the Sprint PCS
Products and Services and to establish distribution channels in the Service
Area;
(c) to conduct continually during the Term advertising and promotion
activities in the Service Area (including mutual decisions to "go dark", with
respect to advertising and promotion activities, for reasonable periods of
time); and
(d) to manage that portion of the customer base of Sprint PCS that
has the NPA-NXXs assigned to the Service Area Network.
Sprint PCS has the right to unfettered access to the Service Area Network
to be constructed by Manager under this agreement. The fee to be paid to Manager
by Sprint PCS under Section 10 is for all obligations of Manager under this
agreement.
1.2 Program Requirements. Manager must adhere to the Program Requirements
established by Sprint PCS and as modified from time to time, to ensure uniform
and consistent operation of all wireless systems within the Sprint PCS Network
and to present the Sprint PCS Products and Services to customers in a uniform
and consistent manner under the Brands.
1.3 Vendor Purchase Agreements. Manager may participate in discounted
volume-based pricing on wireless-related products and services and in the
warranties Sprint PCS receives from its vendors, as is commercially reasonable
and to the extent permitted by applicable procurement agreements (e.g.,
agreements related to network infrastructure equipment, subscriber equipment,
interconnection, and collocation). Sprint PCS will use commercially reasonable
efforts to obtain for managers the same price Sprint PCS receives from vendors;
2
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this does not prohibit Sprint PCS from entering into procurement agreements that
do not provide managers with the Sprint PCS prices.
Manager must purchase subscriber and infrastructure equipment from a
Sprint PCS approved list of products, which will include a selection from a
variety of manufacturers. Where required, the products must include proprietary
software developed by the manufacturers for Sprint PCS or by Sprint PCS to allow
seamless interoperability in the Sprint PCS Network. Sprint PCS or the vendor
may require Manager to execute a separate license agreement for the software
prior to Manager's use of the software.
Manager may only make purchases under this Section 1.3 for items to be
used exclusively in the Service Area (e.g., Manager may not purchase base
stations under a Sprint PCS contract for use in a system not affiliated with
Sprint PCS).
1.4 Interconnection. If Manager desires to interconnect a portion of the
Service Area Network with another carrier and Sprint PCS can interconnect with
that carrier at a lower rate, then to the extent permitted by applicable laws,
tariffs and contracts, Sprint PCS may arrange for the interconnection under its
agreements with the carrier and if it does so, Sprint PCS will bill the
interconnection fees to Manager.
1.5 Seamlessness. Manager will design and operate its systems, platforms,
products and services in the Service Area and the Service Area Network so as to
seamlessly interface them into the Sprint PCS Network.
1.6 Forecasting. Manager and Sprint PCS will work cooperatively to
generate mutually acceptable forecasts of important business metrics including
traffic volumes, handset sales, subscribers and Collected Revenues for the
Sprint PCS Products and Services. The forecasts are for planning purposes only
and do not constitute Manager's obligation to meet the quantities forecast.
1.7 Financing. The construction and operation of the Service Area Network
requires a substantial financial commitment by Manager. The manner in which
Manager will finance the build-out of the Service Area Network and provide the
necessary working capital to operate the business is described in detail on
Exhibit 1.7. Manager will allow Sprint PCS an opportunity to review before
filing any registration statement or prospectus or any amendment or supplement
thereto before distributing any offering memorandum or amendment or supplement
thereto, and agrees not to file or distribute any such document if Sprint PCS
reasonably objects in writing on a timely basis to any portion of the document
that refers to Sprint PCS, its Related Parties, their respective businesses,
this agreement or the Services Agreement.
1.8 Ethical Conduct and Related Covenants. Each party must perform its
obligations under this agreement in a diligent, legal, ethical, and professional
manner.
2. BUILD-OUT OF NETWORK
2.1 Build-out Plan. Manager will build-out the Service Area Network in the
Service Area in accordance with a Build-out Plan. Sprint PCS and Manager will
jointly develop each Build-out Plan, except the initial Build-out Plan and any
modifications, additions or expansions of the Build-out Plan will be subject to
prior written approval by Sprint PCS. Manager will report to Sprint PCS its
performance regarding the critical milestones included in the Build-out Plan on
a periodic basis as mutually agreed to by the parties, but no less frequently
than quarterly. The Build-out Plan and the Service Area Network as built must
comply with Sprint PCS Program Requirements and federal and local regulatory
requirements.
Sprint PCS approves the Build-out Plan in effect as of the date of this
agreement, which Build-out Plan is attached as Exhibit 2.1. Each new or amended
Build-out Plan will also become part of Exhibit 2.1.
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2.2 Compliance with Regulatory Rules. During the build-out of the Service
Area Network, Sprint PCS authorizes Manager to make all filings with regulatory
authorities regarding the build-out, including filings with the Federal Aviation
Administration, environmental authorities, and historical districts. Manager may
further delegate its duty under this Section 2.2 to a qualified site acquisition
company. Manager must ensure that a copy of every filing is given to Sprint PCS.
Manager must ensure that Sprint PCS is notified in writing of any contact by a
regulatory agency including the FCC with Manager or Manager's site acquisition
company regarding any filing. Sprint PCS has the right to direct any proceeding,
inquiry, dispute, appeal or other activity with a regulatory or judicial
authority regarding any filing made on behalf of Sprint PCS. Manager will amend,
modify, withdraw, refile and otherwise change any filing as Sprint PCS requires.
Notwithstanding the preceding sentences in this Section 2.2, and in conjunction
with Section 16, Sprint PCS is solely responsible for making any and all filings
with the FCC regarding the build-out. Manager will notify Sprint PCS of any
activity, event or condition related to the build-out that might require an FCC
filing.
2.3 Exclusivity of Service Area. Manager will be the only person or entity
that is a manager or operator for Sprint PCS with respect to the Service Area
and neither Sprint PCS nor any of its Related Parties will own, operate, build
or manage another wireless mobility communications network in the Service Area
so long as this agreement remains in full force and effect and there is no Event
of Termination that has occurred giving Sprint PCS the right to terminate this
agreement, except that:
(a) Sprint PCS may cause Sprint PCS Products and Services to be sold
in the Service Area through the Sprint PCS National Accounts Program
Requirements and Sprint PCS National or Regional Distribution Program
Requirements;
(b) A reseller of Sprint PCS Products and Services may sell its
products and services in the Service Area so long as such resale is not contrary
to the terms and conditions of this agreement; and
(c) Sprint PCS and its Related Parties may engage in the activities
described in Sections 2.4(a) and 2.4(b) with Manager in the geographic areas
within the Service Area in which Sprint PCS or any of its Related Parties owns
an incumbent local exchange carrier as of the date of this agreement.
2.4 Restriction. In geographic areas within the Service Area in which
Sprint PCS or any of its Related Parties owns an incumbent local exchange
carrier as of the date of this agreement, Manager must not offer any Sprint PCS
Products or Services specifically designed for the competitive local exchange
market ("fixed wireless local loop"), except that:
(a) Manager may designate the local exchange carrier that is a
Related Party of Sprint PCS to be the exclusive distributor of the fixed
wireless local loop product in the territory served by the local exchange
carrier, even if a portion of its territory is within the Service Area; or
(b) Manager may sell the fixed wireless local loop product under the
terms and conditions specified by Sprint PCS (e.g., including designation by
Sprint PCS of an exclusive distribution agent for the territory).
This restriction exists with respect to a particular geographic area only so
long as Sprint PCS or its Related Party owns such incumbent local exchange
carrier.
Nothing in this Section 2.4 prohibits Manager from offering Sprint PCS
Products and Services primarily designed for mobile functionality. The
restricted markets as of the date of this agreement are set forth on Exhibit
2.4.
2.5 Coverage Enhancement. Sprint PCS and Manager agree that maintaining a
high standard of customer satisfaction regarding network capacity and footprint
is a required element of the manager and affiliate
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programs. Sprint PCS intends to expand network coverage to build all cells that
cover at least 5,000 pops and all interstate and major highways in the areas not
operated by Manager or Other Managers. Accordingly, Manager agrees to build-out
New Coverage when directed by Sprint PCS as set forth in this Section 2.5.
Sprint PCS agrees not to require any New Coverage build-out during the first two
years of this Agreement, nor any New Coverage that exceeds the capacity and
footprint parameters that Sprint PCS has adopted for all of its comparable
markets.
Sprint PCS will give to Manager a written notice of any New Coverage
within the Service Area that Sprint PCS decides should be built-out. Such notice
will include an analysis completed by Sprint PCS demonstrating that such
required build-out should be economically advantageous to Manager. Such analysis
will be generated in good faith and will be based on then-currently available
information, however Sprint PCS makes no warranties or representations regarding
the accuracy of, nor will Sprint PCS be bound by, or guarantee the accuracy of,
such analysis. Manager must confirm to Sprint PCS within 90 days after receipt
of the notice that Manager will build-out the New Coverage and deliver to Sprint
PCS with such confirmation Manager's proposed amendment to the Build-out Plan
and a description of the manner and timing in which it will finance such
build-out.
If Manager confirms, within such 90-day period, its intention to build-out
the New Coverage, then Manager and Sprint PCS will diligently finalize an
amendment to the Build-out Plan and proceed as set forth in Sections 2.1 and
2.2. The amended Build-out Plan will contain critical milestones that provide
Manager a commercially reasonable period in which to construct and implement the
New Coverage. In determining what constitutes a "commercially reasonable period"
as used in this paragraph, the parties will consider several factors, including
local zoning processes and other legal requirements, weather conditions,
equipment delivery schedules, the need to arrange additional financing, and
other construction already in progress by Manager. Manager will construct and
operate the New Coverage in accordance with the terms of this Agreement, and the
New Coverage will be included in the Service Area Network for purposes of this
agreement.
If Manager fails to confirm, within such 90-day period, its intention to
build-out the New Coverage, declines to complete such build-out, or fails to
complete such build-out in accordance with the amended Build-out Plan, then an
Event of Termination will be deemed to have occurred under Section 11.3.3,
Manager will not have a right to cure such breach, and Sprint PCS may exercise
its rights and remedies under Section 11.2.2.1.
Notwithstanding the preceding paragraphs in this Section 2.5, the capacity
and footprint parameters contained in the amended Build-out Plan will not be
required to exceed the parameters adopted by Sprint PCS in building out all of
its comparable service areas, unless such build-out relates to an obligation
regarding the Service Area Network mandated by law. When necessary for reasons
related to new technical standards, new equipment or strategic reasons, Sprint
PCS can require Manager to build-out the New Coverage concurrently with Sprint
PCS' build-out, in which case Sprint PCS will reimburse Manager for its costs
and expenses if Sprint PCS discontinues its related build-out.
If Sprint PCS requires build-out of New Coverage that will:
(a) cause the Manager to spend an additional amount greater than 5%
of Manager's shareholder's equity or capital account plus Manager's long-term
debt (i.e., notes that mature more than one year from the date issued), as
reflected on Manager's hooks; or
(b) cause the long-term operating expenses of Manager on a per unit
basis using a 10-year time frame to increase by more than 10% on a net present
value basis,
then Manager may give Sprint PCS a written notice requesting Sprint PCS to
reconsider the required New Coverage.
The Sprint PCS Vice President or the designee of the Sprint PCS Chief
Officer in charge of the group that manages the Sprint PCS relationship with
Manager will review Manager's request and render a decision regarding
5
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the New Coverage. If after the review and decision by the Vice President or
designee, Manager is still dissatisfied, then Manager may ask that the Chief
Officer to whom the Vice President or designee reports review the matter. If
Sprint PCS still requires Manager to complete the New Coverage following the
Chief Officer's review, then if Manager and Sprint PCS fail to agree to an
amended Build-out Plan within 15 days after completion of the reconsideration
process described above in this paragraph or the end of the 90-day period
described in the second paragraph of this Section 2.5, whichever occurs first,
then an Event of Termination will be deemed to have occurred under Section
11.3.3, Manager will not have a right to cure such breach, and Sprint PCS may
exercise its rights and remedies under Section 11.2.2.1.
2.6 Purchase of Assets by Manager. If Sprint PCS has assets located in the
Service Area that Manager could reasonably use in its construction of the
Service Area Network and if Sprint PCS is willing to sell such assets, then
Manager agrees to purchase from Sprint PCS and Sprint PCS agrees to sell to
Manager the assets in accordance with the terms and conditions of the asset
purchase agreement attached as Exhibit 2.6.
2.7 Microwave Relocation. Sprint PCS will relocate interfering microwave
sources in the spectrum in the Service Area to the extent necessary to permit
the Service Area Network to carry the anticipated call volume as set out in the
Build-out Plan. If the spectrum cleared is not sufficient to carry the actual
call volume then Sprint PCS will clear additional spectrum of its choosing to
accommodate the call volume. Sprint PCS may choose to clear spectrum one carrier
at a time. The parties will share equally all costs associated with clearing
spectrum under this Section 2.7.
2.8 Determination of pops. If any provision in this agreement requires the
determination of pops in a given area, then the pops will be determined using
the census block group pop forecast then used by Sprint PCS, except that a
different forecast will be used for any FCC filing and in preparing the
Build-out Plan if required by the FCC. Sprint PCS presently uses the forecast of
Equifax/NDS, but it may choose in its sole discretion to use another service
that provides comparable data.
3. PRODUCTS AND SERVICES; IXC SERVICES
3.1 Sprint PCS Products and Services. Manager must offer for sale, promote
and support all Sprint PCS Products and Services within the Service Area, unless
the parties otherwise agree in advance in writing. Within the Service Area,
Manager may only sell, promote and support wireless products and services that
are Sprint PCS Products and Services or are other products and services
authorized under Section 3.2. The Sprint PCS Products and Services as of the
date of this agreement are attached as Exhibit 3.1. Sprint PCS may modify the
Sprint PCS Products and Services from time to time in its sole discretion by
delivering to Manager a new Exhibit 3.1. If Sprint PCS begins offering
nationally a Sprint PCS Product or Service that is a Manager's Product or
Service, such Manager's Product or Service will become a Sprint PCS Product or
Service under this agreement.
3.2 Other Products and Services. Manager may offer wireless products and
services that are not Sprint PCS Products and Services, on the terms Manager
determines, if the offer of the additional products and services:
(a) does not violate the obligations of Manager under this
agreement;
(b) does not cause distribution channel conflict with or consumer
confusion regarding Sprint PCS' regional and national offerings of Sprint PCS
Products and Services;
(c) complies with the Trademark License Agreements; and
(d) does not materially impede the development of the Sprint PCS
Network.
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Manager will not offer any products or services under this Section 3.2
that are confusingly similar to Sprint PCS Products and Services. Manager must
request that Sprint PCS determine whether Sprint PCS considers a product or
service to be confusingly similar to any Sprint PCS Products and Services by
providing advance written notice to Sprint PCS that describes those products and
services that could be interpreted to be confusingly similar to Sprint PCS
Products and Services. If Sprint PCS fails to provide a response to Manager
within 30 days after receiving the notice, then the products and services are
deemed to create confusion with the Sprint PCS Products and Services and the
request therefore rejected. In rejecting any request Sprint PCS must provide the
reasons for the rejection. If the rejection is based on Sprint PCS' failure to
respond within 30 days and Manager requests an explanation for the deemed
rejection, then Sprint PCS must provide within 30 days the reasons for the
rejection.
3.3 Cross-selling with Sprint. Manager and Sprint and Sprint's Related
Parties may enter into arrangements to sell Sprint's services, including long
distance service (except those long distance services governed by Section 3.4),
Internet access, customer premise equipment, prepaid phone cards, and any other
services that Sprint or its Related Parties make available from time to time.
Sprint's services may be packaged with the Sprint PCS Products and Services.
If Manager chooses to resell the long distance services, Internet access
or competitive local telephone services including prepaid phone cards, of third
parties (other than Manager's Related Parties), Manager will give Sprint the
right of last offer to provide those services on the same terms and conditions
as the offer to which Manager is prepared to agree, subject to the terms of any
existing agreements Manager was subject to prior to execution of this agreement.
If Sprint sells Sprint PCS Products and Services in the Service Area,
Manager will provide such Sprint PCS Products and Services to such customers in
accordance with the terms and conditions of the Sprint PCS National or Regional
Distribution Program Requirements.
3.4 IXC Services. Manager must purchase from Sprint long distance
telephony services for the Sprint PCS Products and Services at wholesale rates.
Long distance telephone calls are those calls between the local calling area for
the Service Area Network and areas outside the local calling area. The local
calling area will be defined by mutual agreement of Sprint PCS and Manager. If
the parties cannot agree on the extent of the local calling area they will
resolve the matter through the dispute resolution process in Section 14. Any
arrangement must have terms at least as favorable to Manager (in all material
respects) as those offered by Sprint to any wholesale customer of Sprint in
comparable circumstances (taking into consideration volume, traffic patterns,
etc.). If Manager is bound by an agreement for these services and the agreement
was not made in anticipation of this agreement, then the requirements of this
Section 3.4 do not apply during the term of the other agreement. If the other
agreement terminates for any reason then the requirements of this Section 3.4 do
apply.
3.5 Resale of Products and Services.
3.5.1 Mandatory Resale of Products and Services. Sprint PCS is
subject to FCC rules that require it to allow its service plans to be resold by
a purchaser of the service plan. Sprint PCS will not grant the purchaser of a
service plan the right to use any of the support services offered by Sprint PCS,
including customer care, billing, collection, and advertising, nor the right to
use the Brands. The reseller only has the right to use the service purchased.
Consequently, Manager agrees not to interfere with any purchaser of the Sprint
PCS Products or Services who resells the service plans in accordance with this
agreement and applicable law. Manager will notify purchaser that the purchaser
does not have a right to use the Brands or Sprint PCS, support services. In
addition, Manager will notify Sprint PCS if it reasonably believes a reseller of
retail service plans is using the support services or Brands.
3.5.2 Voluntary Resale of Products and Services. Sprint PCS may
choose to offer a resale product under which resellers will resell Sprint PCS
Products and Services under brand names other than the Brands, except Sprint PCS
may permit the resellers to use the Brands for limited purposes related to the
resale of
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Sprint PCS Products and Services (e.g., to notify people that the handsets of
the resellers will operate on the Sprint PCS Network). The resellers may also
provide their own support services (e.g., customer care and billing) or may
purchase the support services from Sprint PCS.
If Sprint PCS chooses to offer a voluntary resale product, it will adopt a
program that will be a Program Requirement under this agreement and that
addresses the manner in which Manager and Other Managers interact with the
resellers. Manager must agree to comply with the terms of the program, including
its pricing provisions, if Manager wants handsets of subscribers of resellers
with NPA-NXXs of Manager to be activated. Usage of telecommunications services
while in the Service Area by subscribers of resellers with NPA-NXXs from outside
the Service Area will be subject to the pricing provisions of the Sprint PCS
Roaming and Inter Service Area Program for roaming and inter service area
pricing between Manager and Sprint PCS unless Manager agrees in writing to
different pricing.
Except as required under the regulations and rules concerning mandatory
resale. Manager may not sell Sprint PCS Products and Services for resale unless
Sprint PCS consents to such sales in advance in writing.
3.6 Non-competition. Neither Manager nor any of its Related Parties may
offer Sprint PCS Products and Services outside of the Service Area without the
prior written approval of Sprint PCS.
Within the Service Area, Manager and Manager's Related Parties may offer,
market or promote telecommunications products or services only under the
following brands:
(a) products or services with the Brands;
(b) other products and services approved under Section 3.2;
(c) products or services with Manager's brand; or
(d) products or services with the brands of Manager's Related
Parties.
except no brand of a significant competitor of Sprint PCS or its Related Parties
in the telecommunications business may be used by Manager or Manager's Related
Parties on these products and services.
If Manager or any of its Related Parties has licenses to provide broadband
personal communication services outside the Service Area, neither Manager nor
such Related Party may utilize the spectrum to offer Sprint PCS Products and
Services without prior written consent from Sprint PCS. Additionally, when
Manager's customers from inside the Service Area travel or roam to other
geographic areas, Manager will route the customers' calls, both incoming and
outgoing, according to the Sprint PCS Network Roaming and Inter Service Area
Program Requirements, without regard to any wireless networks operated by
Manager or its Related Parties. For example, Manager will program the preferred
roaming list for handsets sold in the Service Area to match the Sprint PCS
preferred roaming list.
3.7 Right of Last Offer. Manager will offer to Sprint the right to make to
Manager the last offer to provide backhaul and transport services for call
transport for the Service Area Network, if Manager decides to use third parties
for backhaul and transport services rather than self-provisioning the services
or purchasing the services from Related Parties of Manager. Sprint will have a
reasonable time to respond to Manager's request for last offer to provide
backhaul and transport pricing and services, which will be no greater than 5
Business Days after receipt of the request for the services and pricing from
Manager.
If Manager has an agreement in effect as of the date of this agreement for
these services and the agreement was not made in anticipation of this agreement,
then the requirements of this Section 3.7 do not apply during the
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term of the other agreement. If the other agreement terminates for any reason
then the requirements of this Section 3.7 do apply.
4. MARKETING AND SALES ACTIVITIES
4.1 Sprint PCS National or Regional Distribution Program Requirements.
During the term of this agreement, Manager must participate in any Sprint PCS
National or Regional Distribution Program (as in effect from time to time), and
will pay or receive compensation for its participation in accordance with the
terms and conditions of that program. The Sprint PCS National or Regional
Distribution Program Requirements in effect as of the date of this agreement are
attached as Exhibit 4.1.
4.1.1 Territorial Limitations on Manager's Distribution Activities.
Neither Manager nor any of its Related Parties will market, sell or distribute
Sprint PCS Products and Services outside of the Service Area, except:
(a) as otherwise agreed upon by the parties in advance in writing;
or
(b) Manager may place advertising in media that has distribution
outside of the Service Area, so long as that advertising is intended by Manager
to reach primarily potential customers within the Service Area.
4.1.2 Settlement of Equipment Sales. Sprint PCS will establish a
settlement policy and process that will be included in the Sprint PCS National
or Regional Distribution Program Requirements to:
(a) reconcile sales of subscriber equipment made in the service
areas of Sprint PCS or Other Managers of Sprint PCS, that result in activations
in the Service Area; and
(b) reconcile sales of subscriber equipment made in the Service Area
that result in activations in service areas of Sprint PCS or Other Managers.
In general, the policy will provide that the party in whose service area
the subscriber equipment is activated will be responsible for the payment of any
subsidy (i.e., the difference between the price paid to the manufacturer and the
suggested retail price for direct channels or the difference between the price
paid to the manufacturer and the wholesale price for third party retailers) and
for other costs associated with the sale, including logistics, inventory
carrying costs, direct channel commissions and other retailer compensation.
4.1.3 Use of Third-Party Distributors.
(a) Manager may request that Sprint PCS and a local distributor
enter into Sprint PCS' standard distribution agreement regarding the purchase
from Sprint PCS of handsets and accessories. Sprint PCS will use commercially
reasonable efforts to reach agreement with the local distributor. Sprint PCS may
refuse to enter into a distribution agreement with a distributor for any
reasonable reason, including that the distributor fails to pass Sprint PCS' then
current credit and background checks or the distributor fails to agree to the
standard terms of the Sprint PCS distribution agreement. Any local distributor
will be subject to the terms of the Trademark License Agreements or their
equivalent. Manager will report to Sprint PCS the activities of any local
distributor that Manager believes to be in violation of the distribution
agreement.
(b) Manager may establish direct local distribution programs in
accordance with the Sprint PCS National or Regional Distribution Program
Requirements, subject to the terms and conditions of the Trademark License
Agreements and the non-competition and other provisions contained in this
agreement. If Manager sells Sprint PCS handsets and accessories directly to a
local distributor:
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(i) Sprint PCS has the right to approve or disapprove a
particular distributor,
(ii) Manager is responsible for such distributor's compliance
with the terms of the Trademark License Agreements and the other
provisions contained in this agreement, and
(iii) Manager must retain the right to terminate the
distribution rights of the local distributor when so instructed by Sprint
PCS (even if Sprint PCS initially approved or did not exercise its right
to review the distributor).
4.2 Sprint PCS National Accounts Program Requirements. During the term of
this agreement. Manager must participate in the Sprint PCS National Accounts
Program (as in effect from time to time), and will be entitled to compensation
for its participation and will be required to pay the expenses of the program in
accordance with the terms and conditions of that program. The Sprint PCS
National Accounts Program Requirements in effect as of the date of this
agreement are attached as Exhibit 4.2.
4.3 Sprint PCS Roaming and Inter Service Area Program Requirements.
Manager will participate in the Sprint PCS Roaming and Inter Service Area
Program established and implemented by Sprint PCS, including roaming price plans
and inter-carrier settlements. The Sprint PCS Roaming and Inter Service Area
Program Requirements in effect as of the date of this agreement are attached as
Exhibit 4.3.
As part of the Sprint PCS Roaming and Inter Service Area Program
Requirements. Sprint PCS will establish a settlement policy and process to
equitably distribute between the members making up the Sprint PCS Network (i.e.,
Sprint PCS, Manager and all Other Managers) the revenues received by one member
for services used by its customers when they travel into other members' service
areas.
4.4 Pricing. Manager will offer and support all Sprint PCS pricing plans
designated for regional or national offerings of Sprint PCS Products and
Services (e.g., national inter service area rates, regional home rates, and
local price points). The Sprint PCS pricing plans as of the date of this
agreement are attached as Exhibit 4.4. Sprint PCS may modify the Sprint PCS
pricing plans from time to time in its sole discretion by delivering to Manager
a new Exhibit 4.4.
Additionally, with prior approval from Sprint PCS, which approval will not
be unreasonably withheld, Manager may establish price plans for Sprint PCS
Products and Services that are only offered in its local market, subject to:
(a) the non-competition and other provisions contained in this
agreement;
(b) consistency with regional and national pricing plans;
(c) regulatory requirements; and
(d) capability and cost of implementing rate plans in Sprint PCS
systems (if used).
Manager must provide advance written notice to Sprint PCS with details of
any pricing proposal for Sprint PCS Products or Services in the Service Area. If
Sprint PCS fails to respond to Manager within 10 Business Days after receiving
such notice, then the price proposed for those Sprint PCS Products or Services
is deemed approved.
At the time Sprint PCS approves a pricing proposal submitted by Manager,
Sprint PCS will provide Manager an estimate of the costs and expenses and
applicable time frames required for Sprint PCS to implement the proposed pricing
plan. Manager agrees to promptly reimburse Sprint PCS for any cost or expense
incurred by Sprint PCS to implement such a pricing plan, which will not exceed
the amount estimated by Sprint PCS if Manager waited for Sprint PCS' response to
Manager's proposal.
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4.5 Home Service Area. Sprint PCS and Manager will agree to the initial
home service area for each base station in the Service Area Network prior to the
date the Service Area Network goes into commercial operation. If the parties
cannot agree to the home service area for each base station in the Service Area
Network, then the parties will use the dispute resolution process in Section 14
of this agreement to assign each base station to a home service area.
5. USE OF BRANDS
5.1 Use of Brands.
(a) Manager must enter into the Trademark License Agreements on or
before the date of this agreement.
(b) Manager must use the Brands exclusively in the marketing,
promotion, advertisement, distribution, lease or sale of any Sprint PCS Products
and Services within the Service Area, except Manager may use other brands to the
extent permitted by the Trademark License Agreements and not inconsistent with
the terms of this agreement.
(c) Neither Manager nor any of its Related Parties may market,
promote, advertise, distribute, lease or sell any of the Sprint PCS Products and
Services or Manager's Products and Services on a non-branded, "private label"
basis or under any brand, trademark, trade name or trade dress other than the
Brands, except (i) for sales to resellers required under this agreement, or (ii)
as permitted under the Trademark License Agreements.
(d) The provisions of this Section 5.1 do not prohibit Manager from
including Sprint PCS Products and Services under the Brands within the Service
Area as part of a package with its other products and services that bear a
different brand or trademark. The provisions of this Section 5.1 do not apply to
the extent that they are inconsistent with applicable law or in conflict with
the Trademark License Agreements.
5.2 Conformance to Marketing Communications Guidelines. Manager must
conform to the Marketing Communications Guidelines in connection with the
marketing, promotion, advertisement, distribution, lease and sale of any of the
Sprint PCS Products and Services. The Marketing Communications Guidelines in
effect as of the date of this agreement are attached as Exhibit 5.2. Sprint and
Sprint Spectrum may amend the Marketing Communications Guidelines from time to
time in accordance with the terms of the Trademark License Agreements.
5.3 Joint Marketing With Third Parties.
(a) Manager may engage in various joint marketing activities (e.g.,
promotions with sports teams and entertainment providers or tournament
sponsorships) with third parties in the Service Area from time to time during
the term of this agreement with respect to the Sprint PCS Products and Services,
except that Manager may engage in the joint marketing activities only if the
joint marketing activities:
(i) are conducted in accordance with the terms and conditions
of the Trademark License Agreements and the Marketing Communications
Guidelines;
(ii) do not violate the terms of this agreement;
(iii) are not likely (as determined by Sprint PCS, in its sole
discretion) to cause confusion between the Brands and any other trademark
or service mark used in connection with the activities;
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(iv) are not likely (as determined by Sprint, in its sole
discretion) to cause confusion between the Sprint Brands and any other
trademark or service mark used in connection with the activities; and
(v) are not likely (as determined by Sprint PCS, in its sole
discretion) to give rise to the perception that the Sprint PCS Products
and Services are being advertised, marketed or promoted under any
trademark or service mark other than the Brands, except as provided in the
Trademark License Agreements. Manager will not engage in any activity that
includes co-branding involving use of the Brands (that is, the marketing,
promotion, advertisement, distribution, lease or sale of any of the Sprint
PCS Products and Services under the Brands and any other trademark or
service mark), except as provided in the Trademark License Agreements.
(b) Manager must provide advance written notice to Sprint PCS
describing any joint marketing activities that may:
(i) cause confusion between the Brands and any other trademark
or service mark used in connection with the proposed activities; or
(ii) give rise to the perception that the Sprint PCS Products
and Services are being advertised, marketed or promoted under any
trademark or service mark other than the Brands, except as provided in the
Trademark License Agreements.
(c) If Sprint PCS fails to provide a response to Manager within 20
days after receiving such notice, then the proposed activities are deemed, as
the case may be:
(i) not to create confusion between the Brands and any other
trademark or service mark; or
(ii) not to give rise to the perception that Manager's
products and services are being advertised, marketed or promoted under any
trademark or service mark other than the Brands, except as provided in the
Trademark License Agreements.
5.4 Prior Approval of Use of Brands. Manager must obtain advance written
approval from Sprint for use of the Sprint Brands to the extent required by the
Sprint Trademark and Service Mark License Agreement and from Sprint PCS for use
of the Sprint PCS Brands to the extent required by the Sprint Spectrum Trademark
and Service Mark License Agreement. Sprint PCS will use commercially reasonable
efforts to facilitate any review of Manager's use of the Brands, if Sprint PCS
is included in the review process.
5.5 Duration of Use of Brand. Manager is entitled to use the Brands only
during the term of the Trademark License Agreements and any transition period
during which Manager is authorized to use the Brands following the termination
of the Trademark License Agreements.
6. ADVERTISING AND PROMOTION
6.1 National Advertising and Promotion. Sprint PCS is responsible for (a)
all national advertising and promotion of the Sprint PCS Products and Services,
including the costs and expenses related to national advertising and promotions,
and (b) all advertising and promotion of the Sprint PCS Products and Services in
the markets where Sprint PCS operates without the use of an Other Manager.
6.2 In-Territory Advertising and Promotion. Manager must advertise and
promote the Sprint PCS Products and Services in the Service Area (and may do so
in the areas adjacent to the Service Area so long as
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Manager intends that such advertising or promotion primarily reach potential
customers within the Service Area). Manager must advertise and promote the
Sprint PCS Products and Services in accordance with the terms and conditions of
this agreement, the Trademark License Agreements and the Marketing Communication
Guidelines. Manager is responsible for the costs and expenses incurred by
Manager with respect to Manager's advertising and promotion activities in the
Service Area.
Manager will be responsible for a portion of the cost of any promotion or
advertising done by third party retailers in the Service Area (e.g., Best Buy)
in accordance with any cooperative advertising arrangements based on per unit
handset sales.
Sprint PCS has the right to use in any promotion or advertising done by
Sprint PCS any promotion or advertising materials developed by Manager from time
to time with respect to the Sprint PCS Products and Services. Sprint PCS will
reimburse Manager for the reproduction costs related to such use.
Sprint PCS will make available to Manager the promotion or advertising
materials developed by Sprint PCS from time to time with respect to Sprint PCS
Products and Services in current use by Sprint PCS (e.g., radio ads, television
ads, design of print ads, design of point of sale materials, retail store
concepts and designs, design of collateral). Manager will bear the cost of using
such materials (e.g., cost of local radio and television ad placements, cost of
printing collateral in quantity, and building out and finishing retail stores).
6.3 Review of Advertising and Promotion Campaigns. Sprint PCS and Manager
will jointly review the upcoming marketing and promotion campaigns of Manager
with respect to Sprint PCS Products and Services (including advertising and
promotion expense budgets) and will use good faith efforts to coordinate
Manager's campaign with Sprint PCS' campaign to maximize the market results of
both parties. Sprint PCS and Manager may engage in cooperative advertising or
promotional activities during the term of this agreement as the parties may
agree in writing.
6.4 Public Relations. If Manager conducts local public relations efforts,
then Manager must conduct the local public relations efforts consistent with the
Sprint PCS Communications Policies. The Sprint PCS Communications Policies as of
the date of this agreement are attached as Exhibit 6.4. Sprint PCS may modify
the Sprint PCS Communications Policies from time to time by delivering to
Manager a new Exhibit 6.4.
7. SPRINT PCS TECHNICAL PROGRAM REQUIREMENTS
7.1 Conformance to Sprint PCS Technical Program Requirements.
(a) Manager must meet or exceed the Sprint PCS Technical Program
Requirements established by Sprint PCS from time to time for the Sprint PCS
Network. Manager will be deemed to meet the Sprint PCS Technical Program
Requirements if:
(i) Manager operates the Service Area Network at a level equal
to or better than the lower of the Operational Level of Sprint PCS or the
operational level contemplated by the Sprint PCS Technical Program
Requirements; or
(ii) Sprint PCS is responsible under the Services Agreement to
ensure the Service Area Network complies with the Sprint PCS Technical
Program Requirements.
(b) Manager must demonstrate to Sprint PCS that Manager has complied
with the Sprint PCS Technical Program Requirements prior to connecting the
Service Area Network to the rest of the Sprint PCS Network. Once the Service
Area Network is connected to the Sprint PCS Network, Manager must continue to
comply with the Sprint PCS Technical Program Requirements. Sprint PCS agrees
that the Sprint PCS Technical
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Program Requirements adopted for Manager will be the same Sprint PCS Technical
Program Requirements applied by Sprint PCS to the Sprint PCS Network.
7.2 Establishment of Sprint PCS Technical Program Requirements. Sprint PCS
has delivered to Manager a copy of the current Sprint PCS Technical Program
Requirements, attached as Exhibit 7.2. Sprint PCS drafted the Sprint PCS
Technical Program Requirements to ensure a minimum, base-line level of quality
for the Sprint PCS Network. The Sprint PCS Technical Program Requirements
include standards relating to voice quality, interoperability, consistency
(seamlessness) of coverage, RF design parameters, system design, capacity, and
call blocking ratio. Sprint PCS has selected code division multiple access as
the initial air interface technology for the Sprint PCS Network (subject to
change in accordance with Section 9.1).
7.3 Handoff to Adjacent Networks. If technically feasible and commercially
reasonable, Manager will operate the Service Area Network in a manner that
permits a seamless handoff of a call initiated on the Service Area Network to
any adjacent PCS network that is part of the Sprint PCS Network, as specified in
the Sprint PCS Technical Program Requirements. Sprint PCS agrees that the terms
and conditions for seamless handoffs adopted for the Service Area Network will
be the same as the terms Sprint PCS applies to the other parts of the Sprint PCS
Network for similar configurations of equipment.
8. SPRINT PCS CUSTOMER SERVICE PROGRAM REQUIREMENTS
8.1 Compliance With Sprint PCS Customer Service Program Requirements.
Manager must comply with the Sprint PCS Customer Service Program Requirements in
providing the Sprint PCS Products and Services to any customer of Manager,
Sprint PCS or any Sprint PCS Related Party. Manager will be deemed to meet the
standards if:
(a) Manager operates the Service Area Network at a level equal to or
better than the lower of the Operational Level of Sprint PCS or the operational
level contemplated by the Program Requirements; or
(b) Manager has delegated to Sprint PCS under the Services Agreement
responsibility to ensure the Service Area Network complies with the Sprint PCS
Customer Service Standards.
Sprint PCS has delivered to Manager a copy of the Sprint PCS Customer
Service Standards, which are attached as Exhibit 8.1.
9. SPRINT PCS PROGRAM REQUIREMENTS
9.1 Program Requirements Generally. This agreement contains numerous
references to Sprint PCS National and Regional Distribution Program
Requirements, Sprint PCS National Accounts Program Requirements, Sprint PCS
Roaming and Inter Service Area Program Requirements, Sprint PCS Technical
Program Requirements and Sprint PCS Customer Service Program Requirements. This
agreement also provides under Section 3.5.2 for the offering by Sprint PCS of a
voluntary resale product through a program, which program, if adopted, will be a
Program Requirement under this agreement. Sprint PCS may unilaterally amend from
time to time in the manner described in Section 9.2 all Program Requirements
mentioned in this agreement. The most current version of the Program
Requirements mentioned in the first sentence of this Section 9.1 have been
provided to Manager. Manager has reviewed the Program Requirements and adopts
them for application in the Service Area.
9.2 Amendments to Program Requirements. Sprint PCS may amend any of the
Program Requirements, subject to the following conditions:
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(a) The applicable Program Requirements, as amended, will apply
equally to Manager, Sprint PCS and each Other Manager, except if Manager and
Sprint PCS agree otherwise or if Sprint PCS grants a waiver to Manager. Sprint
PCS may grant waivers to Other Managers without affecting Manager's obligation
to comply with the Program Requirements;
(b) Each amendment will be reasonably required to fulfill the
purposes set forth in Section 1.2 with respect to uniform and consistent
operations of the Sprint PCS Network and the presentation of Sprint PCS Products
and Services to customers in a uniform and consistent manner;
(c) Each amendment will otherwise be on terms and conditions that
are commercially reasonable with respect to the construction, operation and
management of the Sprint PCS Network. With respect to any amendment to the
Program Requirements. Sprint PCS will provide for reasonable transition periods
and, where appropriate, may provide for grandfathering provisions for existing
activities by Manager that were permitted under the applicable Program
Requirements before the amendment;
(d) Sprint PCS must give Manager reasonable, written notice of the
amendment, but in any event the notice will be given at least 30 days prior to
the effective date of the amendment; and
(e) Manager must implement any changes in the Program Requirements
within a commercially reasonable period of time unless otherwise consented to by
Sprint PCS. Sprint PCS will determine what constitutes a commercially reasonable
period of time taking into consideration relevant business factors, including
the strategic significance of the changes to the Sprint PCS Network, the
relationship of the changes to the yearly marketing cycle, and the financial
demands on and capacity generally of Other Managers. Notwithstanding the
preceding two sentences, Manager will not be required to implement any change in
the Service Area Network or the business of Manager required by an amendment to
a Program Requirement until Sprint PCS has implemented the required changes in
substantially all of that portion of the Sprint PCS Network that Sprint PCS
operates without the use of a manager or affiliate, unless the amendment to the
Program Requirement relates to an obligation regarding the Service Area Network
mandated by law. When necessary for reasons related to new technical standards,
new equipment or strategic reasons, Sprint PCS can require Manager to implement
the changes in the Service Area Network or Manager's business concurrently with
Sprint PCS, in which case Sprint PCS will reimburse Manager for its costs and
expenses if Sprint PCS discontinues the Program Requirement changes prior to
implementation.
Sprint PCS may grant Manager appropriate waivers and variances from the
requirements of any Program Requirements. Sprint PCS has the right to adopt any
Program Requirements that implement any obligation regarding the Service Area
Network mandated by law.
Any costs and expenses incurred by Manager in connection with conforming
to any change to the Program Requirements during the term of this agreement are
the responsibility of Manager.
9.3 Manager's Right to Request Review of Changes. If Sprint PCS announces
a change to a Program Requirement that will:
(a) cause the Manager to spend an additional amount greater than 5%
of Manager's shareholders equity or capital account plus Manager's long-term
debt (i.e., notes that mature more than one year from the date issued), as
reflected on Manager's books; or
(b) cause the long term operating expenses of Manager on a per unit
basis using a 10-year time frame to increase by more than 10% on a net present
value basis.
then Manager may give Sprint PCS a written notice requesting Sprint PCS to
reconsider the change.
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The Sprint PCS Vice President or the designee of the Sprint PCS Chief
Officer in charge of the group that manages the Sprint PCS relationship with
Manager will review Manager's request and render a decision regarding the
change. If after the review and decision by the Vice President or designee,
Manager is still dissatisfied, then Manager may ask that the Chief Officer to
whom the Vice President or designee reports review the matter. If Sprint PCS
still requires Manager to implement the change to the Program Requirement
following the Chief Officer's review, then upon Manager's failure to implement
the change an Event of Termination will be deemed to have occurred under Section
11.3.3, Manager will not have a right to cure such breach, and Sprint PCS may
exercise its rights and remedies under Section 11.6.
9.4 Sprint PCS' Right to Implement Changes. If Manager requests Sprint PCS
to reconsider a change to a Program Requirement as permitted under Section 9.3
and Sprint PCS decides it will not require Manager to make the change, Sprint
PCS may, but is not required to, implement the change at Sprint PCS' expense, in
which event Manager will be required to operate the Service Area Network, as
changed, but Sprint PCS will be entitled to any revenue derived from the change.
9.5 Rights of Inspection. Sprint PCS and its authorized agents and
representatives may enter upon the premises of any office or facility operated
by or for Manager at any time, with reasonable advance notice to Manager if
possible, to inspect, monitor and test in a reasonable manner the Service Area
Network, including the facilities, equipment, books and records of Manager, to
ensure that Manager has complied or is in compliance with all covenants and
obligations of Manager under this agreement, including Manager's obligation to
conform to the Program Requirements. The inspection, monitoring and testing may
not disrupt the operations of the office or facility, nor impede Manager's
access to the Service Area Network.
9.6 Manager's Responsibility to Interface with Sprint PCS. Manager will
use platforms fully capable of interfacing with the Sprint PCS platforms in
operating the Service Area Network and in providing Sprint PCS Products and
Services. Manager will pay the expense of making its platforms fully capable of
interfacing with Sprint PCS, including paying for the following:
(i) connectivity;
(ii) any changes that Manager requests Sprint PCS to make to
Sprint PCS systems to interconnect with Manager's systems that Sprint PCS,
in its sole discretion, agrees to make;
(iii) equipment to run Manager's software;
(iv) license fees for Managers software; and
(v) Manager's upgrades or changes to its platforms.
10. FEES
10.1 Fees and Payments.
10.1.1 Fee Based on Collected Revenues. Sprint PCS will pay to
Manager a weekly fee equal to 92 % of Collected Revenues for the week for all
obligations of Manager under this Agreement. The fee will be due on Thursday of
the week following the week for which the fee is calculated.
10.1.2 Payment of Universal Service Funds. Sprint PCS and Manager
will share any federal and state subsidy funds (e.g., payments by a state of
universal service fund subsidies to Sprint PCS or Manager), if any, received by
Sprint PCS or Manager for customers who reside in the portion of the Service
Area
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served by the Service Area Network. Manager is entitled to 92% of' any amount
received by either party and Sprint PCS is entitled to 8% of such amounts.
10.1.3 Inter Service Area Fees. Sprint PCS will pay to Manager
monthly a fee as set out in the Sprint PCS Roaming and Inter Service Area
Program, for each minute of use that a customer of Sprint PCS or one of the
Other Managers whose NPA-NXX is not assigned to the Service Area Network uses
the Service Area Network. Manager will pay to Sprint PCS a fee, as set out in
the Sprint PCS Roaming and Inter Service Area Program, for each minute of use
that a customer whose NPA-NXX is assigned to the Service Area Network uses a
portion of the Sprint PCS Network other than the Service Area Network. Manager
acknowledges that the manner in which the NPA-NXX is utilized could change,
which will require a modification in the manner in which the inter service area
fees, if any, will be calculated.
10.1.4 Interconnect Fees. Manager will pay to Sprint PCS (or to
other carriers as appropriate) monthly the interconnect fees, if any, as
provided under Section 1 .4.
10.1.5 Outbound Roaming Fees. If not otherwise provided under any
Program Requirement:
(a) Sprint PCS will pay to Manager monthly the amount of Outbound
Roaming fees that Sprint PCS collects for the month from end users whose NPA-NXX
is assigned to the Service Area; and
(b) Manager will pay to Sprint PCS (or to a clearinghouse or other
carrier as appropriate) the direct cost of providing the capability for the
Outbound Roaming, including any amounts payable to the carrier that handled the
roaming call and the clearinghouse operator.
10.1.6 Reimbursements. Manager will pay to or reimburse Sprint PCS
for any amounts that Sprint PCS is required to pay to a third party (e.g., a
telecommunications carrier) to the extent Sprint PCS already paid such amount to
Manager under this Section 10.
10.2 Monthly True Up. Manager will report to Sprint PCS monthly the amount
of Collected Revenues received directly by the Manager (e.g., customer mails
payment to the business address of Manager rather than to the lockbox or a
customer pays a direct sales force representative in cash). Sprint PCS will on a
monthly basis true up the fees and payments due under Section 10.1 against the
actual payments made by Sprint PCS to Manager. Sprint PCS will provide to
Manager a true up report each month showing the true up and the net amount due
from one party to the other, if any. If the weekly payments made to Manager
exceed the actual fees and payments due to Manager, then Manager will remit the
amount of the overpayment to Sprint PCS within 5 Business Days after receiving
the true up report from Sprint PCS. If the weekly payments made to Manager are
less than the actual fees and payments due to Manager, then Sprint PCS will
remit the shortfall to Manager within 5 Business Days after sending the true up
report to Manager.
If a party disputes any amount on the true up report, the disputing party
must give the other party written notice of the disputed amount and the reason
for the dispute within 90 days after it receives the true up report. The dispute
will be resolved through the dispute resolution process in Section 14. The
parties must continue to pay to the other party any undisputed amounts owed
under this agreement during the dispute resolution process. The dispute of an
item does not stay or diminish a party's other rights and remedies under this
agreement.
10.3 Taxes. Manager will pay or reimburse Sprint PCS for any sales, use,
gross receipts or similar tax, administrative fee, telecommunications fee or
surcharge for taxes or fees levied by a governmental authority on the fees and
charges payable by Sprint PCS to Manager.
Manager will report all taxable property to the appropriate taxing
authority for ad valorem tax purposes. Manager will pay as and when due all
taxes, assessments, liens, encumbrances, levies, and other charges against the
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real estate and personal property owned by Manager or used by Manager in
fulfilling its obligations under this agreement.
Manager is responsible for paying all sales, use, or similar taxes on the
purchase and use of its equipment, advertising, and other goods or services in
connection with this agreement.
10.4 Collected Revenues Definition. "Collected Revenues" means actual
payments received by or on behalf of Sprint PCS or Manager for Sprint PCS
Products and Services from others, including the customers, whose NPA-NXX is the
same as that for the portion of the Service Area served by the Service Area
Network. In determining Collected Revenues the following principles will apply.
(a) The following items will be treated as follows:
(i) Collected Revenues do not include revenues from federal
and state subsidy funds; they are handled separately as noted in Section
10.1.2;
(ii) Collected Revenues do include any amounts received for
the payment of Inbound Roaming charges and interconnect fees when calls
are carried on the Service Area Network; and
(iii) Collected Revenues do not include any amounts received
with respect to any changes made by Sprint PCS under Section 9.4.
(b) The following items are not Collected Revenues; Sprint PCS is
obligated to remit the amounts received with respect to such items, if any, to
Manager, as follows:
(i) inter service area payments will be paid as provided under
Section 10.1.3;
(ii) Outbound Roaming and related charges will be paid as
provided under Section 10.1.5;
(iii) proceeds from the sale or lease of subscriber equipment
and accessories will be paid to Manager, subject to the equipment
settlement process in Section 4.1.2;
(iv) proceeds from sales not in the ordinary course of
business (e.g., sales of switches, cell sites, computers, vehicles or
other fixed assets);
(v) any amounts collected with respect to sales and use taxes,
gross receipts taxes, transfer taxes, and similar taxes, administrative
fees, telecommunications fees, and surcharges for taxes and fees that are
collected by a carrier for the benefit of a governmental authority,
subject to Manager's obligation under Section 10.3; and
(vi) Manager will be entitled to 100% of all revenues received
by Sprint PCS with respect to sales of Manager's Products and Services.
(c) The following items are not Collected Revenues: neither party is
obligated to remit any amounts respecting such items:
(i) reasonable adjustments of a customer's account (e.g., if
Sprint PCS or Manager reduces a customer's bill, then the amount of the
adjustment is not Collected Revenues); and
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(ii) amount of bad debt and fraud associated with customers
whose NPA-NXX is assigned to the Service Area (e.g., if Sprint PCS or
Manager writes off a customer's bill as a bad debt, there are no Collected
Revenues on which a fee is due to Manager).
10.5 Late Payments. Any amount due under this Section 10 that is not paid
by one party to the other party in accordance with the terms of this agreement
will bear interest at the Default Rate beginning (and including) the 3rd day
after the due date until (and including) the date paid.
10.6 Setoff Right If Failure To Pay Amounts Due. If Manager fails to pay
any undisputed amount due Sprint PCS or a Related Party of Sprint PCS under this
agreement, the Services Agreement, or any other agreement with Sprint PCS or a
Related Party of Sprint PCS, then Sprint PCS may setoff against its payments to
Manager under this Section 10, the following amounts:
(a) any amount that Manager owes to Sprint PCS or a Related Party of
Sprint PCS, including amounts due under the Services Agreement; and
(b) any amount that Sprint PCS reasonably estimates will be due to
Sprint PCS for the current month under the Services Agreement (e.g., if under
the Services Agreement customer care calls are billed monthly, Sprint PCS can
deduct from the weekly payment to Manager an amount Sprint PCS reasonably
estimates will be due Sprint PCS on account of such customer care calls under
the Services Agreement).
On a monthly basis Sprint PCS will true up the estimated amounts deducted
against the actual amounts due Sprint PCS and Sprint PCS' Related Parties. If
the estimated amounts deducted by Sprint PCS exceed the actual amounts due to
Sprint PCS and Sprint PCS' Related Parties, then Sprint PCS will remit the
excess to Manager with the next weekly payment. If the estimated amounts
deducted are less than the actual amounts due to Sprint PCS and its Related
Parties, then Sprint PCS may continue to setoff the payments to Manager against
the amounts due to Sprint PCS and Sprint PCS' Related Parties. This right of
setoff is in addition to any other right that Sprint PCS may have under this
agreement.
11. TERM; TERMINATION; EFFECT OF TERMINATION
11.1 Initial Term. This agreement commences on the date of execution and,
unless terminated earlier in accordance with the provisions of this Section 11,
continues for a period of 20 years (the "Initial Term").
11.2 Renewal Terms. Following expiration of the Initial Term, this
agreement will automatically renew for 3 successive 10-year renewal periods (for
a maximum of 50 years including the Initial Term), unless at least 2 years prior
to the commencement of any renewal period either party notifies the other party
in writing that it does not wish to renew this agreement.
11.2.1 Non-renewal Rights of Manager. If this agreement will
terminate because Sprint PCS gives Manager timely written notice of non-renewal
of this agreement, then Manager may exercise its rights under Section 11.2.1.1
or, if applicable, its rights under Section 11.2.1.2.
11.2.1.1 Manager's Put Right. Manager may within 30 days after
the date Sprint PCS gives notice of non-renewal put to Sprint PCS all of the
Operating Assets. Sprint PCS will pay to Manager for the Operating Assets an
amount equal to 80% of the Entire Business Value. The closing of the purchase of
the Operating Assets will occur within 20 days after the later of (a) the
receipt by Sprint PCS of the written notice of determination of the Entire
Business Value provided by the appraisers under Section 11.7 or (b) the receipt
of all materials required to be delivered to Sprint PCS under Section 11.8. Upon
closing the purchase of the Operating Assets this agreement will be deemed
terminated. The exercise of the put, the determination of the Operating
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Assets, the representations and warranties made by Manager with respect to the
Operating Assets and the business, and the process for closing the purchase will
be subject to the terms and conditions set forth in Section 11.8.
11.2.1.2 Manager's Purchase Right.
(a) If Sprint PCS owns 20 MHz or more of PCS spectrum in
the Service Area under the License on the date this agreement is
executed, then Manager may within 30 days after the date Sprint PCS
gives notice of non-renewal declare its intent to purchase the
Disaggregated License. Subject to receipt of FCC approval of the
necessary disaggregation and partition, Manager may purchase from
Sprint PCS the Disaggregated License for an amount equal to the
greater of (1) the original cost of the License to Sprint PCS (pro
rated on a pops and spectrum basis) plus the microwave relocation
costs paid by Sprint PCS or (2) 10% of the Entire Business Value.
(b) Upon closing the purchase of the spectrum this
agreement will be deemed terminated. The closing of the purchase of
the Disaggregated License will occur within the later of:
(1) 20 days after the receipt by Manager of the
written notice of determination of the Entire Business Value
by the appraisers under Section 11.7; or
(2) 10 days after the approval of the sale of the
Disaggregated License by the FCC.
(c) The exercise of the purchase right, the
determination of the geographic extent of the Disaggregated License
coverage, the representations and warranties made by Sprint PCS with
respect to the Disaggregated License, and the process for closing
the purchase will be subject to the terms and conditions set forth
in Section 11.8.
(d) After the closing of the purchase Manager will
allow:
(1) subscribers of Sprint PCS to roam on Manager's
network; and
(2) Sprint PCS to resell Manager's Products and
Services.
Manager will charge Sprint PCS a MFN price in either case.
11.2.2 Non-renewal Rights of Sprint PCS. If this agreement will
terminate because of any of the following five (5) events, then Sprint PCS may
exercise its rights under Section 11.2.2.1 or, if applicable, its rights under
Section 11.2.2.2:
(a) Manager gives Sprint PCS timely written notice of non-renewal of
this agreement;
(b) both parties give timely written notices of non-renewal;
(c) this agreement expires with neither party giving a written
notice of non-renewal;
(d) either party elects to terminate this agreement under Section
11.3.4(a); or
(e) Manager elects to terminate this agreement under Section
11.3.4(b).
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11.2.2.1 Sprint PCS' Purchase Right. Sprint PCS may purchase
from Manager all of the Operating Assets. Sprint PCS will pay to Manager an
amount equal to 80% of the Entire Business Value. The closing of the purchase of
the Operating Assets will occur within 20 days after the later of (a) the
receipt by Sprint PCS of the written notice of determination of the Entire
Business Value provided by the appraisers under Section 11 .7 or (b) the receipt
of all materials required to be delivered to Sprint PCS under Section 11.8. Upon
closing the purchase of the Operating Assets this agreement will be deemed
terminated. The exercise of the purchase right, the determination of the
Operating Assets, the representations and warranties made by Manager with
respect to the Operating Assets and the business, and the process for closing
the purchase will be subject to the terms and conditions set forth in Section
11.8.
11.2.2.2 Sprint PCS' Put Right.
(a) Sprint PCS may, subject to receipt of FCC approval,
put to Manager the Disaggregated License for a purchase price equal
to the greater of (1) the original cost of the License to Sprint PCS
(pro rated on a pops and spectrum basis) plus the microwave
relocation costs paid by Sprint PCS or (2) 10% of the Entire
Business Value.
(b) Upon closing the purchase of the Disaggregated
License this agreement will be deemed terminated. The closing of the
purchase of the Disaggregated License will occur within the later
of:
(1) 20 days after the receipt by Sprint PCS of the
written notice of determination of the Entire Business Value
by the appraisers under Section 11.7; or
(2) 10 days after the approval of the sale of the
Disaggregated License by the FCC.
(c) The exercise of the put, the determination of the
geographic extent of the Disaggregated License coverage, the
representations and warranties made by Sprint PCS with respect to
the Disaggregated License, and the process for closing the purchase
will be subject to the terms and conditions set forth in Section
11.8.
(d) Manager may, within 10 days after it receives notice
of Sprint PCS' exercise of its put, advise Sprint PCS of the amount
of spectrum (not to exceed 10 MHz) it wishes to purchase. After the
purchase Manager will allow:
(1) subscribers of Sprint PCS to roam on Manager's
network; and
(2) Sprint PCS to resell Manager's Products and
Services.
Manager will charge Sprint PCS a MFN price in either case.
11.2.3 Extended Term Awaiting FCC Approval. If Manager is buying the
disaggregated License as permitted or required under Sections 11.2.1.2 or
11.2.2.2, then the Term of this agreement will extend beyond the original
expiration date until the closing of the purchase of the disaggregated License.
The parties agree to exercise their respective commercially reasonable efforts
to obtain FCC approval of the transfer of the Disaggregated License.
11.3 Events of Termination. An "Event of Termination" is deemed to occur
when a party gives written notice to the other party of the Event of Termination
as permitted below:
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11.3.1 Termination of License.
(a) At the election of either party this agreement
may be terminated at the time the FCC revokes or fails to
renew the License. Unless Manager has the right to terminate
this agreement under Section 11.3.1(b), neither party has any
claim against the other party if the FCC revokes or fails to
renew the License, even if circumstances would otherwise
permit one party to terminate this agreement based on a
different Event of Termination, except that the parties will
have the right to pursue claims against each other as
permitted under Section 11.4(b).
(b) If the FCC revokes or fails to renew the
License because of a breach of this agreement by Sprint PCS,
then Manager has the right to terminate this agreement under
Section 11.3.3 and not this Section 11.3.1.
11.3.2 Breach of Agreement; Payment of Money Terms. At the election
of the non-breaching party this agreement may be terminated upon the failure by
the breaching party to pay any amount due under this agreement or any other
agreement between the parties or their respective Related Parties, if the breach
is not cured within 30 days after the breaching party's receipt of written
notice of the nonpayment from the non-breaching party.
11.3.3 Breach of Agreement; Other Terms. At the election of the
non-breaching party this agreement may be terminated upon the material breach by
the breaching party of any material term contained in this agreement that does
not regard the payment of money, if the breach is not cured within 30 days after
the breaching party's receipt of written notice of the breach from the
non-breaching party, except the cure period will continue for a reasonable
period beyond the 30-day period, but will under no circumstances exceed 180 days
after the breaching party's receipt of written notice of the breach, if it is
unreasonable to cure the breach within the 30-day period, and the breaching
party takes action prior to the end of the 30-day period that is reasonably
likely to cure the breach and continues to diligently take action necessary to
cure the breach.
11.3.4 Regulatory Considerations.
(a) At the election of either party this agreement may
be terminated if this agreement violates any applicable law in any
material respect where such violation (i) is classified as a felony
or (ii) subjects either party to substantial monetary fines or other
substantial damages, except that before causing any termination the
parties must use best efforts to modify this agreement, as necessary
to cause this agreement (as modified) to comply with applicable law
and to preserve to the extent possible the economic arrangements set
forth in this agreement.
(b) At the election of Manager this agreement may be
terminated if the regulatory action described under 11.3.4(a) is the
result of a deemed change of control of the License and the parties
are unable to agree upon a satisfactory resolution of the matter
with the regulatory authority without a complete termination of this
agreement.
11.3.5 Termination of Trademark License Agreements. If either
Trademark License Agreement terminates under its terms, then:
(a) Manager may terminate this agreement if the
Trademark License Agreement terminated because of a breach of the
Trademark License Agreement by Sprint PCS or Sprint; and
(b) Sprint PCS may terminate this agreement if the
Trademark License Agreement terminated because of a breach of the
Trademark License Agreement by Manager.
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11.3.6 Financing Considerations. At the election of Sprint PCS this
agreement may be terminated upon the failure of Manager to obtain the financing
described in Exhibit 1.7 by the deadline(s) set forth on such Exhibit.
11.3.7 Bankruptcy of a Party. At the election of the non-bankrupt
party, this agreement may be terminated upon the occurrence of a Voluntary
Bankruptcy or an Involuntary Bankruptcy of the other party.
"Voluntary Bankruptcy" means:
(a) the inability of a party generally to pay its debts
as the debts become due, or an admission in writing by a party of
its inability to pay its debts generally or a general assignment by
a party for the benefit of creditors;
(b) the filing of any petition or answer by a party
seeking to adjudicate itself a bankrupt or insolvent, or seeking any
liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition for itself or its debts under any
law relating to bankruptcy, insolvency or reorganization or relief
of debtors, or seeking, consenting to, or acquiescing in the entry
of an order for relief or the appointment of a receiver, trustee,
custodian or other similar official for itself or for substantially
all of its property; or
(c) any action taken by a party to authorize any of the
actions set forth above.
"Involuntary Bankruptcy" means, without the consent or acquiescence of a
party:
(a) the entering of an order for relief or approving a
petition for relief or reorganization;
(b) any petition seeking any reorganization,
arrangement, composition, readjustment, liquidation, dissolution or
other similar relief under any present or future bankruptcy,
insolvency or similar statute, law or regulation;
(c) the filing of any petition against a party, which
petition is not dismissed within 90 days; or
(d) without the consent or acquiescence of a party, the
entering of an order appointing a trustee, custodian, receiver or
liquidator of party or of all or any substantial part of the
property of the party, which order is not dismissed within 90 days.
11.4 Effect of an Event of Termination.
(a) Upon the occurrence of an Event of Termination, the party with
the right to terminate this agreement or to elect the remedy upon the Event of
Termination, as the case may be, may:
(i) in the case of an Event of Termination under Sections
11.3.1(a) or 11.3.7, give the other party written notice that the
agreement is terminated effective as of the date of the notice, in which
case neither party will have any other remedy or claim for damages (except
any claim the non-bankrupt party has against the bankrupt party and any
claims permitted under Section 11.4(b)); or
(ii) in the case of an Event of Termination other than under
Section 11.3.1(a), give the other party written notice that the party is
exercising one of its rights, if any, under Section 11.5 or Section 11.6.
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(b) If the party terminates this agreement under Section 11.4(a)(i)
then all rights and obligations of each party under this agreement will
immediately cease, except that:
(i) any rights arising out of a breach of any terms of this
agreement will survive any termination of this agreement;
(ii) the provisions described in Section 17.23 will survive
any termination of this agreement;
(iii) the payment obligations under Section 10 will survive
any termination of this agreement if, and to the extent, any costs or fees
have accrued or are otherwise due and owing as of the date of termination
of this agreement from Manager to Sprint PCS or any Sprint PCS Related
Party or from Sprint PCS to Manager or any Manager Related Party;
(iv) either party may terminate this agreement in accordance
with the terms of this agreement without any liability for any loss or
damage arising out of or related to such termination, including any loss
or damage arising out of the exercise by Sprint PCS of its rights under
Section 11.6.3;
(v) Manager will use all commercially reasonable efforts to
cease immediately all of their respective efforts to market, sell, promote
or distribute the Sprint PCS Products and Services;
(vi) Sprint PCS has the option to buy from Manager any new
unsold subscriber equipment and accessories, at the prices charged to
Manager;
(vii) the parties will immediately stop making any statements
or taking any action that might cause third parties to infer that any
business relationship continues to exist between the parties, and where
necessary or advisable, the parties will inform third parties that the
parties no longer have a business relationship; and
(viii) if subscriber equipment and accessories are in transit
when this agreement is terminated. Sprint PCS may, but does not have the
obligation to, cause the freight carrier to not deliver the subscriber
equipment and accessories to Manager but rather to deliver the subscriber
equipment and accessories to Sprint PCS.
(c) If the party exercises its rights under Section 11.4(a)(ii),
this agreement will continue in full force and effect until otherwise
terminated.
(d) If this agreement terminates for any reason other than Manager's
purchase of the Disaggregated License, Manager will not, for 3 years after the
date of termination compile, create, or use for the purpose of selling
merchandise or services similar to any Sprint PCS Products and Services, or
sell, transfer or otherwise convey to a third party, a list of customers who
purchased, leased or used any Sprint PCS Products and Services. Manager may use
such a list for its own internal analysis of its business practices and
operations. If this agreement terminates because of Manager's purchase of the
Disaggregated License, then Sprint PCS will transfer to Manager the Sprint PCS
customers with a MIN assigned to the Service Area covered by the Disaggregated
License, but Sprint PCS retains the customers of a national account and any
resellers who have entered into a resale agreement with Sprint PCS. Manager
agrees not to solicit, directly or indirectly, any customers of Sprint PCS not
transferred to Manager under this Section 11.4(d) for 2 years after the
termination of this agreement, except that Manager's advertising through mass
media will not be considered a solicitation of Sprint PCS customers.
11.5 Manager's Event of Termination Rights and Remedies. In addition to
any other right or remedy that Manager may have under this agreement, the
parties agree that Manager will have the rights and remedies set forth in this
Section 11.5 and that such rights and remedies will survive the termination of
this
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agreement. If Manager has a right to terminate this agreement as the result of
the occurrence of an Event of Termination under Sections 11.3.2, 11.3.3, 11.3.5
or 11.3.7 (if Manager is the non-bankrupt party), then Manager has the right to
elect one of the following three (3) remedies, except Manager cannot elect its
remedies under Sections 11.5.1 or 11.5.2 during the first 2 years of the Initial
Term with respect to an Event of Termination under Section 11.3.3.
11.5.1 Manager's Put Right. Manager may put to Sprint PCS within 30
days after the Event of Termination all of the Operating Assets. Sprint PCS will
pay to Manager an amount equal to 80% of the Entire Business Value. The closing
of the purchase of the Operating Assets will occur within 20 days after the
later of:
(a) the receipt by Sprint PCS of the written notice of
determination of the Entire Business Value by the appraisers under
Section 11.7; or
(b) the receipt of all materials required to be
delivered to Sprint PCS under Section 11.8.
Upon closing the purchase of the Operating Assets this agreement will be
deemed terminated. The exercise of the put, the determination of the Operating
Assets, the representations and warranties made by the Manager with respect to
the Operating Assets and the business, and the process for closing the purchase
will be subject to the terms and conditions set forth in Section 11.8.
11.5.2 Manager's Purchase Right.
(a) If Sprint PCS owns 20 MHz or more of PCS spectrum in
the Service Area under the License on the date this agreement is
executed, then Manager may, subject to receipt of FCC approval,
purchase from Sprint PCS the Disaggregated License for the greater
of (1) the original cost of the License to Sprint PCS (pro rated on
a pops and spectrum basis) plus the microwave relocation costs paid
by Sprint PCS or (2) 9% (10% minus a 10% penalty) of the Entire
Business Value.
(b) Upon closing the purchase of the Disaggregated
License this agreement will be deemed terminated. The closing of the
purchase of the Disaggregated License will occur within the later
of:
(1) 20 days after the receipt by Manager of the
written notice of determination of the Entire Business Value
by the appraisers under Section 11.7; or
(2) 10 days after the approval of the sale of the
Disaggregated License by the FCC.
The exercise of the purchase right, the determination of the geographic
extent of the Disaggregated License coverage, the representations and warranties
made by Sprint PCS with respect to the Disaggregated License, and the process
for closing the purchase will be subject to the terms and conditions set forth
in Section 11.8.
(c) After the closing of the purchase Manager will
allow:
(1) subscribers of Sprint PCS to roam on Manager's
network; and
(2) Sprint PCS to resell Manager's Product and
Services.
Manager will charge Sprint PCS a MFN price in either case.
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11.5.3 Manager's Action for Damages or Other Relief. Manager, in
accordance with the dispute resolution process in Section 14, may seek damages
or other appropriate relief.
11.6 Sprint PCS' Event of Termination Rights and Remedies. In addition to
any other right or remedy that Sprint PCS may have under this agreement, the
parties agree that Sprint PCS will have the rights and remedies set forth in
this Section 11.6 and that such rights and remedies will survive the termination
of this agreement. If Sprint PCS has a right to terminate this agreement as the
result of the occurrence of an Event of Termination under Sections 11.3.2,
11.3.3, 11.3.5, 11.3.6 or 11.3.7 (if Sprint PCS is the non-bankrupt party), then
Sprint PCS has the right to elect one of the following four (4) remedies, except
that (i) if Sprint PCS elects the remedies under Sections 11.6.1, 11.6.2 or
11.6.4, Sprint PCS may pursue its rights under Section 11.6.3 concurrently with
its pursuit of one of the other three remedies, (ii) Sprint PCS cannot elect its
remedies under Sections 11.6.1 or 11.6.2 during the first 2 years of the Initial
Term with respect to an Event of Termination under Section 11.3.3 (unless the
Event of Termination is caused by a breach related to the Build-out Plan or the
build-out of the Service Area Network), and (iii) Sprint PCS cannot elect its
remedy under Section 11.6.2 during the first 2 years of the Initial Term with
respect to an Event of Termination under Section 11.3.6.
11.6.1 Sprint PCS' Purchase Right. Sprint PCS may purchase from
Manager all of the Operating Assets. Sprint PCS will pay to Manager an amount
equal to 72% (80% minus a 10% penalty) of the Entire Business Value. The closing
of the purchase of the Operating Assets will occur within 20 days after the
later of:
(a) the receipt by Sprint PCS of the written notice of
determination of the Entire Business Value by the appraisers
pursuant to Section 11.7; or
(b) the receipt of all materials required to be
delivered to Sprint PCS under Section 11.8.
Upon closing the purchase of the Operating Assets this agreement will be
deemed terminated. The exercise of the purchase right, the determination of the
Operating Assets. the representations and warranties made by Manager with
respect to the Operating Assets and the business, and the process for closing
the purchase will be subject to the terms and conditions set forth in Section
11.8.
11.6.2 Sprint PCS' Put Right.
(a) Sprint PCS may, subject to receipt of FCC approval,
put to Manager the Disaggregated License for a purchase price equal
to the greater of (1) the original cost of the License to Sprint PCS
(pro rated on a pops and spectrum basis) plus the microwave
relocation costs paid by Sprint PCS or (2) 10% of the Entire
Business Value.
(b) Upon closing the purchase of the Disaggregated
License this agreement will be deemed terminated. The closing of the
purchase of the Disaggregated License will occur within the later
of:
(1) 20 days after the receipt by Sprint PCS of the
written notice of determination of the Entire Business Value
by the appraisers under Section 11.7; or
(2) 10 days after the approval of the sale of the
Disaggregated License by the FCC.
(c) The exercise of the put, the determination of the
geographic extent of the Disaggregated License coverage, the
representations and warranties made by Sprint PCS with
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respect to the Disaggregated License, and the process for closing
the purchase will be subject to the terms and conditions set forth
in Section 11.8.
(d) Manager may, within 10 days after it receives notice
of Sprint PCS' exercise of its put, advise Sprint PCS of the amount
of spectrum (not to exceed 10 MHz) it wishes to purchase. After the
closing of the purchase Manager will allow:
(1) subscribers of Sprint PCS to roam on Manager's
network; and
(2) Sprint PCS to resell Manager's Products and
Services.
Manager will charge Sprint PCS a MFN price in either case.
11.6.3 Sprint PCS' Right to Cause A Cure.
(a) Sprint PCS' Right. Sprint PCS may, but is not
obligated to, take such action as it deems necessary to cure
Manager's breach of this agreement, including assuming operational
responsibility for the Service Area Network to complete
construction. continue operation, complete any necessary repairs,
implement changes necessary to comply with the Program Requirements
and terms of this agreement, or take such other steps as are
appropriate under the circumstances, or Sprint PCS may designate a
third party or parties to do the same, to assure uninterrupted
availability and deliverability of Sprint PCS Products and Services
in the Service Area, or to complete the build-out of the Service
Area Network in accordance with the terms of this agreement. In the
event that Sprint PCS elects to exercise its right under this
Section 11.6.3, Sprint PCS will give Manager written notice of such
election. Upon giving such notice:
(1) Manager will collect and make available at a
convenient, central location at its principal place of
business, all documents, books, manuals, reports and records
related to the Build-out Plan and required to operate and
maintain the Service Area Network; and
(2) Sprint PCS, its employees, contractors and
designated third parties will have the unrestricted right to
enter the facilities and offices of Manager for the purpose of
curing the breach and, if Sprint PCS deems necessary, operate
the Service Area Network.
Manager agrees to cooperate with and assist Sprint PCS to the extent
requested by Sprint PCS to enable Sprint PCS to exercise its rights under this
Section 11.6.3.
(b) Liability. Sprint PCS' exercise of its rights under
this Section 11.6.3 will not be deemed an assumption by Sprint PCS
of any liability attributable to Manager or any other party, except
that, without limiting the provisions of Section 13, during the
period that Sprint PCS is curing a breach under this agreement or
operating any portion of the Service Area Network pursuant to this
Section 11.6.3, Sprint PCS will indemnify and defend Manager and its
directors, partners, officers, employees and agents from and
against, and reimburse and pay for, all claims, demands, damages,
losses, judgments, awards, liabilities, costs and expenses
(including reasonable attorneys' fees, court costs and other
expenses of litigation), whether or not arising out of third party
claims, in connection with any suit, claim, action or other legal
proceeding relating to the bodily injury, sickness or death of
persons or the damage to or destruction of property, real or
personal, resulting from or arising out of Sprint PCS' negligence or
willful misconduct in curing the breach or in the operation of the
Service Area Network. Sprint PCS' obligation under this Section
11.6.3(b) will not apply to the extent of any claims, demands,
damages, losses,
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judgments, awards, liabilities, costs and expenses resulting from
the negligence or willful misconduct of Manager or arising from any
contractual obligation of Manager.
(c) Costs and Payments. During the period that Sprint
PCS is curing a breach or operating the Service Area Network under
this Section 11.6.3, Sprint PCS and Manager will continue to make
any and all payments due to the other party and to third parties
under this agreement, the Services Agreement and any other
agreements to which such party is bound, except that Sprint PCS may
deduct from its payments to Manager all reasonable costs and
expenses incurred by Sprint PCS in connection with the exercise of
its right under this Section 11.6.3. Sprint PCS' operation of the
Service Area Network pursuant to this Section 11.6.3 is not a
substitution for Manager's performance of its obligations under this
agreement and does not relieve Manager of its other obligations
under this agreement.
(d) Length of Right. Sprint PCS may continue to operate
the Service Area Network in accordance with Section 11.6.3 until (i)
Sprint PCS cures all breaches by Manager under this agreement; (ii)
Manager cures all breaches and demonstrates to Sprint PCS'
satisfaction that it is financially and operationally willing, ready
and able to perform in accordance with this agreement and resumes
such performance; (iii) Sprint PCS consummates the purchase of the
Operating Assets under Section 11.6.1 or the sale of the
Disaggregated License under Section 11.6.2; or (iv) Sprint PCS
terminates this agreement.
(e) Not Under Services Agreement. The exercise by Sprint
PCS of its right under this Section 11.6.3 does not represent
services rendered under the Services Agreement, and therefore it
does not allow Manager to be deemed in compliance with the Program
Requirements under Sections 7.1(a)(ii), 8.1(b).
11.6.4 Sprint PCS' Action for Damages or Other Relief. Sprint PCS,
in accordance with the dispute resolution process in Section 14, may seek
damages or other appropriate relief.
11.7 Determination of Entire Business Value.
11.7.1 Appointment of Appraisers. Sprint PCS and Manager must each
designate an independent appraiser within 30 days after giving the Purchase
Notice under Exhibit 11.8. Sprint PCS and Manager will direct the two appraisers
to jointly select a third appraiser within 15 days after the day the last of
them is appointed. Each appraiser must be an expert in the valuation of wireless
telecommunications businesses. Sprint PCS and Manager must direct the three
appraisers to each determine, within 45 days after the appointment of the last
appraiser, the Entire Business Value. Sprint PCS and Manager will each bear the
costs of the appraiser appointed by it, and they will share equally the costs of
the third appraiser.
11.7.2 Manager's Operating Assets. The following assets are included
in the Operating Assets (as defined in the Schedule of Definitions):
(a) network assets, including all personal property,
real property interests in cell sites and switch sites, leasehold
interests, collocation agreements, easements, and rights-of-way;
(b) all of the real, personal, tangible and intangible
property and contract rights that Manager owns and uses in
conducting the business of providing the Sprint PCS Products and
Services, including the goodwill resulting from Manager's customer
base;
(c) sale and distribution assets primarily dedicated
(i.e., at least 80% of their revenue is derived from the sale of
Sprint PCS Products and Services) to the sale by Manager
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of Sprint PCS Products and Services. For example, a retail store
that derives at least 80% of its revenue from the sale of Sprint PCS
Products and Services is an Operating Asset. A store that derives
65% of its revenue from Sprint PCS Products and Services is not an
Operating Asset;
(d) customers, if any, that use both the other products
and services approved under Section 3.2 and the Sprint PCS Products
and Services;
(e) handset inventory;
(f) books and records of the wireless business,
including all engineering drawings and designs and financial
records; and
(g) all contracts used by Manager in operating the
wireless business including T1 service agreements, service
contracts, interconnection agreements, distribution agreements,
software license agreements, equipment maintenance agreements, sales
agency agreements and contracts with all equipment suppliers.
11.7.3 Entire Business Value. Utilizing the valuation principles set
forth below and in Section 11.7.4, "Entire Business Value" means the fair market
value of Manager's wireless business in the Service Area, valued on a going
concern basis.
(a) The fair market value is based on the price a
willing buyer would pay a willing seller for the entire on-going
business.
(b) The appraisers will use the then-current customary
means of valuing a wireless telecommunications business.
(c) The business is conducted under the Brands and
existing agreements between the parties and their respective Related
Parties.
(d) Manager owns the Disaggregated License (in the case
where Manager will be buying the Disaggregated License under
Sections 11.2.1.2, 11.2.2.2, 11.5.2 or 11.6.2) or Manager owns the
spectrum and the frequencies actually used by Manager under this
agreement (in the case where Sprint PCS will be buying the Operating
Assets under Sections 11.2.1.1, 11.2.2.1, 11.5.1 or 11.6.1).
(e) The valuation will not include any value for the
business represented by Manager's Products and Services or any
business not directly related to Sprint PCS Products and Services.
11.7.4 Calculation of Entire Business Value. The Entire Business
Value to be used to determine the purchase price of the Operating Assets or the
Disaggregated License under this agreement is as follows:
(a) If the highest fair market value determined by the
appraisers is within 10% of the lowest fair market value, then the
Entire Business Value used to determine the purchase price under
this agreement will be the arithmetic mean of the three appraised
fair market values.
(b) If two of the fair market values determined by the
appraisers are within 10% of one another, and the third value is not
within 10% of the other fair market values, then the
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Entire Business Value used to determine the purchase price under
this agreement will be the arithmetic mean of the two more closely
aligned fair market values.
(c) If none of the fair market values is within 10% of
the other two fair market values, then the Entire Business Value
used to determine the purchase price under this agreement will be
the middle value of the three fair market values.
11.8 Closing Terms and Conditions. The closing terms and conditions for
the transactions contemplated in this Section 11 are attached as Exhibit 11.8.
11.9 Contemporaneous and Identical Application. The parties agree that any
action regarding renewal or non-renewal and any Event of Termination will occur
contemporaneously and identically with respect to all Licenses. For example, if
Manager exercises its purchase right under Section 11.5.2, it must exercise such
right with respect to all of the Licenses under this agreement. The Term of this
agreement will be the same for all Licenses: Manager will not be permitted to
operate a portion of the Service Area Network with fewer than all of the
Licenses.
12. BOOKS AND RECORDS; CONFIDENTIAL INFORMATION; INSURANCE
12.1 Books and Records.
12.1.1 General. Each party must keep and maintain books and records
to support and document any fees, costs, expenses or other charges due in
connection with the provisions set forth in this agreement. The records must be
retained for a period of at least 3 years after the fees, costs, expenses or
other charges to which the records relate have accrued and have been paid, or
such other period as may be required by law.
12.1.2 Audit. On reasonable advance notice, each party must provide
access to appropriate records to the independent auditors selected by the other
party for purposes of auditing the amount of fees, costs, expenses or other
charges payable in connection with the Service Area with respect to the period
audited. The auditing party will conduct the audit no more frequently than
annually. If the audit shows that Sprint PCS was underpaid then, unless the
amount is contested, Manager will pay to Sprint PCS the amount of the
underpayment within 10 Business Days after Sprint PCS gives Manager written
notice of the determination of the underpayment. If the audit determines that
Sprint PCS was overpaid then, unless the amount is contested, Sprint PCS will
pay to Manager the amount of the overpayment within 10 Business Days after
Sprint PCS determines Sprint PCS was overpaid. The auditing party will pay all
costs and expenses related to the audit unless the amount owed to the audited
party is reduced by more than 10% or the amount owed by the audited party is
increased by more than 10%, in which case the costs and expenses related to the
audit will be paid by the audited party.
Notwithstanding the above provisions of this Section 12.1.2, rather than
allow Manager's independent auditors access to Sprint PCS' records. Sprint PCS
may provide a report issued in conformity with Statement of Auditing Standard
No. 70 "Reports on the Processing of Transactions by Service Organizations"
("Type II Report" or "Manager Management Report"). Such report will be prepared
by independent auditors and will provide an opinion on the controls placed in
operation and tests of operating effectiveness of those controls in effect at
Sprint PCS over the Manager Management Processes. "Manager Management Processes"
include those services generally provided within the Management Agreement,
primarily billing and collection of Collected Revenues.
12.1.3 Contesting an Audit. If the party that did not select the
independent auditor does not agree with the findings of the audit, then such
party can contest the findings by providing notice of such disagreement to the
other party (the "Dispute Notice"). The date of delivery of such notice is the
"Dispute Notice
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Date." If the parties are unable to resolve the disagreement within 10 Business
Days after the Dispute Notice Date, they will resolve the disagreement in
accordance with the following procedures.
The two parties and the auditor that conducted the audit will all agree on
an independent certified public accountant with a regional or national
accounting practice in the wireless telecommunications industry (the "Arbiter")
within 15 Business Days after the Dispute Notice Date. If, within 15 Business
Days after the Dispute Notice Date, the three parties fail to agree on the
Arbiter, then at the request of either party to this agreement, the Arbiter will
be selected pursuant to the rules then in effect of the American Arbitration
Association. Each party will submit to the Arbiter within 5 Business Days after
its selection and engagement all information reasonably requested by the Arbiter
to enable the Arbiter to independently resolve the issue that is the subject of
the Dispute Notice. The Arbiter will make its own determination of the amount of
fees, costs, expenses or other charges payable under this agreement with respect
to the period audited. The Arbiter will issue a written report of its
determination in reasonable detail and will deliver a copy of the report to the
parties within 10 Business Days after the Arbiter receives all of the
information reasonably requested. The determination made by the Arbiter will be
final and binding and may be enforced by any court having jurisdiction. The
parties will cooperate fully in assisting the Arbiter and will take such actions
as are necessary to expedite the completion of and to cause the Arbiter to
expedite its assignment.
If the amount owed by a contesting party is reduced by more than 10% or
the amount owed to a contesting party is increased by more than 10% then the
non-contesting party will pay the costs and expenses of the Arbiter, otherwise
the contesting party will pay the costs and expenses of the Arbiter.
12.2 Confidential Information.
(a) Except as specifically authorized by this agreement, each of the
parties must, for the Term and 3 years after the date of termination of this
agreement, keep confidential, not disclose to others and use only for the
purposes authorized in this agreement, all Confidential Information disclosed by
the other party to the party in connection with this agreement, except that the
foregoing obligation will not apply to the extent that any Confidential
Information:
(i) is or becomes, after disclosure to a party, publicly known
by any means other than through unauthorized acts or omissions of the
party or its agents; or
(ii) is disclosed in good faith to a party by a third party
entitled to make the disclosure.
(b) Notwithstanding the foregoing, a party may use, disclose or
authorize the disclosure of Confidential Information that it receives that:
(i) has been published or is in the public domain, or that
subsequently comes into the public domain, through no fault of the
receiving party;
(ii) prior to the effective date of this agreement was
properly within the legitimate possession of the receiving party, or
subsequent to the effective date of this agreement, is lawfully received
from a third party having rights to publicly disseminate the Confidential
Information without any restriction and without notice to the recipient of
any restriction against its further disclosure;
(iii) is independently developed by the receiving party
through persons or entities who have not had, either directly or
indirectly, access to or knowledge of the Confidential Information;
(iv) is disclosed to a third parry consistent with the terms
of the written approval of the party originally disclosing the
information;
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(v) is required by the receiving party to be produced under
order of a court of competent jurisdiction or other similar requirements
of a governmental agency, and the Confidential Information will otherwise
continue to be Confidential Information required to be held confidential
for purposes of this agreement;
(vi) is required by the receiving party to be disclosed by
applicable law or a stock exchange or association on which the receiving
party's securities (or those of its Related Parties) are or may become
listed; or
(vii) is disclosed by the receiving party to a financial
institution or accredited investor (as that term is defined in Rule 501(a)
under the Securities Act of 1933) that is considering providing financing
to the receiving party and which financial institution or accredited
investor has agreed to keep the Confidential Information confidential in
accordance with an agreement at least as restrictive as this Section 12.2.
(c) Notwithstanding the foregoing, Manager and Sprint PCS authorize
each other to disclose to the public in regulatory filings the other's identity
and the Service Area to be developed and managed by Manager, and Manager
authorizes Sprint PCS to mention Manager and the Service Area in public
relations announcements.
(d) The party making a disclosure under Sections 12.2(b)(v),
12.2(b)(vi) or 12.2(b)(vii) must inform the disclosing party as promptly as is
reasonably necessary to enable the disclosing party to take action to, and use
the party's reasonable best efforts to, limit the disclosure and maintain
confidentiality to the extent practicable.
(e) Manager will not except when serving in the capacity of Manager
under this agreement, use any Confidential Information of any kind that it
receives under or in connection with this agreement. For example, if Manager
operates a wireless company in a different license area, Manager may not use any
of the Confidential Information received under or in connection with this
agreement in operating the other wireless business.
12.3 Insurance.
12.3.1 General. During the term of this agreement, Manager must
obtain and maintain, and will cause any subcontractors to obtain and maintain,
with financially reputable insurers licensed to do business in all jurisdictions
where any work is performed under this agreement and who are reasonably
acceptable to Sprint PCS, the insurance described in the Sprint PCS Insurance
Requirements. The Sprint PCS Insurance Requirements as of the date of this
agreement are attached as Exhibit 12.3. Sprint PCS may modify the Sprint PCS
Insurance Requirements as is commercially reasonable from time to time by
delivering to Manager a new Exhibit 12.3.
12.3.2 Waiver of Subrogation. Manager must look first to any
insurance in its favor before making any claim against Sprint PCS or Sprint, and
their respective directors, officers, employees, agents or representatives for
recovery resulting from injury to any person (including Manager's or its
subcontractor's employees) or damage to any property arising from any cause,
regardless of negligence. Manager does hereby release and waive to the fullest
extent permitted by law, and will cause its respective insurers to waive, all
rights of recovery by subrogation against Sprint PCS or Sprint, and their
respective directors, officers, employees, agents or representatives.
12.3.3 Certificates of Insurance. Manager and all of its
subcontractors, if any, must, as a material condition of this agreement and
prior to the commencement of any work under and any renewal of this agreement,
deliver to Sprint PCS a certificate of insurance, satisfactory in form and
content to Sprint PCS, evidencing that the above insurance, including waiver of
subrogation, is in force and will not be canceled or
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materially altered without first giving Sprint PCS at least 30 days prior
written notice and that all coverages are primary to any insurance carried by
Sprint PCS, its directors, officers, employees, agents or representatives.
Nothing contained in this Section 12.3.3 will limit Manager's liability to
Sprint PCS, its directors, officers, employees, agents or representatives to the
limits of insurance certified or carried.
13. INDEMNIFICATION
13.1 Indemnification by Sprint PCS. Sprint PCS agrees to indemnify, defend
and hold harmless Manager, its directors, managers, officers, employees, agents
and representatives from and against any and all claims, demands, causes of
action, losses, actions, damages, liability and expense, including costs and
reasonable attorneys' fees, against Manager, its directors, managers, officers,
employees, agents and representatives arising from or relating to the violation
by Sprint PCS of any law, regulation or ordinance applicable to Sprint PCS or by
Sprint PCS' breach of any representation, warranty or covenant contained in this
agreement or any other agreement between Sprint PCS or Sprint PCS' Related
Parties and Manager or Manager's Related Parties except where and to the extent
the claim, demand, cause of action, loss, action, damage, liability and/or
expense results solely from the negligence or willful misconduct of Manager.
13.2 Indemnification by Manager. Manager agrees to indemnify, defend and
hold harmless Sprint PCS and Sprint, and their respective directors, managers,
officers, employees, agents and representatives from and against any and all
claims, demands, causes of action, losses, actions, damages, liability and
expense, including costs and reasonable attorneys' fees, against Sprint PCS or
Sprint, and their respective directors, managers, officers, employees, agents
and representatives arising from or relating to Manager's violation of any law,
regulation or ordinance applicable to Manager, Manager's breach of any
representation, warranty or covenant contained in this agreement or any other
agreement between Manager or Manager's Related Parties and Sprint PCS and Sprint
PCS' Related Parties, Manager's ownership of the Operating Assets or the
operation of the Service Area Network, or the actions or failure to act of any
of Manager's contractors, subcontractors, agents, directors, managers, officers,
employees and representatives of any of them in the performance of any work
under this agreement, except where and to the extent the claim, demand, cause of
action, loss, action, damage, liability and expense results solely from the
negligence or willful misconduct of Sprint PCS or Sprint, as the case may be.
13.3 Procedure.
13.3.1 Notice. Any party being indemnified ("Indemnitee") will give
the party making the indemnification ("Indemnitor") written notice as soon as
practicable but no later than 5 Business Days after the party becomes aware of
the facts, conditions or events that give rise to the claim for indemnification
if:
(a) any claim or demand is made or liability is asserted
against Indemnitee; or
(b) any suit, action, or administrative or legal
proceeding is instituted or commenced in which Indemnitee is
involved or is named as a defendant either individually or with
others.
Failure to give notice as described in this Section 13.3.1 does not modify
the indemnification obligations of this provision, except if Indemnitee is
harmed by failure to provide timely notice to Indemnitor, then Indemnitor does
not have to indemnify Indemnitee for the harm caused by the failure to give the
timely notice.
13.3.2 Defense by Indemnitor. If within 30 days after giving notice
Indemnitee receives written notice from Indemnitor stating that Indemnitor
disputes or intends to defend against the claim, demand,
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liability, suit, action or proceeding, then Indemnitor will have the right to
select counsel of its choice and to dispute or defend against the claim, demand,
liability, suit, action or proceeding, at its expense.
Indemnitee will fully cooperate with Indemnitor in the dispute or defense
so long as Indemnitor is conducting the dispute or defense diligently and in
good faith. Indemnitor is not permitted to settle the dispute or claim without
the prior written approval of Indemnitee, which approval will not be
unreasonably withheld. Even though Indemnitor selects counsel of its choice,
Indemnitee has the right to retain additional representation by counsel of its
choice to participate in the defense at Indemnitee's sole cost and expense.
13.3.3 Defense by Indemnitee. If no notice of intent to dispute or
defend is received by Indemnitee within the 30-day period, or if a diligent and
good faith defense is not being or ceases to be conducted, Indemnitee has the
right to dispute and defend against the claim, demand or other liability at the
sole cost and expense of Indemnitor and to settle the claim, demand or other
liability, and in either event to be indemnified as provided in this Section
13.3.3. Indemnitee is not permitted to settle the dispute or claim without the
prior written approval of Indemnitor, which approval will not be unreasonably
withheld.
13.3.4 Costs. Indemnitor's indemnity obligation includes reasonable
attorneys' fees, investigation costs, and all other reasonable costs and
expenses incurred by Indemnitee from the first notice that any claim or demand
has been made or may be made, and is not limited in any way by any limitation on
the amount or type of damages, compensation, or benefits payable under
applicable workers' compensation acts, disability benefit acts, or other
employee benefit acts.
14. DISPUTE RESOLUTION
14.1 Negotiation. The parties will attempt in good faith to resolve any
dispute arising out of or relating to this agreement promptly by negotiation
between or among representatives who have authority to settle the controversy.
Either party may escalate any dispute not resolved in the normal course of
business to the appropriate (as determined by the party) officers of the parties
by providing written notice to the other party.
Within 10 Business Days after delivery of the notice, the appropriate
officers of each party will meet at a mutually acceptable time and place, and
thereafter as often as they deem reasonably necessary, to exchange relevant
information and to attempt to resolve the dispute.
Either party may elect, by giving written notice to the other party, to
escalate any dispute arising out of or relating to the determination of fees
that is not resolved in the normal course of business or by the audit process
set forth in Sections 12.1.2 and 12.1.3, first to the appropriate financial or
accounting officers to be designated by each party. The designated officers will
meet in the manner described in the preceding paragraph. If the matter has not
been resolved by the designated officers within 30 days after the notifying
party's notice, either party may elect to escalate the dispute to the
appropriate (as determined by the party) officers in accordance with the prior
paragraphs of this Section 14.1.
14.2 Unable to Resolve. If a dispute has not been resolved within 60 days
after the notifying party's notice, either party may continue to operate under
this agreement and sue the other party for damages or seek other appropriate
remedies as provided in this agreement. If, and only if, this agreement does not
provide a remedy (as in the case of Sections 3.4 and 4.5, where the parties are
supposed to reach an agreement), then either party may give the other party
written notice that it wishes to resolve the dispute or claim arising out of the
parties' inability to agree under such Sections of this agreement by using the
arbitration procedure set forth in this Section 14.2. Such arbitration will
occur in Kansas City, Missouri, unless the parties otherwise mutually agree,
with the precise location being as agreed upon by the parties or, absent such
agreement, at a location in Kansas City, Missouri selected by Sprint PCS. Such
arbitration will be conducted pursuant to the procedures prescribed by the
Missouri Uniform Arbitration Act, as amended from time to time, or, if none,
pursuant to the rules then in effect of the American
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Arbitration Association (or at any other place and by any other form of
arbitration mutually acceptable to the parties). Any award rendered in such
arbitration will be confidential and will be final and conclusive upon the
parties, and a judgment on the award may be entered in any court of the forum,
state or federal, having jurisdiction. The expenses of the arbitration will be
borne equally by the parties to the arbitration, except that each party must pay
for and bear the cost of its own experts, evidence, and attorneys' fees.
The parties must each, within 30 days after either party gives notice to
the other party of the notifying party's desire to resolve a dispute or claim
under the arbitration procedure in this Section 14.2, designate an independent
arbitrator, who is knowledgeable with regard to the wireless telecommunications
industry, to participate in the arbitration hearing. The, two arbitrators thus
selected will select a third independent arbitrator, who is knowledgeable with
regard to the wireless telecommunications industry, who will act as chairperson
of the board of arbitration. If, within 15 days after the day the last of the
two named arbitrators is appointed, the two named arbitrators fail to agree upon
the third, then at the request of either party, the third arbitrator shall be
selected pursuant to the rules then in effect of the American Arbitration
Association. The three independent arbitrators will comprise the board of
arbitration, which will preside over the arbitration hearing and will render all
decisions by majority vote. If either party refuses or neglects to appoint an
independent arbitrator within such 30-day period, the independent arbitrator who
has been appointed as of the 31st day after the notifying party's notice will be
the sole independent arbitrator and will solely preside over the arbitration
hearing. The arbitration hearing will commence no sooner than 30 days after the
date the last arbitrator is appointed and no later than 60 days after such date.
The arbitration hearing will be conducted during normal working hours on
Business Days without interruption or adjournment of more than 2 Business Days
at any one time or 6 Business Days in the aggregate.
The arbitrators will deliver their decision to the parties in writing
within 10 days after the conclusion of the arbitration hearing. The arbitration
award will be accompanied by findings of fact and a statement of reasons for the
decision. There will be no appeal from the written decision, except as permitted
by applicable law. The arbitration proceedings, the arbitrators' decision, the
arbitration award, and any other aspect, matter, or issue of or relating to the
arbitration are confidential, and disclosure of such confidential information is
an actionable breach of this agreement.
Notwithstanding any other provision of this agreement, arbitration will
not be required of any issue for which injunctive relief is properly sought by
either party.
14.3 Attorneys and Intent. If an officer intends to be accompanied at a
meeting by an attorney, the other party's officer will be given at least 3
Business Days prior notice of the intention and may also be accompanied by an
attorney. All negotiations under Section 14.1 are confidential and will be
treated as compromise and settlement negotiations for purposes of the Federal
Rules of Civil Procedure and state rules of evidence and civil procedure.
14.4 Tolling of Cure Periods. Any cure period under Section 11.3 that is
less than 90 days will be tolled during the pendency of the dispute resolution
process. Any cure period under Section 11.3 that is 90 days or longer will not
be tolled during the pendency of the dispute resolution process.
15. REPRESENTATIONS AND WARRANTIES
Each party for itself makes the following representations and warranties
to the other party:
15.1 Due Incorporation or Formation; Authorization of Agreements. The
party is either a corporation, limited liability company, or limited partnership
duly organized, validly existing and in good standing under the laws of the
jurisdiction of its organization. Manager is qualified to do business and in
good standing in every jurisdiction in which the Service Area is located. The
party has the full power and authority to execute and deliver this agreement and
to perform its obligations under this agreement.
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15.2 Valid and Binding Obligation. This agreement constitutes the valid
and binding obligation of the party, enforceable in accordance with its terms,
except as may be limited by principles of equity or by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally.
15.3 No Conflict; No Default. Neither the execution, delivery and
performance of this agreement nor the consummation by the party of the
transactions contemplated in this agreement will conflict with, violate or
result in a breach of (a) any law, regulation, order, writ, injunction, decree,
determination or award of any governmental authority or any arbitrator,
applicable to such party, (b) any term, condition or provision of the articles
of incorporation, certificate of limited partnership, certificate of
organization, bylaws, partnership agreement or limited liability company
agreement (or other governing documents) of such party or of any material
agreement or instrument to which such party is or may be bound or to which any
of its material properties or assets is subject.
15.4 Litigation. No action, suit, proceeding or investigation is pending
or, to the knowledge of the party, threatened against or affecting the party or
any of its properties, assets or businesses in any court or before or by any
governmental agency that could, if adversely determined, reasonably be expected
to have a material adverse effect on the party's ability to perform its
obligations under this agreement. The party has not received any currently
effective notice of any default that could reasonably be expected to result in a
breach of the preceding sentence.
16. REGULATORY COMPLIANCE
16.1 Regulatory Compliance. Manager will construct, operate, and manage
the Service Area Network in compliance with applicable federal, state, and local
laws and regulations, including Siting Regulations. Nothing in this Section 16.1
will limit Manager's obligations under Section 2.2 and the remainder of this
Section 16. Manager acknowledges that failure to comply with applicable federal,
state, and local laws and regulations in its construction, operation, and
management of the Service Area Network may subject the parties and the License
to legal and administrative agency actions, including forfeiture penalties and
actions that affect the License, such as license suspension and revocation, and
accordingly, Manager agrees that it will cooperate with Sprint PCS to maintain
the License in full force and effect.
Manager will write and implement practices and procedures governing
construction and management of the Service Area Network in compliance with
Siting Regulations. Manager will make its Siting Regulations practices and
procedures available upon request to Sprint PCS in the manner specified by
Sprint PCS for its inspection and review, and Manager will modify those Siting
Regulations practices and procedures as may be requested by Sprint PCS. Every
six months, and at the request of Sprint PCS, Manager will provide a written
certification from one of Manager's chief officers that Manager's Service Area
Network complies with Siting Regulations. Manager's first certification of
compliance with Siting Regulations will be provided to Sprint PCS six months
after the date of this agreement.
Manager will conduct an audit and physical inspection of its Service Area
Network at the request of Sprint PCS to confirm compliance with Siting
Regulations, and Manager will report the results of the audit and physical
inspection to Sprint PCS in the form requested by Sprint PCS. Manager will bear
the cost of Siting Regulations compliance audits and physical inspections
requested by Sprint PCS.
Manager will retain for 3 years records demonstrating compliance with
Siting Regulations, including compliance audit and inspection records. Manager
will make those records available upon request to Sprint PCS for production,
inspection, and copying in the manner specified by Sprint PCS. Sprint PCS will
bear the cost of production, inspection, and copying.
16.2 FCC Compliance. The parties agree to comply with all applicable FCC
rules governing the License or the Service Area Network and specifically agree
as follows:
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(a) The party billing a customer will advise the customer that
service is provided over spectrum licensed to Sprint PCS. Neither Manager nor
Sprint PCS will represent itself as the legal representative of the other before
the FCC or any other third party, but will cooperate with each other with
respect to FCC matters concerning the License or the Service Area Network.
(b) Sprint PCS will use commercially reasonable efforts to maintain
the License in accordance with the terms of the License and all applicable laws,
policies and regulations and to comply in all material respects with all other
legal requirements applicable to the operation of the Sprint PCS Network and its
business. Sprint PCS has sole responsibility, except as specifically provided
otherwise in Section 2.2, for keeping the License in full force and effect and
for preparing submissions to the FCC or any other relevant federal, state or
local authority of all reports, applications, interconnection agreements,
renewals, or other filings or documents. Manager must cooperate and coordinate
with Sprint PCS' actions to comply with regulatory requirements, which
cooperation and coordination must include, without limitation, the provision to
Sprint PCS of all information that Sprint PCS deems necessary to comply with the
regulatory requirements. Manager must refrain from taking any action that could
impede Sprint PCS from fulfilling its obligations under the preceding sentence,
and must not take any action that could cause Sprint PCS to forfeit or cancel
the License.
(c) Sprint PCS and Manager are familiar with Sprint PCS'
responsibility under the Communications Act of 1934, as amended, and applicable
FCC rules. Nothing in this agreement is intended to diminish or restrict Sprint
PCS' obligations as an FCC Licensee and both parties desire that this agreement
and each party's obligations under this agreement be in compliance with the FCC
rules.
(d) Nothing in this agreement will preclude Sprint PCS from
permitting or facilitating resale of Sprint PCS Products and Services to the
extent required or elected under applicable FCC regulations. Manager will take
the actions necessary to facilitate Sprint PCS' compliance with FCC regulations.
To the extent permitted by applicable regulations, Sprint PCS will not authorize
a reseller that desires to sell services and products in only the Service Area
to resell Sprint PCS wholesale products and services, unless Manager agrees in
advance to such sales.
(e) If a change in FCC policy or rules makes it necessary to obtain
FCC consent for the implementation, continuation or further effectuation of any
term or provision of this agreement, Sprint PCS will use all commercially
reasonable efforts diligently to prepare, file and prosecute before the FCC all
petitions, waivers, applications, amendments, rule-making comments and other
related documents necessary to secure and/or retain FCC approval of all aspects
of this agreement. Manager will use commercially reasonable efforts to provide
to Sprint PCS any information that Sprint PCS may request from Manager with
respect to any matter involving Sprint PCS, the FCC, the License, the Sprint PCS
Products and Services or any other products and services approved under Section
3.2. Each party will bear its own costs of preparation of the documents and
prosecution of the actions.
(f) If the FCC determines that this agreement is inconsistent with
the terms and conditions of the License or is otherwise contrary to FCC
policies, rules and regulations, or if regulatory or legislative action
subsequent to the date of this agreement alters the permissibility of this
agreement under the FCC's rules or other applicable law, rules or regulations,
then the parties must use best efforts to modify this agreement as necessary to
cause this agreement (as modified) to comply with the FCC policies, rules,
regulations and applicable law and to preserve to the extent possible the
economic arrangements set forth in this agreement.
(g) Manager warrants and represents to Sprint PCS that Manager is
and at all times during the Term of this agreement will be in compliance with
FCC rules and regulations regarding limits on classes and amounts of spectrum
that may be owned by Manager. Manager agrees that in the event that Manager is
or at any time becomes in violation of such rules and regulations, Manager will
promptly take all action necessary and appropriate (other than terminating this
agreement) to cure such violation and comply with such rules and regulations,
including without limitation disposing of its direct or indirect interests in
cellular licenses.
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16.3 Marking and Lighting. Manager will conform to applicable FAA
standards when Siting Regulations require marking and lighting of Manager's
Service Area Network cell sites. Manager will cooperate with Sprint PCS in
reporting lighting malfunctions as required by Siting Regulations.
16.4 Regulatory Notices. Manager will, within 2 Business Days after its
receipt, give Sprint PCS written notice of all oral and written communications
it receives from regulatory authorities (including but not limited to the FCC,
the FAA, state public service commissions, environmental authorities, and
historic preservation authorities) and complaints respecting Manager's
construction, operation, and management of the Service Area Network that could
result in actions affecting the License as well as written notice of the details
respecting such communications and complaints, including a copy of any written
material received in connection with such communications and complaints. Manager
will cooperate with Sprint PCS in responding to such communications and
complaints received by Manager. Sprint PCS has the right to respond to all such
communications and complaints, with counsel and consultants of its own choice.
If Sprint PCS chooses to respond to such communications and complaints, Manager
will not respond to them without the consent of Sprint PCS, and Manager will pay
the costs of Sprint PCS responding to such communications and complaints,
including reasonable attorneys' and consultants' fees, investigation costs, and
all other reasonable costs and expenses incurred by Sprint PCS.
16.5 Regulatory Policy-Setting Proceedings. Manager will not intervene in
or otherwise participate in a rulemaking, investigation, inquiry, contested
case, or similar regulatory policy setting proceedings before a regulatory
authority concerning the License or construction, operation, and management of
the Service Area Network and the Sprint PCS business operated using the Service
Area Network.
17. GENERAL PROVISIONS
17.1 Notices. Any notice, payment, demand, or communication required or
permitted to be given by any provision of this agreement must be in writing and
mailed (certified or registered mail, postage prepaid, return receipt
requested), sent by hand or overnight courier, or sent by facsimile (with
acknowledgment received and a copy sent by overnight courier), charges prepaid
and addressed as described on the Notice Address Schedule attached to the Master
Signature Page, or to any other address or number as the person or entity may
from time to time specify by written notice to the other parties.
All notices and other communications given to a party in accordance with
the provisions of this agreement will be deemed to have been given when
received.
17.2 Construction. This agreement will be construed simply according to
its fair meaning and not strictly for or against either party.
17.3 Headings. The table of contents, section and other headings contained
in this agreement are for reference purposes only and are not intended to
describe, interpret, define, limit or expand the scope, extent or intent of this
agreement.
17.4 Further Action. Each party agrees to perform all further acts and
execute, acknowledge, and deliver any documents that may be reasonably
necessary, appropriate, or desirable to carry out the intent and purposes of
this agreement.
17.5 Counterpart Execution. This agreement will be executed by affixing
the parties' signatures to the Master Signature Page, which Master Signature
Page, and thus this agreement, may be executed in any number of counterparts
with the same effect as if both parties had signed the same document. All
counterparts will be construed together and will constitute one agreement.
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17.6 Specific Performance. Each party agrees with the other party that the
party would be irreparably damaged if any of the provisions of this agreement
were not performed in accordance with their specific terms and that monetary
damages alone would not provide an adequate remedy. Accordingly, in addition to
any other remedy to which the non-breaching party may be entitled, at law or in
equity, the non-breaching party will be entitled to injunctive relief to prevent
breaches of this agreement and specifically to enforce the terms and provisions
of this agreement.
17.7 Entire Agreement; Amendments. The provisions of this agreement, the
Services Agreement and the Trademark License Agreements (including the exhibits
to those agreements) set forth the entire agreement and understanding between
the parties as to the subject matter of this agreement and supersede all prior
agreements, oral or written, and other communications between the parties
relating to the subject matter of this agreement. Except for Sprint PCS' right
to amend the Program Requirements in accordance with Section 9.2 and its right
to unilaterally modify and amend certain other provisions as expressly provided
in this agreement, this agreement may be modified or amended only by a written
amendment signed by persons or entities authorized to bind each party and, with
respect to the sections set forth for Sprint on the Master Signature Page, the
persons or entities authorized to bind Sprint.
17.8 Limitation on Rights of Others. Except as set forth on the Master
Signature Page for Sprint, nothing in this agreement, whether express or
implied, will be construed to give any person or entity other than the parties
any legal or equitable right, remedy or claim under or in respect of this
agreement.
17.9 Waivers.
17.9.1 Waivers--General. The observance of any term of this
agreement may be waived (whether generally or in a particular instance and
either retroactively or prospectively) by the party entitled to enforce the
term, but any waiver is effective only if in a writing signed by the party
against which the waiver is to be asserted. Except as otherwise provided in this
agreement, no failure or delay of either party in exercising any power or right
under this agreement will operate as a waiver of the power or right, nor will
any single or partial exercise of any right or power preclude any other or
further exercise of the right or power or the exercise of any other right or
power.
17.9.2 Waivers--Manager. Manager is not in breach of any covenant in
this agreement and no Event of Termination will have occurred as a result of the
occurrence of any event, if Manager had delegated to Sprint Spectrum under the
Services Agreement (or any successor to that agreement) responsibility for
taking any action necessary to ensure compliance with the covenant or to prevent
the occurrence of the event.
17.9.3 Force Majeure. Neither Manager nor Sprint PCS, as the case
may be, is in breach of any covenant in this agreement and no Event of
Termination will occur as a result of the failure of such party to comply with
such covenant, if such party's non-compliance with the covenant results
primarily from:
(i) any FCC order or any other injunction issued by any
governmental authority impeding the party's ability to comply with the
covenant;
(ii) the failure of any governmental authority to grant any
consent, approval, waiver, or authorization or any delay on the part of
any governmental authority in granting any consent, approval, waiver or
authorization;
(iii) the failure of any vendor to deliver in a timely manner
any equipment or services; or
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(iv) any act of God, act of war or insurrection, riot, fire,
accident, explosion, labor unrest, strike, civil unrest, work stoppage,
condemnation or any similar cause or event not reasonably within the
control of such party.
17.10 Waiver of Jury Trial. EACH PARTY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.
17.11 Binding Effect. Except as otherwise provided in this agreement, this
agreement is binding upon and inures to the benefit of the parties and their
respective and permitted successors, transferees, and assigns, including any
permitted successor, transferee or assignee of the Service Area Network or of
the License. The parties intend that this agreement bind only the party signing
this agreement and that the agreement is not binding on the Related Parties of a
party unless the agreement expressly provides that Related Parties are bound.
17.12 Governing Law. The internal laws of the State of Missouri (without
regard to principles of conflicts of law) govern the validity of this agreement,
the construction of its terms, and the interpretation of the rights and duties
of the parties.
17.13 Severability. The parties intend every provision of this agreement
to be severable. If any provision of this agreement is held to be illegal,
invalid, or unenforceable for any reason, the parties intend that a court
enforce the provision to the maximum extent permissible so as to effect the
intent of the parties (including the enforcement of the remaining provisions).
If necessary to effect the intent of the parties, the parties will negotiate in
good faith to amend this agreement to replace the unenforceable provision with
an enforceable provision that reflects the original intent of the parties.
17.14 Limitation of Liability. NO PARTY WILL BE LIABLE TO THE OTHER PARTY
FOR SPECIAL, INDIRECT, INCIDENTAL, EXEMPLARY, CONSEQUENTIAL OR PUNITIVE DAMAGES,
OR LOSS OF PROFITS, ARISING FROM THE RELATIONSHIP OF THE PARTIES OR THE CONDUCT
OF BUSINESS UNDER, OR BREACH OF, THIS AGREEMENT, EXCEPT WHERE SUCH DAMAGES OR
LOSS OF PROFITS ARE CLAIMED BY OR AWARDED TO A THIRD PARTY IN A CLAIM OR ACTION
AGAINST WHICH A PARTY TO THIS AGREEMENT HAS A SPECIFIC OBLIGATION TO INDEMNIFY
ANOTHER PARTY TO THIS AGREEMENT.
17.15 No Assignment; Exceptions.
17.15.1 General. Neither party will, directly or indirectly, assign
this agreement or any of the party's rights or obligations under this agreement
without the prior written consent of the other party, except as otherwise
specifically provided in this Section 17.15. Sprint PCS may deny its consent to
any assignment or transfer in its sole discretion except as otherwise provided
in this Section 17.15.
Any attempted assignment of this agreement in violation of this Section
17.15 will be void and of no effect.
A party may assign this agreement to a Related Party of the party, except
that Manager cannot assign this agreement to a Related Party that is a
significant competitor of Sprint, Sprint PCS or their respective Related Parties
in the telecommunications business. Except as provided in Section 17.15.5, an
assignment does not release the assignor from its obligations under this
agreement unless the other party to this agreement consents in writing in
advance to the assignment and expressly grants a release to the assignor.
Except as provided in Section 17.15.5. Sprint PCS must not assign this
agreement to any entity that does not also own the License covering the Service
Area directly or indirectly through a Related Party. Manager must not assign
this agreement to any entity (including a Related Party), unless such entity
assumes all rights and obligations under the Services Agreement, the Trademark
License Agreements and any related agreements.
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17.15.2 Assignment Right of Manager to Financial Lender. If Manager
is no longer able to satisfy its financial obligations and other duties, then
Manager has the right to assign its obligations and rights under this agreement
to its Financial Lender, if:
(a) Manager or Financial Lender provides Sprint PCS at least 10 days
advance written notice of such assignment;
(b) Financial Lender cures or commits to cure any outstanding
material breach of this agreement by Manager prior to the end of any applicable
cure period. If Financial Lender fails to make a timely cure then Sprint PCS may
exercise its rights under Section 11;
(c) Financial Lender agrees to serve as an interim trustee for the
obligations and duties of Manager under this agreement for a period not to
exceed 180 days. During this interim period, Financial Lender must identify a
proposed successor to assume the obligations and rights of Manager under this
agreement;
(d) Financial Lender assumes all of Manager's rights and obligations
under the Services Agreement, the Trademark License Agreements and any related
agreements; and
(e) Financial Lender provides to Sprint PCS advance written notice
of the proposed successor to Manager that Financial Lender has identified
("Successor Notice"). Sprint PCS may give to Financial Lender written notice of
Sprint PCS' decision whether to consent to such proposed successor within 30
days after Sprint PCS' receipt of the Successor Notice. Sprint PCS may not
unreasonably withhold such consent, except that Sprint PCS is not required to
consent to a proposed successor that:
(i) has, in the past, materially breached prior agreements
with Sprint PCS or its Related Parties;
(ii) is a significant competitor of Sprint PCS or its Related
Parties in the telecommunications business;
(iii) does not meet Sprint PCS' reasonable credit criteria;
(iv) fails to execute an assignment of all relevant documents
related to this agreement including the Services Agreement and the
Trademark License Agreements; or
(v) refuses to assume the obligations of Manager under this
Agreement, the Services Agreement, the Trademark License Agreements and
any related agreements.
If Sprint PCS fails to provide a response to Financial Lender within 30
days after receiving the Successor Notice, then the proposed successor is deemed
rejected. Any Financial Lender disclosed on the Build-out Plan on Exhibit 2.1 is
deemed acceptable to Sprint PCS.
17.15.3 Change of Control Rights. If there is a Change of Control of
Manager, then:
(a) Manager must provide to Sprint PCS advance written notice
detailing relevant and appropriate information about the new ownership interests
effecting the Change of Control of Manager.
(b) Sprint PCS must provide to Manager written notice of its
decision whether to consent to or reject the proposed Change of Control within
30 days after its receipt of such notice. Sprint PCS may not unreasonably
withhold such consent, except that Sprint PCS is not required to consent to a
Change of Control in which:
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(i) the final controlling entity or any of its Related Parties
has in the past materially breached prior agreements with Sprint PCS or
its Related Parties;
(ii) the final controlling entity or any of its Related
Parties is a significant competitor of Sprint PCS or its Related Parties
in the telecommunications business;
(iii) the final controlling entity does not meet Sprint PCS'
reasonable credit criteria;
(iv) the final controlling entity fails to execute an
assignment of all relevant documents related to this agreement including
the Services Agreement and the Trademark License Agreements; or
(v) the final controlling entity or its Related Parties refuse
to assume the obligations of Manager under this agreement.
(c) In the event that Sprint PCS provides notice that it does not
consent to the Change of Control, Manager is entitled to either:
(i) contest such determination pursuant to the dispute
resolution procedure in Section 14; or
(ii) abandon the proposed Change of Control.
(d) Nothing in this agreement requires Sprint PCS' consent to:
(i) a public offering of Manager that does not result in a
Change of Control (i.e., a shift from one party being in control to no
party being in control is not a Change of Control); or
(ii) a recapitalization or restructuring of the ownership
interests of Manager that Manager determines is necessary to:
(A) facilitate the acquisition of commercial financing
and lending arrangements that will support Manager's operations and
efforts to fulfill its obligations under this agreement; and
(B) that does not constitute a Change of Control.
(e) "Change of Control" means a situation where in any one
transaction or series of related transactions occurring during any 365-day
period, the ultimate parent entity of the Manager changes. The ultimate parent
entity is to be determined using the Hart-Scott-Rodino Antitrust Improvements
Act of 1976 rules. A Change of Control does not occur if:
(i) a party changes the form of its organization without
materially changing their ultimate ownership (e.g., converting from a
limited partnership to a limited liability company); or
(ii) one of the owners of the party on the date of this
agreement or on the date of the closing of Manager's initial equity
offering for purposes of financing its obligations under this agreement
ultimately gains control over the party, unless such party is a
significant competitor of Sprint PCS or Sprint PCS' Related Parties in the
telecommunications business.
17.15.4 Right of First Refusal. Notwithstanding any other provision
in this agreement, Manager grants Sprint PCS the right of first refusal
described below. If Manager determines it wishes to sell an
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Offered Interest, upon receiving any Offer to purchase an Offered Interest,
Manager agrees to promptly deliver to Sprint PCS an Offer Notice. The Offer
Notice is deemed to constitute an offer to sell to Sprint PCS, on the terms set
forth in the Offer, all but not less than all of the Offered Interest. Sprint
PCS will have a period of 60 days from the date of the Offer Notice to notify
Manager that it agrees to purchase the Offered Interest on such terms. If Sprint
PCS timely agrees in writing to purchase the Offered Interest, the parties will
proceed to consummate such purchase not later than the 180th day after the date
of the Offer Notice. If Sprint PCS does not agree within the 60-day period to
purchase the Offered Interest, Manager will have the right, for a period of 120
days after such 60th day, subject to the restrictions set forth in this Section
17, to sell to the person or entity identified in the Offer Notice all of the
Offered Interest on terms and conditions no less favorable to Manager than those
set forth in the Offer. If Manager fails to sell the Offered Interest to such
person or entity on such terms and conditions within such 120-day period.
Manager will again be subject to the provisions of this Section 17.15.4 with
respect to the Offered Interest.
17.15.5 Transfer of Sprint PCS Network. Sprint PCS may sell,
transfer or assign the Sprint PCS Network or any of the Licenses, including its
rights and obligations under this agreement, the Services Agreement and any
related agreements, to a third party without Manager's consent so long as the
third party assumes the rights and obligations under this agreement and the
Services Agreement. Manager agrees that Sprint PCS and Sprint PCS' Related
Parties will be released from any and all obligations under and with respect to
any and all such agreements upon such sale, transfer or assignment in accordance
with this Section 17.15.5, without the need for Manager to execute any document
to effect such release.
17.16 Provision of Services by Sprint Spectrum. As described in the
Recitals, the party or parties to this agreement that own the Licenses are
referred to in this agreement as "Sprint PCS." Sprint Spectrum will provide most
or all of the services required to be provided by Sprint PCS under this
agreement on behalf of Sprint PCS, other than the services to be rendered by
Manager. For example, Sprint Spectrum is the party to the contracts relating to
the national distribution network, the roaming and long distance services, and
the procurement arrangements. Accordingly, Sprint PCS and Manager will deal with
Sprint Spectrum to provide many of the attributes of the Sprint PCS Network.
17.17 Number Portability. Manager understands that the manner in which
customers are assigned to the Service Area Network could change as telephone
numbers become portable without any relation to the service area in which they
are initially activated. To the extent the relationship between NPA-NXX and the
Service Area changes, Sprint PCS will develop an alternative system to attempt
to assign customers who primarily live and work in the Service Area to the
Service Area. The terms of this agreement will be deemed to be amended to
reflect the new system that Sprint PCS develops.
17.18 Disclaimer of Agency. Neither party by this agreement makes the
other party a legal representative or agent of the party, nor does either party
have the right to obligate the other party in any manner, except if the other
party expressly permits the obligation by the party or except for provisions in
this agreement expressly authorizing one party to obligate the other.
17.19 Independent Contractors. The parties do not intend to create any
partnership, joint venture or other profit-sharing arrangement, landlord-tenant
or lessor-lessee relationship, employer-employee relationship, or any other
relationship other than that expressly provided in this agreement. Neither party
to this agreement has any fiduciary duty to the other party.
17.20 Expense. Each party bears the expense of complying with this
agreement except as otherwise expressly provided in this agreement. The parties
must not allocate any employee cost or other cost to the other party, except as
otherwise provided in the Program Requirements or to the extent the parties
expressly agree in advance to the allocation.
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17.21 General Terms.
(a) This agreement is to be interpreted in accordance with the
following rules of construction:
(i) The definitions in this agreement apply equally to both
the singular and plural forms of the terms defined unless the context
otherwise requires;
(ii) The words "include," "includes" and "including" are
deemed to be followed by the phrase "without limitation";
(iii) All references in this agreement to Sections and
Exhibits are references to Sections of, and Exhibits to, this agreement,
unless otherwise specified; and
(iv) All references to any agreement or other instrument or
statute or regulation are to it as amended and supplemented from time to
time (and, in the case of a statute or regulation, to any corresponding
provisions of successor statutes or regulations), unless the context
otherwise requires.
(b) Any reference in this agreement to a "day" or number of "days"
(without the explicit qualification of "Business") is a reference to a calendar
day or number of calendar days. If any action or notice is to be taken or given
on or by a particular calendar day, and the calendar day is not a Business Day,
then the action or notice may be taken or given on the next Business Day.
17.22 Conflicts with Other Agreements. The provisions of this Management
Agreement govern over those of the Services Agreement if the provisions
contained in this agreement conflict with analogous provisions in the Services
Agreement. The provisions of each Trademark License Agreement governs over those
of this agreement if the provisions contained in this agreement conflict with
analogous provisions in a Trademark License Agreement.
17.23 Survival Upon Termination. The provisions of Sections 10, 11.4,
11.5, 11.6, 12.2, 13, 14, 16 and 17 of this agreement will survive any
termination of this agreement.
17.24 Announced Transaction. Sprint Enterprises, L.P., TCI Telephony
Services, Inc., Comcast Telephony Services and Cox Telephony Partnership have
executed a Restructuring and Merger Agreement and related agreements that
provide for restructuring the ownership of Sprint Spectrum L.P., SprintCom,
Inc., PhillieCo Partners I, L.P., and Cox Communications PCS, L.P. Upon
consummation of the transactions contemplated by those agreements, Sprint would
control each of the four entities. While Sprint and Sprint PCS anticipate the
proposed transactions will be consummated, there can be no assurances.
17.25 Additional Terms and Provisions. Certain additional and supplemental
terms and provisions of this agreement, if any, are set forth in the Addendum to
Sprint PCS Management Agreement attached hereto and incorporated herein by this
reference. Manager represents and warrants that the Addendum also describes all
existing contracts and arrangements (written or verbal) that relate to or affect
the rights of Sprint PCS or Sprint under this agreement (e.g., agreements
relating to long distance telephone services (Section 3.4) or backhaul and
transport services (Section 3.7)).
17.26 Master Signature Page. Each party agrees that it will execute the
Master Signature Page that evidences such party's agreement to execute, become a
party to and be bound by this agreement, which document is incorporated herein
by this reference.
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17.27 Agent Authorization. Because of the close operational relationship
between the parties listed together below, each entity authorizes the other
entity to act on its behalf in every capacity under this agreement: (a)
WirelessCo, L.P. and Sprint Spectrum L.P.; (b) Cox PCS License, L.L.C, and Cox
Communications PCS, L.P.; (c) APC PCS, LLC and American PCS Communications, LLC;
and (d) PhillieCo, L.P. and PhillieCo Partners I, L.P.
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SPRINT PCS/UBIQUITEL L.L.C.
MASTER SIGNATURE PAGE
This Master Signature Page is dated and effective as of September __, 1998
(the "Effective Date"). This document provides the means by which each of the
undersigned entities executes and becomes a party to and bound by, to the extent
set forth above such party's signature, the Management Agreement, Services
Agreement, Sprint Trademark and Service Mark License Agreement, Sprint Spectrum
Trademark and Service Mark License Agreement, and Addendum I to the Management
Agreement. This document may be executed in one or more counterparts. The Notice
Address Schedule attached to this document sets forth the addresses to which
notices should be sent under the agreements.
THE MANAGEMENT AGREEMENT AND THE SERVICES AGREEMENT
CONTAIN BINDING ARBITRATION PROVISIONS THAT MAY BE
ENFORCED BY THE PARTIES TO THOSE AGREEMENTS
SPRINT SPECTRUM L.P.
For and in consideration of the covenants contained in the Management
Agreement, Addendum I to the Management Agreement, Services Agreement and Sprint
Spectrum Trademark and Service Mark License Agreement (collectively, the
"Executed Agreements"), and for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Sprint Spectrum L.P. executes,
becomes a party to, and agrees to be bound by and to perform its obligations
under each of the Executed Agreements as of the Effective Date. The execution by
Sprint Spectrum L.P. of this Master Signature Page has the same force and effect
as if Sprint Spectrum L.P. executed individually each of the Executed
Agreements.
SPRINT SPECTRUM L.P.
By:___________________________________
Bernard A. Bianchino,
Chief Business Development Officer
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SPRINT COMMUNICATIONS COMPANY, L.P.
For and in consideration of the covenants contained in the Management
Agreement, Sprint Trademark and Service Mark License Agreement, and Addendum I
to the Management Agreement (collectively, the "Executed Agreements"), and for
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Sprint Communications Company, L.P. executes, becomes a party to,
and agrees to be bound by and to perform its obligations under each of the
Executed Agreements as of the Effective Date; provided, that Sprint
Communications Company, L.P. only agrees to be bound by and perform its
obligations under, and will enjoy the benefits given to it under the Management
Agreement, with respect to only those provisions that expressly apply to Sprint
Communications Company, L.P., including its obligations and benefits under
Sections 2, 3 and 10. The execution by Sprint Communications Company, L.P. of
this Master Signature Page has the same force and effect as if Sprint
Communications Company, L.P. executed individually each of the Executed
Agreements.
SPRINT COMMUNICATIONS COMPANY, L.P.
By:___________________________________
William R. Blessing
Vice President, Wireless
UBIQUITEL L.L.C.
For and in consideration of the covenants contained in the Management
Agreement, Services Agreement, Sprint Trademark and Service Mark License
Agreement, Sprint Spectrum Trademark and Service Mark License Agreement, and
Addendum I to the Management Agreement (collectively, the "Executed
Agreements"), and for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, UbiquiTel L.L.C. executes, becomes
a party to, and agrees to be bound by and to perform its obligations under each
of the Executed Agreements as of the Effective Date. The execution by UbiquiTel
L.L.C. of this Master Signature Page has the same force and effect as if
UbiquiTel L.L.C. executed individually each of the Executed Agreements.
UBIQUITEL L.L.C.
By:___________________________________
Name: Mark A. Louison
Title: Manager
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NOTICE ADDRESS SCHEDULE
The addresses to which notice is to be sent pursuant to Section 17.1 of
the Management Agreement, Section 9.1 of the Services Agreement, Section 15.1 of
the Sprint Trademark and Service Mark License Agreement, or Section 15.1 of the
Sprint Spectrum Trademark and Service Mark License Agreement are as follows:
SPRINT SPECTRUM L.P.
4900 Main, 12th Floor with a copy to: 4900 Main, 12th Floor
Kansas City, Missouri 64112 Kansas City, Missouri 64112
Telephone: (816) 559-1000 Telephone: (816) 559-1000
Telecopier: (816) 559-1290 Telecopier: (816) 559-2591
Attention: Chief Executive Officer Attention: General Counsel
SPRINT COMMUNICATIONS COMPANY, L.P. (and notices regarding the Sprint Brands)
c/o Sprint Corporation
2330 Shawnee Mission Parkway
Westwood, Kansas 66205
Telephone: 913-624-3326
Telecopier: 913-624-8233
Attention: Corporate Secretary
Mail Stop: KSWESA0110
UBIQUITEL L.L.C.
120 Lakeside Avenue, Suite 310
Seattle, Washington 98122
Telephone: (206) 860-2770
Telecopier: (206) 328-0815
Attention: ________________
48
<PAGE>
ADDENDUM I
TO
SPRINT PCS MANAGEMENT AGREEMENT
Manager: UbiquiTel L.L.C.
Service Area: Reno, NV BTA (#372)
Sacramento, CA BTA (#389)
This Addendum contains certain additional and supplemental terms and
provision of that certain Sprint PCS Management Agreement (the "Management
Agreement") entered into contemporaneously with and by the same parties as this
Addendum. The terms and provisions of the Addendum control, supersede and amend
any conflicting terms and provisions contained in the Management Agreement.
Except for express modifications made in this Addendum, the Management Agreement
continues in full force and effect.
Capitalized terms used and not otherwise defined in this Addendum have the
meaning ascribed to them in the Schedule of Definitions. Section and Exhibit
references are to Sections and Exhibits of the Management Agreement unless
otherwise noted.
The Management Agreement is modified as follows:
18. Seamlessness. The following sentence is added to the end of Section 1.5:
Notwithstanding the foregoing, if Manager is in compliance
with Section 7, Manager shall not be required to make any
technical changes or incur expenses to compensate for the
failure of any entity operating a network adjacent to the
Service Area Network (whether such entity is Sprint PCS or an
Other Manager) to comply with the requirements of Section 7.
19. New Area Build-out. Section 2.5 of the Management Agreement is deleted in
its entirety and the following Section is substituted in its place:
2.5 Manager's Right of First Refusal for New Area
Build-out. Sprint PCS grants to Manager the right of first
refusal to build-out New Areas. Sprint PCS will give to
Manager a written notice of a New Area within the Service Area
that Sprint PCS decides should be built-out. Manager must
communicate to Sprint PCS within 90 days after receipt of the
notice whether it will build-out the New Area, otherwise
Manager's right of first refusal terminates with regard to the
New Area described in the notice.
If Manager decides to build-out the New Area then
Manager and Sprint PCS will diligently negotiate and execute
an amendment to the Build-out Plan and proceed as set forth in
Sections 2.1 and 2.2. The amended Build-out Plan will contain
critical milestones that provide Manager a commercially
reasonable period in which to implement
<PAGE>
coverage in the New Area. In determining what constitutes a
"commercially reasonable period" as used in this paragraph,
the parties will consider several factors, including local
zoning processes and other legal requirements, weather
conditions, equipment delivery schedules, the need to arrange
additional financing, and other construction already in
progress by the Manager. Manager will construct and operate
the network in the New Area in accordance with the terms of
this agreement.
If Manager declines to exercise its right of first
refusal or Manager fails to build-out the New Area in
accordance with the amended Build-out Plan then Sprint PCS may
construct the New Area itself or allow a Sprint PCS Related
Party or an Other Manager to construct the New Area. Sprint
PCS has the right, in a New Area that it constructs or that is
constructed by a third party, to manage the network, allow a
Sprint PCS Related Party to manage the network, or hire an
Other Manager to operate the Network in the New Area. Any New
Area that Sprint PCS or a third party builds-out is deemed
removed from the Service Area and the Service Area Exhibit is
deemed amended to reflect the change in the Service Area. If
Manager does not exercise its right of first refusal with
respect to a New Area, Manager's right of first refusal does
not terminate with respect to the remainder of the Service
Area.
The Schedule of Definitions is amended by deleting the definition of "New
Coverage" in its entirety and the following definition is added:
"New Area(s)" means those portions of the Service Area not
covered by the then-existing Build-out Plan that Sprint PCS or
Manager decides should be built-out.
20. Microwave Relocation Costs. The last sentence of Section 2.7 is deleted
and the following sentences are substituted in its place:
The parties will share equally all costs associated with
clearing sufficient spectrum to operate the Service Area
Network. If, in the process of clearing sufficient spectrum,
Sprint PCS relocates microwave paths on adjacent spectrum, the
cost of clearing the entire range of spectrum will be shared
equally.
21. Use of Private Label. The exception language in Section 5.1(c) is amended
to read as follows:
except (i) for sales to resellers required under this
agreement, (ii) for sales of Manager's Products and Services,
as permitted by Section 3.2 and (iii) for sales of Sprint PCS
Products and Services, as permitted under the Trademark
License Agreement.
2
<PAGE>
22. Resale Program Requirements. The Schedule of Definitions is amended to
include the following definition:
"Sprint PCS Resale Program Requirements" means the standards
established by Sprint PCS, in accordance with Section 3.5.2 of
the Management Agreement, as amended from time to time, for
the resale of Sprint PCS Products and Services by third
parties.
23. Time Periods for Right of First Refusal. In Section 17.15.4, the
references to "60 days" throughout Section 17.15.4 are amended to read "30
days."
24. Financing Considerations. Amend Section 11.3.6 to insert the words "or
Manager" after "Sprint PCS" and before "this" so that it reads:
"11.3.6 Financing Considerations. At the election of Sprint
PCS or Manager this agreement may be terminated upon the
failure of Manager to obtain the financing described in
Exhibit 1.7 by the deadline(s) set forth on such Exhibits"
25. Effect of an Event of Termination. Amend Section 11.4 (a) to add a new
subsection (iii) as follows:
"(iii) in the case of an Event of Termination under Section
11.3.6, give the other party written notice that the agreement
is terminated effective as of the data of the notice, in which
case all rights and obligations of each party under this
agreement will immediately cease and neither party will have
any remedy or claim for damages."
3
<PAGE>
ADDENDUM II
TO
SPRINT PCS MANAGEMENT AGREEMENT
Dated as of December _, 1999
Manager: Ubiquitel Holdings, Inc.
Service Area:
California Chico BTA No. 79
Eureka BTA No. 134
Redding BTA No. 371
Sacramento (partial)* BTA No. 389
Yuba City (partial)* BTA No. 485
Nevada Las Vegas (partial)* BTA No. 245
Reno BTA No. 372
Utah Logan BTA No. 258
Provo-Orem (partial)* BTA No. 365
St. George BTA No. 392
Salt Lake City-Ogden (partial)* BTA No. 399
Idaho Boise-Nampa BTA No. 50
Idaho Falls BTA No. 202
Lewiston-Moscow BTA No. 250
Pocatello BTA No. 353
Twin Falls BTA No. 451
Washington Spokane BTA No. 425
Montana Billings BTA No. 41
Bozeman BTA No. 53
Butte BTA No. 64
Great Falls BTA No. 171
Helena BTA No. 188
Kalispell BTA No. 224
Missoula BTA No. 300
So. Ind.--KY Anderson (partial)*, IN BTA No. 15
Bloomington-Bedford, IN BTA No. 47
Bowling Green, KY BTA No. 52
Cincinnati (partial)*, OH BTA No. 81
Clarksville, KY BTA No. 83
Columbus, IN BTA No. 93
Evansville, IN BTA No. 135
Indianapolis (partial)*, IN BTA No. 204
Louisville (partial)*, KY BTA No. 263
Madisonville, KY BTA No. 273
Owensboro, KY BTA No. 338
Paducah, KY BTA No. 339
Richmond, IN BTA No. 373
Terre Haute, IN BTA No. 442
Vincennes-Washington, IN BTA No. 457
(*partial portions of BTAs are described in detail in Exhibit 2.1 attached
herketo)
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
This Addendum II, dated as of December --, 1999, contains certain
additional and supplemental terms and provisions to that certain Sprint PCS
Management Agreement entered into as of October 15, 1998, as amended by that
certain Addendum I to Sprint PCS Management Agreement ("Addendum I") (such
agreement, as amended being the "Management Agreement").
The terms and provisions of this Addendum II control, supersede and amend
any conflicting terms and provisions contained in the Management Agreement.
Except for express modifications made in this Addendum, the Management Agreement
continues in full force and effect.
Capitalized terms used and not otherwise defined in this Addendum have the
meanings ascribed to them in the Management Agreement. Section and Exhibit
references in this Addendum are to Sections and Exhibits of the Management
Agreement unless otherwise noted.
1. Expansion of Service Area. Sprint PCS and Manager agree that Manager will
develop the BTAs set forth above in addition to the prior committed build
out of Manager in the Sacramento and Reno BTAs (the combined new areas
being called the "New Service Area" and the prior committed build out
being called the "Original Service Area"). Manager and Sprint PCS agree
that, subject to certain financing conditions as set forth below in
Section 2 of this Addendum II, the Service Area is expanded to include
all, but not less than all, of the New Service Area.
2. Financing.
(a) The word "and" is inserted between the words "thereto" and "before" in
the last sentence of Section 1.7.
(b) The following paragraph is added at the end of Section 1.7:
Sprint PCS agrees to propose modifications to the Management
Agreement, and perhaps to the Schedule of Definitions, the Services
Agreement, the Sprint Trademark and Service Mark License Agreement,
and the Sprint Spectrum Trademark and Service Mark License
Agreement, that will enhance Manager's ability to obtain financing
for the Service Area Network. Sprint PCS will not be required to
offer the Manager subsequent modifications offered or agreed to with
Other Managers subsequent to the initial set of modifications.
(c) A revised and amended Exhibit 1.7, in the form attached to this
Addendum, is approved by Sprint PCS and Manager and is expressly made a part of
the Management Agreement.
(d) The parties agree that the Manager's closing of the financing
described in amended Exhibit 1.7 (the "New Service Area Financing") by April 15,
2000 (the "Financing Date") is a material term of this Addendum II to the
Management Agreement and that upon Manager's failure to obtain the New Service
Area Financing by the Financing Date Sprint PCS may declare Manager to be in
breach of the Management Agreement pursuant to Section 11.3.6 thereof; provided,
however, that if, as of the Financing Date, Manager has financing sufficient to
complete the build-out of the Original Service Area, Sprint PCS may not use such
breach as a basis to terminate the Management Agreement with respect to the
Original Service Area. The parties further agree that, except for any
modification to the Service Area, the terms of this Addendum II will survive any
termination with respect to the New Service Area.
3. Build-out Plan. A revised and amended Build-out Plan is incorporated into
Exhibit 2.1, in the form attached to this Addendum, and such revised and
amended Build-out Plan is approved by Sprint PCS and
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
Manager and is expressly made a part of the Management Agreement. If the
Management Agreement is terminated with respect to the New Service Area,
the original Exhibit 2.1 will be effective.
4. Purchase of Assets. The purchase of certain assets (the "Assets") from
Sprint PCS by Manager is provided for under and pursuant to the terms of
the Asset Purchase Agreement attached as Exhibit A (also shown as Exhibit
2.6 to Management Agreement) and incorporated herein by this reference
(the "Asset Purchase Agreement"). The Assets are listed on Exhibit A to
the Asset Purchase Agreement. The parties recognize and acknowledge that a
due diligence investigation will be undertaken and completed by Manager as
provided for under the terms of the Asset Purchase Agreement prior to its
determination of whether to make the asset purchase contemplated under
such Asset Purchase Agreement. If manager does not purchase the Assets
pursuant to the terms of the Asset Purchase Agreement, then the BTAs in
which those Assets that are not transferred are located will be excluded
from the New Service Area. Manager shall be responsible for obtaining any
required consents and releases of the various landlords for any leases
acquired or assumed by Manager in connection with the purchase of the
Assets. The purchase price for the Assets is set forth in the Asset
Purchase Agreement.
5. Subscribers. For the right to manage operations in the Service Area, which
includes providing Sprint PCS Services to current Sprint PCS Subscribers,
Manager agrees to pay to Sprint PCS the amount equal to **** for the
Subscribers with an NPA-NXX in the Spokane BTA as of the Financing Date
(the "Spokane Subscribers"). For each Subscriber with an NPA-NXX in the
Service Area and not located in the Spokane BTA as of the Financing Date
(the "Additional Subscribers"), Manager shall pay to Sprint PCS the sum of
****. Manager will pay for both the Spokane Subscribers and the Additional
Subscribers on or before the Financing Date.
For purposes of this paragraph, "Subscriber" means any subscriber to
Sprint PCS service who satisfies all of the following tests: (i) such subscriber
has a NPA-NXX within the Manager's Service Area; (ii) such subscriber is
"active" (as defined below) in the Sprint PCS P2K billing system; (iii) such
subscriber is properly in the "current", "1-30 days past due" or "31-60 days
past due" category in the Sprint PCS accounts receivable management system; (iv)
such subscriber's use is not on a demonstration or test basis; and (v) such
subscriber's use is not pursuant to or under a Sprint PCS employee pricing plan
(other than the Sprint Employee Advantage Plans). For purposes of this paragraph
"active" means not disconnected or canceled.
For each Subscriber who receives Sprint PCS Products and Services using a
Sprint PCS handset which is under warranty at the time of transfer each such
handset shall be subject to the underlying handset purchase agreement and
warranties of Sprint PCS insofar as provided for in such agreements. From and
after April 15, 2000, the cost and risk of loss from defective handsets and
warranty exchanges for any subscribers shall be borne by Manager.
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
6. Sprint Spectrum Employees. Manager will exercise commercially reasonable
efforts to hire all Sprint Spectrum employees working in the Spokane BTA.
7. Fixed Wireless Local Loop. As of the date of this Addendum II, there are
limited geographic areas within the New Service Area and the Original
Service Area in which Sprint PCS or a Related Party of Sprint PCS owns a
priority local exchange carrier. In the geographic areas where Sprint PCS
or its Related Party owns a local exchange carrier, Manager's planned
coverage completely overlaps the portion of the local exchange carrier's
territory in Manager's Service Area.
8. Build out of Spokane MTA. Manager's obligation to complete the network
build-out in the Spokane MTA in a manner sufficient to comply with the
10-year minimum pops coverage requirement under the Sprint PCS license for
such MTA, as required by the FCC, is a material term of the Management
Agreement.
9. Expedite Fees. If Sprint PCS and Manager agree to pay additional fees to a
third party for any efforts associated with expediting completion of any
portion of Manager's Build out Plan or Switch Integration to meet a
Network Ready Date (the "NRD") including, but not limited to, payment of
expedited fees for microwave relocation, and the NRD is later extended due
to Manager action or lack of action, then Manager will have full
responsibility for the payment of such fees.
10. Long-Distance Pricing.
(a) The first sentence of Section 3.4 is deleted in its entirety and
replaced by the following language:
Manager must purchase long-distance telephony services from Sprint
through Sprint PCS both (i) to provide long-distance telephony
service to users of the Sprint PCS Network and (ii) to connect the
Service Area Network with the national platforms used by Sprint PCS
to provide services to Manager under the agreement and/or the
Services Agreement. Sprint will bill Sprint PCS for such services
rendered to Sprint PCS, Manager and all Other Managers, and in turn,
Sprint PCS will bill Manager for the services used by Manager.
Manager will be charged the same price for such long-distance
service as Sprint PCS is charged by Sprint (excluding interservice
area long-distance travel rates) plus an additional administrative
fee to cover Sprint PCS' processing costs.
(b) The following sentence is added as a second paragraph in Section
3.4:
"Manager may not resell the long-distance telephony services
acquired from Sprint under this Section 3.4."
11. Voluntary Resale of Products and Services. Section 3.5.2 is modified by
amending the second sentence of the second paragraph in its entirety to
read as follows:
"If Manager wants handsets of subscribers of resellers with NPA-NXXs
of Manager to be activated, Manager must agree to comply with the
terms of the program, including its pricing provisions."
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
12. Right of Last Offer. Section 3.7 is modified by adding the following
language: "(other than backhaul services relating to national platform and
IT application connections, which Manager must purchase from Sprint)" both
between (i) "Service Area Network" and "if Manager decides to use" in the
first sentence of the first paragraph and (ii) "for these services" and
"and the agreement was not made" in the first sentence of the second
paragraph.
13. Non-termination of Agreement. The following language is added at the end
of Section 11.5.3 and Section 11.6.4: "but such action does not terminate
this agreement."
14. Announced Transactions. Section 17.24 is deleted in its entirety.
15. Additional Terms and Provisions. The phrase "the Addendum also describes"
is deleted from the second sentence of Section 17.25, and the following
language is inserted at the end of that second sentence: "are described on
Exhibit 17.25, and photocopies of any such written agreements have been
delivered to Sprint PCS".
16. Federal Contractor Compliance. A new Section 17.28, the text of which is
attached as Exhibit B, is added and incorporated by this reference.
17. Year 2000 Compliance. The following Section 17.29 is added:
17.29 Year 2000 Compliance. Sprint PCS and Manager each
separately represents and warrants that any system or equipment
acquired, operated or designated by it for use in the Service Area
Network or for use to support the Service Area Network, including
(without limitation) billing, ordering and customer service systems,
will be capable of correctly processing and receiving date data, as
well as properly exchanging date data with all products (for
example, hardware, software and firmware) with which the Service
Area Network is designed to be used, and will not malfunction or
fail to function due to an inability to process correctly date data
in conformance with Sprint PCS requirements for "Year 2000
Compliance." If the Service Area Network or any system used to
support the Service Area Network fails to operate as warranted due
to defects or failures in any system or equipment selected by
Manager (including systems or equipment of third party vendors and
subcontractors selected by Manager rather than by Sprint PCS)
Manager will, at its own expense, make the repairs, replacements or
upgrades necessary to correct the failure and provide a Year 2000
Compliant Service Area Network. If the Service Area Network or any
system used to support the Service Area Network fails to operate as
warranted due to defects or failures in any systems or equipment
selected by Sprint PCS (including systems or equipment of third
party vendors and subcontractors that Sprint PCS selects and
requires Manager to use), Sprint PCS will, at its own expense, make
the repairs, replacements or upgrades necessary to correct the
failure and provide a Year 2000 Compliant Service Area Network.
"Year 2000 Compliance" means the functions, calculations, and
other computing processes of the Service Area Network (collectively
"Processes") that perform and otherwise process, date-arithmetic,
display, print or pass
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
date/time data in a consistent manner, regardless of the date in
time on which the Processes are actually performed or the dates used
in such data or the nature of the date/time data input, whether
before, during or after January 1, 2000 and whether or not the
date/time data is affected by leap years. To the extent any part of
the Service Area Network is intended to be used in combination with
other software, hardware or firmware, it will properly exchange
date/time data with such software, hardware or firmware. The Service
Area Network will accept and respond to two-digit year-date input,
correcting or supplementing as necessary, and store, print, display
or pass date/time data in a manner that is unambiguous as to
century. No date/time data will cause any part of' the Service Area
Network to perform an abnormally ending routine or function within
the Processes or generate incorrect final values or invalid results.
18. Designation of Selected Services. For the period from January 1,2000 until
the earlier of a) such time as Manger has its Reno switch in place and
operational or b) May 31, 2000 (the "Interim Switching Period"), Manager
will designate its Selected Services under Option 1, "Sprint PCS
Provided," and will be charged a price of **** for utilization of the
Sprint PCS Sacramento switch (the **** switching fee assumes deployment of
up to 14 cell sites in the Grass Valley/Auburn area during the Interim
Switching Period). At the point when Manager transfers Manager's cell
sites to Manager's own switch, Manager will change to the Selected
Services Option 2, "Sprint PCS Provided but Manager Provides Switching."
If Manager has need to stay on the Sprint PCS Sacramento switch after May
31, 2000, the **** switching rate will be re-calculated at that time.
Manager is responsible for all transition costs of converting backhaul
connections from Manager's cell sites to the Sprint PCS Sacramento switch
to Manager's switch, including any charges for hardware, leased lines,
installation, termination of existing circuits, etc.
19. Payment of Fees Under Services Agreement. The second sentence of Section
3.1 of the Services Agreement is deleted in its entirety and replaced by
the following two sentences:
Except with respect to fees paid for billing-related services, the
monthly charge for any fees based on the number of subscribers of
the Service Area Network will be determined based on the number of
subscribers as of the 15th day of the month for which the charge is
being calculated. With respect to fees paid for billing-related
services, the monthly charge for any fees based on the number of
subscribers will be based on the number of gross activations in the
month for which the charge is being calculated plus the number of
subscribers of the Service Area Network on the last day of the prior
calendar month.
20. Deleted Sections. Paragraphs 1, 4, and 6 of Addendum I are stricken in
their entirety.
21. Use of Loan Proceeds. Sprint PCS is entering into that certain Consent and
Agreement effective as of the date it is executed, by and between Sprint
Spectrum L.P., Sprint Communications Company, L.P., WirelessCo, L.P. and
Banque Paribas as administrative agent (together with any successors
thereof in accordance with that certain Credit Agreement to be entered
into among Manager, and Administrative Agent) (which Consent and
Agreement, as amended and modified from time to time, is referred to as
the "Consent and Agreement"), to enable Manager to obtain loans from the
Lenders (as defined in the Consent and Agreement, the "Lenders"). Manager
agrees that notwithstanding the permitted uses of the proceeds from the
loans made to Manager to which the Consent and Agreement relates or from
any other loan or extension of credit to which the Consent and Agreement
relates, Manager will not use the proceeds from any such loan or extension
of credit for any purpose other than to construct and operate the wireless
service
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
within the Service Area (as may be amended from time to time) as
contemplated under the Management Agreement.
22. Notices. Manager agrees to promptly give Sprint PCS a copy of any notice
Manager receives from any Agent or any Lender, and a copy of any notice
Manager gives to any Agent or any Lender. Sprint PCS agrees to promptly
give Manager a copy of any notice Sprint PCS receives from the
Administrative Agent or any Lender and a copy of any notice that Sprint
PCS gives to the Administrative Agent or any Lender.
23. No Default Under Management Agreement. Manager warrants and represents
that as of the date hereof, no Default or Event of Default under the
Management Agreement or any documents or instruments related thereto has
occurred.
IN WITNESS WHEREOF, the parties hereto have caused this Addendum II to be
executed as of the date first above written.
UbiquiTel Holdings, Inc.
By:______________________________________
Name:
Title:
WirelessCo, L.P.
By:______________________________________
Bernard A. Bianchino
Chief Business Development Officer
Sprint Spectrum L.P.
By:______________________________________
Bernard A. Bianchino
Chief Business Development Officer
Cox Communications PCS, L.P.
By:______________________________________
Bernard A. Bianchino
Chief Business Development Officer
Cox PCS License, L.L.C.
By:______________________________________
Bernard A. Bianchino
Chief Business Development Officer
Sprint Communications Company, L.P.
By:______________________________________
Name:
Title:
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
Exhibit B
Section 17.28. Federal Contractor Compliance.
(1) The Manager will not discriminate against any employee or
applicant for employment because of race, color, religion, sex, or national
origin. The Manager will take affirmative action to ensure that applicants are
employed, and that employees are treated during employment without regard to
their race, color, religion, sex, or national origin. Such action shall include,
but not be limited to the following: Employment, upgrading, demotion, or
transfer; recruitment or recruitment advertising; layoff or termination; rates
of pay or other forms of compensation; and selection for training, including
apprenticeship. The Manager agrees to post in conspicuous places, available to
employees and applicants for employment, notices to be provided setting forth
the provisions of this nondiscrimination clause.
(2) The Manager will, in all solicitations or advertisements for
employees placed by or on behalf of the Manager, state that all qualified
applicants will receive considerations for employment without regard to race,
color, religion, sex, or national origin.
(3) The Manager will send to each labor union or representative of
workers with which he has a collective bargaining agreement or other contract or
understanding, a notice to be provided advising the said labor union or workers'
representatives of the Manager's commitments under this section, and shall post
copies of the Notice in conspicuous places available to employees and applicants
for employment.
(4) The Manager will comply with all provisions of Executive Order
11246 of September 24, 1965., and of the rules, regulations, and relevant orders
of the Secretary of Labor.
(5) The Manager will furnish all information and reports required by
Executive Order 11246 of September 24, 1965, and by rules, regulations, and
orders of the Secretary of Labor, or pursuant thereto, and will permit access to
his books, records, and accounts by the administering agency and the Secretary
of Labor for purposes of investigation to ascertain compliance with such rules,
regulations, and orders.
(6) In the event of the Manager's noncompliance with the
nondiscrimination clauses of this contract or with any of the said rules,
regulations, or orders, this contract may be canceled, terminated, or suspended
in whole or in part and the Manager may be declared ineligible for further
Government contracts or federally assisted construction contracts in accordance
with procedures authorized in Executive Order 11246 of September 24, 1965, and
such other sanctions may be imposed and remedies invoked as provided in
Executive Order 11246 of September 24, 1965, or by rule, regulation, or order of
the Secretary of Labor, or as otherwise provided by law.
(7) The Manager will include the portion of the sentence immediately
preceding paragraph (1) and the provisions of paragraphs (1) through (7) in
every subcontract or purchase order unless exempted by rules, regulations, or
orders of the Secretary of Labor issued pursuant to section 204 of Executive
Order 11246 of September 24, 1965, so that such provisions will be binding upon
each subcontractor or vendor. The Manager will take such action with respect to
any subcontract or purchase order as the administering agency may direct as a
means of enforcing such provisions, including sanctions for noncompliance.
Provided, however, that in the event a Manager becomes involved in, or is
threatened with, litigation with a subcontractor or vendor as a result of such
direction by the administering agency the Manager may request the United States
to enter into such litigation to protect the interests of the United States.
(8) In consideration of contracts with Sprint PCS, the Manager
agrees to execute the Certificate of Compliance attached hereto as Attachment I
and further agrees that this certification shall be part of each contract
between Sprint PCS and Manager. The Manager will include Attachment I in every
subcontract or purchase order, so that such provisions will be binding upon each
subcontractor.
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
CERTIFICATE OF COMPLIANCE WITH
FEDERAL REGULATIONS
In consideration of contracts with SPRINT SPECTRUM L.P., the undersigned
"contractor", "vendor" or "consultant" agrees to the following and further
agrees that this Certification shall be a part of each purchase order, supply
agreement, or contract between SPRINT SPECTRUM L.P. and the undersigned.
24. Equal Opportunity.
Executive Order 11246 is herein incorporated by reference.
25. Affirmative Action Compliance
If undersigned Contractor has 50 or more employees and if this contract is
for $50,000 or more, Contractor shall develop a written Affirmative Action
Compliance Program for each of its establishments, as required by rules
and regulations of the Secretary of Labor (41 CFR 60-1 and 60-2).
26. Affirmative Action for Special Disabled and Vietnam Era Veterans
If this contract exceeds $10,000, the undersigned Contractor certifies
that the Contractor does not discriminate against any employee or
applicant because the person is a Special Disabled or Vietnam Veteran and
complies with the rules, regulations and relevant orders of the Secretary
of Labor issued pursuant to the Vietnam Veterans Readjustment Assistance
Act of 1972, as amended.
Contractor hereby represents that it has developed and has on file, at
each establishment, affirmative action programs for Special Disabled and
Vietnam Era Veterans required by the rules and regulations of the
Secretary of Labor (41 CFR 60-250).
27. Affirmative Action for Handicapped Workers
If this contract exceeds $2,500, the undersigned Contractor certifies that
the Contractor does not discriminate against any employee or applicant
because of physical or mental handicap and complies with the rules,
regulations and relevant orders of the Secretary of Labor issued under the
Rehabilitation Act of 1973, as amended.
Contractor hereby represents that it has developed and has on file, at
each establishment, affirmative action programs for Handicapped Workers
required by the rules and regulations of the Secretary of Labor (41 CFR
60-741).
28. Employer Information Report (EEO-l Standard Form 100)
If undersigned Contractor has 50 or more employees and if this contract is
for $10,000 or more, Contractor shall complete and file government
Standard Form 100, Equal Employment Opportunity Employer Information
Report EEO-l, in accordance with instructions contained therein.
29. Compliance Review.
The undersigned Contractor certifies that it has not been subject to a
Government equal opportunity compliance review. If the Contractor has
been reviewed, that review occurred on ____________________ (date).
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
30. Utilization of Small Businesses, Small Disadvantaged Businesses, and
Women-Owned Small Business
It is the policy of SPRINT SPECTRUM L.P., consistent with Federal
Acquisition Regulations (FAR 52.219-8 and FAR 52.219-13), that small
business concerns, small business concerns owned and controlled by
socially and economically disadvantaged individuals, and women-owned
businesses shall have the maximum practicable opportunity to participate
in performing subcontracts under Government contracts for which SPRINT
SPECTRUM L.P. is the Government's Prime Contractor. SPRINT SPECTRUM L.P.
awards contracts to small businesses to the fullest extent consistent with
efficient prime contract performance. The Contractor agrees to use its
best efforts to carry out this policy in the award of its subcontract to
the fullest extent consistent with the efficient performance of this
contract.
Contractor hereby represents that it __ is __ is not a small business, __
is __ is not a small business owned and controlled by socially and
economically disadvantaged individuals, and __ is __ is not a small
business controlled and operated as a women-owned small business as
defined by the regulations implementing the Small Business Act.
If the answer to any of the above is in the affirmative, Contractor will
complete SPRINT SPECTRUM L.P. Small/Minority/Women Owned Business Self
Certification Form.
This form is available from Mr. Ron Gier, Sprint PCS, 4900 Main Street,
Kansas City, Missouri 64112.
31. Certification of Nonsegregated Facilities
If this contract is expected to exceed $10,000, the undersigned Contractor
certifies as follows:
The Contractor certifies that the Contractor does not or will not maintain
or provide for its employees any segregated facilities at any of its
establishments, and that it does not and will not permit its employees to
perform services at any location, under its control, where segregated
facilities are maintained. The Contractor agrees that a breach of this
Certification is a violation of the Equal Opportunity provision of this
contract. As used in this Certification, the term "segregated facilities"
means any waiting rooms, work areas, rest rooms and wash rooms,
restaurants and other eating areas, time clocks, locker rooms and other
storage or dressing areas, parking lots, drinking fountains, recreation or
entertainment areas, transportation, and housing facilities provided for
employees that are segregated by explicit directive or are in fact
segregated on the basis of race, color, religion, or national origin,
because of habit, local custom, or otherwise. Contractor further agrees
that (except where it has obtained identical certifications from proposed
subcontracts for specific time periods) it will obtain identical
certifications from proposed subcontractors prior to the award of
subcontracts exceeding $10,000 that are not exempt from the provisions of
the Equal Opportunity Clause; and that it will retain such certification
in its files.
32. Clean Air and Water
The undersigned Contractor certifies that any facility to be used in the
performance of this contract __ is __ is not listed on the Environmental
Protection Agency List of Violating Facilities.
The undersigned Contractor agrees to immediately notify SPRINT SPECTRUM
L.P., immediately upon the receipt of any communication from the
Administrator or a designee of the Environmental Protection Agency
indicating that any facility that the Contractor proposes to use for the
performance of the contract is under consideration to be listed on the EPA
List of Violating Facilities. SPRINT SPECTRUM L.P. includes this
certification and agreement pursuant to FAR 52-223-1(c) which requires
including such paragraph (c) in every nonexempt subcontract.
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
Contractor:
_________________________________________
Company Name
_________________________________________
Address
_________________________________________
City State Zip
By ______________________________________
Name:
Title:
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
ADDENDUM III
TO
SPRINT PCS MANAGEMENT AGREEMENT
Dated as of February 14, 2000
Manager: Ubiquitel Holdings, Inc.
Service Area:
California Chico BTA No. 79
Eureka BTA No. 134
Redding BTA No. 371
Sacramento (partial) BTA No. 389
Yuba City (partial) BTA No. 485
Nevada Las Vegas (partial) BTA No. 245
Reno BTA No. 372
Utah Logan BTA No. 258
Provo-Orem (partial) BTA No. 365
St. George BTA No. 392
Salt Lake City-Ogden (partial) BTA No. 399
Idaho Boise-Nampa BTA No. 50
Idaho Falls BTA No. 202
Lewiston-Moscow BTA No. 250
Pocatello BTA No. 353
Twin Falls BTA No. 451
Washington Spokane BTA No. 425
Montana Billings BTA No. 41
Bozeman BTA No. 53
Butte BTA No. 64
Great Falls BTA No. 171
Helena BTA No. 188
Kalispell BTA No. 224
Missoula BTA No. 300
So. Ind.--KY Anderson (partial), IN BTA No. 15
Bloomington-Bedford, IN BTA No. 47
Bowling Green, KY BTA No. 52
Cincinnati (partial), OH BTA No. 81
Clarksville, KY BTA No. 83
Columbus, IN BTA No. 93
Evansville, IN BTA No. 135
Indianapolis (partial), IN BTA No. 204
Louisville (partial), KY BTA No. 263
Madisonville, KY BTA No. 273
Owensboro, KY BTA No. 338
Paducah, KY BTA No. 339
Richmond, IN BTA No. 373
Terre Haute, IN BTA No. 442
Vincennes-Washington, IN BTA No. 457
This Addendum III (this "Addendum"), dated as of February 14, 2000,
contains certain additional and supplemental terms and provisions to that
certain Sprint PCS Management Agreement entered into as of October 15, 1998, as
amended by that certain Addendum I to Sprint PCS Management Agreement, dated
October 15, 1998 and
1
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that certain Addendum II to Sprint PCS Management Agreement, dated December 28,
1999 (such agreement, as amended being the "Management Agreement").
The terms and provisions of this Addendum III control, supersede and amend
any conflicting terms and provisions contained in the Management Agreement.
Except for express modifications made in this Addendum, the Management Agreement
continues in full force and effect.
Capitalized terms used and not otherwise defined in this Addendum have the
meanings ascribed to them in the Management Agreement. Section and Exhibit
references in this Addendum are in Sections and Exhibits of the Management
Agreement unless otherwise noted.
1. Backhaul and Interconnection. Manager will own and have in operation a
switch capable of switching traffic for the Original Service Area Network on or
before December 31, 2000. In addition, on or before December 31, 2000, Manager
will disconnect all of Manager's circuits from the Sprint PCS Sacramento switch.
For the period from the date of this Addendum until the earlier of (a) such time
as Manager has its own switch available to handle such traffic or (b) December
31, 2000, Manager will be responsible for all backhaul and interconnection costs
associated with the backhaul of all Newcastle traffic through the Sprint PCS
Sacramento switch. Also, Manager will be responsible for all transition costs of
converting existing connections from the Sprint PCS Sacramento switch to Manager
switch, including any charges for hardware, leased-lines, installation, etc.
2. Designation of Selected Services. For utilization of the Sprint PCS
Sacramento switch (i) for the period from the date of this Addendum until the
earlier of (A) May 31, 2000 and (B) the date on which Manager has its switch in
place and operational, Manager will designate its Selected Services under Option
1, "Sprint PCS Provided," and will be charged a price equal to ****; and (ii)
for the period from June 1, 2000 until the earlier of (A) December 31, 2000 and
(B) the date on which Manager has its switch in place and operational, Manager
will designate its Selected Services under Option 1, "Sprint PCS Provided," and
will be charged a price to be determined solely by Sprint PCS.
2
<PAGE>
**** Confidential portions omitted and filed separately with the Commission.
3
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Addendum to be
executed as of the date first above written.
UbiquiTel Holdings, Inc.
By:
Name:
Title:
WirelessCo, L.P.
By:____________________________________________
Bernard A. Bianchino
Senior Vice President and Chief Business
Development Officer - Sprint PCS
Sprint Spectrum L.P.
By:____________________________________________
Bernard A. Bianchino
Senior Vice President and Chief Business
Development Officer - Sprint PCS
Cox Communications PCS, L.P.
By:____________________________________________
Bernard A. Bianchino
Senior Vice President and Chief Business
Development Officer - Sprint PCS
Cox PCS License, L.L.C.
By:____________________________________________
Bernard A. Bianchino
Senior Vice President and Chief Business
Development Officer - Sprint PCS
Sprint Communications Company, L.P.
By:____________________________________________
Don A. Jensen
Vice President - Law
4
<PAGE>
ADDENDUM IV
TO
SPRINT PCS MANAGEMENT AGREEMENT
Dated as of April 5, 2000
Manager: Ubiquitel Holdings, Inc.
Service Area:
California Chico BTA No. 79
Eureka BTA No. 134
Redding BTA No. 371
Sacramento (partial) BTA No. 389
Yuba City (partial) BTA No. 485
Nevada Las Vegas (partial) BTA No. 245
Reno BTA No. 372
Utah Logan BTA No. 258
Provo-Orem (partial) BTA No. 365
St. George BTA No. 392
Salt Lake City-Ogden (partial) BTA No. 399
Idaho Boise-Nampa BTA No. 50
Idaho Falls BTA No. 202
Lewiston-Moscow BTA No. 250
Pocatello BTA No. 353
Twin Falls BTA No. 451
Washington Spokane BTA No. 425
Montana Billings BTA No. 41
Bozeman BTA No. 53
Butte BTA No. 64
Great Falls BTA No. 171
Helena BTA No. 188
Kalispell BTA No. 224
Missoula BTA No. 300
So. Ind.--KY Anderson (partial), IN BTA No. 15
Bloomington-Bedford, IN BTA No. 47
Bowling Green, KY BTA No. 52
Cincinnati (partial), OH BTA No. 81
Clarksville, KY BTA No. 83
Columbus, IN BTA No. 93
Evansville, IN BTA No. 135
Indianapolis (partial), IN BTA No. 204
Louisville (partial), KY BTA No. 263
Madisonville, KY BTA No. 273
Owensboro, KY BTA No. 338
Paducah, KY BTA No. 339
Richmond, IN BTA No. 373
Terre Haute, IN BTA No. 442
Vincennes-Washington, IN BTA No. 457
This addendum IV, dated as of April 5, 2000 (this "Addendum"), contains
certain additional and supplemental terms and provisions to that certain Sprint
PCS Management Agreement entered into as of October 15, 1998, as amended by that
certain Addendum I to Sprint PCS Management entered into as of October 15, 1998
5
<PAGE>
("Addendum I"), that certain Addendum II to Sprint PCS Management Agreement
dated as of December 28, 1999 ("Addendum II"), and that certain Addendum III to
Sprint PCS Management Agreement dated as of February 14, 2000 ("Addendum III")
(such agreement, as amended, being the "Management Agreement").
The terms and provisions of this Addendum control, supersede and amend any
conflicting terms and provisions contained in the Management Agreement. Except
for express modifications made in this Addendum, the Management Agreement
continues in full force and effect.
Capitalized terms used and not otherwise defined in this Addendum have the
meanings ascribed to them in the Management Agreement. Section and Exhibit
references in this Addendum are to Sections and Exhibits of the Management
Agreement unless otherwise noted.
3. Confirmation of Restructuring and Assumption of Sprint Agreements.
Manager confirms and agrees that its present organizational structure,
indicating its stockholders and subsidiaries, is attached to this Addendum as
Exhibit A. Manager acknowledges and agrees that Manager is the party to the
Management Agreement, the Services Agreement, the License Agreements and the
Asset Purchase Agreement and that it has assumed all of the obligations of
UbiquiTel L.L.C., a Washington limited liability company, under such agreements.
4. Financing. A revised and amended Exhibit 1.7, in the form attached to
this Addendum, is approved by Sprint PCS and Manager and is expressly made a
part of the Management Agreement.
5. Build-out Plan. Exhibit 2.1 is amended, with respect only to the
Reno BTA (No. 372), to extend the network ready date (NRD) for such BTA to
September 7, 2000, and the hard launch date to September 21, 2000.
6. Use of Loan Proceeds.
(a) Sprint PCS is entering into that certain Amended and Restated
Consent and Agreement among Sprint PCS, Sprint Communications Company, L.P.,
WirelessCo., L.P., Cox Communications PCS, L.P., Cox PCS License, L.L.C., and
Paribas as administrative agent (together with any successors thereof in
accordance with that certain Credit Agreement dated as of March 31, 2000, among
Manager, UbiquiTel Inc., and Paribas as "Agent" (the "Credit Agreement") (which
Amended and Restated Consent and Agreement, as amended and modified from time to
time, is referred to as the "Consent and Agreement")), to enable Manager to
obtain loans from the Lenders (as defined in the Consent and Agreement, the
"Lenders"). Manager agrees that notwithstanding the permitted uses of the
proceeds from the loans made to Manager to which the Consent and Agreement
relates or from any other loan or extension of credit to which the Consent and
Agreement relates, Manager will not use the proceeds from any such loan or
extension of credit for any purpose other than to construct and operate the
wireless service within the Service Area (as may be amended from time to time)
as contemplated under the Management Agreement, and for corporate and working
capital purposes related to such construction and operation.
(b) Notwithstanding anything to the contrary in Paragraph 21 of
Addendum II, Sprint PCS and Manager agree that, in addition to the uses of the
proceeds from the loan or extension of credit contemplated in such Paragraph 21,
Manager may use the proceeds from the loan or extension of credit contemplated
in such Paragraph 21 for corporate and working capital purposes related to the
construction and operation of the wireless service within the Service Area (as
may be amended from time to time) as contemplated under the Management
Agreement.
6
<PAGE>
7. Notices. Manager agrees to promptly give Sprint PCS a copy of any
notice Manager receives from any Agent or any Lender, and a copy of any notice
Manager gives to any Agent or any Lender. Sprint PCS agrees to promptly give
Manager a copy of any notice Sprint PCS receives from the Administrative Agent
or any Lender and a copy of any notice that Sprint PCS gives to the
Administrative Agent or any Lender.
8. No Default Under Credit Agreement or Management Agreement. Manager
warrants and represents that as of the date hereof, no Default or Event of
Default under the Credit Agreement or any documents or instruments related
thereto has occurred. Manager warrants and represents that as of the date
hereof, no breach or Event of Termination under the Management Agreement, the
Services Agreement, the License Agreements or any documents or instruments
related thereto has occurred.
9. Defense to Employment-Related Charges. Sprint PCS agrees that it will
defend and indemnify Manager against any claims or charges filed with the Equal
Employment Opportunity Commission by a former Sprint PCS employee alleging a
violation of federal or state law arising out of actions that occurred on or
before April 15, 2000. If any part of the alleged violation occurred after April
15, 2000, Sprint PCS agrees that it will work with Manager to jointly defend
against the claim or charge. In return for these promises, Manager agrees to
cooperate with Sprint PCS in defending against any such claim or charge.
Manager's cooperation shall include, but not be limited to, making fact
witnesses available for consultation with Sprint PCS personnel who are working
on the defense of the claim or charge, providing Sprint PCS with access to
documents deemed necessary by Sprint PCS to defend the claim or charge, and
allowing any Manager personnel who are deemed by Sprint PCS to be necessary for
the defense of the claim or charge to attend any hearing or mediation related to
it.
IN WITNESS WHEREOF, the parties hereto have caused this Addendum to be
executed as of the date first above written.
"Manager"
UbiquiTel Operating Company
By:____________________________________________
Name:
Title:
"Sprint PCS"
Sprint Spectrum L.P.
By:____________________________________________
Bernard A. Bianchino
Senior Vice President and Chief Business
Development Officer - Sprint PCS
Sprint Communications Company, L.P.
By:____________________________________________,
Don A. Jensen
7
<PAGE>
Vice President - Law
8
<PAGE>
Schedule of Definitions
This Schedule of Definitions is the "Schedule of Definitions" referred to
in and incorporated by reference under the Management Agreement, Services
Agreement, and Trademark License Agreements (as such agreements are defined
below). Whenever the phrase "this agreement" is used below, such phrase refers
to the particular agreement under whose terms this Schedule of Definitions is
being applied in that instance. If citations to sections or exhibits of
different agreements are included in a definition, the citation to the
particular agreement under whose terms this Schedule of Definitions is being
applied controls to the exclusion of the citations to different agreements.
The following words and phrases used in this agreement have the following
meanings:
"Addendum" means any addendum attached to this agreement that contains the
amendments to this agreement; such Addendum is expressly incorporated as a part
of this agreement.
"Affiliation Agreement" means any and all of the agreements, known as
Sprint PCS Affiliation Agreements, whereby an affiliate and Sprint PCS and/or
one or more of Sprint PCS~ Related Parties agree to the terms and conditions
under which such affiliate will manage the Service Area Network identified in
such agreement, using such Affiliates own PCS license issued by the FCC and any
documents incorporated by reference in such agreement.
"Agent" has the meaning set forth in Section 3.1 of the Sprint Spectrum
Trademark and Service Mark License Agreement or Section 3.1 of the Sprint
Trademark and Service Mark License Agreement.
"Arbiter" has the meaning set forth in Section 12.1.3 of the Management
Agreement or Section 5.1.3 of the Services Agreement.
"Available Services" means those categories of services listed on Exhibit
2.1.1 to the Services Agreement (as the same may be amended from time to time by
Sprint Spectrum and made available to Manager under the terms of the Services
Agreement).
"Available Services and Fees Schedule" means that schedule set forth on
Exhibit 2.1.1 to the Services Agreement, which sets forth the Available Services
offered from time to time and the fees charged for such Available Services.
"Bankruptcy" means, for the purposes of the Trademark License Agreements,
either a Voluntary Bankruptcy or an Involuntary Bankruptcy.
"Brands" means the Sprint PCS Brands and the Sprint Brands.
"BTA" means a Basic Trading Area for which a Basic Trading Area (BTA)
license is issued by the FCC.
"Build-out Plan" means the plan agreed upon by Manager and Sprint PCS,
along with any modifications and updates to the plan, respecting the
construction and design of the Service Area Network, a copy of which is attached
as Exhibit 2.1 to the Management Agreement.
"Business Day" means a day of the year that banks are not required or
authorized to close in the State of New York.
"Cancelled Service" has the meaning set forth in Section 3.2 of the
Services Agreement.
"CDMA" means code division multiple access.
<PAGE>
"Change of Control" has the meaning set forth in Section 17.15.3 of the
Management Agreement.
"Collected Revenues" has the meaning set forth in Section 10.4 of the
Management Agreement.
"Confidential Information" means all Program Requirements, guidelines,
standards, and programs, the technical, marketing, financial, strategic and
other information provided by each party under the Management Agreement,
Services Agreement, and Trademark License Agreements, and any other information
disclosed by one party to the other party pursuant to the Management Agreement,
Services Agreement, and Trademark License Agreements that is not specifically
excluded by Section 12.2 of the Management Agreement. In addition to the
preceding sentence, "Confidential Information" has the meaning set forth in
Section 3.1 of the Sprint Spectrum Trademark and Service Mark License Agreement
or Section 3.1 of the Sprint Trademark and Service Mark License Agreement.
"Controlled Related Party" means the Parent of any Person and each
Subsidiary of such Parent. As used in Section 1.2 and Article 3 of the Sprint
Spectrum Trademark and Service Mark License Agreement or Section 1.2 and Article
3 of the Sprint Trademark and Service Mark License Agreement, the term
"Controlled Related Party" will also include any Related Party of a Person that
such Person or its Parent can directly or indirectly unilaterally cause to take
or refrain from taking any of the actions required, prohibited or otherwise
restricted by such Section, whether through ownership of voting securities,
contractually or otherwise.
"Default Rate" means the rate per annum (computed on the basis of the
actual number of days elapsed in a year of 365 or 366 days, as applicable),
compounded monthly, equal to the Prime Rate (adjusted as and when changes in the
Prime Rate occur) plus five percent (5%).
"Disaggregated License" means that portion of the License that Manager may
or is required to purchase under Section 11 of the Management Agreement from
Sprint PCS under certain circumstances, after Sprint PCS' receipt of FCC
approval of the necessary disaggregation and partition, which portion comprises
no less than the amount of spectrum sufficient to operate one duplex CDMA
carrier (including the required guard bands) within the PCS Spectrum, and no
more than 10 MHz of the Spectrum (at Manager's designation) covering the Service
Area, and which includes the frequencies then in use in the Service Area Network
and, if applicable, adjacent frequencies, so long as such frequencies in the
aggregate do not exceed 10 MHz.
"Dispute Notice" has the meaning set forth in Section 12.1.3 of the
Management Agreement or Section 5.1.3 of the Services Agreement.
"Dispute Notice Date" has the meaning set forth in Section 12.1.3 of the
Management Agreement or Section 5.1.3 of the Services Agreement.
"Encumbrances" has the meaning set forth in Section 5.1(a) of the Sprint
Spectrum Trademark and Service Mark License Agreement or Section 5.1(a) of the
Sprint Trademark and Service Mark License Agreement.
"Entire Business Value" has the meaning set forth in Section 11.7.3 of the
Management Agreement.
"Event of Termination" means any of the events described in Section 11.3
of the Management Agreement. For the purposes of the Sprint Spectrum Trademark
and Service Mark License Agreement only. "Event of Termination" has the meaning
set forth in Section 13.2 of that agreement. For the purposes of the Sprint
Trademark and Service Mark License Agreement only, "Event of Termination" has
the meaning set forth in Section 13.2 of that agreement.
"FAA" means the Federal Aviation Administration.
"FCC" means the Federal Communications Commission.
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
"Financial Lender" means any and all of those commercial and financial
institutions that provide material credit to Manager for the purpose of
assisting Manager with the fulfillment of its obligations and duties under this
agreement.
"fixed wireless local loop" has the meaning set forth in Section 2.4 of
the Management Agreement.
"home service area" means the geographic area within which a customer can
make a local call on the customer's PCS phone (i.e., the customer does not incur
an extra charge).
"Inbound Roaming" means calls placed by a non-Sprint PCS Network customer
on the Sprint PCS Network.
"Indemnitee" and "Indemnitor" have the meanings set forth in Section
13.3.1 of the Management Agreement or Section 6.3.1 of the Services Agreement.
"Initial Term" has the meaning set forth in Section 11.1 of the Management
Agreement.
"Involuntary Bankruptcy" has the meaning set forth in Section 11.3.7 of
the Management Agreement.
"Law" means all laws (statutory or otherwise), ordinances, rules,
regulations, bylaws, Orders and codes of all governmental and regulatory
authorities, whether United States Federal, state or local, which are applicable
to the Sprint PCS Products and Services.
"License" means the PCS license(s) issued by the FCC described on the
Service Area Exhibit to the Management Agreement.
"Licensed Marks" means the trademarks and service marks referred to in the
Recitals section of the Trademark License Agreement under whose terms this
definition is being applied, and such other marks as may be adopted and
established under said agreement from time to time.
"Licensee" has the meaning set forth in the introductory paragraph to the
particular agreement under whose terms this definition is being applied.
"Licensor" has the meaning set forth in the introductory paragraph to the
particular agreement under whose terms this definition is being applied.
"local calling area" means the geographic area within which a customer can
make a local call on the customer's PCS handset without incurring a long
distance charge.
"Loss" means any and all damage, loss, liability, claim, out-of-pocket
cost and expense, including reasonable expenses of investigation and reasonable
attorneys' fees and expenses, but excluding consequential or special damages.
"Management Agreement" means that certain Sprint PCS Management Agreement
executed by Manager and Sprint PCS and any documents incorporated by reference
in said agreement.
"Manager" means the party to this agreement as indicated in the
introductory paragraph of this agreement.
"Manager Management Report" has the meaning set forth in Section 12.1.2 of
the Management Agreement.
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
"Manager's Products and Services" means all types and categories of
wireless communications services and associated products that are offered by
Manager in the Service Area under Section 3.2 of the Management Agreement.
"Marketing Communications Guidelines" means the guidelines issued by
Sprint or Sprint PCS in accordance with Section 5.2 of the Management Agreement
with respect to the marketing, promotion, advertising, distribution, lease and
sale of Sprint PCS Products and Services, as they may be amended from time to
time by Sprint or Sprint PCS in accordance with the terms of the Trademark
License Agreements.
"Master Signature Page" means the document that the parties to the
Management Agreement, Services Agreement and/or one or more of the Trademark
License Agreements sign to evidence their agreement to execute, become a party
to and be bound by each of the agreements, or parts thereof, listed above the
particular party's signature on such Master Signature Page.
"MFN Price" or "Most Favored Nation Price" means, with respect to resale,
the best local market price offered to any third party for the purchase of air
time on Manager's network including but not limited to any third party who may
use the air time for its own wireless communications services or resell the air
time, and, with respect to roaming, the lowest roaming charge of Manager to
other wireless carriers when their customers roam on the Service Area Network.
"MIN" means the 24-bit mobile identification number corresponding to the
7-digit telephone number assigned to the handset, used for both billing and
receiving calls.
"MTA" means a Major Trading Area for which a MTA license is issued by the
FCC.
"New Coverage" means the build-out in the Service Area that is in addition
to the build-out required under the then-existing Build-out Plan, which
build-out Sprint PCS or Manager decides should be built-out.
"Notice Address Schedule" means the schedule attached to the Master
Signature Page that provides the mailing and courier delivery addresses, and the
facsimile number, for giving notices to each of the parties signing the Master
Signature Page. The Notice Address Schedule may include supplemental addresses
that serve as additional or alternate notice addresses for use by the parties in
specifically prescribed situations.
"NPA-NXX" means as follows: "NPA" means numbering plan area, which is the
area code for a telephone number, "NXX" refers to the first three digits of a
telephone number, which identify the specific telephone company central office
that serves that number.
"Offer" means an offer received by Manager to sell substantially all of
the assets comprising or used in connection with the operation and management of
the Service Area Network or any portion of the Service Area Network.
"Offer Notice" means a written notice given by Manager to Sprint PCS that
sets forth in detail the terms and conditions of an Offer and the name and
address of the person or entity making the Offer.
"Offered Interest" means the assets that Manager proposes to sell pursuant
to an Offer.
"Operating Assets" means the assets Manager or its Related Parties owns
and uses in connection with the operation of the Service Area Network, at the
time of termination, to provide the Sprint PCS Products and Services. Operating
Assets does not include items such as furniture, fixtures and buildings that
Manager or its Related Parties use in connection with other businesses. Examples
of Operating Assets include without limitation: switches, towers, cell sites,
systems, records and retail stores.
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
"Operational Level of Sprint PCS" means the average operational level of
all the service area networks operated by Sprint PCS and its Related Parties
without the use of a manager or affiliate, as measured by Sprint PCS, unless the
operational level, as measured by Sprint PCS, of all of the service area
networks operated by Sprint PCS and its Related Parties without the use of a
manager or affiliate that are contiguous to the Service Area are below the
national average, in which case "Operational Level of Sprint PCS" means the
average operational level of those contiguous service area networks.
"Order" means any order, writ, injunction, decree, judgment, award or
determination of any court or governmental or regulatory authority.
"Other Managers" means any person or entity with which Sprint PCS has
entered into an agreement similar to this agreement or an Affiliation Agreement,
including without limitation an affiliate under an Affiliation Agreement or a
manager under another Management Agreement, under which the person or entity
designs, constructs and manages a service area network and offers and promotes
Sprint PCS Products or Services.
"Outbound Roaming" means calls placed by a Sprint PCS Network customer on
a non-Sprint PCS network.
"Parent" means, with respect to any Person, the ultimate parent entity (as
determined in accordance with the Hart-Scott-Rodino Antitrust Improvements Act
of 1976 and the rules and regulations promulgated thereunder) of such Person;
except that if such ultimate parent entity is an individual, the Parent will be
the highest entity in the ownership chain from the ultimate parent entity to and
including such Person that is not an individual.
"Parties" means, with respect to the Management Agreement, Sprint PCS and
Manager. For the purpose of the services Agreement only, "parties" means Sprint
Spectrum and Manager. Sprint is not a party to the Management Agreement, except
to the limited extent described on the signature page executed on behalf of
Sprint. For the purpose of the Trademark License Agreements only, "parties"
means Licensor and Licensee.
"PCS" means a radio communication system authorized under the rules for
broadband personal communications services designated as Subpart E of Part 24 of
the FCC's rules, including the network, marketing, distribution, sales, customer
interface and operations functions relating thereto.
"PCS Spectrum" means the range of frequencies that Sprint PCS is
authorized to use under the License.
"Permitted Assignee" means any assignee of the rights and obligations of
Licensee pursuant to an assignment consented to in writing by Licensor, in its
sole discretion, in accordance with Section 14.1 of the Sprint Spectrum
Trademark and Service Mark License Agreement or Section 14.1 of the Sprint
Trademark and Service Mark License Agreement, or any subsequent permitted
assignee of any such permitted assignee.
"Person" means any individual, partnership, limited partnership, limited
liability company, corporation, trust, other business association or business
entity, estate, or other entity.
"pops" means the population covered by a license or group of licenses.
Unless otherwise noted, as used in the Management Agreement, pops means the most
recent Rand-McNally Population Survey estimate of the population of a geographic
area.
"Premium and Promotional Items" means all items, including clothing,
memorabilia and novelties, used to display the Licensed Marks for the purpose of
promoting the awareness, sale or image of the Sprint PCS Products and Services;
provided, however, that Premium and Promotional Items does not include marketing
and advertising materials prepared by Licensee that are subject to the Marketing
Communications Guidelines (e.g. printed materials such as bill stuffers,
brochures and similar materials).
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
"Prime Rate" means the rate announced from time to time by The Chase
Manhattan Bank, or its successor(s), as its prime rate.
"Program Requirements" means the standards, guidelines, plans, policies
and programs established by Sprint PCS from time to time regarding the operation
and management of the Service Area Network and the Sprint PCS business operated
using the Service Area Network, including the Program Requirements set forth in
Sections 4.1, 4.2, 4.3, 7.2 and 8.1 of the Management Agreement. Sprint PCS may
also implement Program Requirements respecting a voluntary resale program, as
defined in Section 3.5.2 of the Management Agreement.
"Purchase Notice" has the meaning set forth in Section 1.2 of Exhibit 11.8
to the Management Agreement.
"Quality Standards" has the meaning set forth in Section 2.1(a) of the
Sprint Spectrum Trademark and Service Mark License Agreement or Section 2.1(a)
of the Sprint Trademark and Service Mark License Agreement.
"Rand-McNally Population Survey" means the most recent population survey
published by Rand-McNally or, if Rand-McNally no longer publishes the surveys,
then the most recent population survey published by any successor organization
to Rand-McNally or, if no such organization exists, an organization selected by
Sprint PCS that provides surveys similar to the Rand-McNally surveys.
"Receiving Party" has the meaning set forth in Section 3.1 of the Sprint
Spectrum Trademark and Service Mark License Agreement or Section 3. 1 of the
Sprint Trademark and Service Mark License Agreement.
"Related Equipment" means customer-controlled equipment for use in
connection with the Sprint PCS Products and Services including telephones,
wireless handsets and related accessories, PCMCIA cards, "smart" cards, PDA's,
PBX's, set-top boxes and data terminals.
"Related Party" means, with respect to any Person, any other Person that
directly or indirectly through one or more intermediaries controls, is
controlled by, or is under common control with the Person. For purposes of the
Management Agreement, Sprint Spectrum, SprintCom, American PCS Communications,
LLC, PhillieCo Partners I, L.P., and Cox Communications PCS, L.P. will be deemed
to be Related Parties. For purposes of this definition, the term "controls"
(including its correlative meanings "controlled by" and "under common control
with") means the possession, direct or indirect, of the power to direct or cause
the direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise.
"Restricted Party" has the meaning set forth in Section 3.1 of the Sprint
Spectrum Trademark and Service Mark License Agreement or Section 3.1 of the
Sprint Trademark and Service Mark License Agreement.
"Selected Services" means those Available Services selected by Manager to
be provided by Sprint Spectrum under Section 2.1 of the Services Agreement. An
Available Service will not be treated as a Selected Service until Sprint
Spectrum begins providing that service.
"Service Area" means the geographic area described on the Service Area
Exhibit to the Management Agreement.
"Service Area Network" means the network and business activities managed
by Manager under the Management Agreement in the Service Area under the License.
"Services Agreement" means that certain Sprint PCS Services Agreement
executed by Manager and Sprint Spectrum and any documents incorporated by
reference in said agreement, whereby Manager may delegate the performance of
certain services to Sprint PCS for fees that represent an adjustment of the fees
paid by Sprint PCS to Manager under Section 10 of the Management Agreement.
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
"Siting Regulations" means:
(1) FCC regulations governing tower siting, lighting, marking,
monitoring, and reporting of lighting malfunctions as set forth in
47 CFR ss.ss. 17.1 through 17.58, and as may be amended;
(2) FAA regulations governing tower siting, lighting, marking,
monitoring, and reporting of lighting malfunctions as set forth in
14 CFR ss.ss. 77.1 through 77.75, and as may be amended;
(3) FCC land use regulations as set forth in 47 CFRss.ss.1.1301 through
1.1319, and as may be amended; and
(4) FCC radio frequency exposure regulations as set forth in 47
CFRss.ss.1.1301 through 1.1319, and as may be amended.
"spectrum" has the same meaning as PCS Spectrum.
"Sprint" means Sprint Communications Company, L.P., a Delaware limited
partnership.
"Sprint Brands" means the "Licensed Marks" as that term is defined under
the Sprint Trademark and Service Mark License Agreement.
"Sprint PCS" means any or all of the following Related Parties who are
License holders and signatories to the Management Agreement: Sprint Spectrum
L.P., a Delaware limited partnership, SprintCom, Inc., a Kansas corporation,
PhillieCo Partners I, L.P., a Delaware limited partnership, Cox Communications
PCS, L.P., a Delaware limited partnership, and American PCS Communications, LLC,
a Delaware limited liability company. Each entity listed above is a Related
Party to each of the other listed entities.
"Sprint PCS Affiliation Agreement" has the same meaning as Affiliation
Agreement.
"Sprint PCS Brands" means the "Licensed Marks" as that term is defined
under the Sprint Spectrum Trademark and Service Mark License Agreement.
"Sprint PCS Communications Policies" means the policies established in
accordance with Section 6.4 of the Management Agreement with respect to public
relations development, maintenance and management, as they may be amended from
time to time by Sprint PCS in accordance with the terms of the Management
Agreement.
"Sprint PCS Customer Service Program Requirements" means the program and
requirements established in accordance with Section 8.1 of the Management
Agreement with respect to customer service development, maintenance and
management, as it may be amended from time to time by Sprint PCS in accordance
with the terms of the Management Agreement.
"Sprint PCS Customer Service Standards" means those customer service
standards developed by Sprint PCS with respect to customer service and
maintenance as described in Section 8.1 of the Management Agreement, as it may
be amended from time to time by Sprint PCS in accordance with the terms of the
Management Agreement.
"Sprint PCS Insurance Requirements" means the insurance requirements
developed by Sprint PCS as described in Section 12.3 of the Management
Agreement, as they may be amended from time to time by Sprint PCS in accordance
with the terms of the Management Agreement.
"Sprint PCS Management Agreement" has the same meaning as Management
Agreement.
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
"Sprint PCS National Accounts Program Requirements" means the program and
requirements established in accordance with Section 4.2 of the Management
Agreement with respect to national accounts development, maintenance and
management, as it may be amended from time to time by Sprint PCS in accordance
with the terms of the Management Agreement.
"Sprint PCS National or Regional Distribution Program Requirements" means
any distribution program and requirements established in accordance with Section
4.1 of the Management Agreement, as it may be amended from time to time by
Sprint PCS in accordance with the terms of the Management Agreement, and entered
into by Sprint PCS or its Related Parties and a third-party distributor (for
example, a national chain of retail electronics stores) from time to time, under
which the third party will distribute, lease, or sell Sprint PCS Products and
Services on a national or regional basis. The term "distributor" means a
reseller of Sprint PCS Products and Services, or an agent of Sprint PCS
authorized to sell Sprint PCS Products and Services on behalf of Sprint PCS, or
a person engaged in any other means of wholesale or retail distribution of
Sprint PCS Products and Services.
"Sprint PCS Network" means the national wireless network and business
activities to be developed by Sprint PCS, Manager and Other Managers in the
United States and certain of its territories and possessions, which network
includes the Service Area Network.
"Sprint PCS Products and Services" means all types and categories of
wireless communications services and associated products that are designated by
Sprint PCS (whether now existing or developed and implemented in the future) as
products and services to be offered by Sprint PCS, Manager and all Other
Managers as the products and services of the Sprint PCS Network for fixed and
mobile voice, short message and other data services under the FCC's rules for
broadband personal communications services, including all local area service
plans. Sprint PCS Products and Services do not include wireline products or
services, including local exchange service, wireline long distance service, and
wireline based Internet access.
"Sprint PCS Roaming and Inter Service Area Program Requirements" means:
(i) the roaming program and requirements established in accordance with
Section 4.3 of the Management Agreement, as amended from time to time by Sprint
PCS in accordance with the terms of the Management Agreement, to provide for
customers from a carrier not associated with the Sprint PCS Network to operate
the customer's handset on the Sprint PCS Network and for customers from the
Sprint PCS Network (whether customers of Sprint PCS, Manager or an Other
Manager) to operate the customer's handset on a network of a carrier not
associated with the Sprint PCS Network, and
(ii) the program established in accordance with Section 4.3 of the
Management Agreement, as amended from time to time by Sprint PCS in accordance
with the terms of the Management Agreement, to provide for customers from one
Service Area on the Sprint PCS Network, whether managed by Sprint PCS, Manager,
or an Other Manager, to operate the customer's handsets and otherwise receive
seamless service, regardless of whether the customer makes its call to or from
the Sprint PCS Network and regardless of whether the customer is a customer of
Sprint PCS, Manager or an Other Manager.
"Sprint PCS Technical Program Requirements" means the operating and
technical performance standards established by Sprint PCS, in accordance with
Section 7.2 of the Management Agreement, as amended from time to time by Sprint
PCS in accordance with the terms of the Management Agreement, for the Sprint PCS
Network as they may be amended from time to time by Sprint PCS in accordance
with the terms of the Management Agreement.
"Sprint Spectrum" means Sprint Spectrum L. P., a Delaware limited
partnership.
"Sprint Spectrum Brands" means the "Licensed Marks" as that term is
defined under the Sprint Spectrum Trademark and Service Mark License Agreement.
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
"Sprint Spectrum Trademark and Service Mark License Agreement" means that
certain Sprint Spectrum Trademark and Service Mark License Agreement executed by
Manager and Sprint Spectrum and any documents incorporated by reference in said
agreement.
"Sprint Trademark and Service Mark License Agreement" means that certain
Sprint Trademark and Service Mark License Agreement executed by Manager and
Sprint and any documents incorporated by reference in said agreement.
"SprintCom" means SprintCom, Inc., a Kansas corporation.
"Subsidiary" of any Person as of any relevant date means a corporation,
company or other entity (i) more than 50% of whose outstanding shares or equity
securities are, as of such date, owned or controlled, directly or indirectly
through one or more Subsidiaries, by such Person, and the shares or securities
so owned entitle such Person and/or Subsidiaries to elect at least a majority of
the members of the board of directors or other managing authority of such
corporation, company or other entity notwithstanding the vote of the holders of
the remaining shares or equity securities so entitled to vote or (ii) which does
not have outstanding shares or securities, as may be the case in a partnership,
joint venture or unincorporated association, but more than 50% of whose
ownership interest is, as of such date, owned or controlled, directly or
indirectly through one or more Subsidiaries, by such Person, and in which the
ownership interest so owned entitles such Person and/or Subsidiaries to make the
decisions for such corporation, company or other entity.
"Successor Notice" has the meaning set forth in Section 17.15.2(e) of the
Management Agreement.
"Term" means during the term of the Management Agreement, including the
initial Term and any renewal terms.
"Trademark and Service Mark Usage Guidelines" means the rules governing
the depiction and presentation of the Licensed Marks then generally in use by
Licensor, to be furnished by Licensor to Licensee, as the same may be amended
and updated from time to time by Licensor.
"Trademark License Agreements" means the Sprint Trademark and Service Mark
License Agreement and the Sprint Spectrum Trademark and Service Mark License
Agreement.
"Type II Report" has the meaning set forth in Section 12.1.2 of the
Management Agreement.
"Voluntary Bankruptcy" has the meaning set forth in Section 11.3.7 of the
Management Agreement.
"Wireless Mobility Communications Network" means a radio communications
system operating in the 1900 MHz spectrum range under the rules designated as
Subpart E of Part 24 of the FCC's rules.
**** Confidential portions omitted and filed separately with the Commission
<PAGE>
Exhibit 10.2
SPRINT PCS
SERVICES AGREEMENT
BETWEEN
SPRINT SPECTRUM L.P.
AND
UBIQUITEL L.L.C.
SEPTEMBER ___, 1998
<PAGE>
TABLE OF CONTENTS
Page
----
1. ENGAGEMENT OF SPRINT SPECTRUM.............................................1
1.1 Engagement of Sprint Spectrum.......................................1
1.2 Reliance on Manager.................................................1
1.3 Non-exclusive Service...............................................1
1.4 Manager's Use of Services...........................................2
2. SERVICES..................................................................2
2.1 Available Services; Selected Services...............................2
2.2 Third Party Vendors.................................................3
2.3 Contracts...........................................................3
3. FEES FOR SELECTED SERVICES................................................3
3.1 Payment of Fees.....................................................3
3.2 Adjustment of Fees..................................................3
3.3 Late Payments.......................................................4
3.4 Taxes...............................................................4
4. TERM; TERMINATION; EFFECT OF TERMINATION..................................4
4.1 Term................................................................4
4.2 Effect of Termination...............................................4
5. BOOKS AND RECORDS; CONFIDENTIAL INFORMATION...............................5
5.1 Books and Records...................................................5
5.2 Confidential Information............................................6
6. INDEMNIFICATION...........................................................7
6.1 Indemnification by Sprint Spectrum..................................7
6.2 Indemnification by Manager..........................................7
6.3 Procedure...........................................................8
7. [HARDCOPY PG. 10 MISSING]................................................10
7.2 Unable to Resolve..................................................10
7.3 Attorneys and Intent...............................................10
8. REPRESENTATIONS AND WARRANTIES...........................................10
8.1 Due Incorporation or Formation; Authorization of Agreements........10
8.2 Valid and Binding Obligation.......................................10
8.3 No Conflict; No Default............................................10
8.4 Litigation.........................................................11
9. GENERAL PROVISIONS.......................................................11
9.1 Notices............................................................11
9.2 Construction.......................................................11
9.3 Headings...........................................................11
9.4 Further Action.....................................................11
9.5 Specific Performance...............................................11
<PAGE>
9.6 Entire Agreement; Amendments.......................................12
9.7 Limitation on Rights of Others.....................................12
9.8 Waivers; Remedies..................................................12
9.9 Waiver of Jury Trial...............................................12
9.10 Binding Effect.....................................................13
9.11 Governing Law......................................................13
9.12 Severability.......................................................13
9.13 Limitation of Liability............................................13
9.14 No Assignment; Exceptions..........................................13
9.15 Disclaimer of Agency...............................................13
9.16 Independent Contractors............................................13
9.17 Expense............................................................13
9.18 General Terms......................................................14
9.19 Conflicts with Management Agreement................................14
9.20 Master Signature Page..............................................14
ii
<PAGE>
SPRINT PCS SERVICES AGREEMENT
This SERVICES AGREEMENT is made September ___ 1998, by and between Sprint
Spectrum L.P., a Delaware limited partnership ("Sprint Spectrum"), and UbiquiTel
L.L.C., a Washington limited liability company (but not any Related Party)
("Manager"). The definitions for this agreement are set forth on the "Schedule
of Definitions."
RECITALS
A. Manager and the holder of the License ("Sprint PCS") are entering into
a Management Agreement contemporaneously with the execution of this agreement,
under which Manager will design, construct, operate, manage and maintain a
wireless services network in the Service Area in accordance with Sprint PCS
standards and will offer and promote Sprint PCS Products and Services that
operate on the Sprint PCS Network.
B. Manager desires to enter into this agreement with Sprint Spectrum,
under which Sprint Spectrum may furnish certain services to Manager to assist
Manager to build out, operate, manage and maintain the Service Area Network
under the License.
AGREEMENT
In consideration of the recitals and mutual covenants and agreements
contained in this agreement, the sufficiency of which are hereby acknowledged,
the parties. intending to be bound, agree as follows:
1. ENGAGEMENT OF SPRINT SPECTRUM
1.1 Engagement of Sprint Spectrum. Manager engages Sprint Spectrum to
assist Manager with certain specified services in connection with the operations
of Manager and in building out, operating, managing and maintaining the Service
Area Network, subject to the terms and conditions of this agreement. Sprint
Spectrum accepts the engagement and will use the same effort and demonstrate the
same care in performing its obligations under this agreement as it uses in
conducting its own business. Manager will use the efforts and demonstrate the
care necessary for Sprint Spectrum to meet its obligations under this agreement.
When providing the Selected Services, Sprint Spectrum will provide those
services to Manager in the same manner it provides those services to its own
business, including the use of third party vendors to provide certain Selected
Services.
1.2 Reliance on Manager. Manager understands that Sprint Spectrum's
ability to provide the Selected Services will depend largely on Manager's
compliance with the Sprint PCS Program Requirements under the Management
Agreement and cooperation with Sprint Spectrum. Manager agrees to comply with
such requirements and to cooperate with Sprint Spectrum to enable Sprint
Spectrum to perform its obligations under this agreement.
1.3 Non-exclusive Service. Nothing contained in this agreement confers
upon Manager an exclusive right to any of the Available Services. Sprint
Spectrum may contract with
<PAGE>
others to provide expertise and services identical or similar to those to be
made available or provided to Manager under this agreement.
1.4 Manager's Use of Services. Manager agrees it will only use the
Selected Services in connection with its Service Area Network. Manager will not
use the Selected Services outside the Service Area or in connection with any
other business.
2. SERVICES
2.1 Available Services; Selected Services.
2.1.1. Available Services. Subject to the terms of this agreement,
Manager may obtain any of the Available Services from Sprint Spectrum in
accordance with the provisions of this Section 2.1. The Available Services
offered from time to time and the fees charged for such Available Services will
be set forth on the then-current Exhibit 2.1.1 (the "Available Services and Fees
Schedule"). If Sprint Spectrum offers any new Available Service, it will deliver
a new Exhibit 2.1.1 indicating the new service and the fee for the new service.
Manager may select one or more of the categories of Available Services. If
Manager selects a particular category of services it must take and pay for all
of the services under the category selected; Manager may not select only
particular services within that category.
If Sprint Spectrum determines to no longer offer an Available Service and
the service is not a Selected Service, then Sprint Spectrum may give Manager
written notice at any time during the term of this agreement that Sprint
Spectrum no longer offers the Available Service.
Sprint Spectrum may modify Exhibit 2.1.1 from time to time. Exhibit 2.1.1
will be deemed amended upon delivery of the new Exhibit 2.1.1 to Manager.
2.1.2. Selected Services. During the term of this agreement. and
subject to the terms of this agreement, Manager has selected, and Sprint
Spectrum has agreed to furnish or cause to be furnished to Manager, the
Available Services listed on Exhibit 2.1.2 (which listed services will be the
Selected Services). Sprint Spectrum may require from time to time that certain
Available Services be Selected Services where necessary to comply with legal or
regulatory requirements (e.g., mandatory provision of emergency 911 service) or
applicable operating constraints (e.g., delivery of merchandise to the regional
distribution centers of national retail distributors).
2.1.3. Changes to Selected Services. If Manager determines it no
longer requires a Selected Service, then Manager must give Sprint Spectrum
written notice at least 3 months prior to the date on which Manager wishes to
discontinue its use of such Selected Service.
If Sprint Spectrum determines to no longer offer an Available Service and
such service is one of Manager's Selected Services, then Sprint Spectrum must
give Manager written notice at least 9 months prior to its discontinuance of
such Available Service that Sprint Spectrum will no longer offer such Available
Service. If the Available Service to be discontinued is required by
2
<PAGE>
Sprint Spectrum to be a Selected Service, then Sprint Spectrum will use
commercially reasonable efforts to (a) help Manager provide the service itself
or find another vendor to provide the service, and (b) facilitate Manager's
transition to the new service provider.
2.1.4. Performance of Selected Services. Sprint Spectrum may select
the method, location and means of providing the Selected Services. If Sprint
Spectrum wishes to use Manager's facilities to provide the Selected Services,
Sprint Spectrum must obtain Manager's prior written consent.
2.2 Third Party Vendors. Some of the Available Services might be provided
by third party vendors under arrangements between Sprint Spectrum and the third
party vendors. In some instances, Manager may receive Available Services from a
third party vendor under the same terms and conditions that Sprint Spectrum
receives such services, in other instances, Manager may receive Available
Services under the terms and conditions set forth in an agreement between
Manager and the third party vendor. If Manager wishes to engage a third party
vendor to provide Available Services, Selected Services, or Available Services
that Sprint Spectrum will no longer offer, Manager must first obtain Sprint
Spectrum's prior written consent, which consent will not be unreasonably
withheld. Before Manager may obtain from the third party vendor any Available
Services, Selected Services, or Available Services that Sprint Spectrum will no
longer offer, such vendor must execute an agreement prepared by Sprint Spectrum
that obligates the vendor to maintain the confidentiality of any proprietary
information and that prohibits the vendor from using any proprietary technology,
information or methods for its benefit or the benefit of any other person or
entity. Manager's use of a third party vendor that is not providing Available
Services to Manager on behalf of Sprint PCS under the Management Agreement will
not qualify for assumed compliance with the Program Requirements under Sections
7.1(a)(ii) or 8.1(b) of the Management Agreement.
2.3 Contracts. Manager will notify Sprint Spectrum of any contract or
other arrangement Manager has with any other party that will affect how Sprint
Spectrum is to provide the Selected Services.
3. FEES FOR SELECTED SERVICES
3.1 Payment of Fees. Sprint Spectrum and Manager agree that the fees for
the Available Services will initially be those set forth on Exhibit 2.1.1, which
fees represent an adjustment to any fees paid by Sprint PCS to Manager under
Section 10 of the Management Agreement. The monthly charge for any fees based on
the number of subscribers of the Service Area Network will be determined based
on the number of subscribers as of the 15th day of the month for which the
charge is being calculated. Manager agrees to pay the fees to Sprint Spectrum
within 20 days after the date of the invoice. If Manager enters into an
agreement with a third party vendor under Section 2.2, Manager agrees to pay the
fees for the services rendered by the third party vendor in accordance with the
terms and conditions of such agreement.
3.2 Adjustment of Fees. Sprint Spectrum may change the fee for any service
it provides once during any 12-month period by delivering a new Exhibit 2.1.1 to
Manager. Exhibit 2.1.1 will be deemed amended on the effective date noted on the
new Exhibit 2.1.1,
3
<PAGE>
which will be at least 30 days after delivering the new Exhibit 2.1.1. Manager
must notify Sprint Spectrum in writing before the effective date of the new
Exhibit 2.1.1 if Manager wishes to discontinue a Selected Service for which the
price is being increased (a "Cancelled Service"). If Manager discontinues a
Selected Service under this Section 3.2, Sprint Spectrum will, at Manager's
option, continue to provide the Cancelled Service and to charge Manager the
current fee (i.e., the fee under the Exhibit 2.1.1 in effect on the date Manager
gives its cancellation notice to Sprint Spectrum) for the Cancelled Service for
up to 9 months from the date Sprint Spectrum gives Manager notice of the price
change or until Manager no longer needs the Cancelled Service, whichever occurs
first. If Sprint Spectrum continues to provide the Cancelled Service after the
9-month period, Sprint Spectrum will apply the new fee. under the new Exhibit
2.1.1, and such fee will be applied retroactively as of the effective date of
the new schedule. Manager agrees to pay such retroactive charge within 10 days
after the date of the invoice for such charge.
3.3 Late Payments. Any payment due under this Section 3 that is not paid
by Manager to Sprint Spectrum in accordance with the terms of this agreement
will bear interest at the Default Rate beginning (and including) the 6th day
after the due date until (and including) the date on which such payment is made.
3.4 Taxes. Manager will pay or reimburse Sprint Spectrum for any sales,
use, gross receipts or similar tax, administrative fee, telecommunications fee
or surcharge for taxes or fees levied by a governmental authority on the fees
and charges payable to Sprint Spectrum by Manager.
4. TERM; TERMINATION; EFFECT OF TERMINATION
4.1 Term. This agreement commences on the date of execution and continues
until the Management Agreement terminates. This agreement automatically
terminates upon termination of the Management Agreement. Neither party may
terminate this agreement for any reason other than the termination of the
Management Agreement.
4.2 Effect of Termination. Upon the termination of this agreement, all
rights and obligations of each party under this agreement will immediately
cease, except that:
(a) Any rights arising out of a breach of any terms of this
agreement will survive any termination of this agreement;
(b) The provisions of this Section 4.2 and Sections 5.2, 6, 7, and 9
will survive any termination of this agreement; and
(c) The payment obligations under Section 3 will survive any
termination of this agreement if, and to the extent, any fees have accrued or
are otherwise due and owing from Manager to Sprint Spectrum or any Sprint
Spectrum Related Party as of the date of termination of this agreement.
4
<PAGE>
5. BOOKS AND RECORDS; CONFIDENTIAL INFORMATION
5.1 Books and Records.
5.1.1. General. Each party must keep and maintain books and records
to support and document any fees, costs, expenses or other charges due in
connection with the provisions set forth in this agreement. The records must be
retained for a period of at least 3 years after the fees, costs, expenses or
other charges to which the records relate have accrued and have been paid, or
such other period as may be required by law.
5.1.2. Audit. On reasonable advance written notice by the Manager,
but no more frequently than annually, Sprint PCS will provide a report issued in
conformity with Statement of Auditing Standard No. 70 "Reports on the Processing
of Transactions by Service Organizations" ("Type II Report" or "Manager
Management Report"). Such report will be prepared by independent auditors and
will provide an opinion on the controls placed in operation and tests of
operating effectiveness of those controls in effect at Sprint PCS over the
Manager Management Processes. "Manager Management Processes" include those
services generally provided within the Management Agreement, primarily billing
and collection of Collected Revenues. The Manager is responsible for costs
incurred attributable to such requested procedures with respect to the services
provided under this agreement, including without limitation discussion of the
billing and collection of Collected Revenues. This report will be made available
to the other party upon such other party's request.
5.1.3. Contesting an Audit. If the party that did not select the
independent auditor does not agree with the findings of the audit, then such
party can contest the findings by providing notice of such disagreement to the
other party (the "Dispute Notice"). The date of delivery of such notice is the
"Dispute Notice Date." If the parties are unable to resolve the disagreement
within 10 Business Days after the Dispute Notice Date, they will resolve the
disagreement in accordance with the following procedures.
The two parties and the auditor that conducted the audit will all agree on
an independent certified public accountant with a regional or national
accounting practice in the wireless telecommunications industry (the "Arbiter")
within 15 Business Days after the Dispute Notice Date. If, within 15 Business
Days after the Dispute Notice Date, the three parties fail to agree on the
Arbiter, then at the request of either party to this agreement, the Arbiter will
be selected pursuant to the rules then in effect of the American Arbitration
Association. Each party will submit to the Arbiter within 5 Business Days after
its selection and engagement all information reasonably requested by the Arbiter
to enable the Arbiter to independently resolve the issue that is the subject of
the Dispute Notice. The Arbiter will make its own determination of the amount of
fees, costs, expenses or other charges payable under this agreement with respect
to the period audited. The Arbiter will issue a written report of its
determination in reasonable detail and will deliver a copy of the report to the
parties within 10 Business Days after the Arbiter receives all of the
information reasonably requested. The determination made by the Arbiter will be
final and binding and may be enforced by any court having jurisdiction. The
parties will cooperate fully in
5
<PAGE>
assisting the Arbiter and will take such actions as are necessary to expedite
the completion of and to cause the Arbiter to expedite its assignment.
If the amount owed by a contesting party is reduced by more than 10% or
the amount owed to a contesting party is increased by more than 10% then the
non-contesting party will pay the costs and expenses of the Arbiter, otherwise
the contesting party will pay the costs and expenses of the Arbiter.
5.2 Confidential Information.
(a) Except as specifically authorized by this agreement, each of the
parties must, for the term of this agreement and 3 years after the date of
termination of this agreement, keep confidential, not disclose to others and use
only for the purposes authorized in this agreement, all Confidential Information
disclosed by the other party to the party in connection with this agreement,
except that the foregoing obligation will not apply to the extent that any
Confidential Information:
(i) is or becomes, after disclosure to a party, publicly known
by any means other than through unauthorized acts or omissions of the
party or its agents; or
(ii) is disclosed in good faith to a party by a third party
entitled to make the disclosure.
(b) Notwithstanding the foregoing, a party may use, disclose or
authorize the disclosure of Confidential Information that it receives that:
(i) has been published or is in the public domain, or that
subsequently comes into the public domain, through no fault of the
receiving party;
(ii) prior to the effective date of this agreement was
properly within the legitimate possession of the receiving party, or
subsequent to the effective date of this agreement, is lawfully received
from a third party having rights to publicly disseminate the Confidential
Information without any restriction and without notice to the recipient of
any restriction against its further disclosure;
(iii) is independently developed by the receiving party
through persons or entities who have not had, either directly or
indirectly, access to or knowledge of the Confidential Information;
(iv) is disclosed to a third parry consistent with the terms
of the written approval of the party originally disclosing the
information;
(v) is required by the receiving party to be produced under
order of a court of competent jurisdiction or other similar requirements
of a governmental agency, and the Confidential Information will otherwise
continue to be Confidential Information required to be held confidential
for purposes of this agreement;
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(vi) is required by the receiving party to be disclosed by
applicable law or a stock exchange or association on which the receiving
party's securities (or those of its Related Parties) are or may become
listed; or
(vii) is disclosed by the receiving party to a financial
institution or accredited investor (as that term is defined in Rule 501(a)
under the Securities Act of 1933) that is considering providing financing
to the receiving party and which financial institution or accredited
investor has agreed to keep the Confidential Information confidential in
accordance with an agreement at least as restrictive as this Section 5.
(c) The party making a disclosure under Sections 5.2(b)(v),
5.2(b)(vii) or 5.2(b)(vii) must inform the non-disclosing party as promptly as
is reasonably necessary to enable the non-disclosing party to take action to,
and use the disclosing party's reasonable best efforts to, limit the disclosure
and maintain confidentiality to the extent practicable.
(d) Manager will not, except when serving in the capacity of Manager
under this agreement, use any Confidential Information of any kind that it
receives under or in connection with this agreement. For example, if Manager
operates a wireless company in a different licensed area, Manager may not use
any of the Confidential Information received under or in connection with this
agreement in operating its other wireless business.
6. INDEMNIFICATION
6.1 Indemnification by Sprint Spectrum. Sprint Spectrum agrees to
indemnify, defend and hold harmless Manager, its directors, managers, officers
and employees from and against any and all claims, demands, causes of action,
losses, actions, damages, liability and expense, including costs and reasonable
attorneys' fees, against Manager, its directors, managers, officers and
employees arising from or relating to the violation by Sprint Spectrum, its
directors, officers, employees, contractors, subcontractors, agents or
representatives of any law, regulation or ordinance applicable to Sprint
Spectrum in its performance of the Selected Services, or by Sprint Spectrum's,
or its directors', officers', employees', contractors', subcontractors', agents'
or representatives' breach of any representation, warranty or covenant contained
in this agreement, except where and to the extent the claim, demand, cause of
action, loss, action, damage, liability and expense results from the negligence
or willful misconduct of Manager, its directors, managers, officers, employees,
agents or representatives. Sprint Spectrum's indemnification obligations under
this Section 6.1 do not apply to any third party vendors that provide services
(including Selected Services) directly to Manager or Manager's Related Parties
under a separate agreement.
6.2 Indemnification by Manager. Manager agrees to indemnify, defend and
hold harmless Sprint Spectrum, its directors, officers and employees from and
against any and all claims, demands, causes of action, losses, actions, damages,
liability and expense, including costs and reasonable attorneys' fees, against
Sprint Spectrum, its directors, officers and employees arising from or relating
to Manager's, or its directors', managers', officers', employees', contractors',
subcontractors', agents' or representatives' violation of any law, regulation or
ordinance applicable to Manager, or by Manager's, or its directors', managers',
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officers', employees', contractors', subcontractors', agents' or
representatives' breach of any representation, warranty or covenant contained in
this agreement. Manager's ownership of the Operating Assets or the operation of
the Service Area Network, except where and to the extent the claim, demand,
cause of action, loss, action, damage, liability and expense results from the
negligence or willful misconduct of Sprint Spectrum, its directors, officers,
employees, contractors, subcontractors, agents or representatives.
6.3 Procedure.
6.3.1. Notice. Any party being indemnified ("Indemnitee") will give
the party making the indemnification ("Indemnitor") written notice as soon as
practicable but no later than 5 Business Days after the party becomes aware of
the facts, conditions or events that give rise to the claim for indemnification
if:
(a) any claim or demand is made or liability is asserted against
Indemnitee; or
(b) any suit, action, or administrative or legal proceeding is
instituted or commenced in which Indemnitee is involved or is named as a
defendant either individually or with others.
Failure to give notice as described in this Section 6.3.1 does not modify
the indemnification obligations of this provision, except if Indemnitor is
harmed by failure
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[ORIGINAL HARDCOPY PAGE 10 MISSING FROM DOCUMENT GIVEN]
9
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Within 10 Business Days after delivery of the notice, the appropriate
officers of each party will meet at a mutually acceptable time and place, and
thereafter as often as they deem reasonably necessary, to exchange relevant
information and to attempt to resolve the dispute.
Either party may elect, by giving written notice to the other party, to
escalate any dispute arising out of or relating to the determination of fees
that is not resolved in the normal course of business or by the audit process
set forth in Sections 5.1.2 and 5.1.3, first to the appropriate financial or
accounting officers to be designated by each party. The designated officers will
meet in the manner described in the preceding paragraph. If the matter has not
been resolved by the designated officers within 30 days after the notifying
party's notice, either party may elect to escalate the dispute to the
appropriate (as determined by the party) officers in accordance with the prior
paragraphs of this Section 7.1.
7. [HARDCOPY PG. 10 MISSING]
7.2 Unable to Resolve. If a dispute has not been resolved within 60 days
after the notifying party's notice, the parties will continue to operate under
this agreement and sue the other party for damages or seek other appropriate
remedies as provided in this agreement, except neither party may bring a suit
for damages based on an event that occurs during the first two years of this
agreement.
7.3 Attorneys and Intent. If an officer intends to be accompanied at a
meeting by an attorney, the other party's officer will be given at least 3
Business Days prior notice of the intention and may also be accompanied by an
attorney. All negotiations under this Section 7 are confidential and will be
treated as compromise and settlement negotiations for purposes of the Federal
Rules of Civil Procedure and state rules of evidence and civil procedure.
8. REPRESENTATIONS AND WARRANTIES
Each party for itself makes the following representations and warranties
to the other party:
8.1 Due Incorporation or Formation; Authorization of Agreements. The party
is either a corporation, limited liability company, or limited partnership duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization. Manager is qualified to do business and in
good standing in every jurisdiction in which the Service Area is located. The
party has the full power and authority to execute and deliver this agreement and
to perform its obligations under this agreement.
8.2 Valid and Binding Obligation. This agreement constitutes the valid and
binding obligation of the party, enforceable in accordance with its terms,
except as may be limited by principles of equity or by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally.
8.3 No Conflict; No Default. Neither the execution, delivery and
performance of this agreement nor the consummation by the party of the
transactions contemplated in this agreement
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will conflict with, violate or result in a breach of (a) any law, regulation,
order, writ, injunction, decree, determination or award of any governmental
authority or any arbitrator, applicable to such party, or (b) any term,
condition or provision of the articles of incorporation, certificate of limited
partnership, certificate of organization, bylaws, partnership agreement or
limited liability company agreement (or other governing documents) of such party
or of any material agreement or instrument to which such party is or may be
bound or to which any of its material properties or assets is subject.
8.4 Litigation. No action, suit, proceeding or investigation is pending
or, to the knowledge of the party, threatened against or affecting the party or
any of its properties, assets or businesses in any court or before or by any
governmental agency that could, if adversely determined, reasonably be expected
to have a material adverse effect on the party's ability to perform its
obligations under this agreement. The party has not received any currently
effective notice of any default that could reasonably be expected to result in a
breach of the preceding sentence.
9. GENERAL PROVISIONS
9.1 Notices. Any notice, payment, demand, or communication required or
permitted to be given by any provision of this agreement must be in writing and
mailed (certified or registered mail, postage prepaid, return receipt
requested), sent by hand or overnight courier, or sent by facsimile (with
acknowledgment received and a copy sent by overnight courier), charges prepaid
and addressed described on the Notice Address Schedule attached to the Master
Signature Page, or to any other address or number as the person or entity may
from rime to time specify by written notice to the other parties.
All notices and other communications given to a party in accordance with
the provisions of this agreement will be deemed to have been given when
received.
9.2 Construction. This agreement will be construed simply according to its
fair meaning and not strictly for or against either party.
9.3 Headings. The table of contents, section and other headings contained
in this agreement are for reference purposes only and are not intended to
describe, interpret, define, limit or expand the scope, extent or intent of this
agreement.
9.4 Further Action. Each party agrees to perform all further acts and
execute, acknowledge, and deliver any documents that may be reasonably
necessary, appropriate, or desirable to carry out the intent and purposes of
this agreement.
9.5 Specific Performance. Each party agrees with the other party that the
party would be irreparably damaged if any of the provisions of this agreement
were not performed in accordance with their specific terms and that monetary
damages alone would not provide an adequate remedy. Accordingly, in addition to
any other remedy to which the non-breaching party may be entitled, at law or in
equity, the non-breaching party will be entitled to injunctive relief to
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<PAGE>
prevent breaches of this agreement and specifically to enforce the terms and
provisions of this agreement.
9.6 Entire Agreement; Amendments. The provisions of this agreement and the
Management Agreement (if Sprint Spectrum is a party to that agreement)
(including the exhibits to those agreements) set forth the entire agreement and
understanding between the parties as to the subject matter of this agreement and
supersede all prior agreements, oral or written, and other communications
between the parties relating to the subject matter of this agreement. Except for
Sprint Spectrum's right to amend the Available Services and the fees charged for
such services as shown on Exhibit 2.1.1, and Manager's right to amend the
Selected Services listed on Exhibit 2.1.2, this agreement may be modified or
amended only by a written amendment signed by persons or entities authorized to
bind each party.
9.7 Limitation on Rights of Others. Nothing in this agreement, whether
express or implied, will be construed to give any person or entity other than
the parties any legal or equitable right, remedy or claim under or in respect of
this agreement.
9.8 Waivers; Remedies. The observance of any term of this agreement may be
waived (whether generally or in a particular instance arid either retroactively
or prospectively) by the party entitled to enforce the term, but any waiver is
effective only if in a writing signed by the party against which the waiver is
to be asserted. Except as otherwise provided in this agreement, no failure or
delay of either party in exercising any power or right under this agreement will
operate as a waiver of the power or right, nor will any single or partial
exercise of any right or power preclude any other or further exercise of the
right or power or the exercise of any other right or power.
Sprint Spectrum is not in breach of any covenant in this agreement, if
failure of such party to comply with such covenant or Sprint Spectrum's
non-compliance with the covenant results primarily from:
(i) any FCC order or any other injunction issued by any
governmental authority impeding the ability to comply with the covenant;
(ii) the failure of any governmental authority to grant any
consent, approval, waiver, or authorization or any delay on the part of
any governmental authority in granting any consent, approval, waiver or
authorization;
(iii) the failure of any vendor to deliver in a timely manner
any equipment or service; or
(iv) any act of God, act of war or insurrection, riot, fire,
accident, explosion, labor unrest, strike, civil unrest, work stoppage,
condemnation or any similar cause or event not reasonably within the
control of Sprint Spectrum.
9.9 Waiver of Jury Trial. EACH PARTY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY
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IN RESPECT OF ANY ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT.
9.10 Binding Effect. Except as otherwise provided in this agreement, this
agreement is binding upon and inures to the benefit of the parties and their
respective and permitted successors, transferees, and assigns, including any
permitted successor, transferee or assignee of the Management Agreement. The
parties intend that this agreement bind only the party signing this agreement
and that the agreement is not binding on the Related Parties of a party unless
the agreement provides that Related Parties are bound.
9.11 Governing Law. The internal laws of the State of Missouri (without
regard to principles of conflicts of law) govern the validity of this agreement,
the construction of its terms, and the interpretation of the rights and duties
of the parties.
9.12 Severability. The parties intend every provision of this agreement to
be severable. If any provision of this agreement is held to be illegal, invalid,
or unenforceable for any reason, the parties intend that a court enforce the
provision to the maximum extent permissible so as to effect the intent of the
parties (including the enforcement of the remaining provisions). If necessary to
effect the intent of the parties, the parties will negotiate in good faith to
amend this agreement to replace the parties.
9.13 Limitation of Liability. NO PARTY WILL BE LIABLE TO THE OTHER PARTY
FOR SPECIAL, INDIRECT, INCIDENTAL, EXEMPLARY, CONSEQUENTIAL OR PUNITIVE DAMAGES,
OR LOSS OF PROFITS, ARISING FROM THE RELATIONSHIP OF THE PARTIES OR THE CONDUCT
OF BUSINESS UNDER, OR BREACH OF, THIS AGREEMENT, EXCEPT WHERE SUCH DAMAGES OR
LOSS OF PROFITS ARE CLAIMED BY OR AWARDED TO A THIRD PARTY IN A CLAIM OR ACTION
AGAINST WHICH A PARTY TO THIS AGREEMENT HAS A SPECIFIC OBLIGATION TO INDEMNIFY
ANOTHER PARTY TO THIS AGREEMENT.
9.14 No Assignment; Exceptions. This agreement may only be assigned in
conjunction with and to the same party or parties to whom the Management
Agreement has been validly assigned under the Management Agreement's terms and
conditions.
9.15 Disclaimer of Agency. Neither party by this agreement makes the other
party a legal representative or agent of the party, nor does either party have
the right to obligate the other party in any manner, except if the other party
expressly permits the obligation by the party or except for provisions in this
agreement expressly authorizing one party to obligate the other.
9.16 Independent Contractors. The parties do not intend to create any
partnership, joint venture or other profit-sharing arrangement, landlord-tenant
or lessor-lessee relationship, employer-employee relationship, or any other
relationship other than that expressly provided in this agreement. Neither party
to this agreement has any fiduciary duty to the other party.
9.17 Expense. Each party bears the expense of complying with this
agreement except as otherwise expressly provided in this agreement.
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9.18 General Terms.
(a) This agreement, including the attached Schedule of Definitions,
is to be interpreted in accordance with the following rules of construction:
(i) The definitions in this agreement apply equally to both
the singular and plural forms of the terms defined unless the context
otherwise requires;
(ii) The words "include," "includes" and "including" are
deemed to be followed by the phrase "without limitation";
(iii) All references in this agreement to Sections and
Exhibits are references to Sections of, and Exhibits to, this agreement,
unless otherwise specified; and
(iv) All references to any agreement or other instrument or
statute or regulation are to it as amended and supplemented from time to
time (and, in the case of a statute or regulation, to any corresponding
provisions of successor statutes or regulations), unless the context
otherwise requires.
(b) Any reference in this agreement to a "day" or number of "days"
(without the explicit qualification of "Business") is a reference to a calendar
day or number of calendar days. If any action or notice is to be taken or given
on or by a particular calendar day, and the calendar day is not a Business Day,
then the action or notice may be taken or given on the next Business Day.
9.19 Conflicts with Management Agreement. The provisions of the Management
Agreement govern over those of this Services Agreement if the provisions
contained in this agreement conflict with analogous provisions in the Management
Agreement.
9.20 Master Signature Page. Each party agrees that it will execute the
Master Signature Page that evidences such party's agreement to execute, become a
party to and be bound by this agreement, which document is incorported herein by
this reference.
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Exhibit 2.1.2
<PAGE>
Exhibit 10.3
SPRINT SPECTRUM
TRADEMARK AND SERVICE MARK
LICENSE AGREEMENT
BETWEEN
SPRINT SPECTRUM L.P.
AND
UBIQUITEL L.L.C.
SEPTEMBER __, 1998
<PAGE>
SPRINT SPECTRUM TRADEMARK AND
SERVICE MARK LICENSE AGREEMENT
THIS AGREEMENT is made as of the __ day of September, 1998, by and between
Sprint Spectrum L.P., a Delaware limited partnership, as licensor ('Licensor"),
and UbiquiTel L.L.C., a Washington limited liability company, as licensee
("Licensee"). The definitions for this agreement are set forth on the "Schedule
of Definitions".
RECITALS:
WHEREAS, Licensor is the owner of the U.S. trademarks and service marks
"THE CLEAR ALTERNATIVE TO CELLULAR" and "EXPERIENCE THE CLEAR ALTERNATIVE TO
CELLULAR TODAY" and such other marks as may be adopted and established from time
to time and the goodwill of the business symbolized thereby; and
WHEREAS, Licensee desires to use the trademarks and service marks in
commerce;
NOW, THEREFORE, the parties, in consideration of the mutual agreements
herein contained and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, do hereby agree as follows:
ARTICLE 1
GRANT OF TRADEMARK AND SERVICE MARK RIGHTS; EXCLUSIVITY
Section 1.1 License.
(a) Grant of License. Subject to the terms and conditions hereof,
Licensor hereby grants to Licensee, and Licensee hereby accepts from
Licensor, for the term of this agreement, a non-transferable.
royalty-free license to use the Licensed Marks solely for and in
connection with the marketing, promotion, advertisement,
distribution, lease or sale of Sprint PCS Products and Services and
Premium and Promotional Items in the Service Area.
(b) Related Equipment. The rights granted hereunder to Licensee shall
not include the right to manufacture equipment under the Licensed
Marks. However, subject to the terms and conditions hereof. Licensor
hereby grants to Licensee, and Licensee hereby accepts from
Licensor, for the term of this agreement, a non-transferable,
royalty-free license to market, promote, advertise, distribute and
resell and lease Related Equipment in connection with the marketing,
promotion, advertisement, distribution, lease or sale by Licensee of
Sprint PCS Products and Services, and to furnish services relating
to such Related Equipment (including installation, repair and
maintenance of Related Equipment), under the Licensed Marks.
Sprint Proprietary Information - RESTRICTED
<PAGE>
ARTICLE 2
QUALITY STANDARDS, MAINTENANCE
Section 2.1. Maintenance of Quality.
(a) Adherence to Quality Standards. In the course of marketing,
promoting, advertising, distributing, leasing and selling Sprint PCS
Products and Services and Premium and Promotional Items under the
Licensed Marks, Licensee shall maintain and adhere to standards of
quality and specifications that conform to or exceed those quality
standards and technical and operational specifications adopted
and/or amended in the manner provided below ("Quality Standards")
and those imposed by Law. Such Quality Standards are designed to
ensure that the quality of the Sprint PCS Products and Services and
Premium and Promotional Items marketed, promoted, advertised,
distributed, leased and sold under the Licensed Marks are consistent
with the high reputation of the Licensed Marks and are in conformity
with applicable Laws.
(b) Establishment of Quality Standards. The parties acknowledge that the
initial Quality Standards for the Sprint PCS Products and Services
and Premium and Promotional Items are attached to the Management
Agreement as Exhibits 4.1, 4.2, 4.3, 7.2, and 8.1. The Quality
Standards shall (i) be consistent with the reputation for quality
associated with the Licensed Marks and (ii) be commensurate with a
high level of quality (taking into account Licensee's fundamental
underlying technology and standards), consistent with the level of
quality being offered in the market for products and services of the
same kind as the Sprint PCS Products and Services.
(c) Changes in Quality Standards. In the event that Licensor wishes to
change the Quality Standards, it will notify Licensee in writing of
such proposed amendments, and will afford Licensee a reasonable time
period in which to adopt such changes as may be required in order
for Licensee to conform to the amended Quality Standards.
Section 2.2. Rights of Inspection. In order to ensure that the Quality
Standards are maintained, Licensor and its authorized agents and representatives
shall have the right, but not the obligation, with prior notice to Licensee, to
enter upon the premises of any office or facility operated by or for Licensee
with respect to Sprint PCS Products and Services and Premium and Promotional
Items at all reasonable times, to inspect, monitor and test in a reasonable
manner facilities and equipment used to furnish Sprint PCS Products and Services
and Premium and Promotional Items and, with prior written notice to Licensee, to
inspect the books and records of Licensee in a manner that does not unreasonably
interfere with the business and affairs of Licensee, all as they relate to the
compliance with the Quality Standards maintained hereunder.
Sprint Proprietary Information - RESTRICTED
2
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Section 2.3. Marking; Compliance with Trademark Laws. Licensee shall cause
the appropriate designation "TM" or "SM" or the registration symbol "(R)" to be
placed adjacent to the Licensed Marks in connection with the use thereof and to
indicate such additional information as Licensor shall reasonably specify from
time to time concerning the license rights under which Licensee uses the
Licensed Marks. Licensee shall place the following notice on all printed or
electronic materials on which the Licensed Marks appear: "THE CLEAR ALTERNATIVE
TO CELLULAR", "EXPERIENCE THE CLEAR ALTERNATIVE TO CELLULAR TODAY", and such
other marks as may be adopted and established from time to time, are trademarks
and/or service marks of Sprint Spectrum L.P., "used under license" or such other
notice as Licensor may specify from time to time.
Section 2.4. Other Use Restrictions. Licensee shall not use the Licensed
Marks in any manner that would reflect adversely on the image of quality
symbolized by the Licensed Marks.
ARTICLE 3
CONFIDENTIAL INFORMATION
Section 3.1. Maintenance of Confidentiality. Each of Licensor and Licensee
and their respective Controlled Related Parties (each a "Restricted Party")
shall cause their respective officers and directors (in their capacity as such)
to, and shall take all reasonable measures to cause their respective employees,
attorneys, accountants, consultants and other agents and advisors (collectively,
and together with their respective officers and directors, "Agents") to, keep
secret and maintain in confidence the terms of this agreement and all
confidential and proprietary information and data of the other party or its
Related Parties disclosed to it (in each case, a "Receiving Party") in
connection with the performance of its obligations under this agreement (the
"Confidential Information") and shall not, and shall cause their respective
officers and directors not to, and shall take all reasonable measures to cause
their respective other Agents not to, disclose Confidential Information to any
Person other than the parties, their Controlled Related Parties and their
respective Agents that need to know such Confidential Information. Each party
further agrees that it shall not use the Confidential Information for any
purpose other than determining and performing its obligations and exercising its
rights under this agreement. Each party shall take all reasonable measures
necessary to prevent any unauthorized disclosure of the Confidential Information
by any of their respective Controlled Related Parties or any of their respective
Agents. The measures taken by a Restricted Party to protect Confidential
Information shall be not deemed unreasonable if the measures taken are at least
as strong as the measures taken by the disclosing party to protect such
Confidential Information.
Section 3.2. Permitted Disclosures. Nothing herein shall prevent any
Restricted Party or its Agents from using, disclosing, or authorizing the
disclosure of Confidential Information it receives and which:
(i) has been published or is in the public domain, or which
subsequently comes into the public domain, through no fault of
the receiving party;
Sprint Proprietary Information - RESTRICTED
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(ii) prior to receipt hereunder was property within the legitimate
possession of the Receiving Party or, subsequent to receipt
hereunder is lawfully received from a third party having
rights therein without restriction of the third party's right
to disseminate the Confidential Information and without notice
of any restriction against its further disclosure.
(iii) is independently developed by the Receiving Party through
Persons who have not had, either directly or indirectly,
access to or knowledge of such Confidential Information;
(iv) is disclosed to a third party with the written approval of the
party originally disclosing such information, provided that
such Confidential Information shall cease to be confidential
and proprietary information covered by this agreement only to
the extent of the disclosure so consented to;
(v) subject to the Receiving Party's compliance with Section 3.4
below, is required to be produced under order of a court of
competent jurisdiction or other similar requirements of a
governmental agency, provided that such Confidential
Information to the extent covered by a protective order or its
equivalent shall otherwise continue to be Confidential
Information required to be held confidential for purpose of
this agreement; or
(vi) subject to the Receiving Party's compliance with Section 3.4
below, is required to be disclosed by applicable Law or a
stock exchange or association on which such Receiving Party's
securities (or those of its Related Party) are listed.
Section 3.3. Financial Institutions. Notwithstanding this Article 3, any
party may provide Confidential Information to any financial institution in
connection with borrowings from such financial institution by such party or any
of its Controlled Related Parties, so long as prior to any such disclosure such
financial institution executes a confidentiality agreement that provides
protection substantially equivalent to the protection provided the parties in
this Article 3.
Section 3.4. Procedures. In the event that any Receiving Party (i) must
disclose Confidential Information in order to comply with applicable Law or the
requirements of a stock exchange or association on which such Receiving Party's
securities or those of its Related Parties are listed or (ii) becomes legally
compelled (by oral questions, interrogatories, requests for information or
documents, subpoenas, civil investigative demand or otherwise) to disclose any
Confidential Information, the Receiving Party shall provide the disclosing party
with prompt written notice so that in the case of clause (i), the disclosing
party can work with the Receiving Party to limit the disclosure to the greatest
extent possible consistent with legal obligations or in the case of clause (ii),
the disclosing party may seek a protective order or other appropriate
Sprint Proprietary Information - RESTRICTED
4
<PAGE>
remedy or waive compliance with the provisions of this agreement. In the case of
a clause (ii), (A) if the disclosing party is unable to obtain a protective
order or other appropriate remedy, or if the disclosing party so directs, the
Receiving Party shall, and shall cause its employees to, exercise all
commercially reasonable efforts to obtain a protective order or other
appropriate remedy at the disclosing party's reasonable expense, and (B) failing
the entry of a protective order or other appropriate remedy or receipt of a
waiver hereunder, the Receiving Party shall furnish only that portion of the
Confidential Information which it is advised by opinion of its counsel is
legally required to be furnished and shall exercise all commercially reasonable
efforts to obtain reliable assurance that confidential treatment shall be
accorded such Confidential Information, it being understood that such reasonable
efforts shall be at the cost and expense of the disclosing party whose
Confidential Information has been sought.
Section 3.5. Survival. The obligations under this Article 3 shall survive,
as to any party, until two (2) years following the date of termination of this
agreement, and, as to any Controlled Related Party of a party, until two (2)
years following the earlier to occur of (A) the date that such Person is no
longer a Controlled Related Party of a party, or (B) the date of the termination
of this agreement; provided that such obligations shall continue indefinitely
with respect to any trade secret or similar information which is proprietary to
a party or its Controlled Related Parties and provides such party or its
Controlled Related Parties with an advantage over its competitors.
ARTICLE 4
REPRESENTATIONS, WARRANTIES AND COVENANTS OF LICENSEE
Section 4.1. Licensor's Ownership. Licensee acknowledges Licensor's
exclusive right, title and interest in and to the Licensed Marks and
acknowledges that nothing herein shall be construed to accord to Licensee any
rights in the Service Area in the Licensed Marks except as expressly provided,
herein. Licensee acknowledges that its use in the Service Area of the Licensed
Marks shall not create in Licensee any right, title or interest in the Service
Area in the Licensed Marks and that all use in the Service Area of the Licensed
Marks and the goodwill symbolized by and connected with such use of the Licensed
Marks will inure solely to the benefit of the Licensor.
Section 4.2. No Challenge by Licensee. Licensee covenants that (i)
Licensee will not at any time challenge Licensor's rights, title or interest in
the Licensed Marks (other than to assert the specific rights granted to Licensee
under this agreement), (ii) Licensee will not do or cause to be done or omit to
do anything, the doing, causing or omitting of which would contest or in any way
impair or tend to impair the rights of Licensor in the Licensed Marks, and (iii)
Licensee will not represent to any third party that Licensee has any ownership
or rights in the Service Area with respect to the Licensed Marks other than the
specific rights conferred by this agreement.
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ARTICLE 5
REPRESENTATIONS, WARRANTIES AND COVENANTS OF LICENSOR
Section 5.1. Title to the Licensed Marks. Licensor represents and warrants
that:
(a) Licensor has good title to the Licensed Marks and has the right to
grant the licenses provided for hereunder in accordance with the
terms and conditions hereof, free of any liabilities, charges,
liens, pledges, mortgages, restrictions, adverse claims, security
interests, rights of others, and encumbrances of any kind
(collectively, "Encumbrances"), other than Encumbrances which will
not restrict or interfere in any material respect with the exercise
by Licensee of the rights granted to Licensee hereunder.
(b) There is no claim, action, proceeding or other litigation pending
or, to the knowledge of Licensor, threatened with respect to
Licensor's ownership of the Licensed Marks or which, if adversely
determined, would restrict or otherwise interfere in any material
respect with the exercise by Licensee of the rights purported to be
granted to Licensee hereunder.
Except as expressly provided above in this Section 5.1, Licensor makes no
representation or warranty of any kind or nature whether express or implied with
respect to the Licensed Marks (including freedom from third party infringement
of the Licensed Marks).
The representations and warranties provided for in this Section 5.1 shall
survive the execution and delivery of this agreement.
Section 5.2 Other Licensees. In the event Licensor grants to any third
party licenses or rights with respect to the Licensed Marks, Licensor shall not,
in connection with the grant of any such license or rights, take any actions, or
suffer any omission that would adversely affect the existence or validity of the
Licensed Marks or conflict with the rights granted to Licensee hereunder.
Section 5.3. Abandonment. Licensor covenants and agrees that, during the
term of this agreement, it will not abandon the Licensed Marks.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF BOTH PARTIES
Section 6.1 Representations and Warranties. Each party hereby represents
and warrants to the other party as follows:
(a) Due Incorporation or Formation; Authorization of Agreement. Such
party is a corporation duly organized, a limited liability company
duly organized or a partnership duly formed, validly existing and,
if applicable, in good standing
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under the laws of the jurisdiction of its incorporation or formation
and has the corporate, company or partnership power and authority to
own its property and carry on its business as owned and carried on
at the date hereof and as contemplated hereby. Such party is duly
licensed or qualified to do business and, if applicable, is in good
standing in each of the jurisdictions in which the failure to be so
licensed or qualified would have a material adverse effect on its
financial condition or its ability to perform its obligations
hereunder. Such party has the corporate, company or partnership
power and authority to execute and deliver this agreement and to
perform its obligations hereunder and the execution, delivery and
performance of this agreement have been duly authorized by all
necessary corporate, company or partnership action. Assuming the due
execution and delivery by the other party hereto, this agreement
constitutes the legal, valid and binding obligation of such party
enforceable against such party in accordance with its terms, subject
as to enforceability to limits imposed by bankruptcy, insolvency or
similar laws affecting creditors' rights generally and the
availability of equitable remedies.
(b) No Conflict with Restrictions; No Default. Neither the execution,
delivery and performance of this agreement nor the consummation by
such party of the transactions contemplated hereby (i) will conflict
with, violate or result in a breach of any of the terms, conditions
or provisions of any law, regulation, order, writ, injunction,
decree, determination or award of any court, any governmental
department, board, agency or instrumentality, domestic or foreign,
or any arbitrator, applicable to such party or any of its Controlled
Related Parties, (ii) will conflict with, violate, result in a
breach of or constitute a default under any of the terms, conditions
or provisions of the articles of incorporation, articles of
organization or certificate of formation, bylaws, operating
agreement or limited liability company agreement, or partnership
agreement of such party or any of its Controlled Related Parties or
of any material agreement or instrument to which such party or any
of its Controlled Related Parties is a party or by which such party
or any of its Controlled Related Parties is or may be bound or to
which any of its material properties or assets is subject (other
than any such conflict, violation, breach or default that has been
validly and unconditionally waived), (iii) will conflict with,
violate, result in a breach of, constitute a default under (whether
with notice or lapse of time or both), accelerate or permit the
acceleration of the performance required by, give to others any
material interests or rights or require any consent, authorization
or approval under any indenture, mortgage, lease agreement or
instrument to which such party or any of its Controlled Related
Parties is a party or by which such party or any of its Controlled
Related Parties is or may be bound, or (iv) will result in the
creation or imposition of any lien upon any of the material
properties or assets of such party or any of its Controlled Related
Parties, which in any such case could reasonably be expected to
materially impair such party's ability to perform its obligations
under this
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agreement or to have a material adverse effect on the consolidated
financial condition of each parts or its Parent.
(c) Governmental Authorizations. Any registration, declaration or filing
with, or consent, approval, license, permit or other authorization
or order by, any governmental or regulatory authority, domestic or
foreign. that is required to be obtained by such party in connection
with the valid execution, delivery, acceptance and performance by
such party under this agreement or the consummation by such party of
any transaction contemplated hereby has been completed, made or
obtained, as the case may be.
(d) Litigation. There are no actions, suits, proceedings or
investigations pending or, to the knowledge of such party,
threatened against or affecting such party or any of its Controlled
Related Parties or any of their properties, assets or businesses in
any court or before or by any governmental department, board, agency
or instrumentality, domestic or foreign, or any arbitrator which
could, if adversely determined (or, in the case of an investigation
could lead to any action, suit or proceeding, which if adversely
determined could), reasonably be expected to materially impair such
party's ability to perform its obligations under this agreement or
to have a material adverse effect on the consolidated financial
condition of such party or its parent; and such party or any of its
Controlled Related Parties has not received any currently effective
notice of any default, and such party or any of its Controlled
Related Parties is not in default, under any applicable order, writ,
injunction, decree, permit, determination or award of any court, any
governmental department, board, agency or instrumentality, domestic
or foreign, or any arbitrator, which default could reasonably be
expected to materially impair such party's ability to perform its
obligations under this agreement or to have a material adverse
effect on the consolidated financial condition of such party or its
Parent.
Section 6.2. Survival. The representations and warranties provided for
under this Article 6 will survive the execution and delivery of this agreement.
ARTICLE 7
PROSECUTION OF INFRINGEMENT CLAIMS
Section 7.1. Notice and Prosecution of Infringement. Licensee agrees to
notify Licensor promptly, in writing, of any alleged, actual or threatened
infringement of any of the Licensed Marks within the Service Area of which
Licensee becomes aware. Licensor has the sole right to determine whether or not
to take any action on such infringements. Licensor has the sole right to employ
counsel of its choosing and to direct any litigation and settlement of
infringement actions. Any recoveries, damages and costs recovered through such
proceedings shall belong exclusively to Licensor, and Licensor shall be solely
responsible for all costs and expenses
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(including attorney fees) of prosecuting such actions. Licensee agrees to
provide Licensor with all reasonably requested assistance in connection with
such proceedings.
ARTICLE 8
LICENSEE DEFENSE AND INDEMNIFICATION OF LICENSOR
Section 8.1 Indemnification.
(a) Each party hereby agrees to indemnify the other party against and
agrees to hold it harmless from any Loss incurred or suffered by
such other party arising out of or in connection with:
(i) the material breach of any representation or warranty made by
such party in this agreement; and
(ii) the material breach of any covenant or agreement by such party
contained in this agreement.
(b) In addition to the indemnification provided for in Section 8.1(a),
Licensee agrees to indemnify Licensor against and hold it harmless
from any Loss suffered or incurred by Licensor or its Controlled
Related Parties by reason of a third party claim arising out of or
relating to (i) the use of the Licensed Marks by Licensee; or (ii)
the marketing, promotion, advertisement, distribution, lease or sale
by Licensee (or any permitted sublicensee) or by any additional
Licensee (or any permitted sublicensee) of any Sprint PCS Products
and Services, Related Equipment or Premium and Promotional Items
under the Licensed Marks pursuant to this agreement, including
unfair or fraudulent advertising claims, warranty claims and product
defect or liability claims, pertaining to the Sprint PCS Products
and Services, Related Equipment or Premium and Promotional Items.
Notwithstanding the foregoing, Licensee will not be required under
this paragraph (b) to indemnify any Loss arising solely out of
Licensee's use of the Licensed Marks in compliance with the terms of
the Trademark and Service Mark Usage Guidelines; provided that
Licensor shall have no obligation to indemnify for third-party
claims alleged to arise from the specifics of uses of third party
trademarks or service marks, or the specifics of claims made, in
marketing materials prepared by or for Licensee, which marketing
materials have not been approved by Licensor prior to the
publication out of which such claims are alleged to have arisen.
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ARTICLE 9
OBLIGATIONS/SETOFF
Section 9.1 Obligations/Setoff. The obligations of the parties as set
forth in this agreement shall be unconditional and irrevocable, and shall not be
subject to any defense or be released, discharged or otherwise affected by any
matter, including impossibility, illegality, impracticality, frustration of
purpose, force majeure, act of government, the bankruptcy or insolvency of any
party hereto, and the obligations of each party shall not be subject to any
right of setoff or recoupment which such party may not or hereafter have against
the other party.
ARTICLE 10
LIMITATION ON USE OF LICENSED MARKS
Section 10.1 Restrictions on Use. Licensee is not permitted to make any
use of the Licensed Marks in connection with products or services other than the
Sprint PCS Products and Services, and as specifically authorized in Sections
1.1(b) above with respect to Related Equipment and Premium and Promotional
Items, nor to make any use of the Licensed Marks directed outside of the Service
Area.
Section 10.2 Adherence to Trademark and Service Mark Usage Guidelines.
Licensee agrees to comply with and adhere to Trademark and Service Mark Usage
Guidelines for the depiction or presentation of the Licensed Marks, as furnished
by Licensor. Prior to Licensee depicting or presenting any of the Licensed Marks
on any type of marketing, advertising or promotional materials, Licensee agrees
to submit samples of such materials to Licensor for approval. Licensor shall
have fourteen (14) days from the date Licensor receives such materials to
approve or object to any such materials submitted to Licensor for review. In the
event Licensor does not object to such materials within such fourteen (14) day
period, such materials shall be deemed approved by Licensor. Thereafter,
Licensee shall not be obligated to submit to Licensor materials prepared in
accordance with the samples previously approved by Licensor arid the Trademark
and Service Mark Usage Guidelines; provided, however, Licensee shall, at the
reasonable request of Licensor, continue to furnish samples of such marketing,
advertising and promotional materials to Licensor from time to time during the
term hereof at the request of Licensor.
Section 10.3. Use of Similar Trademarks and Service Marks. Licensee agrees
not to use (a) any trademark or service mark which is confusingly similar to, or
a colorable imitation of, the Licensed Marks or any part thereof, or (b) any
work, symbol, character, or set of words, symbols, or characters, which in any
language would be identified as the equivalent of the Licensed Marks or that are
otherwise confusingly similar to, or a colorable imitation of, the Licensed
Marks. whether during the term of this agreement or at any time following
termination of this agreement. Licensee shall not knowingly engage in any
conduct which may place the Sprint PCS Products and Services, the Licensed Marks
or Licensor in a negative light or context.
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Section 10.4. Services of Public Figures. Licensee agrees to obtain
Licensor's prior written approval (which approval will not be unreasonably
withheld) before engaging the services of any celebrity or publicly known
individual for endorsement of any Sprint PCS Products and Services or Premium
and Promotional Items.
ARTICLE 11
CONTROL OF BRAND IMAGE
Section 11.1 Exclusive Use of Licensed Marks. The Sprint PCS Products and
Services shall be marketed by Licensee solely under the Licensed Marks.
Section 11.2 Consistency With Brand Image and Principles. Licensee shall
use the Licensed Marks in a manner that is consistent with the brand image and
principles established by Licensor, and mechanics to ensure consistency will be
included in the Marketing Communications Guidelines.
Section 11.3 Management of Brand Image. Licensor shall be responsible for
the overall management of the brand image for the Licensed Marks. All
advertising, marketing and promotional materials using the Licensed Marks
prepared by Licensee shall, in addition to the provisions set forth in Section
11.2 above, comply with the Marketing Communications Guidelines to be furnished
by Licensor to Licensee as such Marketing Communications Guidelines may be
amended and updated by Licensor from time to time. Such Marketing Communications
Guidelines shall establish reasonable principles to be followed in the
development of advertising, marketing and promotional campaigns in order to
ensure a consistent and coherent brand image. All advertising, marketing and
promotional campaigns conducted by Licensee shall be conducted in a manner
consistent with the Marketing Communications Guidelines.
Section 11.4 Advertising Agencies; Promotions. Licensee may select its own
advertising agencies for development of its advertising and promotional
campaigns; provided, however, that all media buys shall be coordinated by
Licensee with the buying agency of Licensor. Licensee and Licensor shall conduct
ongoing reviews of upcoming advertising, marketing and promotional campaigns of
each party and shall use good faith efforts to coordinate their respective
campaigns in a manner that will maximize the advertising, marketing and
promotional efforts of the parties and be consistent with the Marketing
Communications Guidelines. Licensee shall not initiate any products or
promotions under names which are confusingly similar to any names of national
product offerings or promotions by Licensor. Neither Licensor nor any of its
Controlled Related Parties shall initiate any products or promotions under names
which are confusingly similar to any names of national product offerings or
promotions by Licensee. In addition, Licensor will use its commercially
reasonable efforts to ensure that no third party licensee under the Licensed
Marks initiates any products or promotions in the Service Area under names which
are confusingly similar to any names of national product offerings or promotions
by Licensee.
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Section 11.5 Ownership of Advertising Materials. All agreements entered
into by Licensee with advertising agencies shall provide that Licensor shall own
all advertising materials (including concepts, themes, characters and the like)
created or developed thereunder. Subject to the terms and conditions set forth
herein, Licensee shall receive a perpetual, non-exclusive royalty-free license
to use such materials in connection with advertising and promotional materials
developed by Licensee; provided, however, that the rights granted under such
perpetual license shall be limited solely to the use of such materials and shall
not extend the term of the license with respect to the Licensed Marks provided
for hereunder.
ARTICLE 12
RELATIONSHIP OF PARTIES
Section 12.1. Relationship of Parties. It is the express intention of the
parties that Licensee is and shall be an independent contractor and no
partnership shall exist between Licensee and Licensor pursuant hereto. This
agreement shall not be construed to make Licensee the agent or legal
representative of Licensor for any purpose whatsoever (except as expressly
provided in Articles 7 and 8), and Licensee is not granted any right or
authority to assume or create any obligations for, on behalf of, or in the name
of Licensor (except as expressly provided in Articles 7 and 8), Licensee agrees,
and shall require its permitted sublicensees to agree, not to incur or contract
any debt or obligation on behalf of Licensor, or commit any act, make any
representation, or advertise in any manner that may adversely affect any right
of Licensor in or with respect to the Licensed Marks or be detrimental to
Licensor's image.
ARTICLE 13
TERM; TERMINATION; EFFECTS OF TERMINATION
Section 13.1 Term. This agreement commences on the date of execution and
continues until the Management Agreement terminates, unless earlier terminated
in accordance with the terms set forth in this Article 13. This agreement
automatically terminates upon termination of the Management Agreement.
Section 13.2. Events of Termination. If any of the following events shall
occur with respect to Licensee, each such occurrence shall be deemed an "Event
of Termination":
(a) Bankruptcy. The occurrence of a "Bankruptcy" with respect to
Licensee.
(b) Breach of Agreements. Licensee fails to perform in accordance with
any of the material terms and conditions contained herein in any
material respect.
(c) Material Misrepresentation. Licensee breaches any material
representation or warrants of Licensee made in Section 4.2 or
Article 6 in any material respect.
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(d) Termination of Management Agreement. The termination of the
Management Agreement, for whatever reason.
Section 13.3. Licensor's Right to Terminate Upon Event of Termination.
Licensor may, at its option, without prejudice to any other remedies it may
have, terminate this agreement by giving written notice of such termination to
Licensee as follows: (a) immediately, upon the occurrence of any Event of
Termination pursuant to Section 13.2(a) with respect to Licensee; or (b) after
the expiration of thirty (30) days from Licensee's receipt of written notice
from Licensor of the occurrence of any Event of Termination pursuant to Sections
13.2(b) or 13.2(c). if such failure to perform or breach is then still uncured;
or (c) immediately upon the repeated or continuing occurrence of Events of
Termination pursuant to Section 13.2(b) (regardless of whether such continuing
failures to perform or breaches have been cured by Licensee in accordance with
the provisions of clause (b) or this Section 13.3); or (d) immediately upon the
occurrence of a termination pursuant to Section 13.2(d).
Section 13.4 Licensee's Right to Terminate. Licensee may, at its option,
without prejudice to any other remedies it may have, terminate this agreement by
giving written notice of such termination to Licensor as follows: (a)
immediately, in the event that Licensor abandons the Licensed Marks or otherwise
ceases to support the Licensed Marks in Licensor's business; or (b) immediately
in the event of the occurrence of a Bankruptcy with respect to Licensor; or (c)
immediately in the event of an occurrence of termination pursuant to Section
13.2(d).
Section 13.5. Effects of Termination. Upon the termination of this
agreement for any reason, all rights of Licensee in and to the Licensed Marks in
the Service Area shall cease within thirty (30) days following the date on which
this agreement terminates (except in the case of a termination resulting from an
Event of Termination described in Section 13.2(b), (c) or (d), in which case
such rights to use the Licensed Marks will terminate immediately upon the date
of termination); provided, however, that Licensee may thereafter sell, transfer
or otherwise dispose of any Related Equipment and Premium and Promotional Items
that are then in Licensee's inventory (or which Licensee has purchased or is
then legally obligated to purchase) for an additional reasonable period not to
exceed three (3) months. Licensee's right of disposal under this Section 13.5
shall not prohibit Licensor from granting to third parties during the disposal
period licenses and other rights with respect to the Licensed Marks. The
provisions of Articles 3, 4, 5, 6 and 8 will survive any termination of this
agreement.
ARTICLE 14
ASSIGNMENT; SUBLICENSING
Section 14.1 Licensee Right to Assign. Licensee, without the prior written
consent of Licensor (in its sole discretion), shall have no right to assign any
of its rights or obligations hereunder.
Section 14.2. Licensor Right to Assign the Licensed Marks. Nothing herein
shall be construed to limit the right of the Licensor to transfer or assign its
interests in the Licensed
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Marks, subject to the agreement of the assignee to be bound by the terms and
conditions of this agreement.
Section 14.3 Licenses to Additional Licensees; Sublicenses; Licenses to
Additional Licensees. Licensee shall not sublicense (or attempt to sublicense)
any of its rights hereunder without the prior written consent of Licensor, in
the sole discretion of Licensor.
ARTICLE 15
MISCELLANEOUS
Section 15.1. Notices. Any notice, payment, demand, or communication
required or permitted to be given by any provision of this agreement shall be in
writing and mailed (certified or registered mail, postage prepaid, return
receipt requested) or sent by hand or overnight courier, or by facsimile (with
acknowledgment received), charges prepaid and addressed as described on the
Notice Address Schedule attached to the Master Signature Page, or to such other
address or number as such party may from time to time specify by written notice
to the other party in accordance with the provisions of this Section 15.1. All
notices and other communications given to a party in accordance with the
provisions of this agreement shall be deemed to have been given and received (i)
four (4) Business Days after the same are sent by certified or registered mail,
postage prepaid, return receipt requested, (ii) when delivered by hand or
transmitted by facsimile (with acknowledgment received and, in the case of a
facsimile only, a copy of such notice is sent no later than the next Business
Day by a reliable overnight courier service, with acknow1edgment of receipt) or
(iii) one (1) Business Day after the same are sent by a reliable overnight
courier service, with acknowledgment of receipt.
Section 15.2. Binding Effect. Except as otherwise provided in this
agreement, this agreement shall be binding upon and inure to the benefit of the
parties and their respective successors, transferees, and assigns.
Section 15.3. Construction. This agreement shall be construed simply
according to its fair meaning and not strictly for or against any party.
Section 15.4 Time. Time is of the essence with respect to this agreement.
Section 15.5 Table of Contents; Headings. The table of contents and
section and other headings contained in this agreement are for reference
purposes only and are not intended to describe, interpret, define or limit the
scope, extent or intent of this agreement.
Section 15.6 Severability. Every provision of this agreement is intended
to be severable. If any term or provision hereof is illegal, invalid or
unenforceable for any reason whatsoever, that term or provision will be enforced
to the maximum extent permissible so as to effect the intent of the parties, and
such illegality, invalidity or unenforceabilitv shall not affect the validity or
legality of the remainder of this agreement. If necessary to effect the intent
of the parties, the parties will negotiate in good faith to amend this agreement
to replace the
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unenforceable language with enforceable language which as closely as possible
reflects such intent.
Section 15.7. Further Action. Each party, upon the reasonable request of
the other party, agrees to perform all further acts and execute, acknowledge,
and deliver an documents which may be reasonably necessary, appropriate, or
desirable to carry out the intent and purposes of this agreement.
Section 15.8. Governing Law. The internal laws of the State of Missouri
(without regard to principles of conflict of law) shall govern the validity of'
this agreement, the construction of its terms, and the interpretation of the
rights and duties of the parties.
Section 15.9. Specific Performance. Each party agrees with the other party
that the other party would be irreparably damaged if any of the provisions of
this agreement are not performed in accordance with their specific terms and
that monetary damages would not provide an adequate remedy in such event.
Accordingly, in addition to any other remedy to which the nonbreaching party may
be entitled, at law or in equity, the nonbreaching party shall be entitled to
injunctive relief to prevent breaches of this agreement and specifically to
enforce the terms and provisions hereof.
Section 15.10 Entire Agreement. The provisions of this agreement set forth
the entire agreement and understanding between the parties as to the subject
matter hereof and supersede all prior agreements, oral or written, and other
communications between the parties relating to the subject matter hereof.
Section 15.11. Limitation on Rights of Others. Nothing in this agreement,
whether express or implied, shall be construed to give any party other than the
parties any legal or equitable right, remedy or claim under or in respect of
this agreement.
Section 15.12. Waivers; Remedies. The observance of any term of this
agreement may be waived (either generally or in a particular instance and either
retroactively or prospectively) by the party or parties entitled to enforce such
term, but any such waiver shall be effective only if in writing signed by the
party or parties against which such waiver is to be asserted. Except as
otherwise provided herein, no failure or delay of any party in exercising any
power or right under this agreement shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such right or power, preclude any other
further exercise thereof or the exercise of any other right or power.
Section 15.13 Jurisdiction; Consent to Service of Process.
(a) Each party hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of any
Missouri State court sitting in the County of Jackson or any Federal
court of the United States of America sitting in the Western
District of Missouri, and any appellate court from any such court,
in any suit action or proceeding arising out of or relating to this
agreement, or for
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recognition or enforcement of any judgment, and each party hereby
irrevocably and unconditionally agrees that all claims in respect of
any such suit, action or proceeding may be heard and determined in
such Missouri State Court or, to the extent permitted by law, in
such Federal court.
(b) Each party hereby irrevocably and unconditionally waives, to the
fullest extent it may legally do so, any objection which it may now
or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this agreement in Missouri
State court sitting in the County of Jackson or any Federal court
sitting in the Western District of Missouri. Each party hereby
irrevocably waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such suit,
action or proceeding in any such court and further waives the right
to object, with respect to such suit, action or proceeding, that
such court does not have jurisdiction over such party.
(c) Each party irrevocably consents to service of process in the manner
provided for the giving of notices pursuant to this agreement,
provided that such service shall be deemed to have been given only
when actually received by such party. Nothing in this agreement
shall affect the right of a party to serve process in another manner
permitted by law,
Section 15.14. Waiver of Jury Trial. Each party waives, to the fullest
extent permitted by applicable law, any right it may have to a trial by jury in
respect of any action, suit or proceeding arising out of or relating to this
agreement.
Section 15.15. Consents. Whenever this agreement requires or permits
consent by or on behalf of a party, such consent shall be given in writing in a
manner consistent with the requirements for a waiver of compliance as set forth
in Section 15.13, with appropriate notice in accordance with Section 15.1 of
this agreement.
Section 15.16. Master Signature Page. Each party agrees that it will
execute the Master Signature Page that evidences such party's agreement to
execute, become a party to and be bound by this agreement, which document in
incorporated herein by this reference.
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Exhibit 10.4
SPRINT
TRADEMARK AND SERVICE MARK
LICENSE AGREEMENT
BETWEEN
SPRINT COMMUNICATIONS COMPANY, L.P.
AND
UBIQUITEL L.L.C.
SEPTEMBER __, 1998
<PAGE>
SPRINT TRADEMARK AND
SERVICE MARK LICENSE AGREEMENT
THIS AGREEMENT is made as of the _____ day of September, 1998, by and
between Sprint Communications Company, L.P., a Delaware limited partnership, as
licensor ("Licensor"), and UbiquiTel L.L.C., a Washington limited liability
company, as licensee ("Licensee"). The definitions for this agreement are set
forth on the "Schedule of Definitions."
RECITALS:
WHEREAS, Licensor is the owner of the U.S. trademarks and service marks
"Sprint," together with related "Diamond" logo, "Sprint PCS," "Sprint Personal
Communications Services" and the goodwill of the business symbolized thereby;
and
WHEREAS, Licensee desires to use the trademarks and service marks in
commerce;
NOW, THEREFORE, the parties, in consideration of the mutual agreements
herein contained and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, do hereby agree as follows:
ARTICLE 1
GRANT OF TRADEMARK AND SERVICE MARK RIGHTS; EXCLUSIVITY
Section 1.1. License.
(a) Grant of License. Subject to the terms and conditions hereof,
Licensor hereby grants to Licensee, and Licensee hereby accepts from
Licensor, for the term of this agreement, a non-transferable,
royalty-free license to use the Licensed Marks solely for and in
connection with the marketing, promotion, advertisement,
distribution, lease or sale of Sprint PCS Products and Services and
Premium and Promotional Items in the Service Area.
Related Equipment. The rights granted hereunder to Licensee shall not
include the right to manufacture equipment under the Licensed Marks. However,
subject to the terms and conditions hereof, Licensor hereby grants to Licensee,
and Licensee hereby accepts from Licensor, for the term of this agreement, a
non-transferable, royalty-free license to market, promote, advertise, distribute
and resell and lease Related Equipment in connection with the marketing,
promotion, advertisement, distribution, lease or sale by Licensee of Sprint PCS
Products and Services, and to furnish services relating to such Related
Equipment (including installation, repair and maintenance of Related Equipment),
under the Licensed Marks.
<PAGE>
ARTICLE 2
QUALITY STANDARDS, MAINTENANCE
Section 2.1. Maintenance of Quality.
(a) Adherence to Quality Standards. In the course of marketing,
promoting, advertising, distributing, leasing and selling Sprint PCS
Products and Services and Premium and Promotional Items under the
Licensed Marks, Licensee shall maintain and adhere to standards of
quality and specifications that conform to or exceed those quality
standards and technical and operational specifications adopted
and/or amended in the manner provided below ("Quality Standards")
and those imposed by Law. Such Quality Standards are designed to
ensure that the quality of the Sprint PCS Products and Services and
Premium and Promotional Items marketed, promoted, advertised,
distributed, leased and sold under the Licensed Marks are consistent
with the high reputation of the Licensed Marks and are in conformity
with applicable Laws.
(b) Establishment of Quality Standards. The parties acknowledge that the
initial Quality Standards for the Sprint PCS Products and Services
and Premium and Promotional Items are attached to the Affiliation
Agreement as Exhibits 4.1, 4.2, 4.3, 7.2, and 8.1. The Quality
Standards shall (i) be consistent with the reputation for quality
associated with the Licensed Marks and (ii) be commensurate with a
high level of quality (taking into account Licensee's fundamental
underlying technology and standards), consistent with the level of
quality being offered in the market for products and services of the
same kind as the Sprint PCS Products and Services.
(c) Changes in Quality Standards. In the event that Licensor wishes to
change the Quality Standards, it will notify Licensee in writing of
such proposed amendments, and will afford Licensee a reasonable time
period in which to adopt such changes as may be required in order
for Licensee to conform to the amended Quality Standards.
Section 2.2. Rights of Inspection. In order to ensure that the Quality
Standards are maintained, Licensor and its authorized agents and representatives
shall have the right, but not the obligation, with prior notice to Licensee, to
enter upon the premises of any office or facility operated by or for Licensee
with respect to Sprint PCS Products and Services and Premium and Promotional
Items at all reasonable times, to inspect, monitor and test in a reasonable
manner facilities and equipment used to furnish Sprint PCS Products and Services
and Premium and Promotional Items and, with prior written notice to Licensee, to
inspect the books and records of Licensee in a manner that does not unreasonably
interfere with the business and affairs of Licensee, all as they relate to the
compliance with the Quality Standards maintained hereunder.
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Section 2.3. Marking; Compliance with Trademark Laws. Licensee shall cause
the appropriate designation "(TM)" or "(SM)" or the registration symbol "(R)" to
be placed adjacent to the Licensed Marks in connection with the use thereof and
to indicate such additional information as Licensor shall reasonably specify
from time to time concerning the license rights under which Licensee uses the
Licensed Marks. Licensee shall place the following notice on all printed or
electronic materials on which the Licensed Marks appear: "Sprint", the "DIAMOND"
logo and "Sprint PCS", "Sprint Personal Communications Services" are trademarks
and/or service marks of Sprint Communications Company, L.P., "used under
license" or such other notice as Licensor may specify from time to time.
Section 2.4. Other Use Restrictions. Licensee shall not use the Licensed
Marks in any manner that would reflect adversely on the image of quality
symbolized by the Licensed Marks.
ARTICLE 3
CONFIDENTIAL INFORMATION
Section 3.1. Maintenance of Confidentiality. Each of Licensor and Licensee
and their respective Controlled Related Parties (each a "Restricted Party")
shall cause their respective officers and directors (in their capacity as such)
to, and shall take all reasonable measures to cause their respective employees,
attorneys, accountants, consultants and other agents and advisors (collectively,
and together with their respective officers and directors, "Agents") to, keep
secret and maintain in confidence the terms of this agreement and all
confidential and proprietary information and data of the other party or its
Related Parties disclosed to it (in each case, a "Receiving Party") in
connection with the performance of its obligations under this agreement (the
"Confidential Information") and shall not, and shall cause their respective
officers and directors not to, and shall take all reasonable measures to cause
their respective other Agents not to, disclose Confidential Information to any
Person other than the parties, their Controlled Related Parties and their
respective Agents that need to know such Confidential Information. Each party
further agrees that it shall not use the Confidential Information for any
purpose other than determining and performing its obligations and exercising its
rights under this agreement. Each party shall take all reasonable measures
necessary to prevent any unauthorized disclosure of the Confidential Information
by any of their respective Controlled Related Parties or any of their respective
Agents. The measures taken by a Restricted Party to protect Confidential
Information shall be not deemed unreasonable if the measures taken are at least
as strong as the measures taken by the disclosing party to protect such
Confidential Information.
Section 3.2. Permitted Disclosures. Nothing herein shall prevent any
Restricted Party or its Agents from using, disclosing, or authorizing the
disclosure of Confidential Information it receives and which:
(i) has been published or is in the public domain, or which
subsequently comes into the public domain, through no fault of
the receiving party;
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(ii) prior to receipt hereunder was property within the legitimate
possession of the Receiving Party or, subsequent to receipt
hereunder is lawfully received from a third party having
rights therein without restriction of the third party's right
to disseminate the Confidential Information and without notice
of any restriction against its further disclosure;
(iii) is independently developed by the Receiving Party through
Persons who have not had, either directly or indirectly,
access to or knowledge of such Confidential Information;
(iv) is disclosed to a third party with the written approval of the
party originally disclosing such information, provided that
such Confidential Information shall cease to be confidential
and proprietary information covered by this agreement only to
the extent of the disclosure so consented to;
(v) subject to the Receiving Party's compliance with Section 3.4
below, is required to be produced under order of a court of
competent jurisdiction or other similar requirements of a
governmental agency, provided that such Confidential
Information to the extent covered by a protective order or its
equivalent shall otherwise continue to be Confidential
Information required to be held confidential for purpose of
this agreement; or
(vi) subject to the Receiving Party's compliance with Section 3.4
below, is required to be disclosed by applicable Law or a
stock exchange or association on which such Receiving Party's
securities (or those of its Related Party) are listed.
Section 3.3. Financial Institutions. Notwithstanding this Article 3, any
party may provide Confidential Information to any financial institution in
connection with borrowings from such financial institution by such party or any
of its Controlled Related Parties, so long as prior to any such disclosure such
financial institution executes a confidentiality agreement that provides
protection substantially equivalent to the protection provided the parties in
this Article.
Section 3.4. Procedures. In the event that any Receiving Party (i) must
disclose Confidential Information in order to comply with applicable Law or the
requirements of a stock exchange or association on which such Receiving Party's
securities or those of its Related Parties are listed or (ii) becomes legally
compelled (by oral questions, interrogatories, requests for information or
documents, subpoenas, civil investigative demand or otherwise) to disclose any
Confidential Information, the Receiving Party shall provide the disclosing party
with prompt written notice so that in the case of clause (i), the disclosing
party can work with the Receiving Party to limit the disclosure to the greatest
extent possible consistent with legal obligations or in the case of clause (ii),
the disclosing party may seek a protective order or other appropriate remedy or
waive compliance with the provisions of this agreement. In the case of a clause
(ii),
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(A) if the disclosing party is unable to obtain a protective order or other
appropriate remedy, or if the disclosing party so directs, the Receiving Party
shall, and shall cause its employees to, exercise all commercially reasonable
efforts to obtain a protective order or other appropriate remedy at the
disclosing party's reasonable expense, and (B) failing the entry of a protective
order or other appropriate remedy or receipt of a waiver hereunder, the
Receiving Party shall furnish only that portion of the Confidential Information
which it is advised by opinion of its counsel is legally required to be
furnished and shall exercise all commercially reasonable efforts to obtain
reliable assurance that confidential treatment shall be accorded such
Confidential Information, it being understood that such reasonable efforts shall
be at the cost and expense of the disclosing parry whose Confidential
Information has been sought.
Section 3.5. Survival. The obligations under this Article 3 shall survive,
as to any party, until two (2) years following the date of termination of this
agreement, and, as to any Controlled Related Party of a party, until two (2)
years following the earlier to occur of (A) the date that such Person is no
longer a Controlled Related Party of a party, or (B) the date of the termination
of this agreement; provided that such obligations shall continue indefinitely
with respect to any trade secret or similar information which is proprietary to
a party or its Controlled Related Parties and provides such party or its
Controlled Related Parties with an advantage over its competitors.
ARTICLE 4
REPRESENTATIONS, WARRANTIES AND COVENANTS OF LICENSEE
Section 4.1. Licensor's Ownership. Licensee acknowledges Licensor's
exclusive right, title and interest in and to the Licensed Marks and
acknowledges that nothing herein shall be construed to accord to Licensee any
rights in the Service Area in the Licensed Marks except as expressly provided,
herein. Licensee acknowledges that its use in the Service Area of the Licensed
Marks shall not create in Licensee any right, title or interest in the Service
Area in the Licensed Marks and that all use in the Service Area of the Licensed
Marks and the goodwill symbolized by and connected with such use of the Licensed
Marks will inure solely to the benefit of the Licensor.
Section 4.2. No Challenge by Licensee. Licensee covenants that (1)
Licensee will not at any time challenge Licensor's rights, title or interest in
the Licensed Marks (other than to assert the specific rights granted to Licensee
under this agreement), (ii) Licensee will not do or cause to be done or omit to
do anything, the doing, causing or omitting of which would contest or in any way
impair or tend to impair the rights of Licensor in the Licensed Marks, and (iii)
Licensee will not represent to any third party that Licensee has any ownership
or rights in the Service Area with respect to the Licensed Marks other than the
specific rights conferred by this agreement.
ARTICLE 5
REPRESENTATIONS, WARRANTIES AND COVENANTS OF LICENSOR
Section 5.1. Title to the Licensed Marks. Licensor represents and warrants
that:
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(a) Licensor has good title to the Licensed Marks and has the right to
grant the licenses provided for hereunder in accordance with the
terms and conditions hereof, free of any liabilities, charges,
liens, pledges, mortgages, restrictions, adverse claims, security
interests, rights of others, and encumbrances of any kind
(collectively, "Encumbrances"), other than Encumbrances which will
not restrict or interfere in any material respect with the exercise
by Licensee of the rights granted to Licensee hereunder.
(b) There is no claim, action, proceeding or other litigation pending
or, to the knowledge of Licensor, threatened with respect to
Licensor's ownership of the Licensed Marks or which, if adversely
determined, would restrict or otherwise interfere in any material
respect with the exercise by Licensee of the rights purported to be
granted to Licensee hereunder.
Except as expressly provided above in this Section 5.1, Licensor makes no
representation or warranty of any kind or nature whether express or implied with
respect to the Licensed Marks (including freedom from third party infringement
of the Licensed Marks).
The representations and warranties provided for in this Section 5.1 shall
survive the execution and delivery of this agreement.
Section 5.2. Other Licensees. In the event Licensor grants to any third
party any licenses or rights with respect to the Licensed Marks, Licensor shall
not, in connection with the grant of any such license or rights, take any
actions, or suffer any omission that would adversely affect the existence or
validity of the Licensed Marks or conflict with the rights granted to Licensee
hereunder.
Section 5.3. Abandonment. Licensor covenants and agrees that, during the
term of this agreement, it will not abandon the Licensed Marks.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF BOTH PARTIES
Section 6.1. Representations and Warranties. Each party hereby represents
and warrants to the other party as follows:
(a) Due Incorporation or Formation; Authorization of Agreement. Such
party is a corporation duly organized, a limited liability company
duly organized or a partnership duly formed, validly existing and,
if applicable, in good standing under the laws of the jurisdiction
of its incorporation or formation and has the corporate, company or
partnership power and authority to own its property and carry on its
business as owned and carried on at the date hereof and as
contemplated hereby. Such party is duly licensed or qualified to do
business and, if applicable, is in good standing in each of the
jurisdictions in which the failure to
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be so licensed or qualified would have a material adverse effect on
its financial condition or its ability to perform its obligations
hereunder. Such party has the corporate, company or partnership
power and authority to execute and deliver this agreement and to
perform its obligations hereunder and the execution, delivery and
performance of this agreement have been duly authorized by all
necessary corporate, company or partnership action.
Assuming the due execution and delivery by the other party hereto,
this agreement constitutes the legal, valid and binding obligation
of such party enforceable against such party in accordance with its
terms, subject as to enforceability to limits imposed by bankruptcy,
insolvency or similar laws affecting creditors' rights generally and
the availability of equitable remedies.
(b) No Conflict with Restrictions; No Default. Neither the execution,
delivery and performance of this agreement nor the consummation by
such party of the transactions contemplated hereby (i) will conflict
with, violate or result in a breach of any of the terms, conditions
or provisions of any law, regulation, order, writ, injunction,
decree, determination or award of any court, any governmental
department, board, agency or instrumentality, domestic or foreign,
or any arbitrator, applicable to such party or any of its Controlled
Related Parties, (ii) will conflict with, violate, result in a
breach of or constitute a default under any of the terms, conditions
or provisions of the articles of incorporation, articles of
organization or certificate of formation, bylaws, operating
agreement or limited liability company agreement, or partnership
agreement of such party or any of its Controlled Related Parties or
of any material agreement or instrument to which such party or any
of its Controlled Related Parties is a party or by which such party
or any of its Controlled Related Parties is or may be bound or to
which any of its material properties or assets is subject (other
than any such conflict, violation, breach or default that has been
validly and unconditionally waived), (iii) will conflict with,
violate, result in a breach of, constitute a default under (whether
with notice or lapse of time or both), accelerate or permit the
acceleration of the performance required by, give to others any
material interests or rights or require any consent, authorization
or approval under any indenture, mortgage, lease agreement or
instrument to which such party or any of its Controlled Related
Parties is a party or by which such party or any of its Controlled
Related Parties is or may be bound, or (iv) will result in the
creation or imposition of any lien upon any of the material
properties or assets of such party or any of its Controlled Related
Parties, which in any such case could reasonably be expected to
materially impair such party's ability to perform its obligations
under this agreement or to have a material adverse effect on the
consolidated financial condition of each party or its Parent.
(c) Governmental Authorizations. Any registration, declaration or filing
with, or consent, approval, license, permit or other authorization
or order by, any
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governmental or regulatory authority, domestic or foreign, that is
required to be obtained by such party in connection with the valid
execution, delivery, acceptance and performance by such party under
this agreement or the consummation by such party of any transaction
contemplated hereby has been completed, made or obtained, as the
case may be.
(d) Litigation. There are no actions, suits, proceedings or
investigations pending or, to the knowledge of such party,
threatened against or affecting such party or any of its Controlled
Related Parties or any of their properties, assets or businesses in
any court or before or by any governmental department, board, agency
or instrumentality, domestic or foreign, or any arbitrator which
could, if adversely determined (or, in the case of an investigation
could lead to any action, suit or proceeding, which if adversely
determined could), reasonably be expected to materially impair such
party's ability to perform its obligations under this agreement or
to have a material adverse effect on the consolidated financial
condition of such party or its parent; and such party or any of its
Controlled Related Parties has not received any currently effective
notice of any default, and such party or any of its Controlled
Related Parties is not in default, under any applicable order, writ,
injunction, decree, permit, determination or award of any court, any
governmental department, board, agency or instrumentality, domestic
or foreign, or any arbitrator, which default could reasonably be
expected to materially impair such party's ability to perform its
obligations under this agreement or to have a material adverse
effect on the consolidated financial condition of such party or its
Parent.
Section 6.2. Survival. The representations and warranties provided for
under this Article 6 will survive the execution and delivery of this agreement.
ARTICLE 7
PROSECUTION OF INFRINGEMENT CLAIMS
Section 7.1. Notice and Prosecution of Infringement. Licensee agrees to
notify Licensor promptly, in writing, of any alleged, actual or threatened
infringement of any of the Licensed Marks within the Service Area of which
Licensee becomes aware. Licensor has the sole right to determine whether or not
to take any action on such infringements. Licensor has the sole right to employ
counsel of its choosing and to direct any litigation and settlement of
infringement actions. Any recoveries, damages and costs recovered through such
proceedings shall belong exclusively to Licensor, and Licensor shall be solely
responsible for all costs and expenses (including attorney fees) of prosecuting
such actions. Licensee agrees to provide Licensor with all reasonably requested
assistance in connection with such proceedings.
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ARTICLE 8
LICENSEE DEFENSE AND INDEMNIFICATION OF LICENSOR
Section 8.1. Indemnification. (a) Each party hereby agrees to indemnify
the other party against and agrees to hold it harmless from any Loss incurred or
suffered by such other party arising out of or in connection with:
(i) the material breach of any representation or warranty made by
such parry in this agreement; and
(ii) the material breach of any covenant or agreement by such party
contained in this agreement.
(b) In addition to the indemnification provided for in Section 8.1(a),
Licensee agrees to indemnify Licensor against and hold it harmless
from any Loss suffered or incurred by Licensor or its Controlled
Related Parties by reason of a third party claim arising out of or
relating to (i) the use of the Licensed Marks by Licensee; or (ii)
the marketing, promotion, advertisement, distribution, lease or sale
by Licensee (or any permitted sublicensee) or by any additional
Licensee (or any permitted sublicensee) of any Sprint PCS Products
and Services, Related Equipment or Premium and Promotional Items
under the Licensed Marks pursuant to this agreement, including
unfair or fraudulent advertising claims, warranty claims and product
defect or liability claims, pertaining to the Sprint PCS Products
and Services, Related Equipment or Premium and Promotional Items.
Notwithstanding the foregoing, Licensee will not be required under
this paragraph (b) to indemnify any Loss arising solely out of
Licensee's use of the Licensed Marks in compliance with the terms of
the Trademark and Service Mark Usage Guidelines; provided that
Licensor shall have no obligation to indemnify for third-party
claims alleged to arise from the specifics of uses of third-party
trademarks or service marks, or the specifics of claims made, in
marketing materials prepared by or for Licensee, which marketing
materials have not been approved by Licensor prior to the
publication out of which such claims are alleged to have arisen.
ARTICLE 9
OBLIGATIONS/SETOFF
Section 9.1. Obligations/Setoff. The obligations of the parties as set
forth in this agreement shall be unconditional and irrevocable, and shall not he
subject to any defense or be released, discharged or otherwise affected by any
matter, including impossibility, illegality, impracticality, frustration of
purpose, force majeure, act of government, the bankruptcy or insolvency of any
party hereto, and the obligations of each party shall not be subject to any
right of setoff or recoupment which such party may not or hereafter have against
the other party.
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ARTICLE 10
LIMITATION ON USE OF LICENSED MARKS
Section 10.1. Restrictions on Use. Licensee is not permitted to make any
use of the Licensed Marks in connection with products or services other than the
Sprint PCS Products and Services, and as specifically authorized in Sections
1.1(b) above with respect to Related Equipment and Premium and Promotional
Items, nor to make any use of the Licensed Marks directed outside of the Service
Area.
Section 10.2. Adherence to Trademark and Service Mark Usage Guidelines.
Licensee agrees to comply with and adhere to Trademark and Service Mark Usage
Guidelines for the depiction or presentation of the Licensed Marks, as furnished
by Licensor. Prior to Licensee depicting or presenting any of the Licensed Marks
on any type of marketing, advertising or promotional materials, Licensee agrees
to submit samples of such materials to Licensor for approval. Licensor shall
have fourteen (14) days from the date Licensor receives such materials to
approve or object to any such materials submitted to Licensor for review. In the
event Licensor does not object to such materials within such fourteen (14) day
period, such materials shall be deemed approved by Licensor. Thereafter,
Licensee shall not be obligated to submit to Licensor materials prepared in
accordance with the samples previously approved by Licensor and the Trademark
and Service Mark Usage Guidelines; provided, however, Licensee shall, at the
reasonable request of Licensor, continue to furnish samples of such marketing,
advertising and promotional materials to Licensor from time to time during the
term hereof at the request of Licensor.
Section 10.3. Use of Similar Trademarks and Service Marks. Licensee agrees
not to use (a) any trademark or service mark which is confusingly similar to, or
a colorable imitation of, the Licensed Marks or any part thereof, or (b) any
work, symbol, character, or set of words, symbols, or characters, which in any
language would be identified as the equivalent of the Licensed Marks or that are
otherwise confusingly similar to, or a colorable imitation of, the Licensed
Marks, whether during the term of this agreement or at any time following
termination of this agreement. Licensee shall not knowingly engage in any
conduct which may place the Sprint PCS Products and Services, the Licensed Marks
or Licensor in a negative light or context.
Section 10.4. Services of Public Figures. Licensee agrees to obtain
Licensor's prior written approval (which approval will not be unreasonably
withheld) before engaging the services of any celebrity or publicly known
individual for endorsement of any Sprint PCS Products and Services or Premium
and Promotional Items.
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ARTICLE 11
CONTROL OF BRAND IMAGE
Section 11.1. Exclusive Use of Licensed Marks. The Sprint PCS Products and
Services shall be marketed by Licensee solely under the Licensed Marks.
Section 11.2. Consistency With Brand Image and Principles. Licensee shall
use the Licensed Marks in a manner that is consistent with the brand image and
principles established by Licensor, and mechanics to ensure consistency will be
included in the Marketing Communications Guidelines.
Section 11.3. Management of Brand Image. Licensor shall be responsible for
the overall management of the brand image for the Licensed Marks. All
advertising, marketing and promotional materials using the Licensed Marks
prepared by Licensee shall, in addition to the provisions set forth in Section
11.2 above, comply with the Marketing Communications Guidelines to be furnished
by Licensor to Licensee as such Marketing Communications Guidelines may be
amended and updated by Licensor from time to time. Such Marketing Communications
Guidelines shall establish reasonable principles to be followed in the
development of advertising, marketing and promotional campaigns in order to
ensure a consistent and coherent brand image. All advertising, marketing and
promotional campaigns conducted by Licensee shall be conducted in a manner
consistent with the Marketing Communications Guidelines.
Section 11.4. Advertising Agencies; Promotions. Licensee may select its
own advertising agencies for development of its advertising and promotional
campaigns; provided, however, that all media buys shall be coordinated by
Licensee with the buying agency of Licensor. Licensee and Licensor shall conduct
ongoing reviews of upcoming advertising, marketing and promotional campaigns of
each party and shall use good faith efforts to coordinate their respective
campaigns in a manner that will maximize the advertising, marketing and
promotional efforts of the parties and be consistent with the Marketing
Communications Guidelines. Licensee shall not initiate any products or
promotions under names which are confusingly similar to any names of national
product offerings or promotions by Licensor. Neither Licensor nor any of its
Controlled Related Parties shall initiate any products or promotions under names
which are confusingly similar to any names of national product offerings or
promotions by Licensee. In addition, Licensor will use its commercially
reasonable efforts to ensure that no third party licensee under the Licensed
Marks initiates any products or promotions in the Service Area under names which
are confusingly similar to any names of national product offerings or promotions
by Licensee.
Section 11.5. Ownership of Advertising Materials. All agreements entered
into by Licensee with advertising agencies shall provide that Licensor shall own
all advertising materials (including concepts, themes, characters and the like)
created or developed thereunder. Subject to the terms and conditions set forth
herein, Licensee shall receive a perpetual, non-exclusive, royalty-free license
to use such materials in connection with advertising and promotional
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materials developed by Licensee; provided, however, that the rights granted
under such perpetual license shall be limited solely to the use of such
materials and shall not extend the term of the license with respect to the
Licensed Marks provided for hereunder.
ARTICLE 12
RELATIONSHIP OF PARTIES
Section 12.1. Relationship of Parties. It is the express intention of the
parties that Licensee is and shall be an independent contractor and no
partnership shall exist between Licensee and Licensor pursuant hereto. This
agreement shall not be construed to make Licensee the agent or legal
representative of Licensor for any purpose whatsoever (except as expressly
provided in Articles 7 and 8), and Licensee is not granted any right or
authority to assume or create any obligations for, on behalf of, or in the name
of Licensor (except as expressly provided in Articles 7 and 8), Licensee agrees,
and shall require its permitted sublicensees to agree, not to incur or contract
any debt or obligation on behalf of Licensor, or commit any act, make any
representation, or advertise in any manner that may adversely affect any right
of Licensor in or with respect to the Licensed Marks or be detrimental to
Licensor's image.
ARTICLE 13
TERM; TERMINATION; EFFECTS OF TERMINATION
Section 13.1. Term. This agreement commences on the date of execution and
continues until the Affiliation Agreement terminates, unless earlier terminated
in accordance with the terms set forth in this Article 13. This agreement
automatically terminates upon termination of the Affiliation Agreement.
Section 13.2. Events of Termination. If any of the following events shall
occur with respect to Licensee, each such occurrence shall be deemed an "Event
of Termination":
(a) Bankruptcy. The occurrence of a "Bankruptcy" with respect to
Licensee.
(b) Breach of Agreements. Licensee fails to perform in accordance with
any of the material terms and conditions contained herein in any
material respect.
(c) Material Misrepresentation. Licensee breaches any material
representation or warranty of Licensee made in Section 4.2 or
Article 6 in any material respect.
(d) Termination of Affiliation Agreement. The termination of the
Affiliation Agreement, for whatever reason.
Section 13.3. Licensor's Right to Terminate. Upon Event of Termination,
Licensor may, at its option, without prejudice to any other remedies it may
have, terminate this agreement by giving written notice of such termination to
Licensee as follows: (a) immediately, upon the occurrence of any Event of
Termination pursuant to Section 13.2(a) with respect to Licensee; or (b) after
the expiration of thirty (30) days from Licensee's receipt of written notice
from Licensor
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of the occurrence of any Event of Termination pursuant to Sections 13.2(b) or
13.2(c), if such failure to perform or breach is then still uncured; or (c)
immediately upon the repeated or continuing occurrence of Events of Termination
pursuant to Section 13.2(b) (regardless of whether such continuing failures to
perform or breaches have been cured by Licensee in accordance with the
provisions of clause (b) or this Section 13.3); or (d) immediately upon the
occurrence of a termination pursuant to Section 13.2(d).
Section 13.4. Licensee's Right to Terminate. Licensee may, at its option,
without prejudice to any other remedies it may have, terminate this agreement by
giving written notice of such termination to Licensor as follows: (a)
immediately, in the event that Licensor abandons the Licensed Marks or otherwise
ceases to support the Licensed Marks in Licensor's business; or (b) immediately
in the event of the occurrence of a Bankruptcy with respect to Licensor; or (c)
immediately in the event of an occurrence of termination pursuant to Section
13.2(d).
Section 13.5. Effects of Termination. Upon the termination of this
agreement for any reason, all rights of Licensee in and to the Licensed Marks in
the Service Area shall cease within thirty (30) days following the date on which
this agreement terminates (except in the case of a termination resulting from an
Event of Termination described in Section 13.2(b), (c) or (d), in which case
such rights to use the Licensed Marks will terminate immediately upon the date
of termination); provided, however, that Licensee may thereafter sell, transfer
or otherwise dispose of any Related Equipment and Premium and Promotional Items
that are then in Licensee's inventory (or which Licensee has purchased or is
then legally obligated to purchase) for an additional reasonable period not to
exceed three (3) months. Licensee's right of disposal under this Section 13.5
shall not prohibit Licensor from granting to third parties during the disposal
period licenses and other rights with respect to the Licensed Marks. The
provisions of Articles 3, 4, 5, 6 and 8 will survive any termination of this
agreement.
ARTICLE 14
ASSIGNMENT; SUBLICENSING
Section 14.1. Licensee Right to Assign. Licensee, without the prior
written consent of Licensor (in its sole discretion), shall have no right to
assign any of its rights or obligations hereunder.
Section 14.2. Licensor Right to Assign the Licensed Marks. Nothing herein
shall be construed to limit the right of the Licensor to transfer or assign its
interests in the Licensed Marks, subject to the agreement of the assignee to be
bound by the terms and conditions of this agreement.
Section 14.3. Licenses to Additional Licensees; Sublicenses; Licenses to
Additional Licensees. Licensee shall not sublicense (or attempt to sublicense)
any of its rights hereunder without the prior written consent of Licensor, in
the sole discretion of Licensor.
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ARTICLE 15
MISCELLANEOUS
Section 15.1. Notices. Any notice, payment, demand, or communication
required or permitted to be given by any provision of this agreement shall be in
writing and mailed (certified or registered mail, postage prepaid, return
receipt requested) or sent by hand or overnight courier, or by facsimile (with
acknowledgment received), charges prepaid and addressed as described on the
Notice Address Schedule attached to the Master Signature Page, or to such other
address or number as such party may from time to time specify by written notice
to the other party. All notices and other communications given to a party in
accordance with the provisions of this agreement shall be deemed to have been
given and received (i) four (4) Business Days after the same are sent by
certified or registered mail, postage prepaid, return receipt requested, (ii)
when delivered by hand or transmitted by facsimile (with acknowledgment received
and, in the case of a facsimile only, a copy of such notice is sent no later
than the next Business Day by a reliable overnight courier service, with
acknowledgment of receipt) or (iii) one (1) Business Day after the same are sent
by a reliable overnight courier service, with acknowledgment of receipt.
Section 15.2. Binding Effect. Except as otherwise provided in this
agreement, this agreement shall be binding upon and inure to the benefit of the
parties and their respective successors, transferees, and assigns.
Section 15.3. Construction. This agreement shall be construed simply
according to its fair meaning and not strictly for or against any party.
Section 15.4. Time. Time is of the essence with respect to this agreement.
Section 15.5. Table of Contents; Headings. The table of contents and
section and other headings contained in this agreement are for reference
purposes only and are not intended to describe, interpret, define or limit the
scope, extent or intent of this agreement.
Section 15.6. Severability. Every provision of this agreement is intended
to be severable. If any term or provision hereof is illegal, invalid or
unenforceable for any reason whatsoever, that term or provision will be enforced
to the maximum extent permissible so as to effect the intent of the parties, and
such illegality, invalidity or unenforceabilitv shall not affect the validity or
legality of the remainder of this agreement. If necessary to effect the intent
of the parties, the parties will negotiate in good faith to amend this agreement
to replace the unenforceable language with enforceable language which as closely
as possible reflects such intent.
Section 15.7. Further Action. Each party, upon the reasonable request of
the other party, agrees to perform all further acts and execute, acknowledge,
and deliver any documents which may be reasonably necessary, appropriate, or
desirable to carry out the intent and purposes of this agreement.
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Section 15.8. Governing Law. The internal laws of the State of Missouri
(without regard to principles of conflict of law) shall govern the validity of
this agreement, the construction of its terms, and the interpretation of the
rights and duties of the parties.
Section 15.9. Specific Performance. Each party agrees with the other party
that the other party would be irreparably damaged if any of the provisions of
this agreement are not performed in accordance with their specific terms and
that monetary damages would not provide an adequate remedy in such event.
Accordingly, in addition to any other remedy to which the nonbreaching party may
be entitled, at law or in equity, the nonbreaching party shall be entitled to
injunctive relief to prevent breaches of this agreement and specifically to
enforce the terms and provisions hereof.
Section 15.10. Entire Agreement. The provisions of this agreement set
forth the entire agreement and understanding between the parties as to the
subject matter hereof and supersede all prior agreements, oral or written, and
other communications between the parties relating to the subject matter hereof.
Section 15.11. Limitation on Rights of Others. Nothing in this agreement,
whether express or implied, shall be construed to give any party other than the
parties any legal or equitable right, remedy or claim under or in respect of
this agreement.
Section 15.12. Waivers; Remedies. The observance of any term of this
agreement may be waived (either generally or in a particular instance and either
retroactively or prospectively) by the party or parties entitled to enforce such
term, but any such waiver shall be effective only if in writing signed by the
party or parties against which such waiver is to be asserted. Except as
otherwise provided herein, no failure or delay of any party in exercising any
power or right under this agreement shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such right or power, preclude any other
further exercise thereof or the exercise of any other right or power.
Section 15.13. Jurisdiction; Consent to Service of Process.
(a) Each party hereby irrevocably and unconditionally submits, for itself
and its property, to the nonexclusive jurisdiction of any Missouri State court
sitting in the County of Jackson or any Federal court of the United States of
America sitting in the Western District of Missouri, and any appellate court
from any such court, in any suit action or proceeding arising out of or relating
to this agreement, or for recognition or enforcement of any judgment, and each
party hereby irrevocably and unconditionally agrees that all claims in respect
of any such suit, action or proceeding may be heard and determined in such
Missouri State Court or, to the extent permitted by law, in such Federal court.
(b) Each party hereby irrevocably and unconditionally waives, to the
fullest extent it may legally do so, any objection which it may now or hereafter
have to the laying of venue of any suit, action or proceeding arising out of or
relating to this agreement in Missouri State court
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<PAGE>
sitting in the County of Jackson or any Federal court sitting in the Western
District of Missouri. Each party hereby irrevocably waives, to the fullest
extent permitted by law, the defense of an inconvenient forum to the maintenance
of such suit, action or proceeding in any such court and further waives the
right to object, with respect to such suit, action or proceeding, that such
court does not have jurisdiction over such party.
(c) Each party irrevocably consents to service of process in the manner
provided for the giving of notices pursuant to this agreement, provided that
such service shall be deemed to have been given only when actually received by
such party. Nothing in this agreement shall affect the right of a party to serve
process in another manner permitted by law.
Section 15.14. Waiver of Jury Trial. Each party waives, to the fullest
extent permitted by applicable law, any right it may have to a trial by jury in
respect of any action, suit or proceeding arising out of or relating to this
agreement.
Section 15.15. Consents. Whenever this agreement requires or permits
consent by or on behalf of a party, such consent shall be given in writing in a
manner consistent with the requirements for a waiver of compliance as set forth
in Section 15,13, with appropriate notice in accordance with Section 15.1 of
this agreement.
Section 15.16. Master Signature Page. Each party agrees that it will
execute the Master Signature Page that evidences such party's agreement to
execute, become a party to and be bound by this agreement, which document is
incorporated herein by this reference.
[The remainder of this page is intentionally left blank.]
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Exhibit 10.5
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (the "Agreement") is made and entered into
as of December __, 1999, by SPRINT SPECTRUM L.P., SPRINT SPECTRUM EQUIPMENT
COMPANY, L.P. and SPRINT SPECTRUM REALTY COMPANY, L.P., COX COMMUNICATIONS PCS,
L.P., COX PCS LEASING CO., L.P., all of which are Delaware limited partnerships,
and COX PCS ASSETS, LLC, a Delaware limited company (together "Seller"), and
UbiquiTel Holdings, Inc., a Delaware corporation ("Buyer").
Recitals
A. Seller or one of Seller's subsidiaries owns or leases those certain
property, equipment and contract rights identified as follows (collectively the
"Assets"):
1. That equipment and property of Seller located in the Spokane BTA and
identified on attached Exhibit A (the "Spokane Assets"); and
2. That equipment and property of Seller located in BTAs outside of the
Spokane BTA and identified on attached Exhibit B (the "Additional Assets").
B. Buyer and Seller have entered into that certain Addendum II dated
December __,, 1999 to the Sprint PCS Management Agreement dated October 15, 1998
(the "Management Agreement"), to which this Agreement is made an exhibit upon
its execution by the parties and that provides, among other things, that Buyer
will purchase and Seller will sell the Assets, upon the terms and conditions set
forth in this Agreement;
Agreements
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained in this Agreement the parties hereto agree as follows:
1. Transfer of Assets. Subject to the terms and conditions of this
Agreement, Seller agrees to sell, convey and assign to Buyer, and
Buyer agrees to purchase from Seller, all of Seller's right, title
and interest in the Assets free and clear from all liens created by
the Seller other than the Assumed Liabilities (as defined below).
The consummation of this transaction (the "Closing") will occur,
subject to the terms and conditions of this Agreement, on or before
April 15, 2000 (the "Closing Date").
2. Purchase Price. The purchase price of the Assets (the "Purchase
Price") will be equal to the sum of the following: ****
**** Confidential material omitted and filed separately with the Commission.
<PAGE>
The parties agree that, on or before the Closing Date, and insofar
as it has not been calculated as part of the Purchase Price, they
shall determine an allocation of the Purchase Price among the
Assets, which allocation will be the result of arm's-length
negotiations between the parties as to the price of each item or
category of items of the Assets, and neither party will make any
claim or treat any item on its tax returns in a manner that is
inconsistent with such allocation.
3. Review Period. For a period extending for thirty (30) days after
this Agreement has been executed by both parties ("Review Period"),
Buyer may review such documents and make, or cause to be made by
agents or contractors of Buyer's choosing, any and all physical,
mechanical, environmental, structural or other inspections of the
Assets as Buyer deems appropriate. If, in Buyer's reasonable
discretion, based upon the results of Buyer's inspections, Buyer
determines that the Assets are unsatisfactory to Buyer, Buyer may by
written notice to Seller within the Review Period, terminate this
Agreement, and upon such termination, neither party will have any
further rights or obligations under this Agreement. Any termination
notice provided to Seller must contain a specific description of the
condition on which Buyer bases such termination. If Buyer does not
terminate this Agreement by such notice within the Review Period,
this Agreement will remain in full force and effect in accordance
with its terms. Buyer may not elect to purchase less than all of the
Assets.
4. Assumption of Liabilities. Buyer agrees to assume all liabilities,
debts, expenses and obligations now existing or hereafter arising
in, to, under or pursuant to the Assets as of the Closing Date,
including, without limitation, all liabilities, debts, expenses and
obligations relating to all the Assets (the "Assumed Liabilities")
and to pay and perform the Assumed Liabilities when due. Buyer's
assumption of the Assumed Liabilities does not enlarge any rights of
third parties under contracts or arrangements with Buyer or Seller.
Nothing in this Agreement prevents Buyer from contesting in good
faith any of the Assumed Liabilities.
5. Condition of Assets. It is understood and agreed that Seller is not
making and specifically disclaims any warranties or representations
of any kind or character, express or implied, with respect to the
Assets, including, but not limited to, warranties or representations
as to matters of title (except that Seller represents and warrants
that Seller has not previously conveyed, pledged, encumbered,
hypothecated or assigned that Asset to any other party), zoning, tax
consequences, physical or environmental conditions, availability of
access, operating history or projections, valuation, governmental
approvals, governmental regulations or any other matter or thing
relating to or affecting the Assets including, without limitation:
(i) the value, condition, merchantability, marketability,
profitability, suitability or fitness for a particular use or
purpose of the Assets; (ii) the manner or quality of the
construction or materials incorporated into any of the Assets and
(iii) the manner, quality, state of repair or lack of repair of the
Assets. Buyer agrees that with respect to the Assets, Buyer has not
relied
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upon and will not rely upon, either directly or indirectly, any
representation or warranty of Seller or any agent of Seller other
than as specifically set forth in this Agreement. Buyer represents
that it is a knowledgeable purchaser and that it is relying solely
on its own expertise and that of Buyer's consultants, and that Buyer
will conduct such inspections and investigations of the Assets,
including, but not limited to, the physical and environmental
conditions thereof, and shall rely upon same, and, upon closing,
shall assume the risk that adverse matters, including, but not
limited to, adverse physical and environmental conditions, may not
have been revealed by Buyer's inspections and investigations. Buyer
acknowledges and agrees that upon closing, Seller shall sell and
convey to Buyer and Buyer shall accept the Assets "as is, where is"
with all faults, and Buyer further acknowledges and agrees that
there are no oral agreements, warranties or representations,
collateral to or affecting the Assets by Seller, any agent of Seller
or any third party. The terms and conditions of this paragraph shall
expressly survive the closing.
6. Damage or Destruction. If prior to the Closing Date, any of the
Assets are destroyed or substantially damaged by fire, lightning or
any other cause, or all or any part of the Assets is taken by
eminent domain (or is the subject of a pending or contemplated
taking which has not been consummated), Seller will immediately
deliver to Buyer written notice of such event or condition, and
Buyer will have the option of(a) enforcing this Agreement and
retaining any insurance proceeds or proceeds of the taking by
eminent domain, or (b) terminating this Agreement by written notice
within twenty (20) days after receiving written notice from Seller
of such destruction, damage or claim. If this Agreement is
terminated, neither party will have any further obligation under
this Agreement. The risk of loss will be borne by Seller until the
Closing Date.
7. Closing. If Buyer does not terminate the Agreement pursuant to
Paragraph 3 or 6 of this Agreement, on the Closing Date:
(a) Seller and Buyer shall execute and deliver to each other an
Assignment of Leases and Bill of Sale in the form attached
hereto as Exhibit D
(b) Buyer shall pay the Purchase Price to Seller in immediately
available funds;
(c) Buyer shall provide copies of all necessary consents, if any,
for the conveyance or assignment of the Assets. Such consents
to be in the form of Consent and Release attached hereto as
Exhibit E.
For each cell site which is the subject of this Asset Purchase
Agreement and for which a release of Sprint PCS' obligations cannot
be obtained prior to the Closing Date, Sprint PCS, in its sole
discretion, may continue to be obligated under any existing leases
or purchase obligations for any such cell sites subject to (1)
receipt of a consent from the landlord or seller of the cell site
consenting to the
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<PAGE>
assumption of the leasehold or purchase obligation by Manager and
(2) execution of an agreement setting forth the obligations of
Manager with respect to each such cell site for which a release
cannot be obtained and containing terms and conditions acceptable to
Sprint PCS.
Buyer is responsible for paying or causing to be paid all transfer,
stamp, recording, sales, use, excise or similar taxes, fees or
duties payable in connection with the sale, assignment or conveyance
of Seller's interest in and to the Assets or the assumption of the
Assumed Liabilities.
Buyer is also responsible for reporting all taxable property to the
appropriate taxing authority for ad valorem tax purposes. Buyer will
pay as and when due all taxes, assessments, liens, encumbrances,
levies, and other charges against the real estate, personal property
and intangible property that is sold, transferred, assigned or
otherwise conveyed to Buyer pursuant to this agreement.
8. Further Assurances. Seller will from time to time at the request of
Buyer, do, make, execute, acknowledge and deliver all such other
instruments of conveyance, assignment, and transfer, in form and
substance satisfactory to Seller, as Buyer may reasonably require
for the more effective conveyance and transfer of any of the Assets.
Seller's obligations hereunder shall be subject to receipt of the
Consents and
9. Indemnification. Breaches of this Agreement by either Buyer or
Seller will be a breach for which the non-breaching party is
entitled to indemnification in accordance with the terms and
conditions and utilizing the procedures set forth in the Management
Agreement.
10. Entire Agreement and Binding Effect. This Agreement and the exhibits
and schedules attached to this Agreement (which are incorporated by
this reference) and the Management Agreement, including all addenda
thereto, contain the entire agreement between the parties hereto
with respect to the acquisition of the Assets and the other
transactions contemplated herein, and supersedes all prior
agreements or understandings between the parties hereto relating to
the subject matter hereof. AU exhibits attached hereto are
incorporated herein by this reference.
11. Severability. In the event any one or more of the provisions
contained in this Agreement or any application thereof is invalid,
illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions of this Agreement and any
other application thereof will not in any way be affected or
impaired thereby. Paragraph headings herein or in any exhibit hereto
have no legal significance and are used solely for convenience of
reference.
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<PAGE>
12. No Other Representations and Warranties. Seller makes no
representation or warranty to Buyer with respect to the Assets,
except as expressly set forth in this Agreement.
13. Waivers and Notices. Any term or condition of this Agreement may be
waived at any time by the party entitled to the benefit thereof by a
written instrument. No delay or failure on the part of any party in
exercising any rights hereunder, and no partial or single exercise
thereof, will constitute a waiver of such rights or of any other
rights hereunder. All notices, consents, requests, instructions,
approvals and other communications provided for herein will be
validly given, made or served if given, made or served in accordance
with the Management Agreement.
14. Counterparts. This Agreement may be executed in any number of
counterparts, each of which will constitute an original but all of
such counterparts taken together will constitute only one Agreement.
15. Governing Law. The internal laws of the State of Missouri (without
regard to principles of conflicts of law) govern the validity of
this agreement, the construction of its terms, and the
interpretation of the rights and duties of the parties.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
SELLER: SPRINT SPECTRUM L.P.
By__________________________________________
Bernard A. Bianchino
Chief Business Development Officer
SPRINT SPECTRUM EQUIPMENT COMPANY, L.P.
By__________________________________________
Name:___________________________________
Title:__________________________________
SPRINT SPECTRUM REALTY COMPANY, L.P.
By__________________________________________
Name:___________________________________
Title:__________________________________
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<PAGE>
COX PCS COMMUNICATIONS, L.P.
By__________________________________________
Name:___________________________________
Title:__________________________________
PCS LEASING CO., L.P.
By__________________________________________
Name:___________________________________
Title:__________________________________
COX PCS ASSETS, LLC
By__________________________________________
Name:___________________________________
Title:__________________________________
BUYER: UBIQUITEL HOLDINGS, INC.
By__________________________________________
Name:___________________________________
Title:__________________________________
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Exhibit A
The Spokane Assets
The following sets forth the Spokane Assets:
1. Cell site and base station assets:
Listed by Cascade Number and state of development as shown on the attached
Spokane District Inventory List Summary.' In summary, the status of
Spokane sites as of December 23, 1999 follows.
****
See attached inventory list for On Air sites.
2. Switch Assets listed as follows:
There is one switch in Spokane:
****
Spokane, WA
See attached inventory list for the switch.
3. Retail Assets listed as follows:
SPCS Retail Store:
11404 E. Sprague
Spokane, WA 99206
(509 892 3000)
SPCS Kiosk:
4750 N. Division
Spokane, WA 99207
(509 484 6782)
SPCS Field Operations Office:
11707 E. Sprague, 2nd Floor
Spokane, WA 99206
Inventory list to be provided prior to Closing Date.
4. Spares, test equipment and tools.
See attached inventory list.
**** Confidential portions omitted and filed separately with the Commission.
<PAGE>
5. Certain assets which may be physically located in the Spokane BTA but are
maintained by Sprint PCS as part of its national asset base are not
included in the transfer. These assets include, for example, the
following:
-Portable generators
-Any Cell on Wheels (COW)
6. The parties agree that the inventory lists provided by Sprint PCS under
and as part of this exhibit have not been confirmed by a physical
inventory of the assets by Sprint PCS but simply reflect the asset
inventories as maintained in the books and records of Sprint PCS. Buyer
shall assume all risk of any discrepancy between the inventory list as
provided by Sprint PCS and the actual assets, equipment and spares as may
be found in the Spokane BTA. Buyer shall have the right of inspection
prior to Closing as provided for under the Agreement to determine the
extent, if any, of this risk.
7. The parties agree that Sprint PCS shall retain ownership and control of
any cell site located in the Spokane BTA which is (a) owned in fee simple,
(b) for which Sprint PCS has a ground lease, or (c) for which Sprint PCS
has the right to co-locate any users of the site in addition to Sprint PCS
or Manager. For each such site Sprint PCS shall sell the equipment located
at the site as provided for under the terms of the Agreement and, after
Closing, Sprint PCS shall lease the site to Manager at market lease rates
for sites of a similar nature located in the Spokane BTA subject to the
execution of a Master Lease Agreement between Manager and Sprint Sites
USA.
**** Confidential portions omitted and filed separately with the Commission.
<PAGE>
Exhibit 10.6
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT is made as of November 23, 1999, by and
between by and among UbiquiTel Holdings, Inc., a Delaware corporation (the
"Company"), and James Parsons, Donald A. Harris, Paul F. Judge, The Walter
Group, Inc., a State of Washington corporation ("The Walter Group"), and U.S.
Bancorp (each a "Founder" and collectively "Founders"), and the individuals and
entities listed on the signature page hereto as Purchasers (the "Preferred
Stockholders"), all of whom are parties to the Series A Preferred Stock Purchase
Agreement of even date (the "Series A Agreement").
RECITALS
The Company and the Preferred Stockholders are parties to the Series
A Agreement. The parties agree that this Agreement shall govern the rights of
the Founders and the Preferred Stockholders to cause the Company to register
shares of Founder Stock and shares of Voting Common Stock issuable to the
Preferred Stockholders pursuant to the Series A Agreement and certain other
matters as set forth herein;
NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:
1. Registration Rights. The Company covenants and agrees as follows:
1.1. Definitions. For purposes of this Section 1:
(a) The term "Act" means the Securities Act of 1933, as
amended.
(b) The term "Form S-3" means such form under the Act as
in effect on the date hereof or any registration form under the Act subsequently
adopted by the SEC which permits inclusion or incorporation of substantial
information by reference to other documents filed by the Company with the SEC.
(c) The term "Holder" means any person owning or having
the right to acquire Registrable Securities or any assignee thereof in
accordance with Section 1.12 hereof.
(d) The term "Founder Stock" means the 3,417,000 shares
of Voting Common Stock presently issued to the Founders and, if and to the
extent vested, any of the 16,000,000 shares of Nonvoting Common Stock presently
issued to the Founders, and any additional shares of Voting Common Stock or
Nonvoting Common Stock issued to the Founders as a result of stock splits, stock
dividends, or other recapitalizations.
(e) The term "1934 Act" shall mean the Securities
Exchange Act of 1934, as amended.
(f) The term "register," "registered," and
"registration" refer to a registration effected by preparing and filing a
registration statement or similar document in
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<PAGE>
compliance with the Act, and the declaration or ordering of effectiveness of
such registration statement or document.
(g) The term "Registrable Securities" means the Voting
Common Stock issuable or issued upon conversion of the Series A Preferred Stock
or any shares of Voting Common Stock issued or issuable as a result of stock
splits, stock dividends, or other recapitalization, and solely with respect to
the piggyback registration rights provided in Section 1.3 below, the Founder
Stock.
(h) The number of shares of "Registrable Securities then
outstanding" means, at the time of any determination of such number, the total
of (i) the number of shares of Voting Common Stock issued as a result of the
conversion of the Series A Preferred Stock, and (ii) the number of shares of
Voting Common Stock issuable upon conversion of outstanding Series A Preferred
Stock, and (iii) the number of shares of Voting Common Stock issued or issuable
as a result of stock splits, stock dividends, or other recapitalization.
(i) The term "SEC" shall mean the Securities and
Exchange Commission.
(j) The term "Series A Preferred Stock" means the Series
A Preferred Stock being purchased by the Preferred Stockholders pursuant to the
Series A Agreement.
(k) The term "IPO" means the Company's first sale of
securities to the general public pursuant to a registration in a firm commitment
underwritten offering registered under the Securities Act of 1933, as amended,
which results in gross proceeds to the Company (prior to underwriters' discounts
and expenses) of not less than thirty million ($30,000,000) dollars.
1.2. Request for Registration.
(a) If the Company shall receive at any time a written
request from a majority of Holders of the Registrable Securities that the
Company file a registration statement under the Act covering the registration of
all Registrable Securities then outstanding, then the Company shall:
(i) within ten (10) days of the receipt thereof,
give written notice of such request to all Holders; and
(ii) effect as soon as practicable, and in any
event within 120 days of the receipt of such request, the registration under the
Act of all Registrable Securities which the Holders request to be registered,
subject to the limitations of subsection 1.2(b).
(b) If the Holders initiating the registration request
hereunder ("Initiating Holders") intend to distribute the Registrable Securities
covered by their request by
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<PAGE>
means of an underwriting, they shall so advise the Company as a part of their
request made pursuant to subsection 1.2(a) and the Company shall include such
information in the written notice referred to in subsection 1.2(a). The
underwriter will be selected by the Company and shall be reasonably acceptable
to a majority in interest of the Initiating Holders. In such event, the right of
any Holder to include his Registrable Securities in such registration shall be
conditioned upon such Holder's participation in such underwriting and the
inclusion of such Holder's Registrable Securities in the underwriting (unless
otherwise mutually agreed by a majority in interest of the Initiating Holders
and such Holder) to the extent provided herein. All Holders proposing to
distribute their securities through such underwriting shall (together with the
Company as provided in subsection 1.4(e)) enter into an underwriting agreement
in customary form with the underwriter or underwriters selected for such
underwriting. Notwithstanding any other provision of this Section 1.2, if the
underwriter advises the Initiating Holders in writing that marketing factors
require a limitation of the number of shares to be underwritten, then the
Initiating Holders shall so advise all Holders of Registrable Securities which
would otherwise be underwritten pursuant hereto, and the number of shares of
Registrable Securities that may be included in the underwriting shall be
allocated among all Holders thereof, including the Initiating Holders, in
proportion (as nearly as practicable) to the amount of Registrable Securities of
the Company owned by each Holder.
(c) Notwithstanding the foregoing, if the Company shall
furnish to Holders requesting a registration statement pursuant to this Section
1.2, a certificate signed by the Chief Executive Officer of the Company stating
that in the good faith judgment of the Board of Directors of the Company, it
would be seriously detrimental to the Company and its stockholders for such
registration statement to be filed and it is therefore essential to defer the
filing of such registration statement, the Company shall have the right to defer
taking action with respect to such filing for a period of not more than one
hundred eighty (180) days after receipt of the request of the Initiating
Holders; provided, however, that the Company may not utilize this right more
than once in any twelve-month period.
(d) In addition, the Company shall not be obligated to
effect, or to take any action to effect, any registration pursuant to this
Section 1.2:
(i) After the Company has effected two
registrations pursuant to this Section 1.2 and such registrations have been
declared or ordered effective;
(ii) During the period starting with the date sixty
(60) days prior to the Company's good faith estimate of the date of filing of,
and ending on a date one hundred eighty (180) days after the effective date of,
a registration subject to Section 1.3 hereof; provided, that the Company is
actively employing in good faith all reasonable efforts to cause such
registration statement to become effective; or
(iii) If the Initiating Holders propose to dispose
of shares of Registrable Securities that may be immediately registered on Form
S-3 pursuant to a request made pursuant to Section 1.11 below.
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1.3. Company Registration. If (but without any obligation to
do so) the Company proposes to register (including for this purpose a
registration effected by the Company for stockholders other than the Holders)
any of its stock or other securities under the Act in connection with the public
offering of such securities solely for cash (other than a registration relating
solely to the sale of securities to participants in a Company stock plan, a
registration with respect to corporate reorganization or other transaction under
Rule 145 of the Securities Act, a registration on any form which does not
include substantially the same information as would be required to be included
in a registration statement covering the sale of the Registrable Securities or a
registration in which the only Common Stock being registered is Common Stock
issuable upon conversion of debt securities which are also being registered),
the Company shall, at such time, promptly give each Holder written notice of
such registration. Upon the written request of each Holder given within thirty
(30) days after mailing of such notice by the Company in accordance with Section
3.5, the Company shall, subject to the provisions of Section 1.8, cause to be
registered under the Act all of the Registrable Securities that each such Holder
has requested to be registered. The Founders shall have the right to have the
shares of the Founder Stock included in any Company registration under this
Section 1.3; provided, however, that such rights shall be subject and
subordinate to the rights of the Holders (other than the Founders) and; provided
further that no shares of the Founder Stock shall be included in any Company
registration hereunder, unless and until all shares of Holders (other than the
Founders) requesting that their Registrable Securities be registered are
included in such offering.
1.4. Obligations of the Company. Whenever required under this
Section 1 to effect the registration of any Registrable Securities, the Company
shall, as expeditiously as reasonably possible:
(a) Prepare and file with the SEC a registration
statement with respect to such Registrable Securities and use its best efforts
to cause such registration statement to become effective, and, upon the request
of the Holders of a majority of the Registrable Securities registered
thereunder, keep such registration statement effective for a period of up to one
hundred twenty (120) days or until the distribution contemplated in the
Registration Statement has been completed; provided, however, that (i) such
120-day period shall be extended for a period of time equal to the period the
Holder refrains from selling any securities included in such registration at the
request of an underwriter of Common Stock (or other securities) of the Company;
and (ii) in the case of any registration of Registrable Securities on Form S-3
which are intended to be offered on a continuous or delayed basis, such 120-day
period shall be extended, if necessary, to keep the registration statement
effective until all such Registrable Securities are sold, provided that Rule
415, or any successor rule under the Act, permits an offering on a continuous or
delayed basis, and provided further that applicable rules under the Act
governing the obligation to file a post-effective amendment permit, in lieu of
filing a post-effective amendment which (x) includes any prospectus required by
Section 10(a)(3) of the Act or (y) reflects facts or events representing a
material or fundamental change in the information set forth in the registration
statement, the incorporation by reference of information required to be included
in (x) and (y) above to be contained in periodic reports filed pursuant to
Section 13 or 15(d) of the 1934 Act in the registration statement.
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<PAGE>
(b) Prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in connection
with such registration statement as may be necessary to comply with the
provisions of the Act with respect to the disposition of all securities covered
by such registration statement.
(c) Furnish to the Holders such numbers of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Act, and such other documents as they may reasonably request
in order to facilitate the disposition of Registrable Securities owned by them.
(d) Use its best efforts to register and qualify the
securities covered by such registration statement under such other securities or
Blue Sky laws of such jurisdictions as shall be reasonably requested by the
Holders; provided, that the Company shall not be required in connection
therewith or as a condition thereto to qualify to do business or to file a
general consent to service of process in any such states or jurisdictions.
(e) In the event of any underwritten public offering,
enter into and perform its obligations under an underwriting agreement, in usual
and customary form, with the managing underwriter of such offering. Each Holder
participating in such underwriting shall also enter into and perform its
obligations under such an agreement.
(f) Notify each Holder of Registrable Securities
covered by such registration statement at any time when a prospectus relating
thereto is required to be delivered under the Act of the happening of any event
as a result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing.
(g) Cause all such Registrable Securities registered
pursuant hereunder to be listed on each securities exchange on which similar
securities issued by the Company are then listed.
(h) Provide a transfer agent and registrar for all
Registrable Securities registered pursuant hereunder and a CUSIP number for all
such Registrable Securities, in each case not later than the effective date of
such registration.
1.5. Furnish Information.
(a) It shall be a condition precedent to the
obligations of the Company to take any action pursuant to this Section 1 with
respect to the Registrable Securities of any selling Holder that such Holder
shall furnish to the Company such information regarding itself, the Registrable
Securities held by it, and the intended method of disposition of such securities
as shall be required to effect the registration of such Holder's Registrable
Securities.
(b) The Company shall have no obligation with respect
to any registration requested pursuant to Section 1.2 or Section 1.11 if the
number of shares or the
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<PAGE>
anticipated aggregate offering price of the Registrable Securities to be
included in the registration does not equal or exceed the number of shares or
the anticipated aggregate offering price required to originally trigger the
Company's obligation to initiate such registration as specified in subsection
1.2(a) or subsection 1.11(b)(2), whichever is applicable.
1.6. Expenses of Demand Registration. All expenses other than
underwriting discounts and commissions incurred in connection with
registrations, filings or qualifications pursuant to Section 1.2, including
(without limitation) all registration, filing and qualification fees, printers'
and accounting fees, fees and disbursements of counsel for the Company, shall be
borne by the Company; provided, however, that the Company shall not be required
to pay for any expenses of any registration proceeding begun pursuant to Section
1.2 if the registration request is subsequently withdrawn at the request of the
Holders of a majority of the Registrable Securities to be registered (in which
case all participating Holders shall bear such expenses), unless the Holders of
a majority of the Registrable Securities agree to forfeit their right to one
demand registration pursuant to Section 1.2.
1.7. Expenses of Company Registration. The Company shall bear
and pay all expenses incurred in connection with any registration, filing or
qualification of Registrable Securities with respect to the registrations
pursuant to Section 1.3 for each Holder (which right may be assigned as provided
in Section 1.12), including (without limitation) all registration, filing, and
qualification fees, printers, legal and accounting fees relating or
apportionable thereto, but excluding underwriting discounts and commissions
relating to Registrable Securities.
1.8. Underwriting Requirements. In connection with any
offering involving an underwriting of shares of the Company's capital stock, the
Company shall not be required under Section 1.3 to include any of the Holders'
securities in such underwriting unless they accept the terms of the underwriting
as agreed upon between the Company and the underwriters selected by it (or by
other persons entitled to select the underwriters), and then only in such
quantity as the underwriters determine in their sole discretion will not
jeopardize the success of the offering by the Company. If the total amount of
securities, including Registrable Securities, requested by stockholders to be
included in such offering exceeds the amount of securities sold other than by
the Company that the underwriters determine in their sole discretion is
compatible with the success of the offering, then the Company shall be required
to include in the offering only that number of such securities, including
Registrable Securities, which the underwriters determine in their sole
discretion will not jeopardize the success of the offering (the securities so
included to be apportioned pro rata among the selling stockholders according to
the total amount of securities entitled to be included therein owned by each
selling stockholder or in such other proportions as shall mutually be agreed to
by such selling stockholders).
1.9. Delay of Registration. No Holder shall have any right to
obtain or seek an injunction restraining or otherwise delaying any such
registration as the result of any controversy that might arise with respect to
the interpretation or implementation of this Section 1.
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<PAGE>
1.10. Indemnification. In the event any Registrable
Securities are included in a registration statement under this Section 1:
(a) To the extent permitted by law, the Company will
indemnify and hold harmless each Holder, such Holder's members, officers,
directors, partners, shareholders and employees, any underwriter (as defined in
the Act) for such Holder and each person, if any, who controls such Holder or
underwriter within the meaning of the Act or the 1934 Act, against any losses,
claims, damages, or liabilities (joint or several) to which they may become
subject under the Act, or the 1934 Act or other federal or state law, insofar as
such losses, claims, damages, or liabilities (or actions in respect thereof)
arise out of or are based upon any of the following statements, omissions or
violations (collectively a "Violation"): (i) any untrue statement or alleged
untrue statement of a material fact contained in such registration statement,
including any preliminary prospectus or final prospectus contained therein or
any amendments or supplements thereto, (ii) the omission or alleged omission to
state therein a material fact required to be stated therein, or necessary to
make the statements therein not misleading, or (iii) any violation or alleged
violation by the Company of the Act, the 1934 Act, any state securities law or
any rule or regulation promulgated under the Act, or the 1934 Act or any state
securities law; and the Company will pay to each such Holder, underwriter or
controlling person, as incurred, any legal or other expenses reasonably incurred
by them in connection with investigating or defending any such loss, claim,
damage, liability, or action; provided, however, that the indemnity agreement
contained in this subsection 1.10(a) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability, or action if such
settlement is effected without the consent of the Company (which consent shall
not be unreasonably withheld), nor shall the Company be liable in any such case
for any such loss, claim, damage, liability, or action to the extent that it
arises out of or is based upon a Violation which occurs in reliance upon and in
conformity with written information furnished expressly for use in connection
with such registration by any such Holder, underwriter or controlling person.
(b) To the extent permitted by law, each selling Holder
will indemnify and hold harmless the Company, each of its directors, each of its
officers who has signed the registration statement, each person, if any, who
controls the Company within the meaning of the Act, any underwriter, any other
Holder selling securities in such registration statement and any controlling
person of any such underwriter or other Holder, against any losses, claims,
damages, or liabilities (joint or several) to which any of the foregoing persons
may become subject, under the Act, or the 1934 Act or other federal or state
law, insofar as such losses, claims, damages, or liabilities (or actions in
respect thereto) arise out of or are based upon any Violation, in each case to
the extent (and only to the extent) that such Violation occurs in reliance upon
and in conformity with written information furnished by such Holder expressly
for use in connection with such registration; and each such Holder will pay, as
incurred, any legal or other expenses reasonably incurred by any person intended
to be indemnified pursuant to this subsection 1.10(b), in connection with
investigating or defending any such loss, claim, damage, liability, or action;
provided, however, that the indemnity agreement contained in this subsection
1.10(b) shall not apply to amounts paid in settlement of any such loss, claim,
damage, liability or action if such settlement is effected without the consent
of the Holder, which consent
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<PAGE>
shall not be unreasonably withheld; provided, that, in no event shall any
indemnity under this subsection 1.10(b) exceed the gross proceeds from the
offering received by such Holder.
(c) Promptly after receipt by an indemnified party
under this Section 1.10 of notice of the commencement of any action (including
any governmental action), such indemnified party will, if a claim in respect
thereof is to be made against any indemnifying party under this Section 1.10,
deliver to the indemnifying party a written notice of the commencement thereof
and the indemnifying party shall have the right to participate in, and, to the
extent the indemnifying party so desires, jointly with any other indemnifying
party similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party
(together with all other indemnified parties which may be represented without
conflict by one counsel) shall have the right to retain one separate counsel,
with the fees and expenses to be paid by the indemnifying party, if
representation of such indemnified party by the counsel retained by the
indemnifying party would be inappropriate due to actual or potential differing
interests between such indemnified party and any other party represented by such
counsel in such proceeding. The failure to deliver written notice to the
indemnifying party within a reasonable time of the commencement of any such
action, if prejudicial to its ability to defend such action, shall relieve such
indemnifying party of any liability to the indemnified party under this Section
1.10, but the omission so to deliver written notice to the indemnifying party
will not relieve it of any liability that it may have to any indemnified party
otherwise than under this Section 1.10.
(d) If the indemnification provided for in this Section
1.10 is held by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any loss, liability, claim, damage, or expense
referred to therein, then the indemnifying party, in lieu of indemnifying such
indemnified party hereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such loss, liability, claim, damage, or
expense in such proportion as is appropriate to reflect the relative fault of
the indemnifying party on the one hand and of the indemnified party on the other
in connection with the statements or omissions that resulted in such loss,
liability, claim, damage, or expense as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and of the
indemnified party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties' relative intent,
knowledge, access to information, and opportunity to correct or prevent such
statement or omission.
(e) Notwithstanding the foregoing, to the extent that
the provisions on indemnification and contribution contained in the underwriting
agreement entered into in connection with the underwritten public offering are
in conflict with the foregoing provisions, the provisions in the underwriting
agreement shall control.
(f) The obligations of the Company and Holders under
this Section 1.10 shall survive the completion of any offering of Registrable
Securities in a registration statement under this Section 1, and otherwise.
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<PAGE>
1.11. Form S-3 Registration. In case the Company shall
receive from any Holder or Holders a written request or requests that the
Company effect a registration on Form S-3 and any related qualification or
compliance with respect to all or a part of the Registrable Securities owned by
such Holder or Holders, and the Company is then eligible to register the Common
Stock on Form S-3, the Company will:
(a) promptly give written notice of the proposed
registration, and any related qualification or compliance, to all other Holders;
and
(b) as soon as practicable, effect such registration
and all such qualifications and compliances as may be so requested and as would
permit or facilitate the sale and distribution of all or such portion of such
Holder's or Holders' Registrable Securities as are specified in such request,
together with all or such portion of the Registrable Securities of any other
Holder or Holders joining in such request as are specified in a written request
given within 15 days after receipt of such written notice from the Company;
provided, however, that the Company shall not be obligated to effect any such
registration, qualification or compliance, pursuant to this Section 1.11: (1) if
Form S-3 is not available for such offering by the Holders; (2) if the Holders,
together with the holders of any other securities of the Company entitled to
inclusion in such registration, propose to sell Registrable Securities and such
other securities (if any) at an aggregate price to the public (net of any
underwriters' discounts or commissions) of less than $500,000; (3) if the
Company shall furnish to the Holders a certificate signed by the President of
the Company stating that in the good faith judgment of the Board of Directors of
the Company, it would be seriously detrimental to the Company and its
stockholders for such Form S-3 Registration to be effected at such time, in
which event the Company shall have the right to defer the filing of the Form S-3
registration statement for a period of not more than sixty (60) days after
receipt of the request of the Holder or Holders under this Section 1.11;
provided, however, that the Company shall not utilize this right more than once
in any twelve month period; (4) if the Company has, within the twelve (12) month
period preceding the date of such request, already effected two (2)
registrations on Form S-3 for the Holders pursuant to this Section 1.11; or (5)
in any particular jurisdiction in which the Company would be required to qualify
to do business or to execute a general consent to service of process in
effecting such registration, qualification or compliance.
(c) Subject to the foregoing, the Company shall file a
registration statement covering the Registrable Securities and other securities
so requested to be registered as soon as practicable after receipt of the
request or requests of the Holders. All expenses incurred in connection with a
registration requested pursuant to Section 1.11, including (without limitation)
all registration, filing, qualification, printer's and accounting fees and the
reasonable fees and disbursements of counsel for the selling Holder or Holders
and counsel for the Company, shall be borne by the Company. Registrations
effected pursuant to this Section 1.11 shall not be counted as demands for
registration or registrations effected pursuant to Sections 1.2 or 1.3,
respectively.
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1.12. Assignment of Registration Rights
(a) The rights to cause the Company to register
Registrable Securities pursuant to this Section 1 may be assigned (but only with
all related obligations) by a Holder to a transferee or assignee of such
securities if (x) such transfer involves all the Registrable Securities held by
the Holder, or (y) a transfer by a Preferred Stockholder which is a corporation
to a wholly owned subsidiary of such corporation, a transfer by a Preferred
Stockholder which is a partnership to a partner of such partnership or a retired
partner of such partnership who retires after the date hereof, or to the estate
of any such partner or retired partner, or a transfer by a Preferred Stockholder
which is a limited liability company to a member of such limited liability
company or a retired member who resigns after the date hereof or to the estate
of any such member or retired member; or a transfer by a Preferred Stockholder
which is an individual to a member of the immediate family of such individual or
to a trust solely for the benefit of such individual or the members of the
immediate family of such individual or to the estate of such individual;
provided, that all such assignees who would not qualify individually for
assignment of registration rights under subsection 1.12 (a) shall have a single
attorney-in-fact for the purpose of exercising any rights, receiving notices or
taking any action under this Section 1 and shall provide a power of attorney to
that effect if requested by the Company.
(b) No assignment or transfer pursuant to this Section
1.12 shall be effective unless (i) the Company is, within a reasonable time
after such transfer, furnished with written notice of the name and address of
such transferee or assignee and the securities with respect to which such
registration rights are being assigned; (ii) such transferee or assignee agrees
in writing to be bound by and subject to the terms and conditions of this
Agreement, including without limitation the provisions of Section 1.14 below;
and (iii) such assignment shall be effective only if immediately following such
transfer the further disposition of such securities by the transferee or
assignee is restricted under the Act.
1.13. Limitations on Subsequent Registration Rights. From and
after the date of this Agreement, the Company shall not, without the prior
written consent of the Holders of 75% of the outstanding Registrable Securities,
enter into any agreement with any holder or prospective holder of any securities
of the Company which would allow such holder or prospective holder (a) to
include such securities in any registration filed under Section 1.2 hereof,
unless under the terms of such agreement, such holder or prospective holder may
include such securities in any such registration only to the extent that the
inclusion of his securities will not reduce the amount of the Registrable
Securities of the Holders which is included or (b) to make a demand registration
which could result in such registration statement being declared effective prior
to the earlier of either of the dates set forth in subsection 1.2(a) or within
one hundred twenty (120) days of the effective date of any registration effected
pursuant to Section 1.2.
1.14. "Market Stand-Off" Agreement. Preferred Stockholders
and the Founders hereby agree that, during the period of duration specified by
the Company and an underwriter of common stock or other securities of the
Company, following the effective date of a registration statement of the Company
filed under the Act, they shall not, to the extent requested by the Company and
such underwriter, directly or indirectly sell, offer to sell, contract
10
<PAGE>
to sell (including, without limitation, any short sale), grant any option to
purchase or otherwise transfer or dispose of (other than to donees who agree to
be similarly bound) any securities of the Company held by them at any time
during such period except common stock included in such registration; provided,
however, that:
(a) such agreement shall be applicable only to the
first two such registration statements of the Company which cover common stock
(or other securities) to be sold on its behalf to the public in an underwritten
offering;
(b) all executive officers and directors of the Company
and all other persons with registration rights (whether or not pursuant to this
Agreement) enter into similar agreements; and
(c) such market stand-off time period shall not exceed
one hundred eighty (180) days.
In order to enforce the foregoing covenant, the Company may impose
stop-transfer instructions with respect to the Registrable Securities of
Preferred Stockholders (and the shares or securities of every other person
subject to the foregoing restriction) until the end of such period.
Notwithstanding the foregoing, the obligations described in this
Section 1.14 shall not apply to a registration relating solely to employee
benefit plans on Form S-8 or similar forms which may be promulgated in the
future, or a registration relating solely to a Commission Rule 145 transaction
on Form S-4 or similar forms which may be promulgated in the future.
1.15. Termination of Registration Rights.
No Holder shall be entitled to exercise any right
provided for in this Section 1 after ten (10) years following the effective date
of the IPO.
2. Covenants of the Company.
2.1. Right of First Offer. Subject to the terms and
conditions specified in this Section 2.1, the Company hereby grants to the
Preferred Stockholders a right of first offer with respect to future sales by
the Company of its Shares (as hereinafter defined). For purposes of this Section
2.1, "Preferred Stockholders" includes any general partners, members, and
affiliates of the Preferred Stockholders. The Preferred Stockholders shall
apportion the right of first offer hereby granted among each Preferred
Stockholder in proportion to such Preferred Stockholder's proportionate
investment, or in such proportions as may be agreed upon amongst the Preferred
Stockholders, and each Preferred Stockholder shall be entitled to apportion the
right of first offer hereby granted it among itself and its partners, members,
and affiliates in such proportions as it deems appropriate.
Each time the Company proposes to offer any shares of, or securities
convertible into or exercisable for any shares of, common stock relating to the
financing of any market
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("Shares"), other than pursuant to an IPO, while shares of the Series A
Preferred are outstanding ("Private Equity Offering"), the Company shall first
make an offering of a number of Shares to the Preferred Stockholders in
accordance with the following provisions:
(a) The Company shall deliver a notice by certified
mail ("Notice") to each Preferred Stockholder stating (i) its bona fide
intention to offer such Shares, (ii) the number of such Shares to be offered,
and (iii) the price and terms, if any, upon which it proposes to offer such
Shares.
(b) Within sixty (60) calendar days after receipt of
the Notice, the Preferred Stockholders may elect to purchase, at the price and
on the terms specified in the Notice, such number of Shares so as to maintain
their then existing ownership interest in the Company, assuming that all of the
shares of Series A Preferred then outstanding were converted into common stock
immediately prior to consummation of such Private Equity Offering.
(c) If the Preferred Stockholders do not elect to
purchase the full number of Shares that they are entitled to purchase pursuant
to subsection 2.1(b), the Company may, during the 120-day period following the
expiration of the period provided in subsection 2.4(b), offer the remaining
unsubscribed portion of such Shares to any person or persons at a price not less
than, and upon terms no more favorable to the offeree than those specified in
the Notice. If the Company does not enter into an agreement for the sale of the
Shares within such period, or if such agreement is not consummated within ninety
(90) days of the execution thereof, the right provided hereunder shall be deemed
to be revived and such Shares shall not be offered unless first reoffered to the
Preferred Stockholders in accordance herewith.
(d) The right of first offer in this Section 2.1 shall
not be applicable (i) to the issuance or sale of shares of common stock (or
options therefor) to employees, consultants, directors or vendors for the
primary purpose of soliciting or retaining their employment or services, or (ii)
after the effective date of the IPO; or (iii) the issuance of securities
pursuant to the conversion or exercise of convertible or exercisable securities,
or (iv) the issuance of securities in connection with a bona fide business
acquisition of or by the Company, whether by merger, consolidation, sale of
assets, sale or exchange of stock or otherwise, or (v) the issuance of stock,
warrants or other securities or rights to persons or entities with which the
Company has business relationships, provided such issuances are for other than
primarily equity financing purposes.
(e) The right of first offer set forth in this Section
2.1 may not be assigned or transferred, and shall terminate upon an IPO.
2.2. Negative Covenants. So long as the Series A Preferred
Stock, the Paribas Stock and the BET Stock is still outstanding, the Company
shall not, without the prior written consent of the holders of at least seventy
five percent (75%) of all outstanding shares of Series A Preferred Stock:
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(a) Grant registration rights superior to those set
forth in Section 1 without also making such rights available to the Preferred
Stockholders; or
(b) Grant rights of first offer or first refusal
superior to those set forth in Section 2.1, without also making such rights
available to the Preferred Stockholders.
2.3 Additional Rights. In addition to the registration rights
granted in Section 1, and the right of first offer granted in Section 2.1, the
Company grants to the Preferred Stockholders any registration rights, or rights
of first refusal, which are granted to any subsequent purchasers of the
Company's equity securities if and to the extent that any such rights are in the
good faith judgment of the Company's Board of Directors superior to those
granted in Sections 1, and 2.1.
3. Miscellaneous.
3.1. Successors and Assigns. Except as otherwise provided
herein, the terms and conditions of this Agreement shall inure to the benefit of
and be binding upon the respective successors and assigns of the parties
(including transferees of any shares of Registrable Securities). Nothing in this
Agreement, express or implied, is intended to confer upon any party other than
the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement.
3.2. Governing Law. This Agreement shall be governed by and
construed under the laws of the State of Delaware as applied to agreements
entered into and to be performed entirely within Delaware.
3.3. Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
3.4. Titles and Subtitles. The titles and subtitles used in
this Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
3.5. Notices. Unless otherwise provided, any notice required
or permitted under this Agreement shall be given in writing and shall be deemed
effectively given upon personal delivery to the party to be notified or upon
delivery by recognized overnight courier service, or upon deposit with the
United States Post Office, by registered or certified mail, postage prepaid and
addressed to the party to be notified at the address indicated for such party on
the signature page hereof, or at such other address as such party may designate
by ten (10) days' advance written notice to the other parties.
3.6. Expenses. If any action at law or in equity is necessary
to enforce or interpret the terms of this Agreement, the prevailing party shall
be entitled to reasonable
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<PAGE>
attorneys' fees, costs and necessary disbursements in addition to any other
relief to which such party may be entitled.
3.7. Amendments and Waivers. Any term of this Agreement may
be amended and the observance of any term of this Agreement may be waived
(either generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the holders of
a majority of the Registrable Securities then outstanding; provided that the
sections of this Agreement that contain a super majority requirement shall be
amended only with the written consent of the Company and the holders of 75% of
the Registrable Securities then outstanding. Any amendment or waiver effected in
accordance with this paragraph shall be binding upon each holder of any
Registrable Securities then outstanding, each future holder of all such
Registrable Securities, and the Company.
3.8. Severability. If one or more provisions of this
Agreement are held to be unenforceable under applicable law, such provision
shall be excluded from this Agreement and the balance of the Agreement shall be
interpreted as if such provision were so excluded and shall be enforceable in
accordance with its terms.
3.9. Aggregation of Stock. All shares of Registrable
Securities held or acquired by affiliated entities or persons shall be
aggregated together for the purpose of determining the availability of any
rights under this Agreement.
3.10. Entire Agreement. This Agreement (including the
Exhibits hereto, if any) constitutes the full and entire understanding and
agreement between the parties with regard to the subjects hereof and thereof.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first above written.
SIGNATURE PAGE FOR REGISTRATION RIGHTS AGREEMENT
The foregoing agreement is hereby executed as of the date set forth on the
first page:
COMPANY:
UBIQUITEL HOLDINGS, INC.
By:_____________________________________
Name: Donald A. Harris
Title: President and CEO
3 Bala Plaza - Suite 502
Bala Cynwyd, PA 19004
(610) 660-4920 (fax)
FOUNDERS:
________________________________________
Donald A. Harris
130 Abrahams Lane
St. Davids, PA 19087
(610) 660-4920 (fax)
________________________________________
James Parsons
330 Madison Avenue S.
Bainbridge Island, WA 98110
(206) 780-1414 (fax)
________________________________________
Paul F. Judge
120 Lakeside Avenue, Suite 310
Seattle, WA 98122-6578
(206)328-0815 (fax)
<PAGE>
THE WALTER GROUP
By:_____________________________________
Name:___________________________________
Title:__________________________________
120 Lakeside Avenue, Suite 310
Seattle, WA 98122-6578
(206) 328-0815 (fax)
US BANCORP.
By:_____________________________________
Name:___________________________________
Title:__________________________________
111 SW 5th Avenue - 2nd Floor
Portland, OR 97204
(503) 275-6663
PURCHASERS
________________________________________
Donald A. Harris
BROOKWOOD FINANCIAL
PARTNERS, LLC
By:_____________________________________
Name: Thomas N. Trkla
Title: Chairman and CEO
55 Tozer Road
Beverly, MA 01915
(978) 927-0499 (fax)
Copy to:
James T. Easterling
Ungaretti & Harris
3500 Three First National Plaza
Chicago, IL 60602
(312) 977-4405
<PAGE>
LANCASTER INVESTMENT PARTNERS
By:_____________________________________
Name:___________________________________
Title:__________________________________
500 N. Gulph Road - Suite 110
King of Prussia, PA 19406
(610) 783-4788 (fax)
________________________________________
Stephen C. Marcus
915 Exeter Crest
Villanova, PA 19085
(610) 519-1389 (fax)
________________________________________
Robert Berlacher
675 Church Road
Villanova, PA 19085
(610) 783-4788 (fax)
________________________________________
Richard C. Walling, Jr.
c/o Richard C. Walling, Jr.
Express Marine, Inc.
29th Street on the Delaware
Camden, NJ 08105
(856) 541-0338 (fax)
PORTER PARTNERS, LP
By:_____________________________________
Name:___________________________________
Title:__________________________________
100 Shoreline, Suite 211B
Mill Valley, CA 94941
(415) 332-8223 (fax)
<PAGE>
BALLYSHANNON PARTNERS LP
By:_____________________________________
Name:___________________________________
Title:__________________________________
325 Bryn Mawr Avenue
Bryn Mawr, PA 19010
(610) 935-3000 (fax)
________________________________________
Barry Porter
(310) 385-3714 (fax)
WESTOVER COMMUNICATIONS,
By:_____________________________________
Name:___________________________________
Title:__________________________________
1733 H Street, #330-141
Blaine, WA 98230
Copy to:
Westover Communications Ltd.
17886 55 Avenue
Surray BC V35 6C8
(604) 576-4855 (fax)
SPECTRASITE COMMUNICATIONS
By:_____________________________________
Name:___________________________________
Title:__________________________________
100 Regency Forest Drive - Suite 400
Cary, NC 27511
(919) 468-8522 (fax)
<PAGE>
________________________________________
Mark Buechley
________________________________________
Jerri Buechley
P.O. Box 394
Glide, OR 97443
(503) 210-1002 (fax)
Copy to:
Coni Rathbone
Davis Wright Tremane
1300 SW 5th Avenue, Suite 2300
Portland, OR 97201
(503) 778-5299 (fax)
New Ventures, LLC
By:_____________________________________
Name:___________________________________
Title:__________________________________
211 N. Union Street, Suite 300
Alexandria, VA 22314
(703) 706-3837 (fax)
<PAGE>
EXHIBIT A
PREFERRED STOCKHOLDERS
<PAGE>
Exhibit 10.17
AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
THIS AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (this Agreement")
is made as of February 16, 2000, by and among Ubiquitel Holdings, Inc., a
Delaware corporation (the "Company"), James Parsons, Donald A. Harris, Paul F.
Judge, The Walter Group, Inc., a State of Washington corporation ("The Walter
Group"), U.S. Bancorp (each a "Founder" and collectively "Founders"), the
individuals and entities listed on the signature page hereto as Purchasers (the
"Preferred Stockholders"), Paribas North America, Inc., a Delaware corporation
("Paribas"), BET Associates, L.P., a Delaware limited partnership, ("BET"), and
DLJ Merchant Banking Partners II, L.P., a Delaware limited partnership("DLJ").
RECITALS
A. The Company and the Preferred Stockholders are parties to a
Series A Preferred Stock Purchase Agreement dated as of November 23, 1999 (the
"Series A Agreement") and a Registration Rights Agreement dated as of November
23, 1999 (the "Registration Rights Agreement"), which governs the rights of the
Founders and the Preferred Stockholders to cause the Company to register shares
of the Founder Stock and shares of the Voting Common Stock (as defined below)
issuable to the Preferred Stockholders pursuant to the Series A Agreement;
B. The Company and Paribas are parties to a Credit Agreement dated
as of December 28, 1999 as the same may be amended, amended and restated,
supplemented, restructured or otherwise modified from time to time (in whole or
in part and without limitation as to terms, conditions or covenants and without
regard to the principal amount thereof) and in effect, including all related
notes, collateral documents, guaranties, instruments and agreements entered into
in connection therewith, and any successive restructurings, renewals, extensions
or refundings thereof, (the "Paribas Credit Agreement") and a Warrant Agreement
dated as of December 28, 1999 (the "Paribas Warrant") pursuant to which the
Company issued to Paribas Common Stock Purchase Warrants to purchase up to
574,402 shares of Nonvoting Common Stock of the Company (the "Paribas Stock");
C. The Company and BET are parties to a Purchase Agreement dated as
of December 28, 1999 (the "BET Purchase Agreement") and a Warrant Agreement
dated as of December 28, 1999 (the "BET Warrant") pursuant to which the Company
issued to BET Common Stock Purchase Warrants to purchase up to 2,489,075 shares
of Voting Common Stock of the Company (the "BET Stock"); and
D. The Company and DLJ are parties to a Preferred Stock Purchase
Agreement (the "Series B Preferred Stock Purchase Agreement") pursuant to which
the Company will issue and sell to DLJ shares of the Company's 7% Senior
Pay-in-Kind Non Voting Convertible Preferred Stock (the "Non Voting Preferred
Stock"), which is convertible into the Company's 7% Senior Pay-in-Kind
Convertible Preferred Stock (the "Voting Preferred Stock" and, together with the
Non Voting Preferred Stock, "Series B Preferred Stock") for an aggregate
purchase price of $25,000,000 ("Initial Shares"). The Series B Preferred Stock
Purchase Agreement also provides that if the Company's initial public offering
does not go
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forward, and at the request of the Company, DLJ will purchase an additional
$100,000,000 of Series B Preferred Stock ("Additional Shares"). The Initial
Shares, the Additional Shares and the shares of Voting Common Stock into which
the Initial Shares and the Additional shares are convertible are referred to
herein as the "DLJ Stock".
E. The Company, the Founders and the Preferred Stockholders desire
to amend and restate the Registration Rights Agreement as set forth herein in
order to provide for the rights of Paribas, BET and DLJ to cause the Company to
register shares of the Paribas Stock, shares of the BET Stock and shares of DLJ
Stock..
NOW, THEREFORE, in consideration of the premises and mutual
covenants contained herein and for other good and valuable consideration the
receipt and sufficiency of which is hereby acknowledged, the parties hereby
agree as follows:
1. Registration Rights. The Company covenants and agrees as follows:
1.1. Definitions. For purposes of this Section 1:
(a) The term "Act" means the Securities Act of 1933, as
amended.
(b) The term "Form S-1" means such form under the Act as
in effect on the date hereof or any registration form subsequently adopted by
the SEC under the Act replacing such form.
(c) The term "Form S-3" means such form under the Act as
in effect on the date hereof or any registration form under the Act subsequently
adopted by the SEC which permits inclusion or incorporation of substantial
information by reference to other documents filed by the Company with the SEC.
(d) The term "Founder Stock" means the 3,417,000 shares
of Voting Common Stock presently issued to the Founders and, if and to the
extent vested, any of the 16,000,000 shares of Nonvoting Common Stock presently
issued to the Founders, and any additional shares of Voting Common Stock or
Nonvoting Common Stock issued to the Founders as a result of stock splits, stock
dividends, or other recapitalizations.
(e) The term "Holder" means any person owning or having
the right to acquire Registrable Securities or any assignee thereof in
accordance with Section 1.12 hereof.
(f) The term "IPO" means the Company's first sale of
securities to the general public pursuant to a registration in a firm commitment
underwritten offering registered under the Act, which results in gross proceeds
to the Company (prior to underwriters' discounts and expenses) of not less than
fifty million ($50,000,000) dollars.
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(g) The term "1934 Act" shall mean the Securities
Exchange Act of 1934, as amended.
(h) The term "register," "registered," and
"registration" refer to a registration effected by preparing and filing a
registration statement or similar document in compliance with the Act, and the
declaration or ordering of effectiveness of such registration statement or
document.
(i) The term "Series A Registrable Securities" means the
shares of Voting Common Stock issued or issuable upon conversion of the Series A
Preferred Stock or any shares of Voting Common Stock issued or issuable as a
result of stock splits, stock dividends, or other recapitalization.
(j) The term "BET Registrable Securities" means the BET
Stock or any shares of Voting Common Stock issued or issuable as a result of
stock splits, stock dividends, or other recapitalization.
(k) The term "DLJ Registrable Securities" means the DLJ
Stock or any shares of Voting Common Stock issued or issuable as a result of
stock splits, stock dividends, or other recapitalization.
(l) The term "Paribas Registrable Securities" means the
shares of Voting Common Stock issued or issuable upon conversion of the Paribas
Stock or any shares of Voting Common Stock issued or issuable as a result of
stock splits, stock dividends, or other recapitalization.
(m) The term "Registrable Securities" means the Series A
Registrable Securities, the BET Registrable Securities, the Paribas Registrable
Securities, the DLJ Registrable Securities and, solely with respect to the
piggyback registration rights provided in Section 1.3 below, the Founder Stock.
(m) The term "SEC" shall mean the Securities and
Exchange Commission.
(n) The term "Series A Preferred Stock" means the Series
A Preferred Stock purchased by the Preferred Stockholders pursuant to the Series
A Agreement.
(o) The term "Voting Common Stock" means the Company's
voting common stock, par value $0.001 per share.
1.2. Request for Registration.
(a) If the Company shall receive at any time a written
request from (i) the Holders of a majority of Series A Registrable Securities,
and/or (ii) the Holders of a majority of the Paribas Registrable Securities,
(iii) the Holders of a majority of the BET Registrable Securities, or (iv) the
Holders of a majority of the DLJ Registrable Securities that the
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<PAGE>
Company file a registration statement on Form S-1 under the Act covering the
registration of any Registrable Securities held by such Holder, then the Company
shall:
(i) within ten (10) days of the receipt thereof,
give written notice of such request to all Holders; and
(ii) effect as soon as practicable, and in any
event within 120 days of the receipt of such request, the registration under the
Act of all Registrable Securities which the Holders request to be registered,
subject to the limitations of subsection 1.2(b).
(b) If the Holders initiating the registration request
hereunder ("Initiating Holders") intend to distribute the Registrable Securities
covered by their request by means of an underwriting, they shall so advise the
Company as a part of their request made pursuant to subsection 1.2(a) and the
Company shall include such information in the written notice referred to in
subsection 1.2(a). The underwriter will be selected by the Company and shall be
reasonably acceptable to a majority in interest of the Initiating Holders,
unless DLJ is an Initiating Holder, in which case DLJ shall select the
underwriter. In any such event, the right of any Holder to include his
Registrable Securities in such registration shall be conditioned upon such
Holder's participation in such underwriting and the inclusion of such Holder's
Registrable Securities in the underwriting (unless otherwise mutually agreed by
a majority in interest of the Initiating Holders and such Holder) to the extent
provided herein. All Holders proposing to distribute their securities through
such underwriting shall (together with the Company as provided in subsection
1.4(e)) enter into an underwriting agreement in customary form with the
underwriter or underwriters selected for such underwriting. Notwithstanding any
other provision of this Section 1.2, if the underwriter advises the Company in
writing that, in its good faith opinion, the inclusion of all Registrable
Securities and other securities proposed to be included in such registration
would adversely affect the offering and sale (including price) of all
securities, then the Company shall provide a copy of such written advice to all
Holders of Registrable Securities which would otherwise be underwritten pursuant
hereto, and the number of shares of Registrable Securities proposed to be
included in such registration shall be included in the following order:
(i) First, the Registrable Securities proposed to
be included in such registration by the Initiating Holders, pro rata based upon
the number of Registrable Securities owned by each Initiating Holder at the time
of registration;
(ii) Second, other securities which constitute
Registrable Securities which are proposed to be included in such registration,
pro rata based upon the number of Registrable Securities owned by each Holder at
the time of registration; and
(iii) Third, other securities not referred to in
(i) or (ii) above.
Notwithstanding the foregoing, in the event the managing underwriter
advises the Company in writing that the inclusion of Registrable Securities
proposed to be included by
4
<PAGE>
members of the Company's management in such registration may adversely affect
the offering and sale (including price) of all securities to be included in such
registration, the number of shares of Registrable Securities proposed to be
included by the management may be disproportionately cut back.
(c) Notwithstanding the foregoing, if the Company shall
furnish to Holders requesting a registration statement pursuant to this Section
1.2, a certificate signed by the Chief Executive Officer of the Company stating
that in the good faith judgment of the Board of Directors of the Company, it
would (i) require the disclosure of a material transaction or other matter and
such disclosure would be disadvantageous to the Company or (ii) adversely affect
a material financing, acquisition, disposition of assets or stock, merger or
other comparable transaction, the Company shall have the right to defer taking
action with respect to such filing for a period of not more than one hundred
eighty (180) days after receipt of the request of the Initiating Holders;
provided, however, that the Company may not utilize this right more than once in
any twelve-month period.
(d) In addition, the Company shall not be obligated to
effect, or to take any action to effect, any registration pursuant to this
Section 1.2:
(i) Other than with respect to a demand initiated
by DLJ, after the IPO of the Company, if the Company has effected two
registrations pursuant to this Section 1.2 for each of (i) the Holders of a
majority of Series A Registrable Securities, or (ii) the Holders of a majority
of the Paribas Registrable Securities, or (iii) the Holders of a majority of the
BET Registrable Securities, and such registrations have been declared or ordered
effective, it being understood that the Company shall be obligated after the IPO
to effect one registration pursuant to this Section 1.2 upon the request of
Paribas;
(ii) During the period starting with the date
thirty (30) days prior to the Company's good faith estimate of the date of
filing of, and ending on a date one hundred eighty (180) days after the
effective date of, a registration subject to Section 1.3 hereof; provided, that
the Company is actively employing in good faith all reasonable efforts to cause
such registration statement to become effective; or
(iii) If the Initiating Holders propose to dispose
of shares of Registrable Securities that may be registered on Form S-3 pursuant
to a request made pursuant to Section 1.11 below, it is being understood that
the Company shall be obligated to effect a registration on Form S-3 at any time
pursuant to Section 1.11 below.
(e) A requested registration under this Section 1.2 may be rescinded
by written notice to the Company by a majority of the Initiating Holders. Such
rescinded registration shall not count as a registration statement initiated
pursuant to this Section 1.2 for purposes of paragraph (d) above if such request
is rescinded by a majority of the Initiating Holders prior to the filing of a
registration statement with the SEC.
1.3. Company Registration. If (but without any obligation to
do so) the Company proposes to register (including for this purpose a
registration effected by the Company
5
<PAGE>
for stockholders other than the Holders) any of its stock or other securities
under the Act in connection with the public offering of such securities solely
for cash (other than a registration relating solely to the sale of securities to
participants in a Company stock plan), the Company shall, at such time, promptly
give each Holder written notice of such registration. Upon the written request
of each Holder given within thirty (30) days after mailing of such notice by the
Company in accordance with Section 3.5, the Company shall, subject to the
provisions of Section 1.8, cause to be registered under the Act all of the
Registrable Securities that each such Holder has requested to be registered. The
Founders shall have the right to have the shares of the Founder Stock included
in any Company registration under this Section1.3; provided, however, that such
rights shall be subject and subordinate to the rights of the Holders (other than
the Founders) and; provided further that no shares of the Founder Stock shall be
included in any Company registration hereunder, unless and until all shares of
Holders (other than the Founders) requesting that their Registrable Securities
be registered are included in such offering. The number of Registrable
Securities and other securities proposed to be included in such offering shall
be included in the following order:
(a) First, the securities proposed to be included by the
Company;
(b) Second, the Registrable Securities held by the
Holders of Registrable Securities other than the Founders, pro rata based upon
the number of Registrable Securities owned by each Holder at the time of such
registration;
(c) Third, the Registrable Securities held by the
Founders, pro rata based upon the number of Registrable Securities owned by each
Founder at the time of such registration; and
(d) Fourth, other securities not referred to in (a), (b)
or (c) above.
In connection with the exercise of its registration rights pursuant
to this Section 1.3, DLJ shall have the right to approve the underwriter for
such registration. Notwithstanding the foregoing, in the event the managing
underwriter advises the Company in writing that the inclusion of Registrable
Securities proposed to be included by members of the Company's management in
such registration may adversely affect the offering and sale (including price)
of all securities to be included in such registration, the number of shares of
Registrable Securities proposed to be included by the management may be
disproportionately cut back.
1.4. Obligations of the Company. Whenever required under this
Section 1 to effect the registration of any Registrable Securities, the Company
shall, as expeditiously as reasonably possible:
(a) Prepare and file with the SEC a registration
statement with respect to such Registrable Securities and use its best efforts
to cause such registration statement to become effective, and, upon the request
of the Holders of a majority of the Registrable Securities registered
thereunder, keep such registration statement effective for a period of up to
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<PAGE>
one hundred twenty (120) days or until the distribution contemplated in the
Registration Statement has been completed; provided, however, that (i) such
120-day period shall be extended for a period of time equal to the period the
Holder refrains from selling any securities included in such registration
following the receipt of any notice given by the Company pursuant to Section
1.4(f) or at the request of an underwriter of Common Stock (or other securities)
of the Company; and (ii) in the case of any registration of Registrable
Securities on Form S-3 which are intended to be offered on a continuous or
delayed basis, such 120-day period shall be extended, if necessary, to keep the
registration statement effective until all such Registrable Securities are sold,
provided that Rule 415, or any successor rule under the Act, permits an offering
on a continuous or delayed basis, and provided further that applicable rules
under the Act governing the obligation to file a post-effective amendment
permit, in lieu of filing a post-effective amendment which (x) includes any
prospectus required by Section 10(a)(3) of the Act or (y) reflects facts or
events representing a material or fundamental change in the information set
forth in the registration statement, the incorporation by reference of
information required to be included in (x) and (y) above to be contained in
periodic reports filed pursuant to Section 13 or 15(d) of the 1934 Act in the
registration statement.
(b) Prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in connection
with such registration statement as may be necessary to comply with the
provisions of the Act with respect to the disposition of all securities covered
by such registration statement.
(c) Furnish to the Holders such numbers of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Act, and such other documents as they may reasonably request
in order to facilitate the disposition of Registrable Securities owned by them
and give such Holders reasonable time to review and comment on such documents.
(d) Use its best efforts to register and qualify the
securities covered by such registration statement under such other securities or
Blue Sky laws of such jurisdictions as shall be reasonably requested by the
Holders; provided, that the Company shall not be required in connection
therewith or as a condition thereto to qualify to do business or to file a
general consent to service of process in any such states or jurisdictions.
(e) In the event of any underwritten public offering,
enter into and perform its obligations under an underwriting agreement, in usual
and customary form, with the managing underwriter of such offering.
(f) (i) Notify each Holder of Registrable Securities
covered by such registration statement at any time when a prospectus relating
thereto is required to be delivered under the Act of the happening of any event
as a result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing and
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(ii) (A) use its best efforts to prevent the
issuance of any stop order or obtain its withdrawal at the earliest possible
moment and
(B) prepare and furnish to such Holder a
reasonable number of copies of a supplement to or an amendment of such
prospectus as may be necessary so that, as thereafter delivered to the offerees
of such Registrable Securities, such prospectus shall not include an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading in
light of the circumstances then existing.
(g) Cause all such Registrable Securities registered
pursuant hereunder to be listed on each securities exchange on which similar
securities issued by the Company are then listed including without limitation,
the automated quotation system of the National Association of Securities
Dealers, Inc.'s National Market System or the New York Stock Exchange, Inc.
(h) Provide a transfer agent and registrar for all
Registrable Securities registered pursuant hereunder and a CUSIP number for all
such Registrable Securities, in each case not later than the effective date of
such registration.
(i) Use its best efforts to obtain from its independent
certified public accountants "cold comfort" letters in customary form and at
customary times and covering matters of the type customarily covered by cold
comfort letters for delivery to the Holders.
(j) Use its best efforts to obtain from its counsel an
opinion or opinions in customary form for delivery to the Holders.
(k) Cause it employees and personnel to use their
reasonable best efforts to support the marketing of the Registrable Securities
(including, without limitation, the participation in "road show presentations")
to the extent possible taking into account the Company's business needs and the
requirements of the marketing process.
1.5. Furnish Information.
(a) It shall be a condition precedent to the obligations
of the Company to take any action pursuant to this Section 1 with respect to the
Registrable Securities of any selling Holder that such Holder shall furnish to
the Company such information regarding itself, the Registrable Securities held
by it, and the intended method of disposition of such securities as shall be
reasonably requested to effect the registration of such Holder's Registrable
Securities.
(b) Other than with respect to a demand initiated by
DLJ, the Company shall have no obligation with respect to any registration
requested pursuant to Section 1.2 or Section 1.11 if the number of shares or the
anticipated aggregate offering price of the Registrable Securities to be
included in the registration does not equal or exceed the number of shares or
the anticipated aggregate offering price required to originally trigger the
Company's
8
<PAGE>
obligation to initiate such registration as specified in subsection 1.2(a) or
subsection 1.11(b)(2), whichever is applicable.
1.6. Expenses of Demand Registration. All expenses other than
underwriting discounts and commissions incurred in connection with
registrations, filings or qualifications pursuant to Section 1.2 or Section
1.11, including (without limitation) all registration, filing and qualification
fees, printers' and accounting fees, fees and disbursements of one counsel for
the Initiating Holders, shall be borne by the Company.
1.7. Expenses of Company Registration. The Company shall bear
and pay all expenses incurred in connection with any registration, filing or
qualification of Registrable Securities with respect to the registrations
pursuant to Section 1.3 for each Holder (which right may be assigned as provided
in Section 1.12), including (without limitation) all registration, filing, and
qualification fees, printers, legal and accounting fees relating or
apportionable thereto, but excluding underwriting discounts and commissions
relating to Registrable Securities.
1.8. [reserved]
1.9. [reserved]
1.10. Indemnification. In the event any Registrable Securities
are included in a registration statement under this Section 1:
(a) To the extent permitted by law, the Company will
indemnify and hold harmless each Holder, such Holder's members, officers,
directors, partners, shareholders and employees, any underwriter (as defined in
the Act) for such Holder and each person, if any, who controls such Holder or
underwriter within the meaning of the Act or the 1934 Act, against any losses,
claims, damages, or liabilities (joint or several) to which they may become
subject under the Act, or the 1934 Act or other federal or state law, insofar as
such losses, claims, damages, or liabilities (or actions in respect thereof)
arise out of or are based upon any of the following statements, omissions or
violations (collectively a "Violation"): (i) any untrue statement or alleged
untrue statement of a material fact contained in such registration statement,
including any preliminary prospectus or final prospectus contained therein or
any amendments or supplements thereto, (ii) the omission or alleged omission to
state therein a material fact required to be stated therein, or necessary to
make the statements therein not misleading, or (iii) any violation or alleged
violation by the Company of the Act, the 1934 Act, any state securities law or
any rule or regulation promulgated under the Act, or the 1934 Act or any state
securities law; and the Company will pay to each such Holder, underwriter or
controlling person, as incurred, any legal or other expenses reasonably incurred
by them in connection with investigating or defending any such loss, claim,
damage, liability, or action; provided, however, that the indemnity agreement
contained in this subsection 1.10(a) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability, or action if such
settlement is effected without the consent of the Company (which consent shall
not be unreasonably withheld), nor shall the Company be liable to any Holder,
underwriter or controlling person in any such case for any such loss, claim,
damage, liability, or action to the
9
<PAGE>
extent that it arises out of or is based upon a Violation which occurs in
reliance upon and in conformity with written information relating to such
Holder, underwriter or controlling person furnished expressly for use in
connection with such registration by such Holder, underwriter or controlling
person.
(b) To the extent permitted by law, each selling Holder
will, severally, and not jointly and severally, indemnify and hold harmless the
Company, each of its directors, each of its officers who has signed the
registration statement, each person, if any, who controls the Company within the
meaning of the Act, any underwriter, any other Holder selling securities in such
registration statement and any controlling person of any such underwriter or
other Holder, against any losses, claims, damages, or liabilities (joint or
several) to which any of the foregoing persons may become subject, under the
Act, or the 1934 Act or other federal or state law, insofar as such losses,
claims, damages, or liabilities (or actions in respect thereto) arise out of or
are based upon any Violation, in each case to the extent (and only to the
extent) that such Violation occurs in reliance upon and in conformity with
written information relating to such Holder, underwriter or controlling person
furnished by such Holder expressly for use in connection with such registration;
and each such Holder will pay, as incurred, any legal or other expenses
reasonably incurred by any person intended to be indemnified pursuant to this
subsection 1.10(b), in connection with investigating or defending any such loss,
claim, damage, liability, or action; provided, however, that the indemnity
agreement contained in this subsection 1.10(b) shall not apply to amounts paid
in settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Holder, which consent shall
not be unreasonably withheld; provided, that, in no event shall any indemnity
under this subsection 1.10(b) exceed the lesser of such Holder's allocable share
of such indemnity payment and the gross proceeds from the offering received by
such Holder.
(c) Promptly after receipt by an indemnified party under
this Section 1.10 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying party under this Section 1.10, deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to such indemnifying parties; provided, however, that an
indemnified party (together with all other indemnified parties which may be
represented without conflict by one counsel) shall have the right to retain one
separate counsel, with the fees and expenses to be paid by the indemnifying
party, if representation of such indemnified party by the counsel retained by
the indemnifying party would be inappropriate due to actual or potential
differing interests between such indemnified party and any other party
represented by such counsel in such proceeding. The failure to deliver written
notice to the indemnifying party within a reasonable time of the commencement of
any such action, if prejudicial to its ability to defend such action, shall
relieve such indemnifying party of liability to the indemnified party under this
Section 1.10 to the extent, and only to the extent, prejudiced thereby, but the
omission so to deliver written notice to the indemnifying party will not relieve
it of any liability that it may have to any indemnified party otherwise than
under this Section 1.10.
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(d) If the indemnification provided for in this Section
1.10 is held by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any loss, liability, claim, damage, or expense
referred to therein, then the indemnifying party, in lieu of indemnifying such
indemnified party hereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such loss, liability, claim, damage, or
expense in such proportion as is appropriate to reflect the relative fault of
the indemnifying party on the one hand and of the indemnified party on the other
in connection with the statements or omissions that resulted in such loss,
liability, claim, damage, or expense as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and of the
indemnified party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties' relative intent,
knowledge, access to information, and opportunity to correct or prevent such
statement or omission.
(e) The obligations of the Company and Holders under
this Section 1.10 shall survive the completion of any offering of Registrable
Securities in a registration statement under this Section 1, and otherwise.
1.11. Form S-3 Registration. In case the Company shall receive
from any Holder or Holders a written request or requests that the Company effect
a registration on Form S-3 and any related qualification or compliance with
respect to all or a part of the Registrable Securities owned by such Holder or
Holders, and the Company is then eligible to register the Common Stock on Form
S-3, the Company will:
(a) promptly give written notice of the proposed
registration, and any related qualification or compliance, to all other Holders;
and
(b) as soon as practicable, effect such registration and
all such qualifications and compliances as may be so requested and as would
permit or facilitate the sale and distribution of all or such portion of such
Holder's or Holders' Registrable Securities as are specified in such request,
together with all or such portion of the Registrable Securities of any other
Holder or Holders joining in such request as are specified in a written request
given within 15 days after receipt of such written notice from the Company;
provided, however, that the Company shall not be obligated to effect any such
registration, qualification or compliance, pursuant to this Section 1.11: (1) if
Form S-3 is not available for such offering by the Holders; (2) if the Holders,
together with the holders of any other securities of the Company entitled to
inclusion in such registration, propose to sell Registrable Securities and such
other securities (if any) at an aggregate price to the public (net of any
underwriters' discounts or commissions) of less than $500,000; (3) if the
Company shall furnish to the Holders a certificate signed by the President of
the Company stating that in the good faith judgment of the Board of Directors of
the Company, to effect such a Form S-3 Registration would (i) require the
disclosure of a material transaction or other matter and such disclosure would
be disadvantageous to the Company or (ii) adversely affect a material financing,
acquisition, disposition of assets or stock, merger, or other comparable
transaction, in which case the Company shall have the right to defer the filing
of the
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Form S-3 registration statement for a period of not more than sixty (60) days
after receipt of the request of the Holder or Holders under this Section 1.11;
provided, however, that the Company shall not utilize this right more than once
in any twelve month period; (4) if the Company has, within the twelve (12) month
period preceding the date of such request, already effected two (2)
registrations on Form S-3 for the Holders pursuant to this Section 1.11; or (5)
in any particular jurisdiction in which the Company would be required to qualify
to do business or to execute a general consent to service of process in
effecting such registration, qualification or compliance.
(c) Subject to the foregoing, the Company shall file a
registration statement covering the Registrable Securities and other securities
so requested to be registered as soon as practicable after receipt of the
request or requests of the Holders. All expenses incurred in connection with a
registration requested pursuant to Section 1.11, including (without limitation)
all registration, filing, qualification, printer's and accounting fees and the
reasonable fees and disbursements of counsel for the selling Holder or Holders
and counsel for the Company, shall be borne by the Company. Registrations
effected pursuant to this Section 1.11 shall not be counted as demands for
registration or registrations effected pursuant to Sections 1.2 or 1.3,
respectively.
1.12. Assignment of Registration Rights
(a) The rights to cause the Company to register
Registrable Securities pursuant to this Section 1 may be assigned (but only with
all related obligations) by a Holder to a transferee or assignee of such
securities if, other than in the case of a transfer of DLJ Registrable
Securities, (x) such transfer involves all the Registrable Securities held by
the Holder, or (y) a transfer by a Holder which is a corporation to any
affiliate, officer, director, partner, member, or employee of such Holder and,
in the case of Paribas, any bank which may become a party to the Paribas Credit
Agreement, a transfer by a Holder which is a partnership to a partner of such
partnership or a retired partner of such partnership who retires after the date
hereof, or to the estate of any such partner or retired partner, or a transfer
by a Holder which is a limited liability company to a member of such limited
liability company or a retired member who resigns after the date hereof or to
the estate of any such member or retired member; or a transfer by a Holder which
is an individual to a member of the immediate family of such individual or to a
trust solely for the benefit of such individual or the members of the immediate
family of such individual or to the estate of such individual; provided, that
all such assignees who would not qualify individually for assignment of
registration rights under subsection 1.12 (a) shall have a single
attorney-in-fact for the purpose of exercising any rights, receiving notices or
taking any action under this Section 1 and shall provide a power of attorney to
that effect if requested by the Company.
(b) No assignment or transfer pursuant to this Section
1.12 shall be effective unless (i) the Company is, within a reasonable time
after such transfer, furnished with written notice of the name and address of
such transferee or assignee and the securities with respect to which such
registration rights are being assigned; (ii) such transferee or assignee agrees
in writing to be bound by and subject to the terms and conditions of this
Agreement, including without limitation the provisions of Section 1.14 below;
and (iii) such
12
<PAGE>
assignment shall be effective only if immediately following such transfer the
further disposition of such securities by the transferee or assignee is
restricted under the Act.
1.13. Limitations on Subsequent Registration Rights. From and
after the date of this Agreement, the Company shall not, without the prior
written consent of the Holders of 75% of the outstanding Registrable Securities,
enter into any agreement with any holder or prospective holder of any securities
of the Company which would allow such holder or prospective holder (a) to
include such securities in any registration filed under Section 1.2 hereof,
unless under the terms of such agreement, such holder or prospective holder may
include such securities in any such registration only to the extent that the
inclusion of his securities will not reduce the amount of the Registrable
Securities of the Holders which is included or (b) to make a demand registration
which could result in such registration statement being declared effective prior
to the earlier of either of the dates set forth in subsection 1.2(a) or within
one hundred twenty (120) days of the effective date of any registration effected
pursuant to Section 1.2.
1.14. "Market Stand-Off" Agreement. All Holders hereby agree
that, during the period of duration specified by the Company and an underwriter
of common stock or other securities of the Company, following the effective date
of a registration statement of the Company filed under the Act, they shall not,
to the extent requested by the Company and such underwriter, directly or
indirectly sell, offer to sell, contract to sell (including, without limitation,
any short sale), grant any option to purchase or otherwise transfer or dispose
of (other than to donees who agree to be similarly bound) any securities of the
Company held by them at any time during such period except common stock included
in such registration; provided, however, that:
(a) such agreement shall be applicable only to the first
two such registration statements of the Company which cover common stock (or
other securities) to be sold on its behalf to the public in an underwritten
offering;
(b) all executive officers and directors of the Company
and all other persons with registration rights (whether or not pursuant to this
Agreement) enter into similar agreements; and
(c) such market stand-off time period shall not exceed
one hundred eighty (180) days in the case of an initial public offering of the
company and ninety (90) days for all other registrations filed by the Company on
it behalf.
In order to enforce the foregoing covenant, the Company may impose
stop-transfer instructions with respect to the Registrable Securities of
Preferred Stockholders (and the shares or securities of every other person
subject to the foregoing restriction) until the end of such period.
Notwithstanding the foregoing, the obligations described in this
Section 1.14 shall not apply to a registration relating solely to employee
benefit plans on Form S-8 or similar forms which may be promulgated in the
future, or a registration relating solely to a Commission Rule 145 transaction
on Form S-4 or similar forms which may be promulgated in the future.
13
<PAGE>
1.15. Termination of Registration Rights.
No Holder shall be entitled to exercise any right
provided for in this Section 1 after ten (10) years following the effective date
of the IPO.
2. Covenants of the Company.
2.1. [reserved]
2.2. Exchange Act Compliance. The Company shall comply with
all of the reporting requirements of the 1934 Act and shall comply with all
other public information reporting requirements of the Commission which are
conditions to the availability of Rule 144 for the sale of common stock. The
Company shall cooperate with each Holder in supplying such information as may be
necessary for such Holder to complete and file any information reporting forms
presently or hereafter required by the SEC as a condition to the availability of
Rule 144.
2.3. Negative Covenants.
(a) So long as the Series A Preferred Stock, the DLJ
Stock, the Paribas Stock, and the BET Stock are still outstanding, the Company
shall not, without the prior written consent of the Holders of at least seventy
five percent (75%) each of the Series A Registrable Securities, the BET
Registrable Securities, and the Paribas Registrable Securities grant
registration rights superior to those set forth in Section 1 without also making
such rights available to the Holders of the Series A Registrable Securities, the
BET Registrable Securities, and the Paribas Registrable Securities.
(b) So long as the Series A Preferred Stock is still
outstanding, the Company shall not, without the prior written consent of the
Holders of at least 75% of the Series A Registrable Securities, grant rights of
first offer or first refusal superior to those set forth in Section 2.1, without
also making such rights available to the Preferred Stockholders.
3. Miscellaneous.
3.1. Successors and Assigns. Except as otherwise provided
herein, the terms and conditions of this Agreement shall inure to the benefit of
and be binding upon the respective successors and assigns of the parties
(including transferees of any shares of Registrable Securities). Nothing in this
Agreement, express or implied, is intended to confer upon any party other than
the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement.
3.2. Governing Law. This Agreement shall be governed by and
construed under the laws of the State of Delaware as applied to agreements
entered into and to be performed entirely within Delaware.
14
<PAGE>
3.3. Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
3.4. Titles and Subtitles. The titles and subtitles used in
this Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
3.5. Notices. Unless otherwise provided, any notice required
or permitted under this Agreement shall be given in writing and shall be deemed
effectively given by fax or upon personal delivery to the party to be notified
or upon delivery by recognized overnight courier service, or upon deposit with
the United States Post Office, by registered or certified mail, postage prepaid
and addressed to the party to be notified at the address indicated for such
party on the signature page hereof, or at such other address as such party may
designate by ten (10) days' advance written notice to the other parties.
3.6. Expenses. If any action at law or in equity is necessary
to enforce or interpret the terms of this Agreement, the prevailing party shall
be entitled to reasonable attorneys' fees, costs and necessary disbursements in
addition to any other relief to which such party may be entitled.
3.7. Amendments and Waivers. Any term of this Agreement may be
amended and the observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and Holders of at
least seventy five percent (75%) each of the Series A Registrable Securities,
the DLJ Registrable Securities, the BET Registrable Securities and the Paribas
Registrable Securities then outstanding; provided that no such amendment or
waiver which adversely affects the rights of any Holder may be made without such
Holder's prior written consent; and further provided that with respect to the
amendments to Section 2.1 only the vote of the Holders of the Series A Preferred
Stock will be required. Any amendment or waiver effected in accordance with this
paragraph shall be binding upon each Holder of any Registrable Securities, each
future holder of all such Registrable Securities, and the Company.
3.8. Severability. If one or more provisions of this Agreement
are held to be unenforceable under applicable law, such provision shall be
excluded from this Agreement and the balance of the Agreement shall be
interpreted as if such provision were so excluded and shall be enforceable in
accordance with its terms.
3.9. Aggregation of Stock. All shares of Registrable
Securities held or acquired by affiliated entities or persons shall be
aggregated together for the purpose of determining the availability of any
rights under this Agreement.
3.10. Restatement. This Agreement amends, restates and
supersedes the Registration Rights Agreement in its entirety and the
Registration Rights Agreement shall be of no further force and effect as of the
date hereof.
15
<PAGE>
3.11 Effectiveness. This Agreement shall become effective upon
its execution by a majority of holders of the Series A Registrable Securities
and shall be enforceable in accordance with its terms against the parties that
executed this Agreement.
3.12. Entire Agreement. This Agreement (including the Exhibits
hereto, if any) constitutes the full and entire understanding and agreement
between the parties with regard to the subjects hereof and thereof.
[Signature page follows]
16
<PAGE>
SIGNATURE PAGE FOR AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first above written.
The foregoing agreement is hereby executed as of the date set forth on the
first page:
COMPANY:
UBIQUITEL HOLDINGS, INC.
By:______________________________________
Name: Donald A. Harris
Title: President and CEO
3 Bala Plaza - Suite 502
Bala Cynwyd, PA 19004
(610) 660-4920 (fax)
FOUNDERS:
_________________________________________
Donald A. Harris
130 Abrahams Lane
St. Davids, PA 19087
(610) 660-4920 (fax)
_________________________________________
James Parsons
330 Madison Avenue S.
Bainbridge Island, WA 98110
(206) 780-1414 (fax)
_________________________________________
Paul F. Judge
120 Lakeside Avenue, Suite 310
Seattle, WA 98122-6578
(206)328-0815 (fax)
17
<PAGE>
SIGNATURE PAGE FOR AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
18
<PAGE>
SIGNATURE PAGE FOR AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
THE WALTER GROUP
By:______________________________________
Name:____________________________________
Title:___________________________________
120 Lakeside Avenue, Suite 310
Seattle, WA 98122-6578
(206) 328-0815 (fax)
US BANCORP.
By:______________________________________
Name:____________________________________
Title:___________________________________
111 SW 5th Avenue - 2nd Floor
Portland, OR 97204
(503) 275-6663
PURCHASERS
_________________________________________
Donald A. Harris
BROOKWOOD UBIQUITEL INVESTORS, LLC
By:______________________________________
Name: Thomas N. Trkla
Title: Chairman and CEO
55 Tozer Road
Beverly, MA 01915
(978) 927-0499 (fax)
Copy to: James T. Easterling
Ungaretti & Harris
3500 Three First National Plaza
Chicago, IL 60602
19
<PAGE>
SIGNATURE PAGE FOR AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
(312) 977-4405
20
<PAGE>
SIGNATURE PAGE FOR AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
LANCASTER INVESTMENT PARTNERS
By:______________________________________
Name:____________________________________
Title:___________________________________
Lancaster Investment Parkview Tower
1150 First Ave., Suite 600
King of Prussia, PA 19406
(610) 783-4788 (fax)
_________________________________________
Stephen C. Marcus
915 Exeter Crest
Villanova, PA 19085
(610) 519-1389 (fax)
_________________________________________
Robert Berlacher
675 Church Road
Villanova, PA 19085
(610) 783-4788 (fax)
_________________________________________
Richard C. Walling, Jr.
c/o Richard C. Walling, Jr.
Express Marine, Inc.
29th Street on the Delaware
Camden, NJ 08105
(856) 541-0338 (fax)
PORTER PARTNERS, LP
By:______________________________________
Name:____________________________________
Title:___________________________________
100 Shoreline, Suite 211B
Mill Valley, CA 94941
21
<PAGE>
SIGNATURE PAGE FOR AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
(415) 332-8223 (fax)
22
<PAGE>
SIGNATURE PAGE FOR AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
BALLYSHANNON PARTNERS LP
By:______________________________________
Name:____________________________________
Title:___________________________________
325 Bryn Mawr Avenue
Bryn Mawr, PA 19010
(610) 935-3000 (fax)
_________________________________________
Barry Porter
(310) 385-3714 (fax)
CBT WIRELESS INVESTMENTS, LLC
By:______________________________________
Name:____________________________________
Title:___________________________________
1733 H Street, #330-141
Blaine, WA 98230
Copy to:
Westover Communications Ltd.
17886 55 Avenue
Surray BC V35 6C8
(604) 576-4855 (fax)
23
<PAGE>
SIGNATURE PAGE FOR AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
SPECTRASITE COMMUNICATIONS
By:______________________________________
Name:____________________________________
Title:___________________________________
100 Regency Forest Drive - Suite 400
Cary, NC 27511
(919) 468-8522 (fax)
_________________________________________
Mark Buechley
_________________________________________
Jerri Buechley
P.O. Box 394
Glide, OR 97443
(503) 210-1002 (fax)
Copy to:
Coni Rathbone
Davis Wright Tremane
1300 SW 5th Avenue, Suite 2300
Portland, OR 97201
(503) 778-5299 (fax)
New Ventures, LLC
By:______________________________________
Name:____________________________________
Title:___________________________________
211 N. Union Street, Suite 300
Alexandria, VA 22314
(703) 706-3837 (fax)
24
<PAGE>
SIGNATURE PAGE FOR AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
Notice Address: PARIBAS NORTH AMERICA, INC.
Paribas North America, Inc.
787 Seventh Avenue By: __________________________________
New York, New York 10019 Name:_________________________________
Fax: (212) 841-2369 Title:________________________________
Attention: Salo Aizenberg
with a copy to:
White & Case LLP
1155 Avenue of the Americas
New York, New York 10036
Fax: (212) 354-8113
Attention: John M. Reiss, Esq.
BET ASSOCIATES, L.P.
By: Bruce Toll
Its General Partner
By: __________________________________
Bruce E. Toll, Member
DLJ Merchant Banking Partners II, L.P.
By: DLJ Merchant Banking II, Inc.,
its general partner
By:___________________________________
Name:
Title:
25
<PAGE>
EXHIBIT A
PREFERRED STOCKHOLDERS
Brookwood 4,668,999.33
Lancaster 1,000,500
Marcus 1,800,900
Berlacher 50,025
Walling 166,750.33
Porter Partners 900,450
Ballyshannon 500,250
Porter 250,125
CBT Wireless Investments, LLC 2,701,350
SpectraSite 1,666,500.34
Buechly 300,150
Telecom (New Ventures, LLC) 2,001,000
Harris 1,000,500
<PAGE>
AMENDED AND RESTATED CONSENT AND AGREEMENT
(Paribas/UbiquiTel)
This Amended and Restated Consent and Agreement (this "Consent and
Agreement") is entered into as of April 5, 2000, between SPRINT SPECTRUM L.P., a
Delaware limited partnership ("Sprint Spectrum"), SPRINT COMMUNICATIONS COMPANY,
L.P., a Delaware limited partnership ("Sprint Communications"), WIRELESSCO,
L.P., a Delaware limited partnership ("WirelessCo"), COX COMMUNICATIONS PCS,
L.P., a Delaware limited partnership ("Cox Communications"), COX PCS LICENSE,
L.L.C., a Delaware limited liability company ("Cox PCS" and together with Sprint
Spectrum, Sprint Communications, WirelessCo, and Cox Communications the "Sprint
Parties"), and PARIBAS, as administrative agent (together with any successors
thereof in accordance with the Credit Agreement hereinafter described, the
"Agent") for the lenders under that certain Credit Agreement among UBIQUITEL
OPERATING COMPANY, a Delaware corporation (the successor of UbiquiTel LLC, a
Delaware limited liability company) ("Affiliate"), UbiquiTel Inc., a Delaware
corporation (f/k/a UbiquiTel Holdings, Inc.)("Holdings"), the Agent and the
lenders from time to time party thereto (the "Lenders").
Affiliate has succeeded to that certain Sprint PCS Management Agreement
entered into as of October 15, 1998 (as amended by Addendum I, Addendum II,
Addendum III, and Addendum IV and as it may be amended, modified or supplemented
further from time to time, the "Management Agreement") between UbiquiTel LLC, a
Washington limited liability company ("Former UbiquiTel"), and Sprint Spectrum
providing for the design, construction and management of the Service Area
Network (as therein defined). Affiliate has also succeeded to the Sprint PCS
Services Agreement (as it may be amended, modified, or supplemented from time to
time, the "Services Agreement") and the Sprint Trademark and Service Mark
License Agreement and the Sprint Spectrum Trademark and Service Mark License
Agreement (together, as they may be amended, modified, or supplemented from time
to time, the "License Agreements") (the Management Agreement, the Services
Agreement and the License Agreements and all other agreements between Affiliate
or its subsidiaries, on the one hand and the Sprint Parties or any subsidiary of
Sprint Corporation on the other hand (whether entered into prior to, on, or
after the date hereof) that relate to the Service Area Network as they may be
amended, modified, or supplemented from time to time, collectively, the "Sprint
Agreements").
The parties are entering into this Consent and Agreement because Affiliate
and the Agent are entering into the Credit Agreement (defined below). This
Consent and Agreement amends, restates, and supersedes that certain Consent and
Agreement entered into as of December 28, 1999, by and among certain of the
Sprint Parties and the Agent, which was acknowledged by Affiliate and Holdings.
Affiliate has entered into or concurrently herewith is entering into that
certain Credit Agreement dated as of March 31, 2000, with Holdings, the Agent
and the Lenders (such Credit Agreement, as it may be amended, supplemented,
restated, replaced, refinanced or refunded or otherwise modified from time to
time, and shall include, without limitation, any such amendments,
<PAGE>
modifications, supplements, deferrals, renewals, extensions, replacements,
refinancings or refundings that increase the aggregate amount of commitments or
borrowings thereunder or add subsidiaries of Affiliate as additional borrowers
or guarantors thereunder, the "Credit Agreement"), to provide financing for a
portion of the costs of the design and construction of the Service Area Network
and for certain other purposes. The Credit Agreement and each note, security
agreement, pledge agreement, guaranty and any and all other agreements,
documents or instruments entered into in connection with any of the foregoing,
as the same may from time to time be amended, supplemented, restated, replaced
or otherwise modified from time to time, shall collectively be referred to as
the "Loan Documents."
The Obligations under the Credit Agreement, interest rate protection
agreements and other hedging agreements are guaranteed by Holdings, the sole
shareholder of Affiliate, and by any existing and future subsidiaries of
Holdings (other than Affiliate and UbiquiTel Leasing Company) (collectively, the
"Guarantors") pursuant to that certain Guaranty executed by the Guarantors in
favor of the Agent (the "Guarantors' Guaranty").
As a condition to the availability of credit to Affiliate under the Credit
Agreement, the Agent and the Lenders have required the execution and delivery of
this Consent and Agreement by the Sprint Parties and have required that
Affiliate and the Guarantors acknowledge, consent and agree to all terms and
provisions of this Consent and Agreement.
WirelessCo and Cox PCS hold, directly or indirectly, certain of the
licenses for the Service Areas managed by Affiliate as contemplated in the
Management Agreement. As used in this Consent and Agreement, the term "Sprint
PCS" shall refer in each particular instance or application to WirelessCo and/or
Cox PCS, based on which of the two entities owns the License in that portion of
the Service Area to which the subject of the instance or application applies.
All capitalized terms in this Consent and Agreement shall have the same
meanings ascribed to them in the Management Agreement unless otherwise provided
in this Consent and Agreement; provided, that the terms "Default", "Event of
Default" and "Obligations" shall have the meanings ascribed to them in the
Credit Agreement.
Accordingly, each Sprint Party and the Agent, on behalf of itself and for
the Lenders, hereby agrees as follows:
SECTION 1. Consent to Security Interest. In connection with the
transactions contemplated by the Credit Agreement and the other Loan Documents,
each of Affiliate, Holdings and each subsidiary of Holdings (other than
UbiquiTel Leasing Company) have granted or will grant to the Agent, for the
benefit of the Lenders (a) a first priority security interest in and lien upon
substantially all of its assets and property, tangible and intangible, whether
now owned or hereafter acquired or arising, and all proceeds and products
thereof and accessions thereto, including but not limited to the Operating
Assets, (b) a first priority security interest in and pledge of all stock and
other equity interests in Affiliate and its subsidiaries (the "Pledged Equity"),
and (c) a first priority
2
<PAGE>
security interest in and lien upon the rights of Affiliate, Holdings and its
subsidiaries in, to and under the Sprint Agreements. The foregoing security
interests, liens and pledges are referred to collectively as the "Security
Interests" and the foregoing assets and property in which the Agent, for the
benefit of the Lenders, has been or will be granted a first priority security
interest in and lien are referred to collectively as the "Collateral". Each
Sprint Party (i) acknowledges notice of the Loan Documents, (ii) consents to the
granting of the Security Interests in the Collateral to the Agent, for the
benefit of the Lenders, and (iii) agrees that (A) neither it nor any subsidiary
of Sprint Corporation will challenge or contest that the Security Interests are
valid, enforceable and duly perfected first priority security interests and
liens in and to the Collateral, (B) neither it nor any subsidiary of Sprint
Corporation will argue that any such Security Interest is subject to avoidance,
limitation or subordination under any legal or equitable theory or cause of
action, and (C) so long as the Management Agreement is in effect, it will not
sell, transfer or assign all or part of the Licenses that Affiliate has the
right to use; provided, however, that notwithstanding the foregoing, a Sprint
Party may at any time sell, transfer or assign all or part of the Licenses that
Affiliate has the right to use in accordance with a transaction allowed under
Section 17.15.5 of the Management Agreement and in accordance with Section 18
herein, so long as the buyer, transferee or assignee, as the case may be, agrees
to be bound by the terms of this Consent and Agreement as such terms relate to
such Licenses.
Each Sprint Party acknowledges and agrees that (i) Sections 17.15.1 and
17.15.2 of the Management Agreement do not apply to the assignment of
Affiliate's rights under the Sprint Agreements to the Agent or the Lenders under
the Loan Documents or in connection with a transaction permitted pursuant to
this Consent and Agreement to any other Person pursuant to the Loan Documents or
to any other assignment in connection with any transaction permitted pursuant to
this Consent and Agreement and (ii) Section 17.15.3 of the Management Agreement
shall not apply to any Change of Control of Affiliate in connection with the
exercise by the Agent of any of its rights or remedies under the Loan Documents,
including without limitation in connection with the sale of the equity interests
of Affiliate to any Person or to any other Change of Control of Affiliate;
provided, however, Section 17.15.3 of the Management Agreement shall apply to
any such transaction if such transaction is not with the Agent or the Lenders or
is not a transaction permitted pursuant to this Consent and Agreement. It is
understood that any assignment described in this Section 1 to the Agent or the
Lenders is hereby consented to by the Sprint Parties; provided, that any
subsequent assignment by the Agent or the Lenders shall be in accordance with
the terms of this Consent and Agreement.
SECTION 2. Payments. Upon receipt of the Agent's written instructions,
each Sprint Party agrees to make all payments (if any) to be made by it under
the Sprint Agreements, subject to its rights of setoff or recoupment with
respect to such payments as permitted under Section 10.6 of the Management
Agreement, to Affiliate directly to the Agent, or otherwise as the Agent shall
direct; provided, that during the period that such Sprint Party is making such
payments directly to the Agent or its designee pursuant to this Section 2, such
Sprint Party's setoff and recoupment rights under such Section 10.6 shall not be
limited to undisputed amounts. The Agent hereby agrees that the Agent will not
give any such written instructions for it to receive such payments directly from
a
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Sprint Party unless an Event of Default has occurred under the Credit Agreement
and is continuing. Such written instructions to make payments directly to the
Agent shall be effective only so long as an Event of Default is continuing, and
the Agent will revoke such instructions promptly following the cure of such
Event of Default. Any payments made by any Sprint Party directly to, or at the
direction of, the Agent shall fully satisfy any obligation of such Sprint Party
to make payments to Affiliate under the Sprint Agreements to the extent of such
payments.
SECTION 3. Notice and Effect of Event of Default, Management Agreement
Breach and Event of Termination. The Agent agrees to provide to Sprint Spectrum
a copy of any written notice that Agent sends to Affiliate, promptly after
sending such notice, that a Default or an Event of Default has occurred and is
continuing, and Sprint Spectrum agrees to provide to the Agent a copy of any
written notice that Sprint Spectrum sends to Affiliate, promptly after sending
such notice, that an Event of Termination or an event that if not cured, or if
notice is provided, will constitute an Event of Termination (each of an Event of
Termination and an event that if not cured would constitute an Event of
Termination, a "Management Agreement Breach") has occurred. Sprint Spectrum
acknowledges that the Agent has informed it that an Event of Termination
constitutes an Event of Default under the Loan Documents, and Sprint Spectrum
further acknowledges that the Management Agreement does not prohibit Affiliate
from curing such an Event of Default.
SECTION 4. Event of Default without a Management Agreement Breach.
(a) Affiliate Remains as Manager or Interim Manager Appointed. Upon
and during the continuation of an Event of Default when no Management
Agreement Breach as to which Sprint Spectrum has given the Agent notice
exists on the original date of occurrence of such Event of Default, the
Agent may, by prior written notice to Sprint Spectrum, (i) allow Affiliate
to continue to act as the Manager under the Sprint Agreements, (ii)
appoint Sprint Spectrum to act as "Interim Manager" under the Sprint
Agreements, or (iii) appoint a Person other than Sprint Spectrum to act as
Interim Manager under the Sprint Agreements. If the Agent initially allows
Affiliate to continue to act as the Manager under the Sprint Agreements,
the Agent may later, during a continuation of an Event of Default, remove
Affiliate as Manager and take the action described above in clauses (ii)
and (iii). The date on which a Person begins serving as Interim Manager
shall be the "Commencement Date."
(b) Sprint Spectrum or Sprint Spectrum Designee as Interim Manager.
If the Agent appoints Sprint Spectrum as Interim Manager, within 14 days
after its appointment Sprint Spectrum shall accept the position or
designate another Person (a "Sprint Spectrum Designee") to act as Interim
Manager under the Sprint Agreements. The Agent shall accept Sprint
Spectrum and any Sprint Spectrum Designee that is then acting as an Other
Manager (other than Affiliate) to act as Interim Manager under the Sprint
Agreements. Any Sprint Spectrum Designee that is not an Other Manager must
be acceptable to the Agent, which acceptance will not be unreasonably
withheld. If, within 30 days after the Agent gives Sprint Spectrum notice
of its appointment as Interim Manager, Sprint Spectrum or a Sprint
Spectrum Designee does not agree to act as Interim Manager, then the Agent
shall have the
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right to appoint an Agent Designee as Interim Manager in accordance with
Section 4(c). At the discretion of the Agent, Sprint Spectrum or the
Sprint Spectrum Designee shall serve as Interim Manager for up to six
months from the Commencement Date.
Upon the expiration of its initial six-month period as Interim
Manager under the Sprint Agreements, Sprint Spectrum or the Sprint
Spectrum Designee will agree, at the written request of the Agent, to
serve as Interim Manager for up to six months from such expiration date
until the Agent gives Sprint Spectrum or the Sprint Spectrum Designee at
least 30 days' written notice of its desire to terminate the relationship;
provided, that the extended period will be for 12 months rather than six
months (for a complete term of 18 months) in the event, as of the date of
the initial appointment, the aggregate number of pops that Affiliate and
all Other Managers have the right to serve under their respective
management agreements with the Sprint Parties is less than 40 million
(such six or 12 month period, the "Extension Period"). If Sprint
Spectrum's or the Sprint Spectrum Designee's term as Interim Manager is
extended, then the Agent agrees that Sprint Spectrum or the Sprint
Spectrum Designee's right to be reimbursed by Affiliate promptly for all
amounts previously expended by Sprint Spectrum or the Sprint Spectrum
Designee under Section 11.6.3 of the Management Agreement (which
expenditures were incurred in accordance with Section 9 of this Consent
and Agreement) shall no longer be subordinated to the Obligations as
provided in Section 9 in this Consent and Agreement, and Sprint Spectrum
or the Sprint Spectrum Designee's right to be reimbursed by Affiliate for
any expenses it incurs pursuant to its rights under Section 11.6.3 of the
Management Agreement as provided in the Management Agreement (which
expenditures were incurred in accordance with Section 9 of this Consent
and Agreement) shall not be subject to the subordination to the
Obligations as provided in Section 9 of this Consent and Agreement;
provided, that Sprint Spectrum or the Sprint Spectrum Designee's right to
be reimbursed for amounts expended under Section 11.6.3 of the Management
Agreement that exceed in an aggregate amount 5% of Affiliate's
shareholder's or member's equity or capital account plus Affiliate's
long-term debt (i.e., notes that on their face are scheduled to mature
more than one year from the date issued), as reflected on Affiliate's
books (the "Reimbursement Limit") shall remain subordinated to the
Obligations as provided in Section 9 of this Consent and Agreement.
Notwithstanding any other provision in this Section 4(b) to the contrary,
Sprint Spectrum or the Sprint Spectrum Designee shall not be required to
continue to serve as Interim Manager during the Extension Period at any
time after 30 days following delivery by it to the Agent of written notice
that Sprint Spectrum or the Sprint Spectrum Designee needs to expend
amounts under Section 11.6.3 of the Management Agreement that Sprint
Spectrum or the Sprint Spectrum Designee reasonably believes will not be
reimbursed based on the projected Collected Revenues for the remainder of
the Extension Period or reimbursed by the Lenders. If it becomes necessary
for Sprint Spectrum or the Sprint Spectrum Designee to expend any amount
that it believes will not be reimbursed or that exceeds the Reimbursement
Limit, Sprint Spectrum or the Sprint Spectrum Designee is not required to
incur such expense.
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Upon the termination or expiration of the term of Sprint Spectrum or
the Sprint Spectrum Designee as Interim Manager, the Agent shall have the
right to appoint a successor Interim Manager in accordance with Section
4(c).
(c) Agent Designee as Interim Manager. If the Agent elects to
appoint a Person other than Sprint Spectrum to act as Interim Manager
under the Sprint Agreements (an "Agent Designee") as permitted under
Sections 4(a)(iii) and 4(b), such Agent Designee must (i) agree to serve
as Interim Manager for six months unless terminated earlier by Sprint
Spectrum because of a material breach by the Agent Designee of the terms
of the Sprint Agreements that is not timely cured or by the Agent in its
discretion, (ii) meet the applicable "Successor Manager Requirements" set
forth below in Section 13, and (iii) agree to comply with the terms of the
Sprint Agreements but will not be required to assume the existing
liabilities of Affiliate. In the case of a proposed Agent Designee, Sprint
Spectrum shall provide to the Agent, within 10 Business Days after the
request therefor, a detailed description of all information reasonably
requested by Sprint Spectrum to enable Sprint Spectrum to determine if a
proposed Agent Designee satisfies the Successor Manager Requirements.
Sprint Spectrum agrees to inform Agent within 20 days after it receives
such information respecting such proposed Agent Designee from the Agent
whether such designee satisfies the Successor Manager Requirements. If
Sprint Spectrum does not so inform the Agent within such 20-day period,
then Sprint Spectrum shall be deemed to agree, for all purposes of this
Consent and Agreement, that such proposed designee satisfies the Successor
Manager Requirements. A Person that satisfies the Successor Manager
Requirements (or is deemed to satisfy such requirements) qualifies under
the Management Agreement to become a Successor Manager, unless the Agent
Designee materially breaches the terms of a Sprint Agreement while acting
as Interim Manager or no longer meets the Successor Manager Requirements.
The Agent Designee may continue to serve as Interim Manager after the
initial six-month period at the Agent's discretion, so long as the Agent
Designee continues to satisfy the Successor Manager Requirements and it
does not materially breach the terms of the Sprint Agreements. If the
Agent Designee materially breaches any Sprint Agreement while acting as
Interim Manager, then Sprint Spectrum and the Agent have the rights set
forth in Section 5; provided, that Sprint Spectrum may not allow Affiliate
to act as the Manager of the Sprint Agreements without the Agent's
consent.
SECTION 5. Event of Default Created by a Management Agreement Breach.
(a) Affiliate Remains as Manager or Interim Manager Appointed. Upon
an Event of Default created by a Management Agreement Breach (so long as
at such time an Event of Default not created by a Management Agreement
Breach as to which Agent has given Sprint Spectrum notice is not in
existence), Sprint Spectrum may by prior written notice to Agent (i) allow
Affiliate to continue to act as the Manager under the Sprint Agreements if
approved by the Agent, (ii) act as Interim Manager under the Sprint
Agreements, or (iii) appoint a Sprint Spectrum Designee to act as Interim
Manager under the Sprint Agreements as provided in paragraph (b) below. If
Sprint Spectrum initially allows Affiliate to continue
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to act as the Manager under the Sprint Agreements, Sprint Spectrum may
later remove Affiliate as Manager and take the action described above in
clauses (ii) and (iii). The Agent shall have no right to appoint an
Interim Manager when an Event of Default is caused by a Management
Agreement Breach (unless an Event of Default not created by a Management
Agreement Breach is in existence), unless Sprint Spectrum elects not to
act as Interim Manager or elects not to appoint a Sprint Spectrum
Designee.
(b) Sprint Spectrum or Sprint Spectrum Designee as Interim Manager.
If Sprint Spectrum acts as Interim Manager or designates a Sprint Spectrum
Designee to act as Interim Manager under the Sprint Agreements, the
Interim Manager shall serve as Interim Manager for up to six months from
the Commencement Date, at the discretion of Sprint Spectrum. The Agent
shall accept Sprint Spectrum and any Sprint Spectrum Designee that is then
acting as an Other Manager (other than Affiliate) to act as Interim
Manager under the Sprint Agreements. Any Sprint Spectrum Designee that is
not then acting as an Other Manager must be acceptable to the Agent, which
acceptance will not be unreasonably withheld.
Upon the expiration of its initial six-month period as Interim
Manager under the Sprint Agreements, Sprint Spectrum or the Sprint
Spectrum Designee will agree to serve as Interim Manager for the Extension
Period until the Agent gives Sprint Spectrum or the Sprint Spectrum
Designee at least 30 days' written notice of its desire to terminate the
relationship. If Sprint Spectrum's or the Sprint Spectrum Designee's term
as Interim Manager is extended, then the Agent agrees that Sprint Spectrum
or the Sprint Spectrum Designee's right to be reimbursed by Affiliate
promptly for all amounts previously expended by Sprint Spectrum or the
Sprint Spectrum Designee under Section 11.6.3 of the Management Agreement
(which expenditures were incurred in accordance with Section 9 of this
Consent and Agreement) shall no longer be subordinated to the Obligations
as provided in Section 9 of this Consent and Agreement, and Sprint
Spectrum or the Sprint Spectrum Designee's right to be reimbursed by
Affiliate for any expenses it incurs pursuant to its rights under Section
11.6.3 of the Management Agreement as provided in the Management Agreement
(which expenditures were incurred in accordance with Section 9 of this
Consent and Agreement) shall not be subject to subordination to the
Obligations as provided in Section 9 of this Consent and Agreement;
provided, that Sprint Spectrum or the Sprint Spectrum Designee's right to
be reimbursed for amounts expended under Section 11.6.3 of the Management
Agreement in an aggregate amount that exceed the Reimbursement Limit shall
remain subordinated to the Obligations as provided in Section 9 of this
Consent and Agreement. Notwithstanding any other provision in this Section
5(b) to the contrary, Sprint Spectrum or the Sprint Spectrum Designee
shall not be required to continue to serve as Interim Manager during the
Extension Period at any time after 30 days following delivery by it to the
Agent of written notice that Sprint Spectrum or the Sprint Spectrum
Designee needs to expend amounts under Section 11.6.3 of the Management
Agreement that Sprint Spectrum or the Sprint Spectrum Designee reasonably
believes will not be reimbursed based on the projected Collected Revenues
for the remainder of the Extension Period or reimbursed by the Lenders. If
it becomes necessary for Sprint Spectrum or the Sprint Spectrum
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Designee to expend any amount that it believes will not be reimbursed or
that exceeds the Reimbursement Limit, Sprint Spectrum or the Sprint
Spectrum Designee is not required to incur such expense.
Upon the termination or expiration of the term of Sprint Spectrum or
the Sprint Spectrum Designee as Interim Manager and with the consent of
the Agent (which consent shall not be unreasonably withheld or delayed),
Sprint Spectrum shall have the right to appoint a successor Interim
Manager in accordance with Section 5(a).
(c) Agent Designee as Interim Manager. Notwithstanding anything in
paragraph (a) above to the contrary, if, after Acceleration (as defined in
Section 6(a) of this Consent and Agreement) and within 30 days after
Sprint Spectrum gives the Agent notice of a Management Agreement Breach,
Sprint Spectrum does not agree to act as Interim Manager or does not
obtain the consent of a Sprint Spectrum Designee to act as Interim Manager
under the Sprint Agreements, or if Sprint Spectrum or the Sprint Spectrum
Designee gives the Agent notice of its resignation as Interim Manager and
Sprint Spectrum fails to appoint a successor in accordance with Section
5(b) within 30 days after such resignation, the Agent may appoint an Agent
Designee to act as Interim Manager. Such Agent Designee must (i) agree to
serve as Interim Manager for six months unless terminated earlier by
Sprint Spectrum because of a material breach by the Agent of the terms of
the Sprint Agreements or by the Agent in its discretion, (ii) meet the
applicable Successor Manager Requirements, and (iii) agree to comply with
the terms of the Sprint Agreements. In the case of a proposed Agent
Designee, Sprint Spectrum shall provide to the Agent, within 10 Business
Days after the request therefor, a detailed description of all information
reasonably requested by Sprint Spectrum to enable Sprint Spectrum to
determine if a proposed Agent Designee satisfies the Successor Manager
Requirements. Sprint Spectrum agrees to inform Agent within 20 days after
it receives such information respecting such proposed Agent Designee from
the Agent whether such designee satisfies the Successor Manager
Requirements. If Sprint Spectrum does not so inform the Agent within such
20-day period, then Sprint Spectrum shall be deemed to agree, for all
purposes of this Consent and Agreement, that such proposed designee
satisfies the Successor Manager Requirements. A Person that satisfies the
Successor Manager Requirements qualifies under the Management Agreement to
become a Successor Manager, unless the Agent Designee materially breaches
the terms of a Sprint Agreement while acting as Interim Manager or no
longer meets the Successor Manager Requirements. The Agent Designee may
continue to serve as Interim Manager after the initial six-month period at
the Agent's discretion, so long as the Agent Designee continues to satisfy
the Successor Manager Requirements and it does not materially breach the
terms of the Sprint Agreements. If the Agent Designee materially breaches
any Sprint Agreement while acting as Interim Manager, then Sprint Spectrum
and the Agent have the rights set forth in Section 5; provided, that
Sprint Spectrum may not allow Affiliate to act as the Manager of the
Sprint Agreements without the Agent's consent.
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SECTION 6. Purchase and Sale of the Operating Assets. Upon the occurrence
and during the continuation of an Event of Default, the following provisions
shall govern the purchase and sale of the Operating Assets:
(a) Acceleration of the Obligations Under the Loan Documents. In the
event the Lenders accelerate the maturity of the Obligations under the
Loan Documents (an "Acceleration" and, the date thereof, an "Acceleration
Date"), the Agent shall give written notice thereof to Sprint Spectrum.
Upon receipt of notice of Acceleration, Sprint Spectrum shall have the
right, to which right Affiliate, by acknowledging this Consent and
Agreement, expressly agrees, to purchase the Operating Assets from
Affiliate for an amount equal to the greater of (i) 72% of the Entire
Business Value (as defined in the Management Agreement) of Affiliate,
valued in accordance with the procedure set forth in Section 11.7 of the
Management Agreement (with the assumption that the deemed ownership of the
Disaggregated License under Section 11.7.3 of the Management Agreement
includes the transfer of the Sprint PCS customers as contemplated by
Section 11.4 of the Management Agreement), and (ii) the aggregate amount
of the Obligations. Sprint Spectrum shall, within 60 days of receipt of
notice of Acceleration, give Affiliate and the Agent notice of its intent
to exercise the purchase right. In the event Sprint Spectrum gives the
Agent written notice of its intent to purchase the Operating Assets, the
Agent agrees that it shall not enforce its Security Interests in the
Collateral until the earlier to occur of (i) expiration of the period
consisting of 120 days after the Acceleration Date (or such later date
that shall be provided for in the purchase agreement and acceptable to the
Agent in its discretion to close the purchase of the Operating Assets) or
(ii) receipt by Agent and Affiliate from Sprint Spectrum of written notice
that Sprint Spectrum has determined not to proceed with the closing of the
purchase of the Operating Assets for any reason. If after the 120-day
period after the Acceleration Date Affiliate receives any purchase offer
for the Operating Assets or the Pledged Equity that is confirmed in
writing by Affiliate to be acceptable to Affiliate, Sprint Spectrum shall
have the right subject to the consent of the Agent, to purchase the
Operating Assets or the Pledged Equity, as the case may be, on terms and
conditions at least as favorable to Affiliate as the terms and conditions
proposed in such offer so long as within 14 Business Days after Sprint
Spectrum's receipt of such other offer Sprint Spectrum offers to purchase
the Operating Assets or the Pledged Equity and so long as the conditions
of Sprint Spectrum's offer and the amount of time it will take Sprint
Spectrum to effect such purchase is acceptable to Affiliate and Agent. Any
such offer shall be confirmed in writing by the third party offeror. In
the event Sprint Spectrum exercises its rights under this Section 6(a),
(i) Affiliate shall sell the Operating Assets or the Pledged Equity to
Sprint Spectrum, (ii) the Agent and the Lenders shall consent to such
purchase and sale provided that the proceeds thereof shall be sufficient
to repay the aggregate amount of the Obligations, and (iii) Sprint
Spectrum shall make all payments to be made under this Section 6(a) to
Agent for its application against the Obligations (as defined below); any
additional amounts (i.e., if 72% of the Entire Business Value is greater
than the Obligations) shall be paid to Affiliate unless otherwise required
by law or by this Consent and Agreement. The purchase right of the Sprint
Parties under this Section 6(a) shall be in substitution of the purchase
rights of the
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Sprint Parties under Section 11.6.1 of the Management Agreement. If Sprint
Spectrum purchases the Operating Assets or the Pledged Equity as permitted
under this Section 6(a), and the Net Obligations have been paid in full
and the Credit Agreement is terminated or assigned to a Sprint Party, the
Agent and the Guarantors will release or assign their interests (if any)
in the Collateral, the Loan Documents and the Guarantors' Guaranty as
described below in Section 6(e).
(b) Sale of Operating Assets to Third Parties. If the Sprint Parties
do not purchase the Operating Assets from Affiliate after an Acceleration
as described above in Section 6(a), the Collateral may be sold as follows:
(i) Sale to Successor Manager. The Collateral may be sold by
the Agent (in its sole discretion) in the exercise of certain of its
rights and remedies as a secured party under the Loan Documents or by
Affiliate, at the discretion of the Agent, to a person that satisfies the
Successor Manager Requirements. Sprint Spectrum shall provide to the
Agent, with a copy to Affiliate, within 10 Business Days after the request
therefor, a detailed description of all information reasonably requested
by Sprint Spectrum to enable Sprint Spectrum to determine if a proposed
buyer satisfies the Successor Manager Requirements. Sprint Spectrum agrees
to inform the Agent and Affiliate within 20 days after it receives such
information respecting such proposed buyer from the Agent whether such
designee satisfies the Successor Manager Requirements. If Sprint Spectrum
does not so inform the Agent within such 20-day period, then Sprint
Spectrum shall be deemed to agree, for all purposes of this Consent and
Agreement, that such proposed designee satisfies the Successor Manager
Requirements. If the proposed buyer satisfies the Successor Manager
Requirements (or is deemed to satisfy such requirements) and wishes to
become a "Successor Manager", the buyer must agree to be bound by the
Sprint Agreements; provided, that buyer shall have no responsibility or
liability for any liability to any Person other than a Sprint Party and
Related Party of Sprint Spectrum arising out of Affiliate's operations
prior to the date buyer becomes bound by the Sprint Agreements. In such
case the Sprint Agreements shall remain in full force and effect with the
buyer as Successor Manager and this Consent and Agreement shall remain in
full force and effect for the benefit of the Successor Manager and any
Person providing senior secured debt financing to such Successor Manager
if required by such Person. Sprint Spectrum agrees, with respect to any
past failure of Affiliate to perform any obligation under the Sprint
Agreements, that the Successor Manager shall have the same amount of time
to perform such obligation that Affiliate had under the Sprint Agreements,
with the performance period commencing on the date on which the buyer
becomes a Successor Manager. Sprint Spectrum shall permit the performance
period set forth in the Management Agreement to be extended for such
period of time that Sprint Spectrum believes is reasonable to allow
Successor Manager to perform such unperformed obligations.
(ii) Sale to Other than Successor Manager. The Collateral may
be sold pursuant to the exercise by the Agent or the Lenders of their
rights and remedies under the
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Loan Agreements or by Affiliate, at the discretion of the Agent (subject
to requirements of applicable law) to a person that does not satisfy the
Successor Manager Requirements or to a person that does not wish to become
a Successor Manager, but only under the following conditions:
(A) the Sprint Parties may terminate the Sprint
Agreements with such buyer following the closing of such purchase (and the
Agent and the buyer shall have no rights thereto or thereunder with
respect to events occurring after the closing of such purchase);
(B) the buyer may purchase the Disaggregated License as
described below in Section 6(b)(iv) and with the Disaggregated License
having the characteristics described in the definition thereof; and
(C) the purchase agreement with the buyer contains the
requirements set forth in Section 6(c) of this Consent and Agreement.
(iii) Confidentiality Agreement. Before any potential buyer is
provided Confidential Information respecting the potential purchase of any
of the Collateral (which buyer shall be entitled to receive), the
potential buyer shall execute a confidentiality agreement in the form
attached as Exhibit A with such changes thereto as may be reasonably
requested by the parties to the agreement; provided, however, in the event
the potential buyer does not satisfy the Successor Manager Requirements or
has notified Affiliate, Sprint Spectrum or the Agent that it does not
intend to be a Successor Manager, Confidential Information that
constitutes or relates to any technical, marketing, financial, strategic
or other information concerning any of the Sprint Parties and that does
not pertain to the business of Affiliate shall not be permitted to be
provided to such potential buyer.
(iv) Sale of Disaggregated Licenses. Sprint PCS will sell
Disaggregated Licenses as follows when required under Section 6(b)(ii)(B):
(A) If a buyer wishes to purchase spectrum in connection
with its purchase of the Operating Assets, it will purchase such spectrum
from Affiliate and Sprint PCS as follows. The buyer will purchase from
Affiliate or its Related Parties any licenses that Affiliate or such
Related Parties own (the "Affiliate's Licenses"). If the Affiliate's
Licenses were not being used to operate the Service Area Network, Sprint
PCS will reimburse the buyer for the microwave relocation costs incurred
to clear the spectrum bought from Affiliate or its Related Parties that
the buyer will need to use to operate the Service Area Network as
constructed on the date that the buyer purchases the Operating Assets. If
the buyer does not meet the FCC requirements to buy the Affiliate's
Licenses, the buyer will seek a waiver from the FCC of the restrictions
that prohibit the buyer's ownership of such licenses. While any such FCC
application is pending and while the buyer is clearing the microwave from
the Affiliate's spectrum, the buyer may continue to use Sprint PCS's
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Spectrum on which the Service Area Network operates. Sprint PCS will sell
its Disaggregated Licenses as described in Sections 6(b)(iv)(B),
6(b)(iv)(C) and 6(b)(iv)(D) only in those BTAs in which (1) Affiliate or
its Related Parties do not own a license or the obligation to sell the
license is unenforceable, (2) the FCC will not approve the transfer of the
Affiliate's License to the buyer, or (3) Sprint PCS determines that it
does not wish to reimburse the buyer for the cost of the microwave
relocation.
(B) If the buyer, an entity with respect to which such
buyer directly or indirectly through one or more persons owns the total
voting power or at least 50% of the total voting power or at least 50% of
the total equity (a "controlled entity"), an entity that directly or
indirectly through one or more persons has a parent entity that owns at
least 50% of the voting power or at least 50% of the total equity of both
the buyer and the common controlled entity (a "common controlled entity"),
owns a license to provide wireless service to at least 50% of the pops in
a BTA with respect to which such buyer proposes to purchase Spectrum (each
a "Restricted Party" with respect to such BTA), the buyer may buy only 5
MHZ of Spectrum from Sprint PCS for such BTA.
(C) If the buyer is not a Restricted Party for a BTA
with respect to which such buyer proposes to purchase Spectrum, and either
does not satisfy the Successor Manager Requirements (other than those set
forth in Section 13(b) of this Consent and Agreement) or does not wish to
be a Successor Manager, then the buyer may buy 5 MHZ, 7.5 MHZ or 10 MHZ of
Spectrum from Sprint PCS as the buyer determines in its sole discretion.
(D) If Sprint PCS sells a Disaggregated License to a
buyer as required under this Section 6(b)(iv), the buyer must pay a price
equal to the sum of (1) the original cost of the applicable License to
Sprint PCS pro rated on a pops and spectrum basis, plus (2) the microwave
relocation costs paid by Sprint PCS attributable to clearing the Spectrum
in the Disaggregated License, plus (3) the amount of carrying costs to
Sprint PCS attributable to such original cost and microwave relocation
costs from the date of this Consent and Agreement to and including the
date on which the Disaggregated License is transferred to the buyer, based
on a rate of 12 percent per annum.
(c) No Direct Solicitation of Customers. Upon the sale of the
Collateral or the Disaggregated License in accordance with this Consent
and Agreement pursuant to Section 6(b)(ii), then the Sprint Parties agree
to transfer to the buyer thereof the customers with a MIN assigned to the
Service Area covered by the Disaggregated License, but Sprint PCS shall
retain the customers of a national account and any resellers who are then
party to a resale agreement with Sprint PCS. Each Sprint Party agrees to
take all actions reasonably requested by the buyer of the Collateral to
fully transfer to such purchaser such customers. Each Sprint Party agrees
that neither it nor any of its Related Parties will directly or indirectly
solicit, for six months after the date of transfer, the customers with a
MIN assigned to the Service Area covered by the Disaggregated License;
provided, that Sprint PCS retains
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the customers of a national account and any resellers that have entered
into a resale agreement with Sprint Spectrum, Sprint Spectrum may
advertise nationally, regionally and locally, and engage direct marketing
firms to solicit customers generally. If the buyer continues to operate
the purchased assets as a wireless network in the same geographic area on
a network that is technologically compatible with Sprint PCS's network,
the buyer and Sprint Spectrum shall each agree to provide roaming services
to the other (in the case of Sprint Spectrum, the roaming services shall
be provided to those customers of buyer in the geographic area serviced by
the Disaggregated License roaming nationally and, in the case of buyer,
the roaming services shall be provided to those customers of Sprint PCS
roaming in the Service Area covered by the Disaggregated License) pursuant
to a roaming agreement to be entered into between buyer and Sprint
Spectrum and to be mutually agreed upon so long as such agreement is based
on Sprint PCS's then standard roaming agreement used by Sprint Spectrum in
the industry and the price that each party shall pay the other party for
roaming services provided to the first party shall be a price equal to the
lesser of: (1) MFN Pricing provided by buyer to third parties roaming in
the geographic area serviced by the Disaggregated License; and (2) the
national average paid by Sprint Spectrum to third parties for Sprint PCS's
customers to roam in such third parties' geographic areas (including Other
Managers). Such obligations with respect to roaming shall continue until
such roaming agreement is terminated pursuant to its terms. The buyer
shall agree in writing that if it continues to operate the purchased
assets as a wireless network in the same geographic area on a network that
is technologically compatible with Sprint Spectrum's network, the buyer
shall, to the extent required by law, provide resale to Sprint Spectrum in
the Service Area covered by the Disaggregated License at the MFN Pricing
that buyer charges third parties who purchase resale from buyer; provided,
however, if buyer is not offering resale to any other customers then
pricing of resale provided to Sprint Spectrum shall be as mutually agreed;
and provided, further, however, whether or not buyer is required by law to
offer such resale, buyer shall offer such resale (on the terms described
in this sentence) to national customers of Sprint PCS.
(d) Deferral of Portion of Collected Revenues. (I) Under Section
10.1.1 of the Management Agreement, Sprint Spectrum retains 8% of the
Collected Revenues on a weekly basis (the "Retained Amount"). Following an
Acceleration and for up to two years after such Acceleration, Sprint
Spectrum shall retain only one half of the Retained Amount, and the
remaining one half of the Retained Amount shall be advanced to Affiliate
(or, if so directed by the Agent pursuant to Section 2 hereof, to the
Agent) at the time the weekly fee provided under Section 10.1.1 of the
Management Agreement is paid; provided, that after the first anniversary
of the Acceleration Date, Sprint Spectrum shall retain the entire Retained
Amount if Sprint Spectrum is not serving as the Interim Manager.
(ii) The portion of the Retained Amount advanced to Affiliate (or,
if so directed by the Agent pursuant to Section 2 hereof, to the Agent)
(the "Deferred Amount") shall be evidenced by a promissory note executed
by Affiliate contemporaneously with this Consent and Agreement in the form
of Exhibit B hereto (the "Deferred Amount Note").
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(A) Amounts will be drawn on the Deferred Amount Note each
time Sprint Spectrum advances a Deferred Amount to Affiliate or the
Agent.
(B) The Deferred Amount Note will bear interest at a rate
equal to the greatest of (I) the average interest rate of
Affiliate's secured debt, (II) the average rate of Affiliate's
unsecured debt, and (III) Sprint PCS's cost of capital.
(C) The Deferred Amount Note shall mature on the earlier of
(I) the date on which a Successor Manager is qualified and assumes
Affiliate's rights and obligations under the Sprint Agreements, and
(II) the date on which the Operating Assets are purchased by a
third-party buyer, or on which a stock or other equity acquisition,
merger, consolidation or other transaction resulting in the indirect
transfer of the Operating Assets to a third-party buyer (an
"Indirect Transfer") is consummated.
(iii) In the event a Successor Manager assumes any of the
obligations of Affiliate under the Sprint Agreements, such Successor
Manager shall also assume the obligations under the Deferred Amount Note.
In the event that the Operating Assets are sold to a third party buyer or
an Indirect Transfer is consummated, the obligations of Affiliate under
the Deferred Amount Note shall be subordinate to the Affiliate's
obligations to its secured lenders.
(iv) After the two-year anniversary of the Acceleration, or
earlier if a Successor Manager is appointed or if Sprint Spectrum is not
serving as the Interim Manager, Sprint Spectrum will again retain the full
Retained Amount.
(e) Payment of Obligations; Release and Assignment of Rights. If
Sprint Spectrum purchases the Operating Assets or the Pledged Equity as
permitted under Section 6(a) or Section 10, and the Obligations have been
paid in full and the Credit Agreement is terminated or assigned to a
Sprint Party: (i) the Guarantors will have no right to any amounts paid by
Sprint Spectrum pursuant to such purchase (except to the extent such
purchase is pursuant to Section 6(a) and the amount paid by Sprint PCS
exceeds the amount of the Obligations and is not payable to other
creditors of Affiliate); (ii) the Agent will, at the election of Sprint
Spectrum, either release or assign to Sprint Spectrum, all Security
Interests in the Collateral and release or assign, all rights related to
the Loan Documents and the Guarantors' Guaranty and all payments under the
Loan Documents and the Guarantors' Guaranty; and (iii) the Guarantors
will, at the election of Sprint Spectrum, release or assign to Sprint
Spectrum, any and all rights they have against the Collateral or arising
out of any payment to the Agent or any Sprint Party with respect to the
Loan Documents or the Guarantors' Guaranty.
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SECTION 7. No Limits on Remedies. Nothing contained in this Consent and
Agreement shall limit any rights of the Agent or Lenders to Accelerate. Except
as expressly provided herein, nothing contained in this Consent and Agreement
shall limit any rights or remedies that the Agent or the Lenders may have under
the Loan Documents or applicable law. The Agent may not sell, lease, assign,
convey or otherwise dispose of the Collateral other than as permitted under this
Consent and Agreement.
SECTION 8. Rights and Obligations of Interim Manager. The Interim Manager
may collect a reasonable management fee for its services; provided, that if
Sprint Spectrum or a Related Party of Sprint Spectrum acts as Interim Manager,
such management fee shall not exceed the direct expenses relating to Sprint
Spectrum or such Related Party employees for the actual time spent by such
employees when performing the function of Interim Manager and Sprint Spectrum's
or such Related Party's out-of-pocket expenses. Such direct expenses shall
include such employees' salaries and benefits, and the out-of-pocket and accrued
expenses allocated to such employees. If Sprint Spectrum is the Interim Manager,
the management fee will be paid out of the 92% Management Fee that Sprint
Spectrum pays under the Management Agreement, and will be in addition to the
fees it receives under the Services Agreement. Sprint Spectrum shall collect
such management fee by setoff against the fees and any other amounts payable to
Affiliate under the Sprint Agreements. The Interim Manager will be required to
operate the Service Area Network in accordance with the terms of the Sprint
Agreements and will be subject to all of the requirements and obligations of
such agreements, but will not be required to assume the existing liabilities of
Affiliate.
SECTION 9. Rights to Cure. Neither the provisions of this Consent and
Agreement nor any action of either Agent or Sprint Spectrum shall require either
Agent, any Lender or Sprint Spectrum to cure any default of Affiliate under the
Sprint Agreements or to perform under the Sprint Agreements, but shall only give
it the option to do so except to the extent otherwise required by this Consent
and Agreement. Sprint Spectrum may exercise its rights under Section 11.6.3 of
the Management Agreement upon an Event of Termination, whether such situation
arises while Affiliate, Sprint Spectrum, an Agent Designee or a Sprint Spectrum
Designee is acting as Interim Manager and notwithstanding any other provision of
this Consent and Agreement; provided, that the right to reimbursement for any
expenses incurred in connection with such cure shall be unsecured and until such
time as the Obligations have been paid in full in cash and all commitments to
advance credit under the Credit Agreement have terminated or expired, the Person
or Persons entitled thereto shall not receive such reimbursement, except as
specifically provided in Section 4(b) or Section 5(b) of this Consent and
Agreement. Sprint Spectrum shall not be permitted to deduct or setoff from its
payments to Affiliate any such amounts it is not entitled to receive under this
Section and shall not take any action of any type to attempt to collect such
reimbursement and the failure to be so reimbursed shall not constitute a
Management Agreement Breach. In the event that Sprint Spectrum receives any
payments or distributions that it is not entitled to receive under this Section,
such payments shall be held in trust for, and promptly turned over to, the
parties entitled thereto. If Sprint Spectrum has designated a third party to
take action under Section 11.6.3 of the Management Agreement, before taking any
such action such third party shall enter into an agreement with Agent providing
that such third party agrees to the provisions of this Section 9 as if it were a
party hereto.
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Until such time as the Obligations have been paid in full in cash and all
commitments to advance credit under the Credit Agreement have terminated or
expired, Sprint Spectrum shall not be entitled to exercise any other remedies
under the Sprint Agreements, including, without limitation, the remedy of
terminating the Sprint Agreements (except to the extent permitted under Sections
6(b)(ii)(A) and 12 of this Consent and Agreement) or the remedy of withholding
any payment set forth in Section 10 of the Management Agreement (subject to
Sprint Spectrum's rights of setoff or recoupment with respect to such payments
as permitted under Sections 2, 4(b) and 5(b) of this Consent and Agreement).
Until such time as the Obligations have been paid in full in cash and all
commitments to advance credit under the Credit Agreement have terminated or
expired, notwithstanding anything to the contrary contained in Section 2.3 of
the Management Agreement, in no event shall any Person other than Affiliate or a
Successor Manager be a manager or operator for Sprint Spectrum with respect to
the Service Area and neither Sprint Spectrum nor any of its Related Parties
shall own, operate, build or manage another wireless mobility communications
network in the Service Area, except to the extent provided in Sections 2.3(a),
(b) or (c) of the Management Agreement and except to the extent that the Sprint
Agreements are terminated in accordance with Section 6(b)(ii)(A) of this
Agreement. The Agent acknowledges and agrees that Sprint Spectrum shall also
have the right to cure an Event of Default or to assist Affiliate in curing an
Event of Default but only to the extent Affiliate has the right to so cure under
the Loan Documents, as applicable (it being understood that the act of Sprint
Spectrum curing an Event of Default shall not constitute an independent Event of
Default unless the act itself would otherwise constitute a Default (e.g. a sale
of assets not otherwise permitted by the Loan Documents)), including but not
limited to Sprint Spectrum's providing Affiliate the funds necessary to operate
or meet certain financial covenants in the Loan Documents. The Agent shall have
the right to cure any Management Agreement Breach.
SECTION 10. Sprint Spectrum's Right to Purchase Obligations, Operating
Assets or Pledged Equity. (a) Following the Acceleration Date and until the
60-day anniversary of the filing of a bankruptcy petition by or with respect to
Affiliate, Sprint Spectrum shall have the right to purchase the Obligations
under, and as defined in, the Credit Agreement, by repaying the Net Obligations
in full in cash. In the event that Sprint Spectrum purchases the Obligations
within 60 days immediately following the earlier of (i) the Acceleration Date
and (ii) the date of the filing of a bankruptcy petition by or with respect to
Affiliate, Sprint Spectrum may in lieu of purchasing the total amount of the
Obligations, purchase all Obligations other than the accrued interest with
respect thereto for a purchase price equal to the amount of the Net Obligations
other than such accrued interest and any fees and expenses that are
unreasonable, in which case, such accrued interest and unreasonable fees and
expenses shall remain due and owing by Affiliate to the Lenders.
(b) In the event that the Agent acquires the Operating Assets or
takes title to the Pledged Equity, Sprint Spectrum shall have the right to
purchase the Operating Assets or the Pledged Equity from the Agent during the
limited period of time provided in and otherwise in accordance with this Section
10(b) by paying to the Agent in cash an amount equal to the sum of the aggregate
amount paid (by credit against the Obligations or otherwise) by the Agent or the
Lenders for the Operating Assets or the Pledged Equity as the case may be, plus
the aggregate amount of any
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remaining unpaid Obligations. Agent shall give Sprint Spectrum notice of any
acquisition of the Operating Assets or the Pledged Equity by the Agent promptly
following the date of final consummation of such acquisition (the "Acquisition
Notice"). Sprint Spectrum shall, within 60 days of receipt of a valid
Acquisition Notice, give the Agent (and Affiliate, in the case of a purchase of
the Pledged Equity) notice of its intent to exercise its purchase right under
this Section 10(b). In the event Sprint Spectrum gives the Agent written notice
of its intent to purchase the Operating Assets or the Pledged Equity, the Agent
agrees that it shall provide Sprint Spectrum the right to purchase the Operating
Assets or the Pledged Equity as the case may be until the earlier to occur of
(i) expiration of the period consisting of 120 days after Sprint Spectrum's
receipt of a valid Acquisition Notice (or such later date that shall be provided
for in the purchase agreement and acceptable to the Agent in its sole discretion
to close the purchase of the Operating Assets or the Pledged Equity) or (ii)
receipt by Agent from Sprint Spectrum of written notice that Sprint Spectrum has
determined not to proceed with the closing of the purchase of the Operating
Assets or the Pledged Equity. If Sprint Spectrum at any time purchases the
Operating Assets or the Pledged Equity as permitted under this Section 10, the
Agent and the Guarantors will release or assign their interests in the
Collateral, the Loan Documents and the Guarantors' Guaranty as described in
Section 6(e). Notwithstanding the foregoing, in the event that a bankruptcy
petition is filed by or with respect to Affiliate, Sprint Spectrum shall again
have the right to purchase the Operating Assets or the Pledged Equity from the
Agent by repaying the Obligations in full in cash, by giving the Agent notice of
its intent to exercise such purchase right no later than 60 days following the
date of filing of such bankruptcy petition.
(c) If at any time during the period described in Section 10(a) or
10(b) above or thereafter the Agent receives any purchase offer for the
Operating Assets or the Pledged Equity or the Obligations, as applicable, that
is acceptable to the Agent, the Agent shall exercise reasonable efforts to
obtain the consent of the offeror to deliver a copy of such offer to Sprint
Spectrum and Sprint Spectrum shall have the right to purchase the Operating
Assets, the Pledged Equity or the Obligations, as applicable, on terms and
conditions at least as favorable to the Agent as the terms and conditions
proposed in such offer so long as within 14 Business Days after Sprint
Spectrum's receipt of such other offer Sprint Spectrum offers to purchase the
Operating Assets, the Pledged Equity or the Obligations, as applicable, and so
long as the conditions of Sprint Spectrum's offer and the amount of time it will
take Sprint Spectrum to effect such purchase is acceptable to the Agent and the
Lenders.
(d) If Sprint Spectrum at any time purchases the entirety of the
Obligations as provided in this Section 10, the Agent shall assign and transfer
or cause the Lenders to assign and transfer to Sprint Spectrum all rights and
interests in, to and under all of the Loan Documents, including but not limited
to all security interests, liens, financing statements, guaranties and other
credit enhancements related to such Loan Documents, and all rights and claims
thereunder (collectively referred to as the "Loan Document Rights"). If Sprint
Spectrum purchases less than all the Obligations (as permitted in the second
sentence of Section 10(a) above), then the Agent shall assign and transfer or
cause the Lenders to assign and transfer to Sprint Spectrum all Loan Document
Rights, except that if Sprint Spectrum receives payment in full of all
Obligations due under the Loan
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Documents (including the amount it did not pay the Agent, as permitted in the
second sentence of Section 10(a) above), it shall pay such amount to the Agent
unless the Agent has already received payment of such amount. If Sprint Spectrum
at any time purchases the entirety or less than all of the Obligations, the
Guarantors will release any and all rights, if any, they have against the
Collateral or arising out of any payment to the Agent or any Sprint Party with
respect to the Loan Documents or the Guarantors' Guaranty.
SECTION 11. Foreclosure. Upon the Agent or any Lender or any other Person
that meets the Successor Manager Requirements acquiring the Operating Assets and
the Sprint Agreements, then such Person shall be entitled to exercise any and
all rights of Affiliate under the Sprint Agreements in accordance with the terms
of the Sprint Agreements and each Sprint Party will thereupon comply in all
respects with such exercise by such Person and perform its obligations under the
Sprint Agreements and this Consent and Agreement for the benefit of such Person.
Each Sprint Party agrees that the Agent or any Lender may (but shall not be
obligated to), subject to and in accordance with the terms of this Consent and
Agreement, assign its rights and interests acquired in the Operating Assets and
the Sprint Agreements to any buyer or transferee thereof and, in the event the
buyer wishes to become a party to the Sprint Agreements and such buyer satisfies
the Successor Manager Requirements, such buyer shall be bound by the Sprint
Agreements; provided, that buyer shall have no responsibility or liability to
any Person other than a Sprint Party and a Related Party of a Sprint Party
arising out of Affiliate's operations prior to the date buyer becomes bound by
the Sprint Agreements. In such case the Sprint Agreements shall remain in full
force and effect with the buyer as Successor Manager and this Consent and
Agreement shall remain in full force and effect for the benefit of the Successor
Manager and any Person providing senior secured debt financing to such Successor
Manager if required by such Person. Sprint Spectrum agrees, with respect to any
past failure of Affiliate to perform any obligation under the Sprint Agreements,
that the Successor Manager shall have the same amount of time to perform such
obligation that Affiliate had under the Sprint Agreements, with the performance
period commencing on the date on which the buyer becomes a Successor Manager.
Sprint Spectrum shall permit the performance period set forth in the Management
Agreement to be extended for such period of time that Sprint Spectrum believes
is reasonable to allow Successor Manager to perform such unperformed
obligations.
SECTION 12. Trademarks and Service Marks. In the event the Agent
forecloses on its security interest in the License Agreements and transfers the
License Agreements to a Person who does not meet the Successor Manager
Requirements, then Sprint Spectrum shall have the right to terminate the License
Agreements and cause the Agent to release its security interest in the License
Agreements immediately prior to such transfer.
SECTION 13. Interim Manager and Successor Manager Requirements. To qualify
as an Interim Manager or a Successor Manager, the Person must satisfy each of
the following "Successor Manager Requirements," as applicable:
(a) The Person must not during the three-year period immediately
preceding the date of determination have materially breached any material
agreement with Sprint Spectrum
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or its Related Parties that resulted in the exercise of a termination
right or in the initiation of judicial or arbitration proceedings;
(b) The Person must not be one of the Persons identified on Schedule
13 (a "Schedule 13 Person"); provided, that no Other Manager under any
Sprint PCS Management Agreement may be identified on Schedule 13;
(c) In the case of a Successor Manager, the Person must meet a
reasonable Person's credit criteria (taking into consideration the
circumstances), it being understood that such criteria is satisfied if the
financial projections contained in the business plan such Person submits
to Sprint Spectrum shows the ability to service its indebtedness and meet
the build-out requirements contained in the Build-out Plan; and
(d) The Person must agree to be bound by the terms of the Sprint
Agreements as if an original party thereto; provided, in the case of an
Interim Manager, the Person must also execute a separate confidentiality
agreement in the form attached as Exhibit A with such changes thereto as
may be reasonably requested by the parties to the agreement, but the
Person is not required to assume the existing liabilities of Affiliate.
The Agent, each Lender and each of their wholly-owned subsidiaries or
entities who wholly-own such entities shall be deemed to satisfy Sections 13(a),
(b) and (c) of the preceding "Successor Management Requirements".
SECTION 14. Management Agreement. Sprint Spectrum agrees that it will not
exercise its right under the Management Agreement to purchase the Operating
Assets or to sell the Disaggregated License to Affiliate if before, or after
giving effect to such exercise, there would exist a Default or Event of Default
under the Credit Agreement, unless Sprint Spectrum pays the aggregate amount of
the Obligations as a condition of the exercise of such right and the Credit
Agreement shall have been terminated in connection with such payment. Sprint
Spectrum agrees that until the Obligations have been paid in full in cash and
all commitments to advance credit under the Credit Agreement have terminated or
expired, a failure to pay any amount by any Related Party of Affiliate under any
agreement with Sprint Spectrum or any of its Related Parties (other than the
Management Agreement, the Services Agreement or the License Agreements) shall
not constitute a Management Agreement Breach for any purpose. Subject to
regulatory approval in connection with any such sale, Sprint Spectrum agrees
that it shall always maintain the ability to sell the Disaggregated License in
accordance with this Consent and Agreement. Sprint Spectrum shall own at least
10 MHZ of Spectrum in the Service Area until the first to occur of the following
events: (i) the Obligations have been paid in full in cash and all commitments
to advance credit under the Credit Agreement have terminated or expired, (ii)
the sale by Sprint Spectrum of the Spectrum pursuant to this Consent and
Agreement shall be effected, (iii) the sale of the Operating Assets pursuant to
this Consent and Agreement, and (iv) the termination of the Management
Agreement. Sprint Spectrum acknowledges that the financing provided and to be
provided pursuant to the Loan Documents, the stock issued or to be issued by
Holdings to the purchasers named therein pursuant
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to that certain Series A Preferred Stock Purchase Agreement, dated November 23,
1999, by and among Holdings, the Walter Group, Inc., Donald A. Harris, Paul F.
Judge, James Parsons, US Bancorp and the purchasers named therein, and the
senior subordinated notes to be issued under and pursuant to the terms and
conditions set forth in that certain Purchase Agreement dated December 28, 1999,
among Affiliate, Holdings and BET Asociates LP, that certain Preferred Stock
Purchase Agreement dated as of February 16, 2000, between UbiquiTel Inc. and DLJ
Merchant Banking Partners II, L.P., that certain Commitment Letter dated
February 24, 2000, among DLJ Bridge Finance, Inc., UbiquiTel Inc. and Affiliate,
and that certain Fee Letter dated February 24, 2000, among DLJ Bridge Finance,
Inc., UbiquiTel Inc. and Affiliate, complies with Section 1.7 of the Management
Agreement, as amended by Addendum II and Addendum IV to the Management Agreement
("Section 1.7"), and that Section 11.3.6 of the Management Agreement shall no
longer be applicable with respect to all such financing. Notwithstanding
anything to the contrary contained in Section 12.2 of the Management Agreement,
the Agent, the Lenders, and any Successor Manager or buyer of the Operating
Assets or Disaggregated License shall be permitted to disclose Confidential
Information (as defined in the Management Agreement) (i) to the extent required
by law, rule or regulation, (ii) to any regulator or any regulatory body
regulating such entity, (iii) to any rating agency in connection with
requirements applicable to such Person and (iv) to the lawyers and accountants
for any such Persons.
SECTION 15. Agent and Eligible Assignees. The Agent and each Lender must
be an Eligible Assignee. "Eligible Assignee" shall mean and include a commercial
bank, financial institution, other "accredited investor" (as defined in
Regulation D of the Securities Act) other than individuals, or a "qualified
institutional buyer" as defined in rule 144A of the Securities Act; provided,
that prior to the 61st day after the filing of a bankruptcy petition by or with
respect to Affiliate in no event may any Person that is engaged in or that
controls, is controlled by or is under common control with any Person engaged
in, the telecommunications service business in the United States (other than
Sprint Corporation and its subsidiaries), be an Eligible Assignee, it being
understood that no small business investment corporation that is ultimately
owned by an Eligible Assignee that is subject to Regulation Y shall be deemed to
be controlled by or under common control with such Eligible Assignee; and
provided further, that after the filing of such bankruptcy petition in no event
may a Schedule 13 Person be an Eligible Assignee.
SECTION 16. Sprint Party Representations. Each Sprint Party represents and
warrants to the Agent, as of the Closing Date (a) its execution, delivery and
performance of this Consent and Agreement has been duly authorized by all
necessary corporate and partnership action, and does not and will not require
any further consents or approvals that have not been obtained, or violate any
provision of any law, regulation, order, judgment, injunction or similar matters
or materially breach any agreement presently in effect with respect to or
binding on it; provided, that the transfer of Spectrum as contemplated under
this Consent and Agreement will require regulatory approval (which each Sprint
Party agrees to use its commercially reasonable efforts to obtain); (b) this
Consent and Agreement is a legal, valid and binding obligation of such Person
enforceable against it in accordance with its terms, except that (i) such
enforceability may be limited by applicable bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws affecting
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the enforcement of creditors' rights generally, and (ii) the remedy of specific
performance and injunctive and other forms of equitable relief may be limited by
equitable defenses and by the discretion of the court before which any
proceeding may be brought; (c) the Sprint Agreements are in full force and
effect and have not been amended, supplemented or modified; (d) as of the date
of execution hereof, to the knowledge of the Sprint Parties, no Event of
Termination has occurred and is continuing (without regard to any requirement of
the delivery of written notice necessary to the occurrence of an Event of
Termination under Section 11.3 of the Management Agreement); (e) on the date the
Management Agreement was executed Sprint Spectrum owned, and on the date hereof
Sprint Spectrum owns, 10 MHZ or more of Spectrum in the Service Area; and (f)
the only existing agreements or arrangements between Affiliate, on the one hand,
and Sprint Corporation or any of its subsidiaries, on the other hand, are the
Management Agreement, the Services Agreement and the License Agreements.
SECTION 17. Agent Representations. The Agent represents and warrants to
Sprint Spectrum, as of the date of this Consent and Agreement (a) its execution,
delivery and performance of this Consent and Agreement has been duly authorized
by all necessary corporate action, and does not and will not require any further
consents or approvals that have not been obtained, or violate any provision of
any law, regulation, order, judgment, injunction or similar matters or
materially breach any agreement presently in effect with respect to or binding
on it; (b) this Consent and Agreement is a legal, valid and binding obligation
of the Agent enforceable against it in accordance with its terms, except that
(i) such enforceability may be limited by applicable bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws affecting the
enforcement of creditors' rights generally, and (ii) the remedy of specific
performance and injunctive and other forms of equitable relief may be limited by
equitable defenses and by the discretion of the court before which any
proceeding may be brought; (c) at the time of the execution hereof, the only
Lenders are Agent, MeesPierson Capital Corp., PNC Bank National Association, and
Westdeutsche Landesbank Girozentrale - New York Branch; (d) to the knowledge of
the Agent, no Event of Default has occurred and is continuing; and (e) Agent
will require the execution and delivery of the Guarantors' Guaranty to the
parties thereto on or prior to the initial borrowing date.
SECTION 18. Successors and Assigns. This Consent and Agreement shall be
binding upon the successors and assigns of the parties hereto and shall inure,
together with the rights and remedies of the parties hereunder, to the benefit
of their respective successors and assigns. In the event the Sprint PCS Network
is sold in accordance with the Management Agreement, the buyer thereof will
assume the obligations of the Sprint Parties hereunder and under all the other
Sprint Agreements other than the Sprint Trademark and Service Mark License
Agreement; provided, however, the buyer of the Sprint PCS Network shall enter
into an agreement with Affiliate on substantially the same terms as the Sprint
Trademark and Service Mark License Agreement with respect to such buyers'
trademarks, service marks, brands, etc. In the event a Successor Manager becomes
a party to the Sprint Agreements as provided in this Agreement, this Consent and
Agreement shall remain in full force and effect for the benefit of the Successor
Manager and any Person providing senior secured debt financing to such Successor
Manager if required by such Person.
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SECTION 19. Amendment. Neither this Consent and Agreement nor any
provision herein may be waived except pursuant to an agreement or agreements in
writing entered into by Sprint Spectrum, the Agent and Affiliate, and neither
this Consent and Agreement nor any provision herein may be amended or modified
except pursuant to an agreement or agreements in writing entered into by Sprint
Spectrum, the Agent and Affiliate. The Agent and each Lender (and its successors
and assigns) shall be bound by any modification or amendment authorized by this
Section 19. No amendment or waiver or effective amendment or waiver entered into
in violation of this Section 19 shall be valid; provided, however, that no
consent of Affiliate shall be necessary for any amendment or modification to
this Consent and Agreement made pursuant to and in accordance with Section 25
hereof.
SECTION 20. APPLICABLE LAW. THIS CONSENT AND AGREEMENT SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
SECTION 21. Notices. Notices and other communications provided for in this
Consent and Agreement shall be in writing and shall be delivered by hand or
overnight courier service, mailed or sent by telecopy, as follows:
(a) if to Sprint PCS, to it at:
Sprint Spectrum L.P.
4900 Main, 12th Floor
Kansas City, Missouri, 64112
Telephone No.: (816) 559-1000
Telecopier No.: (816) 559-1290
Attention: Chief Executive Officer
with a copy to:
4900 Main, 11th Floor
Kansas City, Missouri, 64112
Telephone No.: (816) 559-1000
Telecopier No.: (816) 559-2591
Attention: General Counsel
(b) if to the Agent, to it at:
Paribas
787 Seventh Avenue
New York, New York 10019
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Telephone No.: (212) 841-2119
Telecopier No.: (212) 841-2369
Attention: Salo Aizenberg
with a copy to:
White & Case LLP
1155 Avenue of the Americas
New York, New York 10036
Telephone No.: (212) 819-8247
Telecopier No.: (212) 354-8113
Attention: John Reiss
(c) if to Affiliate, to it at:
UbiquiTel Operating Company
3 Bala Plaza, Suite 502
Bala Conoid, Pennsylvania 19004
Telephone No.: (610) 771-2151
Telecopier No.: (610) 660-4920
Attention: Donald A. Harris
With a copy to:
Greenberg Traurig
1750 Tysons Blvd., Suite 1200
Tysons Corner, VA 22101
Telephone No.: (703) 749-1360
Telecopier No.: (703) 714-8360
Attention: Lee Marks
All notices and other communications given to any party hereto in accordance
with the provisions of this Consent and Agreement shall be deemed to have been
given on the date of receipt if delivered by hand or overnight courier service
or sent by telecopy, or on the date five (5) business days after dispatch by
certified or registered mail if mailed, in each case delivered, sent or mailed
(properly addressed) to such party as provided in this Section 21 or in
accordance with the latest unrevoked direction from such party given in
accordance with this Section 21.
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SECTION 22. Counterparts. This Consent and Agreement may be executed in
two or more counterparts, each of which shall constitute an original but all of
which when taken together shall constitute but one contract.
SECTION 23. Severability. Any provision of this Consent and Agreement that
is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction. The parties shall
endeavor in good faith negotiations to replace the invalid, illegal or
unenforceable provision with valid provisions the economic effect of which is as
close as possible to that of the invalid, illegal or unenforceable provision.
SECTION 24. Termination.This Consent and Agreement shall terminate and be
of no further force and effect upon the first to occur of the following: (i) the
Obligations are paid in full and the Credit Agreement is terminated or assigned
to a Sprint Party ; and (ii) the Sprint Agreements terminate.
SECTION 25. Amendments to Form Consent and Agreement. If Sprint PCS
modifies or amends the form of Consent and Agreement it enters into with another
lender in connection with an initial loan to an Other Manager that is syndicated
or intended to be syndicated (i.e., a loan sold or participated, or intended to
be sold or participated, in whole or in part to at least three financial
institutions or investment funds) and where the initial pops in the Service Area
of the Other Manager exceed 5 million, then Sprint PCS agrees to give the Agent
the right to so amend this Consent and Agreement, subject to the provisions of
clauses (a), (b) and (c) below. This right does not apply in connection with (i)
a new, amended, modified or existing loan to an Other Manager where the initial
pops in the Service Area did not exceed 5 million, but expansion of or growth in
the Service Area caused the pops to exceed 5 million; (ii) a new, amended or
modified loan to an Other Manager where the initial pops in the Service Area did
exceed 5 million pops but the loan is not the initial loan; or (iii) Agent's
extension of additional credit to Affiliate or Agent's amendment or modification
of the Loan Documents.
Sprint PCS agrees to give the Agent written notice of such modifications
and amendments to the form of such Consents and Agreements and, at the request
of Agent, to amend this Consent and Agreement in the same manner; provided,
that: (a) Sprint PCS will not modify this Consent and Agreement to incorporate
changes made for the benefit of a lender because of circumstances related to a
particular Other Manager, subject to the limitations set forth below; (b) the
Agent must agree to make all (or none) of the changes made for the other lender
and the Other Manager, unless Sprint PCS agrees to allow the Agent to make only
some of the changes; and (c) if such amendment to this Consent and Agreement
could reasonably be expected to be materially adverse to Borrower or Affiliate,
such amendment shall not be made without the prior written consent of Borrower
and Affiliate (although the Borrower's and Affiliate's withholding of such
consent will result in none of the changes being made to this Consent and
Agreement because of the requirements of clause (b) above).
24
<PAGE>
For purposes of subsection (a) in the preceding paragraph, Sprint PCS will
not deem the following changes to be made because of circumstances related to a
particular Other Manager: (i) any form of recourse to Sprint PCS or other
similar form of credit enhancement; (ii) any change in Sprint PCS's right to
purchase Operating Assets, Pledged Equity or Obligations; (iii) any change in
the Affiliate's, Agent's or Lenders' right to sell the Collateral or purchase
the Disaggregated License (including, without limitation, any rights of first
refusal and the purchase price of the Disaggregated License); (iv) any change in
the ownership status, terms of usage or amount of Disaggregated License utilized
by Affiliate; (v) any material change in the flow of revenues between Sprint
Spectrum and Affiliate excluding changes related to the pricing of direct or
indirect fees, but including any subordination of direct or indirect fees or
other amounts or costs due under the Sprint Agreements or hereunder to Sprint
PCS; (vi) any change to obligations required to be assumed by, or qualifications
for, any Interim or Successor Manager, including changes in the time period or
terms under which Sprint PCS agrees to remain as Interim Manager; (vii) any
changes in confidentiality, non-compete or Eligible Assignee language, including
changes to Schedule 13; (viii) any clarifications of FCC compliance issues; (ix)
the issuance of legal opinions; (x) any change in the circumstances under, or
procedures by which, an Interim Manager or Successor Manager is appointed; or
(xi) any change to this Section 25.
[The remainder of this page is intentionally left blank.]
25
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Consent and
Agreement to be executed by their respective authorized officers as of the date
and year first above written.
SPRINT SPECTRUM L.P.
By:
----------------------------------------
Bernard A. Bianchino
Senior Vice President and Chief Business
Development Officer - Sprint PCS
WIRELESSCO, L.P.
By:
----------------------------------------
Bernard A. Bianchino
Senior Vice President and Chief Business
Development Officer - Sprint PCS
COX COMMUNICATIONS PCS, L.P.
By:
----------------------------------------
Bernard A. Bianchino
Senior Vice President and Chief Business
Development Officer - Sprint PCS
COX PCS LICENSE, L.L.C.
By:
----------------------------------------
Bernard A. Bianchino
Senior Vice President and Chief Business
Development Officer - Sprint PCS
SPRINT COMMUNICATIONS COMPANY, L.P.
By:
----------------------------------------
Don A. Jensen
Vice President - Law
PARIBAS
26
<PAGE>
for itself and as Agent
By:
----------------------------------------
Name:
--------------------------------------
Title:
--------------------------------------
27
<PAGE>
Acknowledgment, Consent and Agreement of Affiliate
The undersigned Affiliate (i) has reviewed this Consent and
Agreement, (ii) acknowledges, consents and agrees to the terms and provisions of
this Consent and Agreement, and (iii) agrees to be bound by the terms and
provisions of this Consent and Agreement, including, without limitation, such
terms and provisions that affect Affiliate, its assets or its rights under the
Management Agreement. Without limiting the generality of the foregoing: (i)
Affiliate acknowledges and agrees that the right to appoint an Interim Manager
is intended to allow the right and ability to preserve and/or protect the
Collateral or its value and the Service Area Network or its value and (ii)
Affiliate acknowledges and agrees that in the event of the sale of the
Collateral by the Agent, the value of the Collateral may be dependent on the
right of the Person purchasing the Collateral to assume or be a party to the
Sprint Agreements and acknowledges that any sale of the Collateral in accordance
with Sections 6 and 10 hereof, the other provisions of this Consent and
Agreement and, to the extent not inconsistent with this Consent and Agreement,
the Loan Documents is agreed to be a commercially reasonable disposition of the
Collateral by Agent.
UBIQUITEL OPERATING COMPANY
By:
----------------------------------------
Name:
Title:
28
<PAGE>
Acknowledgment, Consent and Agreement of Guarantors
Each of the undersigned Guarantors (i) has reviewed this Consent and
Agreement, (ii) acknowledges, consents and agrees to the terms and provisions of
this Consent and Agreement, particularly as they modify the price (as set forth
in the Management Agreement) pursuant to which Sprint PCS may purchase the
Operating Assets under Sections 6 and 10 hereof, and as they require Affiliate
and its Related Parties to sell Affiliate's Licenses under Section 6 hereof, and
(iii) agrees to be bound by the terms and provisions of this Consent and
Agreement and to take such action as is necessary to cause Affiliate and its
Related Parties to comply with the terms and provisions of this Consent and
Agreement.
UBIQUITEL INC.
By:
----------------------------------------
29
<PAGE>
Exhibit 10.14
PURCHASE AGREEMENT
AMONG
UBIQUITEL, LLC,
UBIQUITEL HOLDINGS, INC.
AND
BET ASSOCIATES, L.P.
DATED AS OF DECEMBER 28, 1999
RELATING TO:
$8,000,000
UBIQUITEL LLC 12% SENIOR SUBORDINATED NOTES
DUE DECEMBER 28, 2007
AND
WARRANTS TO PURCHASE 9.75% OF THE
SHARES OF COMMON STOCK OF UBIQUITEL HOLDING CO.
<PAGE>
TABLE OF CONTENTS
Page
----
SECTION 1. SALE AND PURCHASE OF NOTES AND WARRANTS........................1
SECTION 2. THE CLOSING....................................................1
SECTION 3. DEFINITIONS....................................................2
SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE COMPANIES...............13
4.1 Corporate Existence, Power and Authority......................13
4.2 Capitalization................................................14
4.3 Subsidiaries..................................................14
4.4 Business......................................................14
4.5 No Defaults or Conflicts......................................14
4.6 Disclosure Materials; Other Information.......................15
4.7 Litigation....................................................16
4.8 Taxes.........................................................16
4.9 ERISA.........................................................16
4.10 Legal Compliance..............................................16
4.11 Permits; Licenses and Approvals...............................16
4.12 Patents.......................................................17
4.13 Status Under Certain Statutes.................................17
4.14 Key Employees.................................................17
4.15 Properties....................................................17
4.16 Suppliers and Customers.......................................17
4.17 Environmental Compliance......................................18
4.18 Indebtedness..................................................18
4.19 Disaster......................................................19
4.20 Impact of the Sprint Agreements...............................19
4.21 Offering of Notes and Warrants................................19
SECTION 5. REPRESENTATIONS AND COVENANTS OF THE PURCHASER................19
SECTION 6. PREPAYMENTS AND REPAYMENTS....................................20
6.1 Mandatory Prepayments.........................................20
6.2 Optional Prepayments..........................................21
6.3 Mandatory Repayment Upon Change of Control Event..............22
6.4 Miscellaneous.................................................22
SECTION 7. AFFIRMATIVE COVENANTS.........................................23
7.1 Use of Proceeds...............................................23
7.2 Financial Information.........................................23
(i)
<PAGE>
7.3 Compliance Certificates.......................................25
7.4 Inspection....................................................25
7.5 Maintenance of Existence; Properties and Franchises;
Compliance with Law; Taxes; Insurance.........................25
7.6 Office for Payment............................................26
7.7 Notices.......................................................26
7.8 Payment of Dividends by Subsidiaries..........................27
7.9 Board Observation Rights......................................27
7.10 Environmental Matters.........................................27
7.11 Reservation of Shares.........................................28
7.12 Listing of Shares.............................................28
7.13 Delivery of Information for Rule 144A Transactions............28
7.14 Senior Credit Facility........................................28
7.15 Evidence of Equity Funds......................................29
SECTION 8. NEGATIVE COVENANTS............................................29
8.1 Restricted Payments...........................................29
8.2 Sale of Substantial Portion of Assets; Subsidiaries...........29
8.3 Permitted Indebtedness........................................30
8.4 Certain Ratios................................................31
8.5 No Change in Business.........................................33
8.6 Consolidation or Merger.......................................33
8.7 HSR Act.......................................................33
8.8 Transactions with Affiliates..................................34
8.9 Liens, Etc....................................................34
8.10 No Restrictions on Dividends..................................35
8.11 Private Placement Status......................................35
8.12 No Dilution or Impairment; No Changes in Capital Stock........35
8.13 Limitation on Creation of Subsidiaries........................35
SECTION 9. SUBORDINATION.................................................36
9.1 Agreement to Be Bound.........................................36
9.2 Priority of Senior Indebtedness...............................36
9.3 Liquidation; Dissolution; Bankruptcy..........................37
9.4 No Prejudice or Impairment; Reinstatement.....................38
9.5 Subrogation...................................................38
9.6 Obligations Unaffected........................................39
9.7 Definition of Senior Indebtedness.............................39
9.8 Effectiveness of Acceleration of Notes and
Exercise of Remedies..........................................39
9.9 Turnover; Miscellaneous Subordination Provisions..............40
SECTION 10. CONDITIONS TO PURCHASER'S OBLIGATIONS.........................40
10.1 Final Documentation of Senior Credit Facility.................41
10.2 Accuracy of Representations and Warranties....................41
10.3 Compliance with Agreements; No Defaults.......................41
-ii-
<PAGE>
10.4 Officer's Certificate.........................................41
10.5 Proceedings...................................................41
10.6 Opinion of Counsel............................................41
10.7 Other Documents and Opinions..................................41
10.8 Equity Contribution...........................................41
SECTION 11. AMENDMENT; WAIVER; CONSENT....................................41
SECTION 12. EXCHANGE OF NOTES; ACCRUED INTEREST; CANCELLATION OF
SURRENDERED NOTES; REPLACEMENT................................43
SECTION 13. DEFAULTS......................................................44
SECTION 14. REMEDIES......................................................46
SECTION 15. RESTRICTIONS ON TRANSFER......................................47
SECTION 16. EXPENSES......................................................48
SECTION 17. HOME OFFICE PAYMENTS..........................................50
SECTION 18. NOTICES.......................................................50
SECTION 19. MISCELLANEOUS.................................................51
19.1 Entire Agreement..............................................51
19.2 Survival......................................................51
19.3 Counterparts..................................................51
19.4 Headings......................................................51
19.5 Binding Effect; Benefit and Assignment........................51
19.6 Severability..................................................52
19.7 Governing Law.................................................52
19.8 Currency......................................................52
19.9 Late Payments.................................................52
19.10 Guarantee of Subsidiaries.....................................52
19.11 Consent To Jurisdiction And Service Of Process................56
19.12 Waiver Of Jury Trial..........................................57
-iii-
<PAGE>
Exhibit A - Form of Note
Exhibit B - Form of Warrant
Exhibit C - Disclosure Schedule
Exhibit D - Opinion of Counsel to the Company
Exhibit E - Joinder for Guarantor Subsidiaries
-iv-
<PAGE>
PURCHASE AGREEMENT dated as of December 28, 1999 by and among UBIQUITEL, LLC, a
Delaware limited liability corporation ("Ubiquitel"), UBIQUITEL HOLDINGS, INC.,
a Delaware corporation ("UHC" and together with Ubiquitel, each a "Company" and
together, the "Companies"), and BET ASSOCIATES, L.P., a Delaware limited
partnership (the "Purchaser").
W I T N E S S E T H:
In consideration of the mutual covenants and agreements set forth herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties agree as follows:
SECTION 1. SALE AND PURCHASE OF NOTES AND WARRANTS
(a) Ubiquitel agrees to sell to the Purchaser and, subject to the
terms and conditions hereof and in reliance upon the representations and
warranties of the Companies contained herein or made pursuant hereto, the
Purchaser agrees to purchase from Ubiquitel on the Closing Date specified in
Section 2 hereof, a Note or Notes in the aggregate principal amount of
$8,000,000. UHC agrees to sell to the Purchaser and, subject to the terms and
conditions hereof and in reliance upon the representations and warranties of the
Companies contained herein or made pursuant hereto, the Purchaser agrees to
purchase from UHC on the Closing Date specified in Section 2 hereof, Warrants to
purchase 2,489,075 shares, representing 9.75% of the fully diluted Common Stock
of UHC. The aggregate purchase price to be paid to the Companies by the
Purchaser for such Notes and Warrants is $8,000,000, of which 99.9% shall be
allocated to the Notes and 0.1% to the Warrants.
(b) As used herein, "Notes'" means $8,000,000 aggregate principal
amount of Ubiquitel's 12% Senior Subordinated Notes Due December 28, 2007 issued
pursuant to this Purchase Agreement. Each Note will be substantially in the form
set forth as Exhibit A hereto. Interest on the Notes shall accrue from the
Closing Date and shall be payable quarterly, in arrears, on the first day of
January, April, July and October of each year, commencing April 1, 2000, at the
interest rates and in the manner specified herein and in the form of Note. As
used herein, "Warrants" means the warrants to purchase 2,489,075 shares of
Voting Common Stock issued pursuant to this Purchase Agreement. Each Warrant
shall be substantially in the form set forth in Exhibit B hereto. The Warrants
shall be exercisable at a nominal value at any time prior to the tenth
anniversary of the Closing Date, subject to adjustment as provided in the form
of Warrant.
SECTION 2. THE CLOSING
(a) Subject to the terms and conditions hereof, the closing of the
purchase and sale of the Notes and Warrants to be purchased by the Purchaser
(the "Closing") will take place at the offices of Morgan, Lewis & Bockius LLP,
1701 Market Street, Philadelphia, Pennsylvania at 1:00 P.M., local time, on
December 28, 1999 or such other time and date as shall be mutually agreed to by
the Companies and the Purchaser. Such time and date are herein referred to as
the "Closing Date."
<PAGE>
(b) Subject to the terms and conditions hereof, on the Closing Date
(i) Ubiquitel will deliver to the Purchaser the Notes registered in the name of
the Purchaser in the form of a single Note in the denomination of $8,000,000 or
such other Authorized Denomination as may be specified by the Purchaser and UHC
will deliver the Warrants registered in the name of the Purchaser in the form of
a single Warrant or such other denomination as may be specified by the Purchaser
and (ii) the Purchaser will deliver to Ubiquitel, on behalf of the Companies by
wire transfer of immediately available funds an amount equal to the purchase
price for such Notes and Warrants (as specified in Section 1(a) hereof).
SECTION 3. DEFINITIONS
(a) For purposes of this Agreement, the Notes and the Warrants, the
following definitions shall apply (such definitions to be equally applicable to
both the singular and plural forms of the terms defined):
"Additional Amount" has the meaning set forth in Section 13(b) hereof.
"Additional Common Stock" has the meaning set forth in Section 6.4(c)
hereof.
"Affiliate", when used with respect to any Person, means (i) if such
Person is a corporation, any officer or director thereof and any Person which
is, directly or indirectly, the beneficial owner (by itself or as part of any
group) of more than ten percent (10%) of any class of any equity security
(within the meaning of the Securities Exchange Act) thereof, and, if such
beneficial owner is a partnership, any general partner thereof, or if such
beneficial owner is a corporation, any Person controlling, controlled by or
under common control with such beneficial owner, or any officer or director of
such beneficial owner or of any corporation occupying any such control
relationship, (ii) if such Person is a partnership, any general partner thereof,
and (iii) any other Person which, directly or indirectly, controls or is
controlled by or is under common control with such Person. For purposes of this
definition, "control" (including the correlative terms "controlling",
"controlled by" and "under common control with"), with respect to any Person,
shall mean possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of such Person, whether through the
ownership of voting securities or by contract or otherwise; provided that no
lender or agent for the lenders under the Senior Credit Facility shall be deemed
to be an Affiliate of the Companies.
"Annualized Consolidated EBITDA" for any period means Consolidated EBITDA
times a fraction the numerator of which is four and the denominator which is the
number of fiscal quarters of UHC in such period.
"Authorized Denomination" with respect to the Notes means a principal
amount of at least $500,000, multiplied by the percentage, if any, of the
original principal of the Notes that shall have been prepaid.
"Board" or "Board of Directors" means, with respect to any Person which is
a corporation, a business trust or other entity, the board of directors or other
group, however designated, which is charged with legal responsibility for the
management of such Person, or any
2
<PAGE>
committee of such board of directors or group, however designated, which is
authorized to exercise the power of such board or group in respect of the matter
in question.
"Business Days" means any day, other than a Saturday, Sunday or legal
holiday, on which banks in the location of the offices of the Companies provided
for in Section 7.7 hereof are open for business.
"Capital Expenditures" means, for any period, amounts added or required to
be added to the property, plant and equipment or other fixed assets account on
the Consolidated balance sheet of the Companies and the Subsidiaries, prepared
in accordance with GAAP, in respect of (a) the acquisition, construction,
improvement or replacement of land, buildings, machinery, equipment, leaseholds
and any other real or personal property, (b) to the extent not included in
clause (a) above, materials, contract labor and direct labor relating thereto
(excluding amounts properly expensed as repairs and maintenance in accordance
with GAAP) and (c) software development costs to the extent not expensed.
"Capital Lease" as applied to any Person, means any lease of any property
(whether real, personal or mixed) by that Person as lessee which, in conformity
with generally accepted accounting principles, is accounted for as a capital
lease on the balance sheet of that Person.
"Capitalized Lease Obligations" of any Person means all rental obligations
under Capital Leases that, under GAAP, are or will be required to be capitalized
on the books of such Person, in each case taken at the amount thereof accounted
for as Indebtedness in accordance with such principles.
"Change of Control Event" means the occurrence of any of the following
events:
(a) any person or group (within the meaning of Section 13(d)(3) of
the Securities Exchange Act, whether or not UHC has any capital stock subject to
such Section) together with any affiliates and associates of any such person or
member of such group (within the meaning of Rule 12b-2 under the Securities
Exchange Act, whether or not UHC has any capital stock subject to such Section),
shall at any time beneficially own (within the meaning of Rule 13d-3 under the
Securities Exchange Act, whether or not UHC has any capital stock subject to
such Section) shares of Common Stock of UHC which represents in excess of either
(A) fifty percent (50%) of the total votes entitled to be cast by all
outstanding shares of the Common Stock of UHC or (B) fifty percent (50%) of all
outstanding shares of the Common Stock of UHC; or
(b) a consolidation or merger involving the Companies in which
shares of the resulting or surviving corporation representing 50% or more of the
voting power of such corporation are owned by Persons other than Persons who
were shareholders of UHC or members of Ubiquitel prior to such consolidation or
merger; or
(c) the sale, lease, transfer or other disposition of all or
substantially all of the consolidated assets of either Company in a single
transaction or series of related transactions; or
3
<PAGE>
(d) at any time, a majority of the members of the Board of Directors
of UHC are persons other than persons each of whom was designated pursuant to
UHC's Shareholder's Voting Agreement, dated as of November 23, 1999, or was both
nominated as a director for his or her then current term by UHC's Board of
Directors and was recommended by the Board of Directors of UHC to UHC's
shareholders or members for election as a member of the Board and; or
(e) in the case of Ubiquitel, ownership by any Person other than UHC
of any membership interest in Ubiquitel.
"Closing" has the meaning set forth in Section 2 hereof.
"Closing Dates" has the meaning set forth in Section 2 hereof.
"Code" means the Internal Revenue Code of 1916, as amended, and the
regulations and interpretations thereunder.
"Commission" means the Securities and Exchange Commission and any other
similar or successor agency of the federal government administering the
Securities Act or the Securities Exchange Act.
"Common Stock" means the Voting Common Stock and Non-Voting Common Stock
of UHC.
"Companies" or "Company", as the context requires, means UHC and
Ubiquitel, their successors and assigns.
"Consolidated," when used with reference to any term, mean that term as
applied to the accounts of UHC (or other specified Person) and all of its
Subsidiaries (or other specified group of Persons), or such of its Subsidiaries
as may be specified, consolidated (or combined) in accordance with GAAP and with
appropriate deductions for minority interests in Subsidiaries.
"Consolidated Current Assets" shall mean the consolidated current assets
of UHC and its Subsidiaries.
"Consolidated Current Liabilities" shall mean the consolidated current
liabilities of UHC and its Subsidiaries, but excluding the current portion of
any long-term Indebtedness which would otherwise be included therein.
"Consolidated EBIT" shall mean, for any period, the Consolidated Net
Income before interest income, Consolidated Interest Expense and provision for
taxes and without giving effect to any extraordinary gains or losses, gains or
losses from sales of assets (other than inventory sold in the ordinary course of
business).
"Consolidated EBITDA" for any period shall mean Consolidated EBIT,
adjusted by adding thereto the amount of all amortization of intangibles and
depreciation that were deducted in arriving at Consolidated Net Income for such
period.
4
<PAGE>
"Consolidated Indebtedness" shall mean, at any time, all Indebtedness of
UHC and its Subsidiaries determined on a consolidated basis (arising under
Interest Rate Protection Agreements), except to the extent amounts are owing
with respect thereto upon the termination of the respective agreement
constituting such Indebtedness) plus any original issue discount attributable to
such Indebtedness.
"Consolidated Interest Expenses" shall mean, for any period, the total
consolidated cash interest expense of UHC and its Subsidiaries for such period
(calculated without regard to any limitations on the payment thereof) payable
during such period in respect of all Indebtedness of UHC and its Subsidiaries,
on a consolidated basis, for such period (including, without duplication, that
portion of Capitalized Leases of UHC and its Subsidiaries representing the
interest factor for such period).
"Consolidated Net Income" shall mean, for any period, net income of UHC
and its Subsidiaries for such period determined on a consolidated basis (after
provision for taxes); provided, however, the net income of any Subsidiary of
UHC, which is not a wholly-owned subsidiary and for which the investment of UHC
therein is accounted for by the equity method of accounting, shall have its net
income included in the Consolidated Net Income of UHC and its Subsidiaries only
to the extent of the amount of cash dividends or distributions paid by such
Subsidiary to UHC.
"Consolidated Revenues" shall mean, for any period, the total consolidated
revenues of UHC and its Subsidiaries for such period determined on a
consolidated basis, including, without limitation, all access, airtime, long
distance, travel-out, travel-in, roaming-in, and operator service revenues from
travel-out expenses or long distance expenses; provided, however, Consolidated
Revenues shall not include revenue from handset sales.
"Consolidated Senior Indebtedness" shall mean, at any time, an amount
equal to the amount of all Consolidated Indebtedness at such time less the
outstanding principal amount of the Senior Subordinated Notes at such time.
"Disclosure Materials" has the meaning set forth in Section 4.6(a) hereof.
"Disclosure Schedule" means the schedule attached as Exhibit C to this
Purchase Agreement. Each entry on the Disclosure Schedule shall refer to the
particular section of this Purchase Agreement to which such entry relates.
"Distributions on Common Stock" has the meaning set forth in Section
6.4(b) hereof.
"Environmental Lien" has the meaning set forth in Section 8.12(a) hereof.
"ERISA" has the meaning set forth in Section 4.9(a) hereof.
"Event of Default" has the meaning set forth in Section 14 hereof.
5
<PAGE>
"Financing Debts" means each of the items described in clauses (a) through
(f) of the definition of the term "Indebtedness" and, without duplication, any
Guarantees of such items.
"Fixed Charge Coverage Ratios" for any period means the ratio of (x)
Consolidated EBITDA less the amount of all Capital Expenditures, made by the
Borrower or any of its Subsidiaries for such period to (y) Fixed Charges for
such period.
"Fixed Charges" for any period means the sum of (i) Consolidated Interest
Expense for such period, (ii) the aggregate principal amount of all scheduled
payments of Indebtedness (including the principal portion of rentals under
Capitalized Lease Obligations but excluding repayment of revolving loans not
accompanied by a permanent reduction to the Commitment of the lender to provide
such revolving loans) required to be made during such period and (iii) taxes
paid by UHC and its Subsidiaries during such period.
"GAAP" means generally accepted accounting principles as from time to time
in effect, including the statements and interpretations of the United States
Financial Accounting Standards Board; provided, however, for purposes of
compliance with Section 9 and the related definitions, "GAAP" means such
principles as in effect on the date hereof, as applied by UHC and its
Subsidiaries in the preparation of the most recent financial statements referred
to in Section 4.6(a), that in the event of a change in generally accepted
accounting principles after such date, either UHC or the Majority Noteholders
may request a change in the definition of "GAAP", in which case the parties
hereto shall negotiate in good faith with respect to an amendment of this
Purchase Agreement implementing such change.
"Guarantee" means, with respect to the Companies (or other specified
Person):
(a) any guarantee by the Companies (or such specified Person) of the
payment or performance of, or any contingent obligation by the Companies (or
such specified Person) in respect of, any Indebtedness or other obligation of
any primary obligor;
(b) any other arrangement whereby credit is extended to a primary
obligor on the basis of any promise or undertaking of the Companies (or such
specified Person) including any binding "comfort letters. or "keep well
agreement" written by the Companies (or such specified Person), to a creditor or
prospective creditor of such primary obligor, to (i) pay the Indebtedness of
such primary obligor, (ii) purchase an obligation owned by such primary obligor,
(iii) pay for the purchase or lease of assets or services regardless of the
actual delivery thereof or (iv) maintain the capital, working capital, solvency
or general financial condition of such primary obligor;
(c) reimbursement obligations, whether contingent or matured, of the
Companies (or such specified Person) with respect to letters of credit, bankers
acceptances, surety bonds, other financial guarantees and Interest Rate
Protection Agreements, in each case whether or not any of the foregoing are
reflected on the balance sheet of the Companies (or such specified Person) or in
a footnote thereto; provided, however, that the term "Guarantee" shall not
include endorsements for collection or deposit in the ordinary course of
business. The amount of any Guarantee and the amount of Indebtedness resulting
from such Guarantee shall be the
6
<PAGE>
maximum amount that the guarantor may become obligated to pay in respect of the
obligations (whether or note such obligations are outstanding at the time of
computation).
"HSR Acts" means the Hart-Scott-Rodino Antitrust Improvement Act of 1976,
as heretofore or hereafter amended.
"Hazardous Materials" means any pollutant, toxic substance, hazardous
waste, material, compound, element or chemical identified as such or determined
to be hazardous or toxic by a governmental agency under the Comprehensive
Environmental Response Compensation and Liability Act (CERCLA), 42 U.S.C. 9601
et seq., the Resource Conservation and Recovery Act (RCRA), 42 U.S.C. 6901 et
seq., the Toxic Substances Control Act (TSCA), 15 U.S.C. 2601 et seq., the Water
Pollution Control Act (CWA), 33 U.S.C. 1251 et seq., the Clean Air Act (CAA), 42
U.S.C. 7501 et seq., the Occupational Safety and Health Act (OSHA), 29 U.S.C.
655 and any other federal, state, local or municipal laws, statutes, ordinances,
codes, rules or regulations imposing liability or establishing standards of
conduct for environmental protection. The term "Hazardous Materials" shall also
include raw materials used or stored by the Companies, building components
(including but not limited to asbestos-containing materials) and manufactured
products containing Hazardous Materials.
"Indebtedness" means all obligations, contingent or otherwise, which in
accordance with GAAP are required to be classified upon the Consolidated balance
sheet of the Companies (or other specified Person) as liabilities, but in any
event including (without duplication):
(a) borrowed money;
(b) indebtedness evidenced by notes, debentures or similar
instruments;
(c) Capitalized Lease Obligations;
(d) the deferred purchase price of assets, services or securities,
including related noncompetition, consulting and stock repurchase obligations
(other than ordinary trade accounts payable within six months after the
incurrence thereof in the ordinary course of business);
(e) reimbursement obligations, whether contingent or matured, with
respect to letters of credit, bankers acceptances, surety bonds, other financial
guarantees and Interest Rate Protection Agreements (without duplication of other
Indebtedness supported or guaranteed thereby);
(f) liabilities secured by any Lien existing on property owned or
acquired by the Companies (or such specified Person), whether or not the
liability secured thereby shall have been assumed; and
(g) all Guarantees in respect of Indebtedness of others.
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"Investment" means, with respect to any Person, (i) any loan, advance or
extension of credit by such Person to, and any contributions to the capital of,
any other Person, (ii) any Guarantee by such Person or (iii) any interest in any
capital stock or other securities of any other Person.
"Interest Rate Protection Agreements" means any interest rate swap,
interest rate cap, interest rate hedge or other contractual arrangement that
converts variable interest rates into fixed interest rates, fixed interest rates
into variable interest rates or other similar arrangements.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), or preference, priority or
other security interest of any kind or nature whatsoever (including, without
limitation, any conditional sale or other title retention agreement, any
financing lease having substantially the same effect as any of the foregoing,
any assignment or other conveyance of any right to receive income and any
assignment of receivables with recourse against the assignor), any filing of a
financing statement as debtor under the Uniform Commercial Code or any similar
statute and any agreement to give or make any of the foregoing.
"Majority Noteholders" means the holder or holders, at the time, of at
least a majority of the aggregate principal amount of the Notes then
outstanding.
"Market Price" has the meaning set forth in Section 6.4(g) hereof.
"Material Adverse Effect" means a material adverse effect on the assets,
properties, liabilities, business, affairs, results of operations or condition
(financial or otherwise) of Ubiquitel and its Subsidiaries on a consolidated
basis
"Non-Voting Common Stock" means the non-voting common stock, par value
$.001 per share, of UHC.
"Note" or "Notes" has the meaning set forth in Section 1(b) hereof.
"Other Managers" means any person or entity with which Sprint PCS has
entered into an agreement similar to the Sprint Management Agreement under which
the person or entity designs, constructs and managers a service area network and
offers and promotes Sprint PCS Products or Services.
"Outstanding" or "outstanding" means, when used with reference to the
Notes as of a particular time, all Notes theretofore duly issued except (i)
Notes theretofore reported as lost, stolen, mutilated or destroyed or
surrendered for transfer, exchange or replacement, in respect of which new or
replacement Notes have been issued by Ubiquitel, (ii) Notes theretofore paid in
full and (iii) Notes theretofore canceled by Ubiquitel; except that for the
purpose of determining whether holders of the requisite principal amount of
Notes have made or concurred in any declaration, waiver, consent, approval,
notice, annulment of acceleration or other communication under this Agreement or
under any Notes, Notes registered in the name of, as well as Notes
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owned beneficially by, UHC, any Subsidiary or any of their Affiliates shall not
be deemed to be outstanding.
"Payment Blockage Period" has the meaning set forth in Section 10.2(b)
hereof.
"Permitted Liens" means (i) Liens for taxes not yet due or Liens for taxes
being contested in good faith and by appropriate proceedings, for which adequate
reserves have been established, and provided that any proceedings commenced for
the enforcement of such Liens have been duly suspended, (ii) Liens in respect of
property or assets of the Companies or any Subsidiary imposed by law (such as
carriers', warehousemen's, landlords' and mechanics' liens), which were incurred
in the ordinary course of business and, in each case, were not incurred in
connection with the borrowing of money, and (x) which do not in the aggregate
materially detract from the value of such property or assets or materially
impair the use thereof in the operation of the business of the Companies or any
Subsidiary and (y) which either relate to sums not yet delinquent or are being
contested in good faith by appropriate proceedings, which proceedings have the
effect of preventing the forfeiture or sale of the property or assets subject to
such Lien, provided that adequate reserves have been established for any such
Liens being contested, (iii) pledges or deposits (other than any Lien imposed by
ERISA) in the ordinary course of business in connection with workers'
compensation, unemployment insurance and other social security legislation, (iv)
easements, rights-of-way and minor defects or irregularities in title not
interfering in any material respect with the ordinary conduct of the business of
the Companies or any of their Subsidiaries, (v) Liens securing the performance
of bids, tenders, contracts, statutory obligations, surety, customs and appeal
bonds and other obligations of like nature, incurred as an incident to and in
the ordinary course of business and not to secure the repayment of borrowed
money, (vi) other Liens not exceeding $500,000 and (vii) Liens permitted
pursuant to the Senior Credit Facility.
"Person" or "person" means an individual, corporation, partnership, firm,
association, joint venture, trust, unincorporated organization, government,
governmental body, agency, political subdivision or other entity.
"Potential Default" means a condition or event which, with notice or lapse
of time or both, would constitute an Event of Default.
"Preferred Stock" means any class of the capital stock of a corporation
(whether or not convertible into any other class of such capital stock) which
has any right, whether absolute or contingent, to receive dividends or other
distributions of the assets of such corporation (including, without limitation,
amounts payable in the event of the voluntary or involuntary liquidation,
dissolution or winding-up of such corporation), which right is superior to the
rights of another class of the capital stock of such corporation.
"Prepayment Premium" has the meaning set forth in Section 6.2(a) hereof.
"Purchase Agreement" means this Purchase Agreement (together with exhibits
and schedules) as from time to time supplemented or amended or as the terms
hereof may be waived.
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"Purchaser" means BET Associates, L.P., a Delaware limited partnership,
its successors and assigns.
"Restricted Payment" means (i) every dividend or other distribution paid,
made or declared by the Companies or any Subsidiary on or in respect of any
class of its capital stock, (ii) every payment in connection with the
redemption, purchase, retirement or other acquisition by or on behalf of the
Companies or any Subsidiary of any shares of the UHC or membership interests of
Ubiquitel or a Subsidiary's capital stock, whether or not owned by the Companies
or any Subsidiary, (iii) any prepayments or repayments of principal made on
Indebtedness expressly subordinated to the Notes (unless such payments are
scheduled, or are at maturity, in each case on the dates established for such
payments at the time such Indebtedness was incurred) and (iv) every payment by
or on behalf of the Companies or any Subsidiary (whether as repayment or
prepayment of principal or as interest or otherwise) on or with respect to (A)
any obligation to repay money borrowed owing to any Affiliate of the Companies
or of any Subsidiary, or (B) any obligation, to any Person, of any Affiliate of
the Companies or of any Subsidiary, which obligation is assumed or guaranteed by
the Companies or a Subsidiary; provided, however, (a) that the restrictions of
the foregoing clauses (i) and (ii) shall not apply to (1) any dividend,
distribution or other payment on or in respect of capital stock of the Companies
to the extent payable in shares of the capital stock of the Companies or (2) the
redemption of the Non-Voting Common Stock for an aggregate redemption price not
in excess of $16,000, (b) that none of the foregoing clauses shall apply to any
payments from a Subsidiary to the Companies or from a Subsidiary to a
wholly-owned Subsidiary (including, without limitation, dividends and other
distributions), (c) that none of the foregoing clauses shall apply to any
purchases by the Companies from a wholly-owned Subsidiary of additional capital
stock of such wholly-owned Subsidiary, (d) that none of the foregoing clauses
shall apply to any payments, distributions or other transfers or actions on or
with respect to the Notes, Warrants or to holders of Notes under the Purchase
Agreement and (e) none of the foregoing clauses shall apply to Indebtedness of
the Companies to a wholly-owned Subsidiary. For purposes of this definition,
"capital stock" shall also include warrants and other rights and options to
acquire shares of capital stock (whether upon exercise, conversion, exchange or
otherwise).
"Rule 144" means (i) Rule 144 under the Securities Act as such Rule is in
effect from time to time, and (ii) any successor rule, regulation or law, as in
effect from time to time.
"Rule 144A" means (i) Rule 144A under the Securities Act as such Rule is
in effect from time to time and (ii) any successor rule, regulation or law, as
in effect from time to time.
"Securities Act" means the Securities Act of 1933, as amended from time to
time, and the rules, regulations and interpretations thereunder.
"Securities Exchange Acts" means the Securities Exchange Act of 1934, as
amended from time to time, and the rules, regulations and interpretations
thereunder.
"Senior Credit Facility" means the senior credit facility dated December
28, 1999 among the lenders party thereto in their capacities as lenders
thereunder and Paribas, a French banking organization acting through its New
York Branch, as agent, together with the related documents
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thereto (including, without limitation, any guarantee agreements and security
documents), in each case as such agreements may be amended (including any
amendment and restatement thereof), supplemented or otherwise modified from time
to time, including any agreement extending the maturity of, refinancing,
replacing or otherwise restructuring (including without limitation, increasing
the amount of available borrowings thereunder or adding Subsidiaries of the
Company as additional borrowers or guarantors thereunder) all or any portion of
the Indebtedness under such agreement or any successor or replacement agreement
and whether by the same or any other agent, lender or group of lenders.
"Senior Indebtedness" has the meaning set forth in Section 9.7 hereof.
"Share" or "shares" shall mean the shares of Voting Common Stock obtained
or obtainable upon exercise of the Warrants and shall also include any capital
stock or other securities into which such shares of Voting Common Stock are
changed and any capital stock or other securities resulting from or comprising a
reclassification, combination or subdivision of, or a stock dividend on, such
Shares. In the event that any Shares are sold either in a public offering
pursuant to a registration statement under Section 6 of the Securities Act or
pursuant to Rule 144, then the transferees of such Shares shall not be entitled
to any benefits under this Agreement with respect to such Shares and such Shares
shall no longer be considered to be "shares" for purposes of Section 17 hereof
or any consent or waiver provision of this Agreement.
"Sprint Agreements" means the Sprint Management Agreement, Sprint Services
Agreement, the Sprint License Agreements and all other contracts, agreements or
understandings entered into between UHC or any of its Subsidiaries on the one
hand and Sprint Corporation or any of its Affiliates, on the other hand.
"Sprint Communications Company, L.P." means Sprint Communications Company,
L.P., a Delaware limited partnership.
"Sprint License Agreements" means collectively the (i) Sprint Trademark
and Service Mark License Agreement, dated September --, 1998, among Sprint
Communications Company, L.P. and the Borrower, and (ii) Sprint Spectrum
Trademark and Service Mark Agreement, dated September _, 1998, among Sprint
Spectrum, L.P. and UHC.
"Sprint Management Agreements" means the Sprint PCS Management Agreement,
made September __, 19_, among Sprint Spectrum L.P., SprintCom, Inc. and
Southwest PCS, L.P. WirelessCo, L.P. and Ubiquitel L.L.C., a Washington
corporation, as amended, modified or supplemented from time to time in
accordance with the provisions hereof.
"Sprint PCS" means any or all of the following affiliates who are License
holders and signatories to the Management Agreement: Sprint Spectrum L.P., a
Delaware limited partnership, SprintCom, Inc., a Kansas corporation, PhillieCo
Partners I, L.P., a Delaware limited partnership, Cox Communications PCS, L.P.,
a Delaware limited partnership, and American PCS Communications, LLC, a Delaware
limited liability company. Each entity listed above is an affiliate to each of
the other listed entities.
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"Sprint PCS Network" shall mean the national wireless network and business
activities to be developed by Sprint PCS, UHC and Other Managers in the United
States and certain of its territories and possessions, which network includes
the Service Area Network.
"Sprint PCS Products and Services" means all types and categories of
wireless communications services and associated products that are designated by
Sprint PCS (whether now existing or developed and implemented in the future) as
products and services to be offered by Sprint PCS, UHC and other Sprint-related
parties as the products and services of the Sprint PCS Network for fixed and
mobile voice, short message and other data services under the FCC's rules for
broadband personal communications services, including all local area service
plans. Sprint PCS Products and Services do not include wireline products
services, including local exchange service, wireline long distance service, and
wireline-based Internet access.
"Sprint Services Agreement" means that certain Sprint PCS Services
Agreement executed by the Borrower and Sprint Spectrum L.P. and any documents
incorporated by reference in said agreement.
"Sprint Spectrum L.P." means Sprint Spectrum L.P., a Delaware limited
partnership.
"SprintCom. Inc." shall mean SprintCom, Inc., a Kansas corporation.
"Subordinated Indebtedness" means (i) the principal of, premium, if any,
and interest arising with respect to the Notes and (ii) all other obligations of
either Company or any Subsidiary arising out of or in connection with this
Purchase Agreement or the Notes or any other documents relating to the Notes or
the Purchase Agreement.
"Subsidiary" means any corporation, association or other entity of which
more than 50% of the total voting power of shares of stock or other equity
interests entitled (without regard to the occurrence of any contingency) to vote
in the election of directors, managers or trustees thereof is, at the time as of
which any determination is being made, owned or controlled, directly or
indirectly, by either Company or one or more of its Subsidiaries, or both.
References herein to a "wholly-owned Subsidiary" mean a Subsidiary all of whose
outstanding capital stock (and any rights of any kind to acquire such capital
stock) is owned by the Company or another wholly-owned Subsidiary, except only
for directors' qualifying shares which represent a minority interest in such
Subsidiary and which are required or deemed advisable with respect to any
Subsidiary organized under the laws of a jurisdiction outside of the United
States (and provided that any directors holding such directors' qualifying
shares are nominated, and can be removed, by the Company or another wholly-owned
Subsidiary).
"Subsidiary Guarantor" has the meaning set forth in Section 19.10 hereof.
"UHC" means Ubiquitel Holdings, Inc., a Delaware corporation.
"Ubiquitel" means Ubiquitel, LLC, a Delaware limited liability company.
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"Voting Common Stock" means the voting common stock, par value $.001 per
share, of UHC.
"Warrants" has the meaning set forth in Section 1(b) hereof.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE COMPANIES
Each of the Companies represents and warrants to the Purchaser as follows
as of the date hereof and as of the Closing Date:
4.1 Corporate Existence, Power and Authority.
(a) Each Company is a corporation or limited liability company, duly
organized, validly existing and in good standing under the laws of its state or
other jurisdiction of incorporation. Each Company is duly qualified, licensed
and authorized to do business and is in good standing in each jurisdiction in
which it owns or leases any material property or in which the conduct of its
business requires it to so qualify or be so licensed, except for such
jurisdictions where the failure to so qualify or be so licensed would not have a
Material Adverse Effect.
(b) No proceeding has been commenced looking toward the dissolution
or merger of either Company or the amendment of its respective certificate or
articles of incorporation (or similar governing documents) or limited liability
company certificate of formation or operating agreement. Neither Company nor any
Subsidiary is in violation in any respect of its certificate or articles of
incorporation or by-laws (or similar governing documents) with respect to a
Subsidiary organized under the laws of a jurisdiction outside of the United
States) or its limited liability company certificate of formation or operating
agreement.
(c) Each Company and each Subsidiary has all requisite corporate or
limited liability company power, authority and legal right to own or to hold
under lease and to operate the properties it owns or holds and to conduct its
business as now being conducted.
(d) Each Company has all requisite power, authority and legal right
to execute, deliver, enter into, consummate and perform this Purchase Agreement,
the Notes and the Warrants, including, without limitation, the issuance by
Ubiquitel of the Notes and the issuance by UHC of the Warrants and the Shares as
contemplated herein and therein. The execution, delivery and performance of the
Purchase Agreement, the Notes and the Warrants by each Company (including,
without limitation, the issuance by Ubiquitel of the Notes and the issuance by
UHC of the Warrants and the Shares as contemplated herein and therein) have been
duly authorized by all required corporate, limited liability company and other
actions. The Purchase Agreement constitutes, and the Notes and Warrants when
issued will constitute, the legal, valid and binding obligations of the Company
which is a party thereto, enforceable in accordance with their respective terms,
subject to bankruptcy, insolvency, reorganization, moratorium and other similar
laws relating to the rights of creditors generally. The Shares when issued will
be duly authorized, validly issued, fully paid and non-assessable.
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4.2 Capitalization.
(a) The authorized capital stock of UHC consists of 291,000,000
shares of stock, consisting of (a) 150,000,000 shares of Voting Common Stock,
(b) 16,000,000 shares of Non-Voting Common Stock and (c) 125,000,000 shares of
Preferred Stock. On the date hereof, 3,417,000 shares of Voting Common Stock
were outstanding, 16,000,000 shares of Non-Voting Common Stock were outstanding
and 17,008,500 shares of Preferred Stock were outstanding and all such
outstanding shares were duly authorized, validly issued and outstanding and
fully paid and non-assessable.
(b) The only shares of Common Stock reserved for issuance by UHC are
(i) 17,008,500 shares reserved for issuance to holders of Series A preferred
stock, (ii) shares to be issued upon exercise of the Warrants, (iii) shares to
be issued upon exercise of warrants issued pursuant to the Senior Credit
Facility, (iv) 2,040,000 shares are reserved for issuance under UHC's employee
stock option plan, pursuant to which no options were granted and outstanding as
of December 28, 1999, but an option to purchase 250,000 of such shares has been
committed.
(c) Except as described in Section 4.2(b) or as disclosed on the
Disclosure Schedule, there are no outstanding options, warrants, rights,
convertible securities or other agreements or plans under which UHC may become
obligated to issue, sell or transfer shares of its capital stock or other
securities.
(d) There are outstanding registration rights with respect to all of
UHC's issued and outstanding Common Stock and Preferred Stock.
(e) UHC is the sole member of Ubiquitel LLC and is the sole owner of
all of the outstanding membership interests in Ubiquitel.
4.3 Subsidiaries.
(a) The only Subsidiary on the Closing Date will be Ubiquitel.
Ubiquitel is wholly owned by UHC and UHC is Ubiquitel's sole member. Neither of
the Companies has any Investments in any other Person.
(b) Ubiquitel is not subject to any agreement, order or similar
restriction that may affect or limit its ability to pay dividends to UHC other
than the Senior Credit Facility.
4.4 Business. Each of the Companies is engaged solely in the business of
developing, operating and managing a Sprint PCS Network pursuant to the Sprint
Agreements. Neither Company currently engages in, or has any intention of
engaging in, any other business.
4.5 No Defaults or Conflicts.
(a) No Event of Default or Potential Default has occurred and is
continuing.
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(b) Neither Company is in violation or default under any indenture,
agreement or instrument to which it is a party or by which it or its properties
may be bound where the violation or default could reasonably be expected to have
a Material Adverse Effect.
(c) The execution, delivery and performance by each Company of the
Purchase Agreement, the Notes, the Warrants and any of the transactions
contemplated hereby (including, without limitation, the issuance of the Notes,
the Warrants and the Shares as contemplated herein and therein) does not and
will not (i) violate or conflict with, with or without the giving of notice or
the passage of time or both, any provision of (A) the respective articles or
certificates of incorporation, by-laws, limited liability company certificate of
formation or operating agreement of either Company (or similar governing
documents) or (B) any law, rule, regulation, order, judgment, writ, injunction,
decree, agreement, indenture or other instrument applicable to the Companies or
any of their respective properties, (ii) result in the creation of any security
interest or Lien upon any of either Company's properties, assets or revenues,
(iii) require the consent, waiver, approval, order or authorization of, or
declaration, registration, qualification or filing with, any Person (whether or
not a governmental authority and including, without limitation, any shareholder
approval) or (iv) cause antidilution clauses of any outstanding securities to
become operative or give rise to any preemptive rights.
4.6 Disclosure Materials; Other Information.
(a) The Company has previously furnished to the Purchaser a
consolidated pro forma balance sheet of UHC as of the Closing Date (the
"Disclosure Material").
The financial statements referred to in the preceding sentence fairly
present in all material respects the financial condition of the Companies as of
the date thereof and have been prepared in accordance with GAAP consistently
applied.
(b) Neither Company is aware of any material liabilities, contingent
or otherwise, of either Company that have not been disclosed in the financial
statements referred to in Section 4.6(a) above or otherwise disclosed in the
Disclosure Material.
(c) The financial projections included in the Disclosure Material
conform with the internal operating forecasts of the Companies, are
mathematically accurate, were based on assumptions that the Companies in good
faith believed to have been reasonable when made and have been prepared in good
faith, although actual results may differ materially from such projections.
(d) None of the Disclosure Material contained as of its date or
contains on the date hereof an untrue statement of a material fact or omitted or
omits to state any material fact necessary in order to make the statements made,
in light of the circumstances under which they were and are made, not
misleading;
(e) There is no fact known to either Company which is not in the
Disclosure Material which could reasonably be expected to have a Material
Adverse Effect.
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4.7 Litigation. Except as set forth in the Disclosure Schedule, there is
no action, suit, proceeding, investigation or claim pending or threatened in
law, equity or otherwise before any court, administrative agency or arbitrator
which either (i) questions the validity of the Purchase Agreement, the Notes,
the Warrants or the Shares or any action taken or to be taken pursuant hereto or
thereto or (ii) could reasonably be expected to have a Material Adverse Effect.
4.8 Taxes. Neither Company has filed or been required to file any federal,
state, local or other tax returns and reports. Each Company has paid or caused
to be paid all taxes (including interest and penalties) that are due and
payable, except those which are being contested by it in good faith by
appropriate proceedings and in respect of which adequate reserves are being
maintained on its books in accordance with generally accepted accounting
principles consistently applied. Neither Company has any material liabilities
for taxes other than those incurred in the ordinary course of business and in
respect of which adequate reserves are being maintained by it in accordance with
generally accepted accounting principles consistently applied.
4.9 ERISA. Each Company is in compliance in all material respects with all
applicable provisions of the Employee Retirement Income Security Act of 1974, as
amended, and the regulations and interpretations thereunder (collectively
"ERISA"). Neither Company has engaged in any "prohibited transaction" which
would subject it to a tax or penalty on prohibited transactions imposed by ERISA
or by the Code. With respect to each such plan (other than any multi-employer
plan) that is intended to meet the qualification requirements of Section 401(a)
of ERISA, all amendments have been adopted and all other steps have been taken
that are required to have been adopted or taken as of the date hereof in order
to maintain the continuing qualified status of such plan, and the continuing
exemption of any trust funding or forming part of such plan, from the date of
establishment of such plan to the date hereof. No liability to the Pension
Benefit Guaranty Corporation has been or is expected to be incurred with respect
to any such plan. There has been no "reportable event", as defined in ERISA,
with respect to any such plan, and no event or condition exists which presents a
material risk of termination of any such plan by the Pension Benefit Guaranty
Corporation.
4.10 Legal Compliance.
(a) Each Company has complied with all applicable laws, rules,
regulations, orders, licenses, judgments, writs, injunctions, decrees or
demands, except to the extent that failure to comply would not have a Material
Adverse Effect.
(b) There are no adverse orders, judgments, writs, injunctions,
decrees or demands of any court or administrative body, domestic or foreign, or
of any other governmental agency or instrumentality, domestic or foreign,
outstanding against either Company.
4.11 Permits; Licenses and Approvals. Each Company possesses such
franchises, licenses, permits, consents, approvals and other authority
(governmental or otherwise) from any Person as are necessary for the conduct of
its business as now being conducted and each Company will be able to obtain such
franchises, licenses, permits, consents, approvals and other authority
(governmental or otherwise) as may be necessary for the conduct of its business
as proposed to be conducted) and none is in default in any material respects
under any of such
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franchises, licenses, permits, consents, approvals or other authority, except
for (i) any failures to possess a franchise, license, permit, consent, approval
or other authority or (ii) any such defaults which (in the case of clause (i) or
(ii)) do not and will not (individually or in the aggregate) have a Material
Adverse Effect.
4.12 Patents, Trademarks and Other Rights. Each Company possesses all
patents, patent rights, trademarks, trademark rights, trade names, and trade
name rights (each of which is listed on the Disclosure Schedule) and copyrights
as are necessary to conduct its business as now being conducted and as proposed
to be conducted, except for any failures to possess a patent, patent right,
trademark, trademark right, trade name, trade name right or copyright which
failures (individually or in the aggregate) do not and could not reasonably be
expected to have a Material Adverse Effect. The activities and conduct of
business by each Company do not conflict with or infringe upon any intellectual
property rights of others, and neither Company has received any notice that any
such claim of conflict or infringement has been asserted by any Person.
4.13 Status Under Certain Statutes. Neither Company is: (i) a "public
utility company" or a "holding company", or an "affiliate" or a "subsidiary
company" of a "holding company", or an "affiliate" of such a "subsidiary
company", as such terms are defined in the Public Utility Holding Company Act of
1935, as amended, (ii) a "public utility" as defined in the Federal Power Act,
as amended, or (iii) an "investment company" or an "affiliated person" thereof
or an "affiliated person" of any such "affiliated person", as such terms are
defined in the Investment Company Act of 1940, as amended.
4.14 Key Employees. Each Company has good relationships with its employees
and has not had and does not expect any substantial labor problems. Neither
Company has any knowledge as to any intentions of any key employee or any key
group of employees to leave the employ of either Company.
4.15 Properties. Neither Company owns real estate. Except as set forth on
the Disclosure Schedule, each Company has a valid leasehold interest in, each of
its properties. Certain real property used by each Company in the conduct of
their respective businesses is held under lease (as identified on the Disclosure
Schedule), and neither Company is aware of any pending or threatened claim or
action by any lessor of any such property to terminate any such lease. None of
the properties leased by either Company is subject to any Liens, which might
materially and adversely affect the assets, properties, liabilities, business,
affairs, results of operations, condition (financial or otherwise) or prospects
of either Company on a consolidated basis.
4.16 Suppliers and Customers.
(a) (i) Each Company has adequate sources of supply for its business
as currently conducted and as proposed to be conducted, (ii) each has
satisfactory relationships with all of its material sources of supply of goods
and services and (iii) each does not anticipate any material problem with any
such material sources of supply.
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(b) Each Company has satisfactory relationships with all of its
material customers and each does not anticipate any material problems with any
of them.
(c) Neither Company has any knowledge that the customer base of
either Company might materially decrease.
4.17 Environmental Compliance.
(a) There is no Hazardous Material about or in, in material
violation of law, any real property owned or, to the best of the Company's
knowledge, leased by either Company.
(b) There is no (and has not been any) off-site disposal or on-site
disposal at any locations currently or formerly owned or occupied by either
Company as a result of which disposal there would exist a risk that either
Company would incur a material liability (determined on a consolidated basis) or
obligation under federal, state or local environmental or other laws,
regulations or ordinances.
(c) Neither Company nor any prior or present owner, operator,
tenant, subtenant or invitee of any of the real property (including
improvements) currently or formerly owned or occupied by either Company has:
(i) used, installed, stored, spilled, released, transported,
disposed of or discharged any Hazardous Material upon, into, beneath, from
or affecting such real property (including improvements) in violation of
applicable law, or
(ii) received any verbal or written notice, citation,
subpoena, summons, complaint or other correspondence or communication from
any person with respect to the presence of Hazardous Material upon, into,
beneath, or emanating from or affecting any of the real property
(including improvements) currently or formerly owned or occupied by the
Company which (in case of clause (i) and/or (ii)) would (individually or
in the aggregate) result in a liability or obligation on the part of each
Company, unless such liability or obligation would not have a material
adverse effect on the assets, properties, liabilities, business, affairs,
results of operation, condition (financial or otherwise) or prospects of
the Companies on a consolidated basis.
(d) There has been no intentional or unintentional, gradual or
sudden, release, disposal or discharge upon, into or beneath the real property
(including improvements) currently or formerly owned or occupied by either
Company, that has caused or is causing soil or groundwater contamination which
under applicable environmental laws, regulations or ordinances requires
investigation or remediation or otherwise creates a material liability or
obligation (determined on a consolidated basis) on the part of the Companies.
4.18 Indebtedness. The Disclosure Schedule sets forth (i) the amount of
all Indebtedness of the Company outstanding on the date of this Agreement, (ii)
any Lien with respect to such Indebtedness and (iii) a brief description of each
instrument or agreement governing such Indebtedness. The Company has delivered
to the Purchaser a complete and
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correct copy of each such instrument or agreement (including all amendments,
supplements or modifications thereto). No default in payment or any other
material default exists with respect to or under any such Indebtedness or any
instrument or agreement relating thereto.
4.19 Disaster. Neither the business nor the properties of either Company
is currently affected (or has been affected at any time since December 28, 1999)
by any fire, explosion, accident, strike, lockout or other dispute, drought,
storm, hail, earthquake, embargo, act of God or of the public enemy or other
casualty (whether or not covered by insurance), which could reasonably be
expected to have a Material Adverse Effect.
4.20 Impact of the Sprint Agreements. All rights and obligations of UHC
under the Sprint Agreements have been assigned to Ubiquitel and such agreements
are in full force and effect. The performance by the Companies of their
respective obligations under the Sprint Agreements could not reasonably be
expected to have a materially adversely affect on the assets, properties,
business, affairs, results of operations, condition (financial or otherwise) or
prospects of the Companies on a consolidated basis.
4.21 Offering of Notes and Warrants. Neither Company nor any agent or
other Person acting on its behalf has, directly or indirectly, (i) offered any
of the Notes, Warrants or any similar security of either Company (A) by any form
of general solicitation or general advertising (within the meaning of Regulation
D under the Securities Act) or (B) for sale to or solicited offers to buy any
thereof from, or otherwise approached or negotiated with respect thereto with,
any Person other than the Purchaser and certain institutional investors each of
which either Company reasonably believed was an "accredited investor" within the
meaning of Regulation D under the Securities Act or (ii) done or caused to be
done (or has omitted to do or to cause to be done) any act which act (or which
omission) would result in bringing the issuance or sale of the Notes, Warrants
or Shares within the provisions of Section 5 of the Securities Act.
SECTION 5. REPRESENTATIONS AND COVENANTS OF THE PURCHASER
(a) The Purchaser hereby makes the representations and warranties to
the Companies contained in this Section 5, as of the date hereof and as of the
Closing Date hereunder. The Purchaser has all requisite power, authority and
legal right to execute, deliver, enter into, consummate and perform this
Purchase Agreement. The execution, delivery and performance of this Purchase
Agreement by the Purchaser have been duly authorized by all required partnership
actions. The Purchaser has duly executed and delivered this Purchase Agreement,
and this Purchase Agreement constitutes the legal, valid and binding obligation
of the Purchaser, enforceable against the Purchaser in accordance with its
terms, subject to bankruptcy, insolvency, reorganization, moratorium and other
similar laws relating to the rights of creditors generally.
(b) The Purchaser hereby represents to the Companies (as of the date
hereof and as of the Closing Date hereunder) that the Purchaser is capable of
evaluating the risk of its investment in the Notes, the Warrants and the Shares
being purchased by it and is able to bear the economic risk of such investment,
that it is purchasing the Notes, the Warrants and the
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Shares to be purchased by it for its own account, that it understands that the
Notes, the Warrants and the Shares are "restricted securities" as such term is
used in the Securities Act and therefore cannot be resold unless they are
registered under the Securities Act or an exemption from registration is
available, and that the Notes and Warrants are being purchased by the Purchaser
for investment and not with a present view to any distribution thereof in
violation of applicable securities laws. It is understood that the disposition
of the Purchaser's property shall at all times be within the Purchaser's
control. If the Purchaser should in the future decide to dispose of any of its
Notes, Warrants or Shares, it is understood that it may do so but only in
Authorized Denominations (in the case of the Notes) and in compliance with the
Securities Act, applicable securities laws and this Purchase Agreement. The
Purchaser hereby represents to the Companies that the Purchaser is an
"accredited investor" as defined in Rule 501(a) under the Securities Act.
SECTION 6. PREPAYMENTS AND REPAYMENTS
6.1 Mandatory Prepayments. In the event of any sale, lease or other
transfer of assets (an "Asset Disposition") by either of the Companies or any
Subsidiary (other than Indebtedness permitted to be incurred, the sale of
inventory in the ordinary course of business and other asset sales permitted to
be made pursuant to the Senior Credit Facility (as in effect on the date hereof)
and not giving rise to a required prepayment or reduction in commitment
thereunder) or the incurrence of any Indebtedness (other than pursuant to the
Senior Credit Facility (as in effect on the date hereof) and not giving rise to
a required prepayment or reduction in commitment thereunder) or completion of
any equity financing by either of the Companies or any Subsidiary thereof
Ubiquitel shall prepay the Notes then outstanding, after repayment of the Senior
Credit Facility (or after receipt of any required consents or waivers from the
lenders under the Senior Credit Facility) in the following amounts:
(a) 100% of the cash proceeds (net of other reasonable costs
associated with such transaction) of such Asset Disposition;
(b) l00% of the cash proceeds (net of underwriting discounts and
commissions and all other reasonable costs associated with such transaction) of
any such Indebtedness; and
(c) 100% of the cash proceeds (net of underwriting discounts and
commissions and all other reasonable costs associated with such transaction) of
such equity financing.
Upon any prepayment of the principal amount of any Notes under this
Section 6.1, Ubiquitel shall also pay the holder or holders of any such Notes
any accrued and unpaid interest to the date of prepayment (or repayment). If, on
any such prepayment date, the aggregate principal amount of the Notes
outstanding is less than the amount required to be prepaid on such date,
Ubiquitel shall prepay all Notes in full. The aggregate principal amount of each
prepayment of Notes pursuant to this Section 6.1 shall be allocated among all
Notes at the time outstanding, in proportion, as nearly as practicable, to the
respective unpaid principal amounts of such Notes. Ubiquitel's obligation to
prepay the Notes under this Section 6.1 in the amounts required by this Section
6.1 shall be fixed until there is no longer any remaining aggregate principal
amount of outstanding Notes, and Ubiquitel shall not receive any credit or
offset with respect to such obligation as a result of any prepayment under
Section 6.2, hereof. Ubiquitel shall give the
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holders of Notes written notice of each scheduled prepayment under this Section
6.1(a) at least thirty (30) and not more than sixty (60) days prior to the
scheduled prepayment date for such prepayment. Notwithstanding the foregoing, no
such prepayments shall be required under this Section 6.1 if (i) the Senior
Credit Facility does not require the proceeds from such asset sale, lease or
transfer, such incurrence of Indebtedness or from such equity financing to be
applied to repay amounts owing under the Senior Credit Facility (ii) not less
than $10,000,000 of Indebtedness is outstanding under the Senior Credit Facility
and (iii) Paribas is not at such time a lender to UHC or any Subsidiary of UHC
(other than Ubiquitel and its Subsidiaries at such time).
6.2 Optional Prepayments.
(a) Subject to the other provisions of this Section 6.2, (i) at any
time within the first 12 months following the Closing date, if either Company
completes a private or public offering of debt and/or equity in an amount of not
less than one hundred million dollars at any time on or after the Closing Date,
Ubiquitel may prepay all or part of the principal amount of outstanding Notes at
a price equal to (1) the aggregate principal amount of the Notes to be prepaid,
plus (2) all accrued and unpaid interest on the principal amount of the Notes to
be prepaid, plus (3) a premium equal to one percent (1%) of the principal amount
of the Notes to be prepaid, and (ii) at any time on or after the Closing Date,
Ubiquitel may prepay all or part of the principal amount of outstanding Notes at
a price equal to (1) the aggregate principal amount of the Notes to be prepaid,
plus (2) all accrued and unpaid interest on the principal amount of the Notes to
be prepaid, plus (3) a premium (the "Prepayment Premium") equal to the following
applicable percentage of the principal amount being prepaid (based upon the
period in which the prepayment is made):
Period in which Prepayment is Made Percentage
---------------------------------- ----------
Closing Date through December 28, 2000 7%
December 28, 2000 through December 28, 2001 5%
December 28, 2001 through December 28, 2002 3%
December 28, 2002 through December 28, 2003 2%
December 28, 2003 through December 28, 2004 1%
On or after December 28, 2004 0%
(b) The right of Ubiquitel to prepay Notes pursuant to this Section
6.2 shall be conditioned upon its giving notice of prepayment, signed by its
sole member, to the holders of Notes not less than thirty (30) days and not more
than sixty (60) days prior to the date upon which the prepayment is to be made
specifying (i) the registered holder of each Note to be prepaid, (ii) the
aggregate principal amount being prepaid, (iii) the date of such prepayment,
(iv) the accrued and unpaid interest (to but not including the date upon which
the prepayment is to be made) and (v) the calculation of the Prepayment Premium
with respect to such prepayment; provided, however, in order for such notice to
be effective and to be deemed given, it must include a statement from Ubiquitel
that either no consents from any holders of any Senior Indebtedness are
necessary for any such prepayment or all necessary consents have been obtained
and without such statement such notice shall not be effective and shall not be
deemed to
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be given and Ubiquitel may not prepay the Notes in accordance with such notice
under this Section 6,2, and neither any such statement nor this proviso shall,
in and of itself, impose any obligation or liability on any holder of Notes
relative to any holder of Senior Indebtedness. Notice of prepayment under this
Section 6.2 having been so given, the aggregate principal amount of the Notes so
specified in such notice, all accrued and unpaid interest thereon and the
Prepayment Premium on such aggregate principal amount, shall all become due and
payable on the specified prepayment date.
(c) If any prepayment under Section 6.1 or this Section 6.2 does not
repay in full the aggregate principal amount of all Notes then outstanding, then
the aggregate amount of such prepayment of the principal amount of Notes shall
be allocated among all Notes at the time outstanding in proportion, as nearly as
practicable, to the respective unpaid principal amounts of such Notes.
6.3 Mandatory Repayment Upon Change of Control Event. In the event of the
occurrence of a Change of Control Event, Ubiquitel shall notify the holders of
the Notes as soon as practicable and in any event within five (5) Business Days
thereafter, and the holders of the Notes shall thereafter for a period of sixty
(60) days have the right to demand repayment of all or part of the Notes by
Ubiquitel at a price equal to the principal amount thereof plus accrued interest
to date of payment. Payment by Ubiquitel shall occur not later than ten (10)
days after receipt of notice demanding repayment. Prior to delivering the
notification referred to in the preceding sentence, but in any event within 30
days following any Change of Control Event, Ubiquitel shall (i) repay in full
and terminate all commitments under Indebtedness under the Senior Credit
Facility, and all other Senior Indebtedness the terms of which require repayment
upon a Put Triggering Event, or offer to repay in full and terminate all
commitments under the Senior Credit Facility and all other such Senior
Indebtedness and to repay the Indebtedness owed to each lender which has
accepted such offer, or (iii) obtain the requisite consents under the Senior
Credit Facility and all other Senior Indebtedness to permit the purchase of the
Notes as provided above.
6.4 Miscellaneous.
(a) Nothing in this Section 6 shall in any way limit or affect the
rights or remedies of a holder of Notes, or the covenants and obligations of the
Companies, whether under Section 7, 8 or 13 or any other provision of this
Agreement.
(b) If any prepayment (or repayment) date under this Section 6 is
not a Business Day, such prepayment (or repayment) shall be made on the next
succeeding Business Day.
(c) Neither Company nor any Subsidiary shall repurchase any
outstanding Notes unless either of the Companies either (i) offers to purchase
all then outstanding Notes or (ii) offers to purchase Notes from the holders in
proportion to the respective unpaid principal amount of Notes held by each
holder. In any such repurchase by a Company, if all Notes are not being
repurchased, then the amount of Notes to be repurchased shall be allocated among
all Notes held by holders which accept such Company's repurchase offer so that
the Notes are
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repurchased from such holders in proportion to the respective unpaid principal
amount of Notes held by each such holder which accepts such Company's offer (or
in such other proportion as agreed by all such holders who accept such Company's
offer). Nothing in this Section 6.4(c) shall (i) obligate a holder of Notes to
accept a Company's repurchase offer or (ii) prevent such Company from prepaying
Notes in accordance with the terms of (and this Section 6.4(c) shall not apply
to) Section 6.1 or Section 6.2 of this Purchase Agreement.
SECTION 7. AFFIRMATIVE COVENANTS
The Company covenants and agrees as follows:
7.1 Use of Proceeds. The Companies will use the net proceeds realized from
the sale of the Notes and the Warrants (i) to fund the operating expenses of the
Companies in connection with the construction and operation of a PCS System in
the Reno/Tahoe market under an affiliation agreement among Sprint Spectrum L.P.,
Wireless Co., L.P. and the Companies and related agreements with Sprint and (ii)
for general corporate purposes including closing costs and fees. No portion of
such proceeds will be used for the purpose, whether immediate, incidental or
ultimate, of buying or carrying, within the meaning of Regulation U of the Board
of Governors of the Federal Reserve System, as amended from time to time, any
"margin stock" as defined in said Regulation U, as amended from time to time, or
for the purpose of purchasing, carrying or trading in securities within the
meaning of Regulation U of the Board of Governors of the Federal Reserve System,
as amended from time to time, or for the purpose of reducing or retiring any
indebtedness which both (i) was originally incurred to purchase any such margin
stock or other securities and (ii) was directly or indirectly secured by such
margin stock or other securities. None of the assets of the Companies includes
any such "margin stock," and neither Company has any present intention of
acquiring any such "margin stock."
7.2 Financial Information.
(a) The Companies will maintain, and cause each Subsidiary to
maintain, a system of accounting established and administered in accordance with
sound business practices to permit preparation of financial statements in
accordance with generally accepted accounting principles consistently applied.
(b) The Companies will deliver the following to each holder of a
Note, Warrant or Shares:
(i) within ninety (90) days after the close of each fiscal
year of UHC, (x) a Consolidated balance sheet of each Company and the
Subsidiaries as of the end of such fiscal year, (y) Consolidated
statements of income and expenses and Consolidated statements of changes
in shareholders' equity and cash flows for each Company and the
Subsidiaries for such fiscal year (all in reasonable detail) and
comparative figures for the immediately preceding fiscal year, all such
balance sheets and statements to be in reasonable detail and certified
(without qualification as to the scope or manner of the audit) by
independent public accountants of recognized national standing selected by
UHC and (z) in reasonable detail, management's discussion and analysis of
the results of
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operations and the financial condition of each Company and the
Subsidiaries as of the end of the year covered by the financial
statements;
(A) within forty-five (45) days after the close of each of the
first three (3) fiscal quarters of UHC, (x) the internally prepared
Consolidated balance sheet of each Company and the Subsidiaries as
of the end of such fiscal quarter, (y) Consolidated statements of
income of changes in shareholders' equity and of cash flows of each
Company and the Subsidiaries for such fiscal quarter and for the
portion of the fiscal year then ended (all in reasonable detail) and
comparative figures for the same period in the preceding fiscal year
and (z) in reasonable detail, management's discussion and analysis
of the results of operations and the financial condition of each
Company and the Subsidiaries as of the end of the period covered by
the financial statements;
(ii) as soon as practicable, copies of any annual, special or
interim audit reports or management or comment letters with respect to the
Company or its Subsidiaries or their operations submitted to the Company
by independent public accountants;
(iii) soon as practicable, copies (x) of all financial
statements, proxy material or reports sent to the Company's or any
Subsidiary's stockholders, (y) of any public or press releases and (z) of
all reports or registration statements filed with the Commission pursuant
to the Securities Act or the Securities Exchange Act;
(iv) as soon as practicable and without duplication of any of
the above items, any other materials furnished to holders of Senior
Indebtedness (including without limitation any compliance certificates
furnished in respect of such Senior Indebtedness); and
(v) as soon as practicable, such other information, as may
reasonably be requested by a holder of Notes, regarding the assets,
properties, liabilities, business, affairs, results of operations or
condition (financial or otherwise) of the Company or any Subsidiary.
All such financial statements shall be prepared in accordance with generally
accepted accounting principles consistently applied (except for any change in
accounting principles specified in the accompanying certificate and except that
any interim financial statements may omit notes and may be subject to normal
year-end adjustments).
(c) Without limiting any other provisions of this Section 7.2, the
Companies agree that, if requested in writing by any holder of Notes, Warrants
or Shares, they will not deliver to such holder (until otherwise instructed by
such holder) (x) any non-public information or non-public materials regarding
the Companies or any Subsidiary (whether such information or materials is
described in this Section 8.2 or otherwise) and (y) any information (whether or
not included in clause (x)) which such holder specifies that it does not want to
receive.
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7.3 Compliance Certificates. All financial statements delivered pursuant
to Section 7.2(b)(i) or (ii) shall be accompanied by a certificate of the chief
financial officer or the chief executive officer of UHC stating that to the
knowledge of the signer no Event of Default or Potential Default exists, or, if
any such Event of Default or Potential Default shall exist, the nature and
period of existence thereof. Each certificate of the chief financial officer or
the chief executive officer shall in addition state, if there exists an Event of
Default or a Potential Default, what the Companies propose to do with respect
thereto. Each certificate of the chief financial officer or the chief executive
officer accompanying financial statements delivered pursuant to this Section 7.3
shall in addition set forth in reasonable detail the computations necessary to
establish compliance with Sections 8.1, 8.3 and 8.5 hereof.
7.4 Inspection. At the request of the Majority Noteholders (not more than
once in any calendar year unless a Potential Default or Event of Default
exists), the Companies will permit such holder (or holders) and any authorized
representative of such holder (or holders) to visit and inspect any of the
properties of each Company and any Subsidiaries, to examine their respective
books and records and to discuss with their officers their books and records and
the assets, properties, liabilities, business, affairs, results of operations or
condition (financial or otherwise) of the Companies or any Subsidiary, all at
such reasonable times and as often as may be reasonably requested.
7.5 Maintenance of Existence; Properties and Franchises; Compliance with
Law; Taxes; Insurance. The Companies will, and will cause each Subsidiary to:
(a) maintain their respective corporate or limited liability company
existence, rights and other franchises in full force and effect; provided that
the Companies may terminate the corporate or limited liability company existence
of any of their respective Subsidiaries (provided that UHC may not terminate the
limited liability company existence of Ubiquitel), or permit the termination or
abandonment of rights or other franchises, if in the opinion of such Company it
is no longer in the Company's best interests to maintain such existence, rights
or other franchises and such termination or abandonment will not be prejudicial
in any material respect to the holders of the Notes;
(b) maintain their respective tangible assets in good repair,
working order and condition so far as reasonably necessary or advantageous to
the proper carrying on of their respective businesses;
(c) comply in all material respects with all applicable laws and
with all applicable orders, rules, rulings, certificates, licenses, regulations,
demands, judgments, writs, injunctions and decrees, the noncompliance with which
could reasonably be expected to have a Material Adverse Effect;
(d) pay promptly when due all taxes, fees, assessments and other
governmental charges imposed upon their respective properties, assets or income
and all claims or indebtedness (including, without limitation, materialmen's,
vendor's, workmen's and like claims) which might become a Lien upon such
properties or assets; provided that payment of any such tax, fee, assessment,
charge, claim or indebtedness shall not he necessary so long as it is
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being contested on good faith by appropriate proceedings and failure to make
such payment will not have a material adverse effect on the assets, properties,
liabilities, business, affairs, results of operations, condition (financial or
otherwise) or prospects of the Company on a consolidated basis; and
(e) keep insured, by financially sound and reputable insurers, all
their respective properties of a character customarily insured by entities
similarly situated, against loss or damage of the kinds and in amounts
customarily insured against by such entities and with such deductibles or
coinsurance as is customary.
7.6 Office for Payment, Exchange and Registration. So long as any of the
Notes is outstanding, Ubiquitel will maintain an office or agency where Notes
may be presented for payment, exchange, conversion or registration of transfer
as provided in this Agreement. Such office or agency initially shall be the
office of Ubiquitel set forth in Section 19 hereof, which place may from time to
time be changed by notice to the holders of all Notes then outstanding.
7.7 Notices. The Company will give notice to all holders of Notes promptly
after an executive officer, the treasurer or chief accounting officer of the
Company learns (other than by notice from all of such holders) of the existence
of any of the following:
(a) any Event of Default or any Potential Default;
(b) any default under any other Indebtedness (or under any
indenture, mortgage or other agreement relating to any Indebtedness) in excess
of $100,000 in respect of which either Company or any Subsidiary is liable;
(c) any action or proceeding which has been commenced or threatened
against either Company or any of its Subsidiaries and which, if adversely
determined, could reasonably be expected to have, individually or in the
aggregate, a material adverse effect on the assets, properties, liabilities,
business, affairs, results of operations or condition (financial or otherwise)
of either Company on a consolidated basis or the ability of either Company to
perform its obligations under the Purchase Agreement or the Notes;
(d) any dispute which may exist between either Company or any of the
Subsidiaries and any governmental regulatory body which could reasonably be
expected to, individually or in the aggregate, materially adversely affect the
normal business operations of either Company or any of the Subsidiaries or the
assets, properties, liabilities, business, affairs, results of operations or
condition (financial or otherwise) of the Company on a consolidated basis or the
ability of either Company to perform its obligations under the Purchase
Agreement or the Notes; and
(e) any (i) "reportable event" (as such term is defined in Section
4043(b) of ERISA), (ii) "complete withdrawal" or "partial withdrawal" (within
the meaning of Sections 4203 and 4205 of ERISA) from a multi-employer plan (as
defined in Section 3(37) of ERISA) or (iii) "prohibited transaction" (as such
term is defined in Section 406 of ERISA and Section 4975 of the Internal Revenue
Code of 1986, as amended) in connection with any employee benefit
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pension plan (as defined in Section 3(2) of ERISA), maintained or contributed to
(or required to be maintained or contributed to) by either Company, any
Subsidiary of either Company or any other Person treated with either Company as
a single employer pursuant to Section 414(b), (c), (m) or (o) of the Code
(including, without limitation, any multi-employer plan), or any trust created
thereunder, which in the case of clause (i), (ii) or (iii) may, either
individually or in the aggregate, result in a liability which would materially
adversely affect the assets, properties, liabilities, business, affairs, results
of operations, condition (financial or otherwise) or prospects of either Company
on a consolidated basis or the ability of either Company to perform its
obligations under the Purchase Agreement or the Notes.
Such notice (i) with respect to (a) or (b), shall specify the nature and period
of existence of any such Potential Default, Event of Default or other default
and what either Company proposes to do with respect thereto and (ii) with
respect to (c), (d) or (e), shall specify the nature of any such matter referred
to in such clause, what action either Company or any Subsidiary proposes to take
with respect thereto and what action any other relevant Person is taking or
proposes to take with respect thereto.
7.8 Payment of Dividends by Subsidiaries. Except as restricted by
applicable law or contract, each Company will cause its Subsidiaries to pay
dividends or make other distributions or advances to such Company, to the extent
of funds legally available therefor and to the extent permitted by the Senior
Credit Facility, in sufficient amounts and at sufficient times to enable such
Company to have sufficient earnings and funds to pay on a timely basis all
amounts due with respect to Senior Indebtedness and the Notes and any other
amounts due under this Agreement.
7.9 Board Observation Rights. The holders of the Notes shall receive prior
notice of any meetings of the Board of Directors called by UHC and of any
actions to be taken by the Board by written consent without a meeting of the
Board. The holders of the Notes shall, subject to the execution of
Confidentiality Agreements with the Company in form and substance reasonably
satisfactory to such holders and the Company, have the right to review the
records of all meetings and actions of the Board of Directors of the UHC.
7.10 Environmental Matters.
(a) The Companies and each Subsidiary shall keep any property either
owned or occupied by the Companies or any Subsidiary free and clear of any Liens
imposed for failure to comply with any environmental laws, regulations or
ordinances (each, an "Environmental Lien"), to the extent any such Environmental
Lien could reasonably be expected to have a material adverse effect on the
performance, business, assets, nature of assets, liabilities, operations,
properties, condition (financial or otherwise) or prospects of either of the
Companies or any Subsidiary and the Companies and each Subsidiary, as the case
may be, shall keep all such property in material compliance with all
environmental laws, regulations and ordinances; provided, however, the Companies
or any Subsidiary shall have the right at its cost and expense, and acting in
good faith, to contest, object or appeal by appropriate legal proceeding the
validity of any Environmental Lien.
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(b) Each of the Companies will defend, indemnify and hold harmless
each current, former and future holder of Notes, its employees, officers,
directors, stockholders, partners, agents, representatives and assigns, from and
against any liabilities, obligations, losses, damages, penalties, actions,
judgments, suits and claims, joint or several, and any costs, disbursements and
expenses (including reasonable attorneys' fees and expenses and reasonable costs
of investigation) of whatever kind or nature, known or unknown, contingent or
otherwise, arising out of or in any way related to (i) the presence, disposal,
release, removal, discharge, storage or transportation of any Hazardous Material
upon, into, from or affecting any real property (including improvements) owned
or occupied (or formerly owned or occupied) by either Company or any Subsidiary;
and (ii) any judicial or administrative action, suit or proceeding, actual or
threatened, relating to Hazardous Material upon, in, from or affecting any real
property (including improvements) owned or occupied (or formerly owned or
occupied) by either Company or any Subsidiary; and (iii) any violation of any
environmental law, regulation or ordinance by either Company or any Subsidiary
or any of their agents, tenants, subtenants or invitees; and (iv) the imposition
of any Environmental Lien for the recovery of costs expended in the
investigation, study or remediation of any environmental liability of(or
asserted against) either Company or any Subsidiary. This Section 7.11(b) and
Section 7.11(c) below shall survive any payment, conversion or transfer of Notes
and any termination of this Agreement.
(c) To the extent that either Company or any Subsidiary is strictly
liable without regard to fault under any environmental law, regulation or
ordinance, such Company's obligation to the holders of Notes under any of the
indemnification provisions of this Purchase Agreement shall likewise be strict
without regard to fault with respect to the violation of any environmental law,
regulation or ordinance which results in any liability to any of the indemnified
persons referred to in Section 7.11(b) above.
7.11 Reservation of Shares. UHC shall at all times keep reserved, free
from preemptive rights, out of its authorized Common Stock a number of shares of
Common Stock sufficient to provide for the exercise of the exercise rights
provided in the Warrants.
7.12 Listing of Shares. If any shares of the UHC's Voting Common Stock are
listed on any national securities exchange, then UHC will take such action as
may be necessary, from time to time, to obtain approval for the listing of all
outstanding Shares on such exchange.
7.13 Delivery of Information for Rule 144A Transactions. If a holder of
Notes, Warrants or Shares proposes to transfer any such Notes, Warrants or
Shares pursuant to Rule 144A under the Securities Act (as in effect from time to
time), the Companies agree to provide (upon the request of such holder or the
prospective transferee) to such holder and (if requested) to the prospective
transferee any financial or other information concerning each Company and the
Subsidiaries which is required to be delivered to any transferee of such Notes,
Warrants or Shares pursuant to such Rule 144A.
7.14 Senior Credit Facility. Not later than June 30, 2000, Ubiquitel shall
have satisfied the conditions precedent to borrowing under the Senior Credit
Facility as in effect on the date
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hereof, and the lenders party to the Senior Credit Facility shall have advanced
to Ubiquitel a Loan thereunder.
7.15 Evidence of Equity Funds. Within five (5) Business Days following
Closing, the Company shall provide to Purchaser evidence reasonably acceptable
to Purchaser that not less than $17,000,000 of proceeds from the sale of
Preferred Stock is held in unrestricted accounts solely within the control of
the UHC.
SECTION 8. NEGATIVE COVENANTS
The Companies further covenant and agree as follows:
8.1 Restricted Payments. Neither Company nor any Subsidiary will declare
or make or permit to be declared or made any Restricted Payment; provided,
however, that (a) UHC may repurchase shares of its Common Stock (or repurchase
options to purchase shares of its Common Stock) or pay (or repurchase) stock
appreciation rights granted by UHC, as long as each of the following three
conditions is satisfied: (i) such shares, options or stock appreciation rights
are outstanding under, and such repurchase or payment is made pursuant to, UHC's
incentive plans approved by its Board of Directors with the concurrence of a
majority of UHC's independent directors, (ii) when such repurchase or payment is
made there exists no Event of Default or Potential Default, both immediately
before and immediately after giving effect to such Investment and (iii) such
repurchase or payment is permitted under the terms of any Senior Indebtedness
(and under any agreement under which any Senior indebtedness is outstanding) and
(b) any Restricted Payment expressly permitted to be made pursuant to the terms
of the Senior Credit Facility, without reliance on any consent or waiver, shall
be permitted to be made.
8.2 Sale of Substantial Portion of Assets; Subsidiaries.
(a) Neither Company nor any Subsidiary will sell, transfer, lease or
otherwise dispose of any assets to any Person (other than to the Companies or to
a wholly-owned Subsidiary, and other than assets consisting of inventory being
disposed of in the ordinary course of business and other than assets which are,
contemporaneously with such disposition (or within one hundred eighty (180) days
thereafter), being replaced with other substantially similar (or improved)
assets which are used by the Companies or any Subsidiary for substantially the
same purpose as the assets being replaced) to the extent the aggregate assets so
sold, transferred, leased or disposed of during the twelve (12) month period
ending on such sale, transfer, lease or disposition (i) had an aggregate book
value of fifteen percent (15%) or more of the consolidated total assets of each
Company and the Subsidiaries at the end of the most recent fiscal quarter
preceding such sale, transfer, lease or disposition or (ii) accounted for
fifteen percent (15%) or more of the consolidated revenues of each Company and
the Subsidiaries as shown on the consolidated income statement of the Company
for the most recent fiscal quarter or the then preceding fiscal year;
(b) Neither Company nor any Subsidiary will sell, transfer or
otherwise dispose of any capital stock of any Subsidiary, except to the
Companies or to another Subsidiary; provided, however, that this Section 8.2(b)
shall not prevent the Companies or a Subsidiary from
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selling, transferring or otherwise disposing of the capital stock of a
Subsidiary if such sale, transfer or other disposition does not violate Section
8.2(a) hereof.
(c) The Companies will not create or permit the creation of any Lien
on any shares of the stock of any Subsidiary except Liens to secure Senior
Indebtedness.
(d) Notwithstanding the foregoing, nothing contained in this Section
8.2 shall restrict the sale of any assets permitted to be sold pursuant to the
Senior Credit Agreement, so long as the proceeds of such sale are applied in
accordance with the terms of Section 6.1 of this Purchase Agreement.
8.3 Permitted Indebtedness. Neither Company nor any Subsidiary will
create, incur or assume any Indebtedness other than:
(a) Indebtedness represented by or incurred under the Notes and the
Purchase Agreement and all Senior Indebtedness;
(b) Indebtedness incurred to prepay or repay in full the remaining
outstanding principal amount of Notes and all other amounts due thereon or under
the Purchase Agreement;
(c) Indebtedness existing on the Closing Date and identified on the
Disclosure Schedule;
(d) Indebtedness incurred solely as an extension, renewal,
refinancing or replacement of Indebtedness of the Companies under clause (c)
above (but excluding any Indebtedness under clause (c) above to the extent such
Indebtedness is repaid with the proceeds from the sale of the Notes and
Warrants), provided that any such extension, renewal or refinancing (A) shall be
on terms which on balance are substantially as favorable to the Companies as the
terms of such existing Indebtedness (other than changes in the amount of the
interest rate and other than the imposition of additional Liens permitted by
Section 8.9(h) hereof) and (B) shall not be in a greater principal amount or
have a shorter average life or earlier maturity than such existing Indebtedness;
(e) Interest Rate Protection Agreements required by the Senior
Credit Facility or incurred for hedging purposes in the ordinary course of
business;
(f) Capitalized Leases, to the extent the aggregate amount of
Capitalized Lease Obligations under all Capital Leases when aggregated with the
amount of Indebtedness permitted by Section 8.3(g) (I) incurred during any one
year shall not exceed $200,000 and (II) outstanding at any one time shall not
exceed $1,250,000;
(g) Indebtedness incurred to pay all or a portion of the purchase
price of equipment or machinery used in the ordinary course of business of the
Company or any of its Subsidiaries or any Indebtedness incurred to refinance
such Indebtedness, provided that the aggregate principal amount of all
Indebtedness secured by Liens permitted by this clause (g),
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when aggregated with the amount of Indebtedness permitted by Section 8.3(f) does
not exceed at any one time outstanding the amounts permitted pursuant to 8.3(f);
and;
(h) Additional Indebtedness in an amount which does not exceed
$3,300,000 (which Indebtedness may or may not be incurred pursuant to the Senior
Credit Facility).
8.4 Certain Ratios.
(a) Capital Expenditures (i) UHC will not, and will not permit any
of its Subsidiaries to, make or commit to make any expenditure for fixed or
capital assets (including, without limitation, expenditures for maintenance and
repairs which should be capitalized in accordance with generally accepted
accounting principles and including Capitalized Lease Obligations (collectively,
"Capital Expenditures"), except that UHC and its Subsidiaries may make Capital
Expenditures so long as the aggregate amount thereof does not exceed during any
fiscal year, the amount set forth below opposite such date:
Fiscal Year Ended Amount
----------------- ------
December 31, 2000 $25,000,000
December 31, 2001 5,500,000
December 31, 2002 and thereafter 4,500,000
(ii) Notwithstanding anything to the contrary contained in
Section 8.4(a)(i), to the extent that Capital Expenditures incurred during
any period set forth in Section 8.4(a)(i) are less than the amount set
forth opposite such period above, 100% of such unused amount may be
carried forward to the immediately succeeding fiscal year and utilized to
make Capital Expenditures in excess of the amount permitted above in the
following fiscal year; provided, that, (x) amounts carried forward from
the immediately preceding fiscal year, if any, shall be utilized in full
during the next fiscal year to incur Capital Expenditures before the
relevant amount set forth opposite such next fiscal year shall be utilized
to incur Capital Expenditures during such fiscal year and (y) no amounts
once carried forward to the next fiscal year may be carried forward again
to any fiscal year thereafter.
(b) Fixed Charge Coverage Ratio. UHC will cause Ubiquitel not to
permit, and Ubiquitel will not permit, the Fixed Charge Coverage Ratio for any
fiscal quarter ending on a date set forth below, to be less than the ratio set
forth below opposite such date:
Fiscal Quarter Ended Ratio
-------------------- -----
June 30, 2003 0.825:1.00
September 30, 2003 and thereafter 0.9075:1.00
(c) Interest Coverage Ratio. UHC will cause the Borrower not to
permit, and the Borrower will not permit, the ratio of its Consolidated EBITDA
for any fiscal quarter ending
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on a date set forth below to its Consolidated Interest Expense for such fiscal
quarter, to be less than the ratio set forth opposite such date below:
Fiscal Quarter Ended Ratio
-------------------- -----
March 31, 2003 1.00:1.00
June 30, 2003 1.25:1.00
September 30, 2003 1.45:1.00
December 31, 2003 1.65:1.00
June 30, 2004 2.25:1.00
December 31, 2004 and thereafter 2.90:1.00
(d) Minimum Covered POPS. The percentage of the population of
potential Subscribers in geographic areas where Ubiquitel has completed the
construction of facilities necessary to permit Subscribers in such area to
utilize Ubiquitel's wireless services at the end of any fiscal quarter set forth
below (the "Covered Population") shall not be less than the percentage of the
population set forth opposite such date below:
Fiscal Quarter Ended Percentage
-------------------- ----------
September 30, 2000 42.0%
December 31, 2000 57.0%
March31, 2001 62.0%
December 31, 2001 67.0%
December 31, 2002 69.5%
March 31, 2003 69.5%
June 30, 2003 69.5%
September 30, 2003 and thereafter 72.0%
(e) Leverage Ratios. (A) Consolidated Indebtedness to Annualized
Consolidated EBITDA. UHC will cause Ubiquitel not to permit, and Ubiquitel will
not permit, the ratio of Consolidated Indebtedness as at the end of any fiscal
quarter ended on a date set forth below to Annualized Consolidated EBITDA for
any fiscal quarter ending on a date set forth below to be greater than the ratio
set forth opposite such date below:
Fiscal Quarter Ended Ratio
-------------------- -----
March 31, 2003 8.65:1.00
June 30, 2003 7.50:1.00
September30, 2003 6.35:1.00
December 31, 2003 and thereafter 5.75:1.00
(f) Minimum Subscribers. UHC will cause Ubiquitel not to permit, and
Ubiquitel will not permit, the number of its Subscribers at the end of any month
occurring during a fiscal quarter ended on a date set forth below to be less
than the number of Subscribers set forth opposite such date set forth below:
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Fiscal Quarter Ended Amount
--------------------
September 30, 2000 2,125
December 31, 2000 4,675
March 31,2001 6,800
June 30, 2001 9,350
September 30, 2001 11,390
December 31, 2001 13,770
March 31, 2002 15,895
June 30, 2002 18,530
September 30, 2002 20,740
December 31, 2002 22,865
March 31, 2003 25,330
June 30, 2003 27,880
September 30, 2003 30,345
December 31, 2003 and thereafter 32,810
8.5 No Change in Business. Neither Company nor any of the Subsidiaries
will change substantially the character of its business as conducted on the
Closing Date as represented in Section 4.4 hereof except for reasonable
extensions thereof.
8.6 Consolidation or Merger. Neither Company will consolidate with or
merge with or into any other Person, unless, with respect to UHC only:
(a) at the time of effectiveness of the transaction no Event of
Default or Potential Default has occurred and is continuing and immediately
after the effectiveness of the transaction no Event of Default or Potential
Default will exist;
(b) the surviving Person is a corporation organized under the laws
of a state of the United States; and
(c) if such surviving Person is a corporation other than the
consolidating or merging Company, all liabilities and obligations of UHC under
the Purchase Agreement, the Notes and the Warrants shall remain in effect and
shall have been expressly assumed by such surviving Person (pursuant to a
document in form and substance reasonably satisfactory to the Purchaser and its
counsel) as if such surviving Person were "UHC" hereunder and thereunder.
If UHC is party to a merger as a result of which a Change of Control Event
occurs, the holders of Notes shall have the right to require such Company to
repay the Notes as provided in Section 6.3 hereof
8.7 HSR Act. When and if requested to do so by any holder of the Notes,
the Companies will (i) promptly furnish to such holder information as may be
requested to allow such holder to comply with the HSR Act and (ii) make any
filing that may be required of the Company under the HSR Act.
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8.8 Transactions with Affiliates. Except with respect to agreements
disclosed on the Disclosure Schedules, the Companies will not, and will not
permit any Subsidiary to, directly or indirectly, enter into any transaction or
agreement (including, without limitation, the purchase, sale, distribution,
lease or exchange of any property or the rendering of any service) with any
Affiliate of either Company or of any Subsidiary, other than a wholly-owned
Subsidiary of either Company, unless such transaction, agreement or general
arrangement (a) is approved by the Board with the concurrence of a majority of
the independent directors and (b) is on terms that are no less favorable to the
Companies or such Subsidiary, as the case may be, than those which might be
obtained at the time of such transaction from a Person who is not such an
Affiliate provided, however, that this Section 8.9 shall not limit, or be
applicable to, (i) employment arrangements with (and general salary and benefit
compensation for) any individual who is an employee of either Company or any
Subsidiary if such arrangements are approved by the Board, (ii) the payment of
reasonable and customary regular fees to directors of the Companies who are not
employees of the Companies, (iii) the Companies' existing Agreements with
Spectrasite LLC and the Walter Group and (iv) other transactions permitted
pursuant to the Senior Credit Facility (as in effect on the date hereof).
8.9 Liens, Etc. The Company will not create or suffer to exist, or permit
any of its Subsidiaries to create or suffer to exist, any Lien upon or with
respect to any of its assets, properties or income, other than the following:
(a) Liens securing amounts payable under Senior Indebtedness;
(b) purchase money liens or purchase money security interests upon
or in any property acquired or held by the Companies or any Subsidiary in the
ordinary course of business to secure the purchase price of such property or to
secure Indebtedness incurred and used solely for the purpose of financing the
acquisition of such property, provided that the principal amount of Indebtedness
secured by each such lien or interest in each item of property shall not exceed
the cost of the item subject thereto and that any such lien or interest shall
not apply to any other property, assets or income of the Company or any
Subsidiary;
(c) Liens on property of the Companies subject to, and securing only
Capital Leases, provided that the aggregate amount of Capital Leases shall not
exceed the amount permitted pursuant to Section 8.3(f).
(d) Liens existing on such property at the time of its acquisition
by the Company or a Subsidiary (other than any such Lien created in
contemplation of such acquisition) and provided further, that the aggregate
Indebtedness secured hereby shall not exceed the amount permitted pursuant to
Section 8.3(g);
(e) Liens on real property of the Company or a Subsidiary which
Liens are incurred to finance the acquisition of, or construction on, such real
property and which real property is part of the office, building or plant
facilities of the Company or its Subsidiaries, including surrounding real
property, provided that any such real property referred to in this clause (iii)
is acquired or developed in the ordinary course of the business of the Company
or its Subsidiaries and not for purposes of investment;
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(f) Liens existing on the date hereof and described on the
Disclosure Schedule;
(g) Liens securing Indebtedness permitted under Section 8.3(h);
(h) Liens incurred pursuant to the refinancing of obligations
secured by Liens permitted by clauses (b) through (g) above, provided that such
Liens shall secure new obligations not in excess of the outstanding principal
amount of such obligations being refinanced and that such Liens shall encumber
only such portions of the property, assets and income of the Companies or any
Subsidiaries as were previously encumbered by Liens securing such obligations
being refinanced (except that in the refinancing or renewal of Senior
Indebtedness from banks the Company or a Subsidiary may grant Liens on
additional property or assets); and
8.10 No Restrictions on Dividends. Neither Company nor any Subsidiary will
create (or permit to exist) any consensual restrictions (whether by agreement or
otherwise) that may affect or limit the ability of any Subsidiary to pay
dividends or to make other distributions of any or all of its assets to either
Company or to any Subsidiary except the Senior Credit Facility and other than
restrictions permitted pursuant to the Senior Credit Facility.
8.11 Private Placement Status. Neither Company nor any agent nor other
Person acting on such Company's behalf will do or cause to be done (or will omit
to do or to cause to be done) any act which act (or which omission) would result
in bringing the issuance or sale of the Notes or Shares within the provisions of
Section 5 of the Securities Act (other than in accordance with a registration
and qualification of Shares under Section 17 hereof).
8.12 No Dilution or Impairment; No Changes in Capital Stock. UHC (a) will
not permit the par value or the determined or stated value of any shares of
Common Stock receivable upon the exercise of the Warrants to exceed the amount
payable therefor upon such exercise, (b) will take all such action as may be
necessary or appropriate in order that UHC validly and legally issue fully paid
and nonassessable shares of its Common Stock free from all taxes, Liens and
charges with respect to the issue thereof, (c) will not take any action which
results in any adjustment of the exercise price under the Warrants if the total
number of shares of UHC's Common Stock (or other securities), issuable after the
action upon the exercise of all of the then outstanding Warrants would exceed
the total number of shares of Common Stock (or other securities) then authorized
by UHC's certificate of incorporation and available for the purpose of issuance
upon such exercise and (d) will not have any authorized Common Stock or
securities convertible into or exchangeable for Common Stock (and will not issue
any Common Stock or securities convertible into or exchangeable for Common
Stock) other than its existing authorized Common Stock, except that UHC may
increase the number of such authorized shares of its Common Stock as long as
such additional shares have the same terms as those shares authorized as of the
date hereof.
8.13 Limitation on Creation of Subsidiaries. UHC will not, and will not
permit any of its Subsidiaries to, establish, create or acquire any new
Subsidiary.
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SECTION 9. SUBORDINATION
9.1 Agreement to Be Bound. All Subordinated Indebtedness shall, to the
extent and in the manner hereinafter set forth, be subordinated and subject in
right of payment to the prior payment in full in cash of all Senior
Indebtedness. Each holder of Subordinated Indebtedness, whether upon original
issue or upon transfer or assignment thereof, by its acceptance thereof agrees
that the Subordinated Indebtedness shall be subject to the provisions contained
in this Section 9. The subordination provisions of this Section 9 shall be for
the benefit of the holders of the Senior Indebtedness, may be enforced directly
by such holders and may not be amended without the consent of such holders.
9.2 Priority of Senior Indebtedness.
(a) Upon the maturity of any Senior Indebtedness by lapse of time,
acceleration, required prepayment or otherwise, all Senior Indebtedness shall
first be paid in full in cash before any payment is made of any kind or
character, whether in cash, properties, securities or otherwise, (or any assets
are applied voluntarily or involuntarily) on account of Subordinated
Indebtedness.
(b) No payment on account of or otherwise in connection with the
Subordinated Indebtedness, shall be made, and no assets shall be applied to the
purchase or other acquisition or retirement of the Subordinated Indebtedness,
for so long as there exists a default or an event of default involving failure
to pay when due any Senior Indebtedness or for a period (the "Payment Blockage
Period") of up to one hundred eighty (180) days after both of the following have
occurred: (A) there exists and is continuing an event of default on any Senior
Indebtedness and (B) written notice of such event of default shall have been
given (by the Company or by holders of such Senior Indebtedness) to the holders
of Notes, stating that this Section 9.2(b) is therefore applicable; provided
that any Payment Blockage Period arising as a result of this Section 9.2 shall
terminate immediately upon the waiver or cure of such event of default or if
such Senior Indebtedness is no longer outstanding; provided, further, that in
any three hundred sixty (360) consecutive day period the aggregate number of
days in all Payment Blockage Periods shall not exceed one hundred eighty (180)
days; provided, further, that no event of default on Senior Indebtedness
resulting in a Payment Blockage Period may constitute the basis for a subsequent
Payment Blockage Period unless the event of default has been cured or waived for
a period of at least ninety (90) days (it being acknowledged that any subsequent
action or any breach of any financial covenants, commencing after the date of
commencement of such Payment Blockage Period, that in either case would give
rise to an event of default pursuant to any provisions under which an event of
default previously existed or was continuing would constitute a new event of
default for this purpose). As used in this paragraph, an "event of default" is
an event of default (x) as defined in any Senior Indebtedness or in the
instrument under which the same is outstanding and (y) which would permit the
acceleration of such Senior Indebtedness prior to its maturity. Any notice to be
given to holders of Notes under this Section 9.2(b) shall be deemed properly
given if given using the addresses for holders of Notes provided pursuant to
Section 20 hereof.
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(c) In the event that any money, property or securities is received
by the holder of a Note in violation of this Section 9.2 or Section 9.3 hereof,
the holder thereof shall hold the same in trust for the benefit of the holders
of Senior Indebtedness, and shall deliver the same in kind to the Company.
9.3 Liquidation; Dissolution; Bankruptcy.
(a) Upon any payment or distribution of assets of either Company
(whether in cash, property or securities) to creditors upon any dissolution or
winding-up or total or partial liquidation or reorganization of either Company,
whether voluntary or involuntary, or in any bankruptcy, insolvency, receivership
or similar proceeding regarding such Company, all amounts due or to become due
upon all Senior Indebtedness then outstanding shall first be paid in full in
cash before any Subordinated Indebtedness shall be entitled to receive any
assets so paid or distributed in respect thereof (but without restricting the
rights of holders under Section 6 hereof); provided that with respect to the
foregoing, the holders of Notes may receive (and shall be entitled to retain)
securities which are subordinate to (at least to the extent that the Notes are
subordinate to Senior Indebtedness pursuant to the terms hereof) the payment of
all Senior Indebtedness then outstanding and have a maturity no earlier than the
maturity of the Notes and have an interest rate no greater than that of the
Notes. Upon any such dissolution or winding-up or liquidation, reorganization or
other proceeding, any payment or distribution of assets of a Company of any kind
or character, whether in cash, property or securities, to which Subordinated
Indebtedness would be entitled, except for these provisions, shall be paid by
such Company or by any receiver, trustee in bankruptcy, liquidating trustee,
agent or other person making such payment or distribution directly to the
holders of Senior Indebtedness which was then outstanding (pro rata to each of
such holders on the basis of the respective amounts (to the extent known) of
Senior Indebtedness then held by such holders or their representatives), to the
extent necessary to pay all such Senior Indebtedness which was then outstanding
in full in cash, after giving effect to any concurrent payment or distribution
to or for the holders of Senior Indebtedness, before any payment or distribution
is made to the holders of the Notes (but subject to the proviso to the preceding
sentence).
(b) Each holder of Notes by its acceptance hereof (x) irrevocably
authorizes and empowers (but without imposing any obligation on) each holder of
any Senior Indebtedness at the time outstanding, under (and only under) the
circumstances set forth in Section 9.3(a), if the holder of Notes shall fail to
do so prior to twenty (20) days before the expiration of the time to do so, to
file and prove all claims of such holder for its ratable share of payments or
distributions in respect of the Notes which are required to be paid or delivered
to the holders of Senior Indebtedness as provided in Section 9.3(a), in the name
of each such holder of the Notes or otherwise, as such holder of Senior
Indebtedness may determine to be necessary or appropriate for the enforcement of
the provisions of Section 9.3(a), and the holder of Notes may amend any such
claims regarding the Notes before or after such twentieth (20th) day (but not in
a manner inconsistent with the rights of holders of Senior Indebtedness under
this Section 9 other than this Section 9.3(b)) whether such claims are filed by
such holder of Notes or are filed, pursuant to this Section 9.3(b), by any
holder of Senior Indebtedness; and (y) under (and only under) the circumstances
set forth in Section 9.3(a), agrees to execute and deliver to each holder of
Senior
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Indebtedness all such further instruments confirming the authorization
hereinabove set forth, and all such powers of attorney, proofs of claim,
assignments of claim and other instruments, and to take all such other action,
as may be reasonably requested by such holder in order to enable such holder to
enforce all claims upon or in respect of such Note holder's ratable share of
payments or distributions in respect of the Notes. Nothing in this Section
9.3(b), or any other provision hereof, shall give or be construed to give the
holder of any Senior Indebtedness any right to vote any Note, or any related
claim, or any portion of such Note or such claim, or to exercise any approval
rights, whether in connection with any resolution, arrangement, plan of
reorganization, compromise, settlement, election of trustees or otherwise.
Holders of Senior Indebtedness shall not create any liability to any person on
the part of any holders of Notes in connection with the exercise of any rights
granted under this Section 9.3(b).
9.4 No Prejudice or Impairment; Reinstatement.
(a) No right of any present or future holders of any Senior
Indebtedness to enforce subordination as herein provided shall at any time in
any way be prejudiced or impaired (i) by any act or failure to act on the part
of either Company, including without limitation any merger or consolidation of
either Company into or with any other Person, or any sale, lease or transfer of
any or all of the assets of either Company to any other Person, (ii) by any act
(in good faith) or failure (in good faith) to act by any such holder of Senior
Indebtedness, including, without limitation, the failure by such holder to
perfect a security interest in any security for the payment of Senior
Indebtedness or (iii) by any noncompliance by Ubiquitel with the terms and
provisions of any Note or this Purchase Agreement regardless of any knowledge
thereof which any such holder may have or be otherwise charged with. The holders
of the Senior Indebtedness may, without in any way affecting the subordination
hereunder, at any time or from time to time and in their absolute discretion,
change the manner, place, time or other terms of payment of, or renew or alter,
any Senior Indebtedness, or amend, modify or supplement any agreement or
instrument governing or evidencing such Senior Indebtedness or any other
document referred to therein, or exercise or refrain from exercising any of
their rights under the Senior Indebtedness, including, without limitation,
waiver of default thereunder and release of any collateral securing such Senior
Indebtedness, all without notice to or assent from the holders of the Notes. The
absence of any notice to, or knowledge by, any holder of Notes or the existence
or occurrence of any of the matters or events set forth in this paragraph (a)
shall not impair or otherwise affect the rights of the holders of Senior
Indebtedness against holders of Notes under the subordination provisions of this
Section 9.
(b) The provisions of this Section 9 shall continue to be effective,
or be reinstated, as the case may be, if at any time any payment in respect of
any Senior Indebtedness is rescinded or must otherwise be restored or returned
by the holders of such Senior Indebtedness.
9.5 Subrogation. Subject to the payment in full in cash of all Senior
Indebtedness, the holders of the Notes shall be subrogated to the rights of the
holders of Senior Indebtedness to receive payments or distributions of assets of
Ubiquitel made on the Senior Indebtedness until the principal of, premium, if
any, and interest on (and any other amounts due with respect to) the
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Notes and all other amounts due under this Agreement shall be paid in full;
provided that any holder of any Note shall have the right, in its sole
discretion, to waive such subrogation rights without affecting such holder's
rights with respect to any Note held by such holder or under this Agreement
(which rights shall continue in full force and effect). For the purposes of such
subrogation, no payments or distributions to the holders of Senior Indebtedness
of any cash, property or securities to which the holders of the Notes would be
entitled except for the provisions of this Section 9 shall, as among Ubiquitel,
its creditors other than the holders of Senior Indebtedness, and the holders of
Notes, be deemed to be a payment by Ubiquitel to or on account of Senior
Indebtedness, it being understood that these provisions in this Section 9 are,
and are intended, solely for the purpose of defining the relative rights of the
holders of the Notes, on the one hand, and the holders of Senior Indebtedness,
on the other hand.
9.6 Obligations Unaffected. Nothing contained in this Section 9 is
intended to or shall impair as among Ubiquitel, its creditors other than the
holders of Senior Indebtedness, and the holders of the Notes, the obligation of
Ubiquitel which shall be absolute and unconditional, to pay to the holders of
the Notes the principal of, premium, if any, and interest on the Notes, as and
when the same shall become due and payable in accordance with their terms, or to
affect the relative rights of the holders of the Notes and creditors of
Ubiquitel other than the holders of Senior Indebtedness. Nothing herein (other
than Section 9.8) shall prevent any holder of the Notes from exercising any
remedies otherwise permitted by applicable law upon the occurrence of an Event
of Default, subject to the rights, if any, under these provisions of the holders
of Senior Indebtedness.
9.7 Definition of Senior Indebtedness. The term "Senior Indebtedness"
shall mean the principal of, premium, if any, interest (including, without
limitation, all interest on the Senior Indebtedness accruing after the
commencement of any insolvency, liquidation or other proceeding of the type
referred to in Section 9.3 hereof and any additional interest that would have
accrued but for the commencement of such proceeding whether or not the claim for
such interest is allowed under applicable law) on, and all other obligations of
any type with respect to Indebtedness outstanding under the Senior Credit
Facility and obligations in respect of letters of credit. Interest Rate
Protection Agreements, indemnities, fees and expenses and all obligations under
any Interest Rate Protection Agreement (including guarantees thereof and other
Indebtedness of Ubiquitel incurred pursuant to Section 8.3(h)) in all such cases
whether outstanding on the date hereof or hereinafter incurred; the term "Senior
Indebtedness" shall not include the principal of loans or the amount of letter
of credit obligations under the Senior Credit Facility or any other agreement
evidencing Senior Indebtedness in excess of $28,300,000.
9.8 Effectiveness of Acceleration of Notes and Exercise of Remedies.
(a) Until the Senior Indebtedness under the Senior Credit Facility
shall have been paid in full in cash, any declaration that all or any portion of
the unpaid principal amount of the Notes shall be due and payable shall not be
effective and holders of Notes shall not initiate any action to seek or enforce
collection or enforcement of any Notes, including initiating or joining in the
filing of a petition seeking a bankruptcy proceeding of the Companies, until the
earliest of (i) any insolvency, bankruptcy, receivership, assignment for the
benefit of creditors,
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reorganization, arrangement with creditors or similar proceeding of or regarding
the Companies, or any dissolution, winding-up, liquidation or marshaling of the
assets and liabilities of the Company shall have been commenced by or against
the Companies, (ii) the acceleration of the maturity of any Senior Indebtedness
or any initiation of any judicial proceedings by the holders of any Senior
Indebtedness to collect such Senior Indebtedness, (iii) the expiration of one
hundred and eighty (180) days following occurrence of an Event of Default
hereunder (provided such Event of Default is continuing) or (iv) either (x) the
Companies or any Subsidiary commences a liquidation of assets or (y) holders of
such Senior Indebtedness seek to realize, or foreclose on, any security interest
in capital stock, membership interests or other assets of the Companies or any
Subsidiary securing such Senior Indebtedness.
(b) Except as provided in Section 9.8(a) hereof, nothing contained
in this Section 9 will limit the right of a holder of Notes to take any action
to accelerate the maturity of any Note or to pursue any rights or remedies under
any Note or the Purchase Agreement.
9.9 Turnover; Miscellaneous Subordination Provisions.
(a) If a payment or other distribution is made to any holder of
Subordinated Date that because of this Section 9 or other term or provision of
this Agreement should not have been made to it, such holder shall segregate such
payment or other distribution from its other funds and property and hold it in
trust for the benefit of, and upon written request, pay it over (in the same
form as received, with any necessary endorsement) to, the holders of Senior
Indebtedness as their interests may appear, or their agent or representative or
the trustee under the indenture or other agreements (if any) pursuant to which
Senior Indebtedness may have been issue, as their respective interests may
appear, for application (in the case of cash) to, or as collateral (in the case
of non-cash property or securities) for the payment or prepayment of, all
present and future obligations with respect to Senior Indebtedness remaining
unpaid to the extent necessary to pay such obligations in full in accordance
with their terms, after giving effect to concurrent payment or distribution to
or for the holders of Senior Indebtedness.
(b) A distribution may consist of cash, securities or other
property, by set off or otherwise, and payment or distribution on account of any
obligations with respect to the holders of Subordinated Indebtedness shall
include any redemption, purchase or other acquisition of the Subordinated
Indebtedness.
(c) For the purpose of this Section 9, all indebtedness now or
hereafter existing under the Senior Credit Facility shall not be deemed to have
been paid in full unless the holders or owners thereof shall have received
payment in full in cash or Cash Equivalents.
SECTION 10. CONDITIONS TO PURCHASER'S OBLIGATIONS
The Purchaser's obligation to purchase the Notes and Warrants hereunder is
subject to satisfaction of the following conditions at the Closing (any of which
may be waived by the Purchaser):
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10.1 Final Documentation of Senior Credit Facility. The Credit Agreement
for the Senior Credit Facility shall have been executed by the Companies and
Paribas and the Purchaser shall have received such Agreement in form and
substance satisfactory to it from the Companies and Paribas.
10.2 Accuracy of Representations and Warranties. The representations and
warranties of the Companies herein or in any certificate or document delivered
pursuant hereto shall be correct and complete on and as of the Closing Date with
the same effect as though made on and as of the Closing Date (after giving
effect to the transactions contemplated by this Purchase Agreement).
10.3 Compliance with Agreements; No Defaults. The Companies shall have
performed and complied in all material respects with all agreements, covenants
and conditions contained in this Purchase Agreement, the Notes and the Warrants
and any other document contemplated hereby or thereby which are required to be
performed or complied with by the Company on or before the Closing Date. On the
Closing Date (after giving effect to the transactions contemplated hereby),
there shall be no Event of Default or Potential Default.
10.4 Officer's Certificate. The Purchaser shall have received a
certificate dated the Closing Date and signed by the chief executive officer and
chief financial officer of the Company, to the effect that the conditions of
Sections 10.2, 10.3, and 10.9 have been satisfied.
10.5 Proceedings. All corporate and other proceedings in connection with
the transactions contemplated by the Purchase Agreement, the Notes and the
Warrants, and all documents incident thereto, shall be in form and substance
satisfactory to the Purchaser and its counsel, and the Purchaser shall have
received all such originals or certified or other copies of such documents as
the Purchaser or its counsel may reasonably request.
10.6 Opinion of Counsel. The Purchaser shall have received an opinion
dated the Closing Date and addressed to the Purchaser of Greenberg Traurig,
counsel for the Companies. Such opinion shall be in form and substance
satisfactory to the Purchaser and to the effect set forth in Exhibit D hereto.
10.7 Other Documents and Opinions. The Purchaser shall have received such
other documents and opinions, in form and substance satisfactory to the
Purchaser and its counsel, relating to matters incident to the transactions
contemplated hereby as the Purchaser may reasonably request.
10.8 Equity Contribution. UHC shall have received not less than
$17,000,000 from the sale of Preferred Stock, which funds shall no longer be
held in or subject to any escrow.
SECTION 11. AMENDMENT; WAIVER; CONSENT
(a) (i) This Purchase Agreement and the Notes may be amended (or any
provision hereof or thereof waived) only with the written consent of the
Majority Noteholders and (ii) the Warrants may only be amended (or any provision
thereof waived) only with the
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written consent of the holders of a majority thereof; provided, that no such
amendment or waiver shall (1) change the fixed maturity of any Note, reduce the
rate or change the time of payment of interest thereon, reduce the principal
amount thereof, reduce any premium thereon, change the currency in which
payments are to be made, change the prepayment provisions of Section 6 hereof,
change the provisions of Section 14 or 17 hereof or change the registration
rights under Section 16 hereof, without the consent of the holder of the Note so
affected, (2) reduce the aforesaid percentage of Notes, the holders of which are
required to consent to any such amendment or waiver, without the consent of the
holders of all the Notes then outstanding, (3) increase the percentage of the
amount of the Notes, the holders of which may declare the Notes to be due and
payable under Section 13 hereof, without the consent of the holders of all the
Notes then outstanding or (4) amend Section 9 hereof without the consent of the
holders of a majority of the Senior Indebtedness under the Senior Credit
Facility; and provided, further, that no amendment to the Warrant shall (x)
change the expiration date of any Warrant, change the exercise provisions of
Sections 4 and 6 thereof or change the registration rights under Section 16 or
17 hereof without the consent of the holder of the Warrant (or of Shares issued
upon exercise of the Warrants in the case of a change to Section 16 or 17
hereof) or (y) reduce the aforesaid percentage of Warrants the holders of which
are required to consent to any such amendment or waiver without the consent of
holders of such Warrants then outstanding.
(b) The Companies agree that all holders of Notes or Shares shall be
notified by the Companies in advance of any proposed amendment or waiver under
Section 11(a)(i), but failure to give such notice shall not in any way affect
the validity of any such amendment or waiver. In addition, promptly after
obtaining the written consent of the holders herein provided, the Companies
shall transmit a copy of any amendment or waiver which has been adopted to all
holders of Notes, Warrants or Shares then outstanding, but failure to transmit
copies shall not in any way affect the validity of any such amendment or waiver.
(c) The Companies and each holder of a Note, Warrant or Share then
or thereafter outstanding shall be bound by any amendment or waiver effected in
accordance with the provisions of this Section 11, whether or not any such Note
or Warrant shall have been marked to indicate such modification, but any Note or
Warrant issued thereafter shall bear a notation as to any such modification (but
the failure to bear any such notation shall not affect the validity of any such
subsequently issued Note or Warrant, which shall be enforceable in accordance
with its terms subject to any such modification).
(d) Any provision of this Agreement relating to the consent,
determination, decision or waiver of a holder or holders of Notes or Shares or
of the Majority Noteholders, as the case may be, means such holder's or Majority
Noteholders', as the case may be, consent, determination, decision or waiver, as
the case may be, in such holder's or Majority Noteholders', as the case may be,
sole discretion.
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SECTION 12. EXCHANGE OF NOTES; ACCRUED INTEREST; CANCELLATION OF SURRENDERED
NOTES; REPLACEMENT
(a) Subject to Section 15 hereof, at any time at the request of any
holder of one or more of the Notes to Ubiquitel at its offices provided under
Section 7.7 hereof, Ubiquitel at its expense (except for any transfer tax or any
other tax arising out of the exchange) will issue and deliver to or upon the
order of the holder in exchange therefor new Notes, in such denomination or
denominations as such holder may request (which must be in denominations of
$500,000 or any larger multiple of $100,000, plus one Note in a lesser
denomination, if required), in aggregate principal amount equal to the unpaid
principal amount of the Note or Notes surrendered and substantially in the form
thereof, dated as of the date to which interest has been paid on the Note or
Notes surrendered (or, if no interest has yet been so paid thereon, then dated
the date of the Note or Notes so surrendered) and payable to such person or
persons or order as may be designated by such holder. Any such new Note shall
bear any notation required by Section 11 hereof.
(b) In the event that any Note is surrendered to Ubiquitel upon a
prepayment under Section 6 hereof, Ubiquitel shall pay all accrued and unpaid
interest on such Note or such portion thereof and thereupon interest shall cease
to accrue upon that portion of the principal amount of such Note which was
prepaid, and the right to receive, and any right or obligation to make, any
prepayment on such portion of the principal amount pursuant to Section 6 hereof
shall terminate all upon the date of such prepayment and upon presentation and
surrender of such Note to the Company.
(c) Upon any prepayment under Section 6 hereof, if only a portion of
the principal amount of a Note is prepaid, then such Note shall be surrendered
to Ubiquitel and Ubiquitel shall simultaneously execute and deliver to or on the
order of the holder thereof, at the expense of Ubiquitel, a new Note or Notes in
principal amount equal to the unused or unpaid portion of such Note.
(d) All Notes or portions thereof which have been prepaid under
Section 6 hereof, shall be canceled by Ubiquitel and no Notes shall be issued in
lieu of the principal amount prepaid.
(e) Upon receipt of evidence satisfactory to Ubiquitel of the loss,
theft, destruction or mutilation of any Note and, in the case of any such loss,
theft or destruction, upon delivery of an indemnity agreement reasonably
satisfactory to Ubiquitel (if requested by Ubiquitel and unsecured in the case
of the Purchaser or an institutional holder), or in the case of any such
mutilation, upon surrender of such Note (which surrendered Note shall be
canceled by Ubiquitel), Ubiquitel will issue a new Note of like tenor in lieu of
such lost, stolen, destroyed or mutilated Note as if the lost, stolen, destroyed
or mutilated Note were then surrendered for exchange.
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SECTION 13. DEFAULTS
(a) Any of the following shall constitute an "Event of Default":
(i) Ubiquitel defaults in the payment (whether or not such
payment is prohibited under Section 9 hereof) of (A) any part of the
principal of or premium, if any, on any Note, when the same shall become
due and payable, whether at maturity or at a date fixed for prepayment or
by acceleration or otherwise, and such default in the payment of principal
or premium shall have continued for five (5) Business Days or (B) the
interest on any Note, when the same shall become due and payable, and such
default in the payment of interest shall have continued for ten (10)
Business Days; or
(ii) either Company defaults in the performance of any other
agreement or covenant contained in the Purchase Agreement or the Notes and
such default shall not have been remedied within thirty (30) days after
written notice thereof shall have been given to either Company by any
holder or holders of the Notes (such Company to give forthwith to all
other holders of the Notes at the time outstanding written notice of the
receipt of such notice, specifying the default referred to therein); or
(iii) any representation or warranty by either Company herein
or in any certificate delivered by either Company pursuant hereto proves
to have been incorrect in any material respect when made; or
(iv) the maturity of Indebtedness of either Company or any
Subsidiary in excess of $1,000,000 in the aggregate shall have been
accelerated as a result of an event of default under any indenture,
agreement or instrument evidencing such Indebtedness or under which there
is at the time outstanding such Indebtedness; or
(v) a final judgment or order which, either alone or together
with other final judgments or orders against either Company or any
Subsidiary, exceeds an aggregate of $1,000,000 (which is not covered by
insurance) is rendered by a court of competent jurisdiction against such
Company or any Subsidiary and such judgment or order shall have continued
undischarged or unstayed for sixty (60) days after entry thereof;
(vi) either Company or any Subsidiary shall make an assignment
for the benefit of creditors, or shall admit in writing its inability to
pay its debts; or a receiver or trustee is appointed for either Company or
any Subsidiary or for substantially all of its assets and, if appointed
without its consent, such appointment is not discharged or stayed within
sixty (60) days; or proceedings under any law relating to bankruptcy,
insolvency or the reorganization or relief of debtors are instituted by or
against either Company or any Subsidiary, and, if contested by it, are not
dismissed or stayed within sixty (60) days; or any writ of attachment or
execution or any similar process is issued or levied against either
Company or any Subsidiary or any significant part of its property and is
not released, stayed, bonded or vacated within sixty (60) days after its
issue or levy; or either
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Company or any Subsidiary takes corporate or limited liability company
action in furtherance of any of the foregoing; or
(vii) (a) any provision of the Sprint Agreements shall cease
to be in full force and effect or Sprint Corporation or any of its
Affiliates shall deny or disaffirm its obligations under any such
agreement and such cessation, denial or disaffirmance results in a
Material Adverse Effect, (b) Sprint PCS shall exercise its right to
purchase the Operating Assets under Section 11.6.1 of the Sprint
Management Agreement (c) Sprint PCS shall exercise its rights with respect
to the Disaggregated License under Section 11 .6.2 of the Sprint
Management Agreement, (d) an Event of Termination shall occur or any event
that if not cured or notice were to be given of such event would
constitute an Event of Termination under the Sprint Management Agreement
shall occur (whether or not waived) or (e) Sprint PCS shall amend or
modify any Program Requirements (as defined in the Sprint Management
Agreement), guidelines or policies set forth in the Sprint Agreements
which the Majority Noteholders determine could reasonably be expected to
have a material adverse effect on the performance, business, property,
assets, nature of assets, liabilities, condition or prospects of UHC and
its Subsidiaries; provided, however, that an Event of Default under this
clause (vii) shall be deemed not to occur if at such time an event of
default substantially comparable hereto shall be included in the Senior
Credit Facility and such event of default shall be waived thereunder.
(b) If an Event of Default occurs pursuant to any of clauses
(i) through (vii) of Section 13(a) hereof (but subject to the limitations
contained in Section 9.8), then and in each such event any holder or
holders of Notes which, at the time, holds or hold at least sixty percent
(60%) in aggregate principal amount of the Notes then outstanding may at
any time (unless all Events of Default shall theretofore have been waived
or remedied) at its or their option, by written notice or notices to the
Company, declare all the Notes then held by such holder or holders to be
due and payable. Upon any such declaration all Notes held by such holder
or holders shall forthwith immediately mature and become due and payable,
or upon the occurrence of an Event of Default pursuant to clause (vi) of
Section 13(a) hereof with respect to Ubiquitel (in which case no
declaration is required), all Notes shall forthwith immediately mature and
become due and payable; in each case (referred to in this sentence) the
payments then due and payable on such Notes shall consist of the entire
unpaid principal amount thereof, together with interest accrued thereon
and an amount equal to the "Additional Amount" (as defined below); all of
the foregoing shall occur without presentment, demand, protest or notice,
all of which are hereby waived. "Additional Amounts" shall mean, with
respect to any Note, as of the date of repayment of such Note after such
acceleration, an amount equal to (1) the Prepayment Premium that would be
payable if Ubiquitel had elected to prepay such Note pursuant to Section
6.3 hereof at the time of such acceleration; if an Event of Default
pursuant to clause (i) of Section 13(a) has occurred, and (2) 50% of such
Prepayment Premium, if an Event of Default pursuant to clause (i) of
Section 13(a) has not occurred. However, the foregoing acceleration rights
are subject to the following:
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(i) if, at any time after the principal of any Notes shall so
become due and payable and prior to the date of maturity stated in
the Notes, all arrears of principal (excluding any principal which
would not then be due and payable if the acceleration had not
occurred) and interest on the Notes (with interest at the rate
specified in the Notes on any overdue principal and any overdue
premium and, to the extent legally enforceable, on any overdue
interest) shall be paid to the holders of Notes by or for the
account of Ubiquitel, then the Majority Noteholders, by written
notice or notices to Ubiquitel, may waive such Event of Default and
its consequences and rescind or annul any such declaration, but no
such waiver shall extend to or affect any subsequent Event of
Default or impair any right or remedy resulting therefrom;
(ii) if any holder or holders of Notes which, at the time,
holds or hold at least sixty percent (60%) in aggregate principal
amount of the Notes then outstanding exercises the above rights of
acceleration, then Ubiquitel shall notify each other holder of Notes
of the fact of such acceleration and each other holder shall,
without limiting any other rights hereunder, (A) have the right for
thirty (30) days after such notice from Ubiquitel to accelerate its
own Notes based on the Event or Events of Default on which such
acceleration was based (regardless of whether such Event or Events
of Default are then continuing), unless at the time there are no
outstanding Events of Default and any acceleration of any Notes has
been rescinded or (B) be deemed automatically (without any action by
such holder) to have accelerated its Notes if such holder has not
received such notice of an acceleration from Ubiquitel within ten
(10) days after such acceleration; provided that any such automatic
acceleration may take place regardless of whether the Event or
Events of Default on which the initial acceleration was based are
then continuing but such automatic acceleration shall not take place
if at the time any and all accelerations of any Notes have been
rescinded or annulled pursuant to subparagraph (i) above or
otherwise;
(iii) any holder may at any time rescind and annul any
acceleration with respect to its own Notes; and
(iv) if any holder of a Note shall give any notice or take any
other action with respect to a claimed Potential Default or Event of
Default, Ubiquitel, forthwith upon receipt of such notice or
obtaining knowledge of such other action, will give written notice
thereof to all other holders of the Notes then outstanding,
describing such notice or other action and the nature of the claimed
Potential Default or Event of Default.
SECTION 14. REMEDIES
(a) In case any one or more Events of Default shall occur and be
continuing, then any holder or holders of Notes which, at the time, holds or
hold at least sixty percent (60%) in aggregate principal amount of the Notes
then outstanding may, subject to the limitations
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contained in Section 9.8, proceed to protect and enforce the rights of such
holder or holders by an action at law, suit in equity or other appropriate
proceeding, whether for the specific performance of any agreement contained
herein or in such Note or Notes for an injunction against a violation of any of
the terms hereof or thereof, or in aid of the exercise of any power granted
hereby or thereby or by law or for any other remedy (including, without
limitation, damages). Nothing herein limits the rights and remedies of holders
of Shares.
(b) In case of a default in the payment of any principal of,
premium, if any, or interest on any Note, or default in the observance of any
other agreement or covenant of Ubiquitel in a Purchase Agreement or in a Note,
Ubiquitel will pay to the holder thereof or party thereto, in addition to any
interest or premium otherwise required, such further amount as shall be
sufficient to cover any and all costs and expenses of enforcement and collection
including, without limitation, reasonable attorneys' fees and expenses (whether
or not any suit or action is instituted and including without limitation those
fees and expenses permitted by statutory law and/or incurred at trial, on
appeal, on petition for review, in arbitration or mediation or in a bankruptcy
proceeding).
(c) No course of dealing and no delay on the part of any holder of
any Note, Warrant or the Share or the Purchaser in exercising any rights or
remedies shall operate as a waiver thereof or otherwise prejudice such holder's
or party's rights. No right or remedy conferred hereby or by any Note shall be
exclusive of any other right or remedy referred to herein or therein or
available at law, in equity, by statute or otherwise.
(d) Subject to Section 9, the Purchaser shall, in addition to other
remedies provided by law, have the right and remedy to have the provisions of
this Agreement (including without limitation Section 16 hereof) specifically
enforced by any court having equity jurisdiction, it being acknowledged and
agreed that any breach or threatened breach of the provisions of this Agreement
(including without limitation Section 16 hereof) will cause irreparable injury
to the Purchaser and that money damages will not provide an adequate remedy
subject to Section 9. Nothing contained herein shall be construed as prohibiting
the Purchaser from pursuing any other remedies available to the Purchaser for
such breach or threatened breach, including, without limitation, the recovery of
damages from Ubiquitel.
SECTION 15. RESTRICTIONS ON TRANSFER
(a) Each holder of a Note or Warrant by acceptance thereof agrees
that it will not sell or otherwise dispose of any Notes, Warrants or Shares
unless (i) such Notes, Warrants or Shares have been registered under the
Securities Act and, to the extent required, under any applicable state
securities laws, or (ii) such Notes, Warrants or Shares are sold in accordance
with the applicable requirements and limitations of Rule 144 or Rule 144A and
any applicable state securities laws, or (iii) the Companies have been furnished
with an opinion or opinions from counsel to such holder (which counsel and
opinion(s) shall be reasonably satisfactory to the Companies and which counsel
may be inside counsel of such holder) to the effect that registration under the
Securities Act is not required for the transfer as proposed (which opinion may
be conditioned upon the transferee's assuming the obligations of a holder of
Notes,
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Warrants or Shares under this Section) or (iv) the Companies have been furnished
with a letter from the Division of Corporate Finance of the Commission to the
effect that such Division would not recommend any action to the Commission if
such proposed transfer were effected without a registration statement effective
under the Securities Act. The Companies agree that within five (5) Business Days
after receipt of any opinion referred to in (iii) above, they will notify the
holder supplying such opinion whether such opinion is satisfactory to the
Companies" counsel. Notes may be transferred only in Authorized Denominations.
(b) Ubiquitel may endorse on all Notes, and UHC may endorse on all
Warrants and Share certificates a legend stating or referring to the transfer
restrictions contained in paragraph (a) above; provided that no such legend
shall be endorsed on any Notes, Warrants or Share certificates which, when
issued, are no longer subject to the restrictions of this Section 15; provided,
further, that if a transfer is made pursuant to clause (i), (ii) (other than
pursuant to Rule 144A) or (iv) of paragraph (a) or if an opinion of counsel
provided pursuant to clause (iii) of paragraph (a) concludes that the legend is
no longer necessary, the Companies will deliver upon transfer Notes, Warrants or
Share certificates, as the case may be, without such legends.
SECTION 16. EXPENSES
(a) Whether or not the transactions herein contemplated are
consummated, the Companies will pay (i) the reasonable costs and expenses of the
preparation and production of the Purchase Agreement and the issuance of the
Notes, Warrants and the Shares and the furnishing of all opinions by counsel for
the Company, (ii) the reasonable fees and disbursements of Morgan, Lewis &
Bockius LLP in connection with the Purchase Agreement, the Notes, the Warrants
and the transactions contemplated hereby and thereby (whether or not a closing
occurs hereunder and if a closing occurs the Company will make such payment on
the Closing Date) plus disbursements, (iii) the reasonable fees and expenses of
any investment banker, broker or finder engaged by or on behalf of (or acting
for) the Companies in connection with the Purchase Agreements or any of the
transactions contemplated hereby or thereby, (iv) the reasonable travel expenses
incurred by any Purchaser prior to the Closing Date in connection with due
diligence or negotiation of the terms of the Purchase Agreement, and (v) the
reasonable expenses incurred by any holder in connection with its exercise of
any rights of inspection under Section 7.5 hereof (but each holder's right to
expense reimbursement under this clause (v) shall only apply to (x) one (1) of
such holder's visits to the Company's facilities per year plus (y) all exercises
of inspection rights at any time when a Potential Default or Event of Default
has occurred). Upon the later of January 3, 1999 or one (1) Business Day of the
Closing Date, the Companies will pay a fee in the amount of $160,000
(representing 2% of the principal amount of the Notes) to the Purchaser. The
obligations of the Companies under this Section 17 shall survive the closing
hereunder, the payment or cancellation of the Notes, exercise or cancellation of
the Warrants and the termination of the Purchase Agreement.
(b) In addition to all other sums due hereunder or provided for in
this Agreement, the Companies shall pay to the Purchaser or its agents,
respectively, an amount sufficient to indemnify such persons (net of any taxes
on any indemnity payments) against all reasonable costs and expenses (including
reasonable attorneys' fees and expenses and reasonable
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costs of investigation) and damages and liabilities incurred by the Purchaser or
its agents pursuant to any investigation or proceeding against any or all of the
Companies, the Purchaser, or their agents, arising out of or in connection with
the Purchase Agreement, the Notes or the Warrants (or any transaction
contemplated hereby or thereby or any other document or instrument executed
herewith or therewith or pursuant hereto or thereto), whether or not the
transactions contemplated by this Purchase Agreement are consummated, which
investigation or proceeding requires the participation of the Purchaser or its
agents or is commenced or filed against the Purchaser or its agents because of
the Purchase Agreement, the Notes or the Warrants or any of the transactions
contemplated hereby or thereby (or any other document or instrument executed
herewith or therewith or pursuant hereto or thereto), other than any
investigation or proceeding (x) in which it is finally determined that there was
gross negligence or willful misconduct on the part of the Purchaser or its
agents which was not taken by them in reliance upon any of the Companies'
representations, warranties, covenants or agreements in the Purchase Agreement,
the Notes or the Warrants or in any other documents or instruments contemplated
hereby or thereby or executed herewith or therewith or pursuant hereto or
thereto, (y) which relates to disputes among a Purchaser and its own partners,
shareholders or beneficiaries or (z) which relates to a Purchaser's disposition
of Notes, Warrants or Shares and the conduct of the Purchaser or its agents
giving rise to such investigation or proceeding was not taken by them in
reliance upon any of the Companies' representations, warranties, covenants or
agreements in the Purchase Agreement, the Notes or the Warrants or in any other
documents or instruments contemplated hereby or thereby or executed herewith or
therewith or pursuant hereto or thereto. The Companies shall assume the defense,
and shall have its counsel represent the Purchaser and such agents, in
connection with investigating, defending or preparing to defend any such action,
suit, claim or proceeding (including any inquiry or investigation); provided,
however, that the Purchaser, or any such agent, shall have the right (without
releasing the Companies from any of its obligations hereunder) to employ its own
counsel and either to direct its own defense or to participate in the Companies'
defense, but the fees and expenses of such counsel shall be at the expense of
such person unless (i) the employment of such counsel shall have been authorized
in writing by the Companies in connection with such defense or (ii) the
Companies shall not have provided their counsel to take charge of such defense
or (iii) the Purchaser, or such agent of the Purchaser, shall have reasonably
concluded that there may be defenses available to it or them which are different
from or additional to those available to the Companies, then in any of such
events referred to in clauses (i), (ii) or (iii) such counsel fees and expenses
(but only for one counsel for the Purchaser and its agents) shall be borne by
the Companies. Any settlement of any such action, suit, claim or proceeding
shall require the consent of both the Companies and such indemnified person
(neither of which shall unreasonably withhold its consent).
(c) The Companies agree to pay, or to cause to be paid, all
documentary, stamp and other similar taxes levied under the laws of the United
States of America or any state or local taxing authority thereof or therein in
connection with the issuance and sale of the Notes and the execution and
delivery of the Purchase Agreements and any other documents or instruments
contemplated hereby or thereby and any modification of any of the Notes or the
Purchase Agreements or any such other documents or instruments and will hold the
Purchaser harmless without limitation as to time against any and all liabilities
with respect to all such taxes.
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(d) The obligations of the Companies under this Section 17 shall
survive the closing hereunder, the payment or cancellation of the Notes,
exercise or cancellation of the Warrants and the termination of the Purchase
Agreement.
SECTION 17. HOME OFFICE PAYMENTS
As long as the Purchaser or any payee named in the Notes delivered to the
Purchaser on the Closing Date, or any institutional holder which is a direct or
indirect transferee from the Purchaser or such payee, shall be the holder of any
Note, Ubiquitel will make payments (whether at maturity, upon mandatory or
optional prepayment, or otherwise) of principal, interest and premium, if any,
(i) by check payable to the order of the holder of any such Note duly mailed or
delivered to the Purchaser at such address as the Purchaser or such other holder
may designate in writing, or (ii) if requested by the Purchaser or such other
holder, by wire transfer to the Purchaser's or such other holder's (or its
nominee's) account at any bank or trust company in the United States of America,
notwithstanding any contrary provision herein or in any Note with respect to the
place of payment. If the Purchaser has provided an address for payments by wire
transfer, then the Purchaser shall be deemed to have requested wire transfer
payments under the preceding clause (ii). All such payments shall be made in
federal or other immediately available funds.
SECTION 18. NOTICES
Unless otherwise expressly specified or permitted by the terms hereof, all
notices, requests, demands, consents and other communications hereunder or with
respect to any Note or Warrant shall be in writing and shall be delivered by
hand or shall be sent by or telecopy (confirmed by registered, certified or
overnight mail or courier, postage and delivery charges prepaid), to the
following addresses:
(a) if to the Purchaser, to (i) BET Associates, L.P., c/o Mr. Bruce
E. Toll, 3103 Filmont Avenue, Huntington Valley, PA 19006 and (ii) BET
Associates, L.P., c/o Mr. Leonard Tannenbaum, 17 Leisure Farm, Armonk, NY 10504,
or at such other address as may have been furnished to the Companies by the
Purchaser in writing; or
(b) if to any other holder of a Note or Warrant, at such address as
the payee or registered holder thereof shall have designated to the Companies in
writing; or
(c) if to UHC, at 3 Bala Plaza, Bala Cynwyd, PA 19004 Attn: Donald
A. Harris, with a copy to Greenberg Traurig, 1650 Tysons Boulevard, McLean, VA
22102 Attn: Lee R. Marks, or at such other address as may have been furnished in
writing by UHC to the Purchaser and to the other holders of Notes and Warrants;
or
(d) if to Ubiquitel, at 3 Bala Plaza, Bala Cynwyd, PA 19004 Attn:
Donald A. Harris, with a copy to Greenberg Traurig, 1650 Tysons Boulevard,
McLean, VA 22102 Attn: Lee R. Marks, or at such other address as may have been
furnished in writing by Ubiquitel to the Purchaser and to the other holders of
Notes and Warrants.
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Whenever any notice is required to be given hereunder, such notice shall be
deemed given and such requirement satisfied only when such notice is delivered
or, if sent by telecopier, when received, unless otherwise expressly specified
or permitted by the terms hereof.
SECTION 19. MISCELLANEOUS
19.1 Entire Agreement. The Purchase Agreement and, upon the closing
hereunder, the Notes and Warrants issued hereunder, together with any further
agreements entered into by the Purchaser and the Companies at the closing
hereunder, contain the entire agreement among the Purchaser and the Companies,
and supersede any prior oral or written agreements, commitments, terms or
understandings, regarding the subject matter hereof.
19.2 Survival. All agreements, representations and warranties contained in
this Agreement, the Notes, the Warrants or any document or certificate delivered
pursuant hereto or thereto shall survive, and shall continue in effect
following, the execution and delivery of the Purchase Agreement, the closings
hereunder and thereunder, any investigation at any time made by the Purchaser or
on its behalf or by any other Person, the issuance, sale and delivery of the
Notes and the Warrants, any disposition thereof and any payment or cancellation
of the Notes and any exercise or cancellation of the Warrants. All statements
contained in any certificate or other document delivered by or on behalf of the
Companies pursuant hereto shall constitute representations and warranties by the
Companies hereunder.
19.3 Counterparts. This Agreement may be executed by the parties hereto in
separate counterparts, each of which when so executed and delivered shall be an
original, but all such counterparts shall together constitute one and the same
instrument, and all signatures need not appear on any one counterpart.
19.4 Headings. The headings and captions in this Agreement and the table
of contents are for convenience of reference only and shall not define, limit or
otherwise affect any of the terms or provisions hereof.
19.5 Binding Effect, Benefit and Assignment.
(a) The terms of this Agreement shall be binding upon, and inure to
the benefit of, the parties and their respective successors and permitted
assigns whether so expressed or not.
(b) The Companies may not assign any of their obligations, duties or
rights under this Agreement, or under the Notes or Warrants issued hereunder,
except with the Purchaser's consent.
(c) In addition to any assignment by operation of law, the Purchaser
may assign, in whole or in part, any or all of its rights (and/or obligations)
under this Agreement or under the Notes or Warrants to any permitted transferee
of any or all of its Notes, Warrants or Shares, and (unless such assignment
expressly provides otherwise) any such assignment shall not diminish the rights
the Purchaser would otherwise have under this Agreement or with respect to
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any remaining Notes, Warrants or Shares held by the Purchaser; provided that
Notes may be transferred only in Authorized Denominations.
19.6 Severability. Any provision hereof or of the Notes, or Warrants which
is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
thereof, and any such prohibition or unenforceability in any jurisdiction shall
not invalidate or render unenforceable such provision in any other jurisdiction.
To the extent permitted by applicable law, the parties hereby waive any
provision of law which may render any provision hereof prohibited or
unenforceable in any respect.
19.7 Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York (other than any conflict of
laws rule which might result in the application of the laws of any other
jurisdiction).
19.8 Currency. All payments under this Agreement, the Notes or Warrants
shall be made in lawful money of the United States of America.
19.9 Late Payments. If Ubiquitel fails to pay any amount required to be
paid to a holder of Notes or a party under this Agreement, within twenty (20)
days after notice from such holder or such party demanding such payment, then
Ubiquitel agrees to pay such holder or such party interest on any such overdue
amount at the Default Rate (as defined in the Notes) from the date of such
notice from such holder or such party until such overdue amount is paid in full;
provided that this Section 20.9 shall not apply to overdue payments with respect
to the Notes, to the extent the Notes already provide that such overdue payments
shall bear interest at the Default Rate.
19.10 Guarantee of Subsidiaries
(i) The Guarantee Any wholly-owned Subsidiary of Ubiquitel
that may exist on or after the date hereof and that is incorporated under
the laws of a state of the United States (collectively, the "Subsidiary
Guarantors"), in order to induce the Purchaser to enter into this
Agreement and to extend credit hereunder and in recognition of the direct
benefits to be received by the Subsidiary Guarantors from the proceeds of
the Notes, hereby agree with the Purchaser as follows: the Subsidiary
Guarantors hereby unconditionally and irrevocably guarantee as primary
obligors and not merely as sureties the full and prompt payment when due,
whether upon maturity, by acceleration or otherwise, of any and all
obligations of the Companies under this Purchase Agreement, the Notes, the
Warrant and any other documents executed in connection (the "Guaranteed
Ob1igations"); provided, however, that no wholly-owned Subsidiary of
Ubiquitel shall be required to be a Subsidiary Guarantor if such
wholly-owned Subsidiary is not at such time a guarantor or otherwise
obligated under the Senior Indebtedness. If any or all of the indebtedness
of the Companies to the Purchaser becomes due and payable, the Subsidiary
Guarantors unconditionally promise to pay such indebtedness of the
Companies to the Purchaser, or order, on demand, together with any and all
reasonable expenses which may
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be incurred by the Purchaser in collecting any of the indebtedness,
subject to the subordination provisions of this Agreement.
(ii) Bankruptcy. Additionally, the Subsidiary Guarantors
unconditionally and irrevocably guarantee the payment of any and all
indebtedness of the Companies to the Purchaser whether or not due or
payable by the Companies upon the occurrence of any of the events
specified in Section 9.3, and unconditionally and irrevocably promise to
pay such indebtedness to the Purchaser, or order, on demand, in lawful
money of the United States.
(iii) Nature of Liability. The liability of the Subsidiary
Guarantors hereunder is exclusive and independent of any security for or
other guarantee of the indebtedness of the Companies whether executed by
the Subsidiary Guarantors, any other guarantor or by any other party, and
the liability of the Subsidiary Guarantors hereunder shall not be affected
or impaired by: (a) any direction as to application of payment by the
Companies or by any other party; or (b) any other continuing or other
guarantee, undertaking or maximum liability of a guarantor or of any other
party as to the indebtedness of the Companies; or (c) any payment on or in
reduction of any such other guarantee or undertaking; or (d) any
dissolution, termination or increase, decrease or change in personnel by
the Companies; or (e) any payment made to the Purchaser on the
indebtedness which the Purchaser repays the Companies pursuant to court
order in any bankruptcy, reorganization, arrangement, moratorium or other
debtor relief proceeding, and the Subsidiary Guarantors waive any right to
the deferral or modification of its obligations hereunder by reason of any
such proceeding.
(iv) Guarantee Absolute. No invalidity, irregularity or
unenforceability of all or any part of the indebtedness guaranteed hereby
or of any security therefor shall affect, impair or be a defense to this
Guarantee contained in this Section 19.10, and this Guarantee contained in
this Section 19.10 shall be primary, absolute and unconditional
notwithstanding the occurrence of any event or the existence of any other
circumstances which might constitute a legal or equitable discharge of a
surety or guarantor except payment in full of the indebtedness guaranteed
herein.
(v) Independent Obligation. The obligations of the Subsidiary
Guarantors hereunder are independent of the obligations of any other
guarantor or of the Companies, and a separate action or actions may be
brought and prosecuted against the Subsidiary Guarantors whether or not
action is brought against any other guarantor or the Companies and whether
or not any other guarantor or any Companies be joined in any such action
or actions. The Subsidiary Guarantors waive, to the fullest extent
permitted by law, the benefit of any statue of limitations affecting its
liability hereunder or the enforcement thereof. Any payment by the
Companies or other circumstance which operates to toll any statute of
limitations as to the Companies shall operate to toll the statute of
limitations as to the Subsidiary Guarantors.
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(vi) Authorization. The Subsidiary Guarantors authorize the
Purchaser without notice or demand, and without affecting or impairing its
liability hereunder, from time to time to:(a) change the manner, place or
terms of payment of, and/or change or extend the time of payment of,
renew, increase, accelerate or alter, any of the indebtedness (including
any increase or decrease in the rate of interest thereon), any security
therefor, or any liability incurred directly or indirectly in respect
thereof, and the guarantees herein made shall apply to the Guaranteed
Obligations as so changed, extended, renewed or altered;(b) take and hold
security for the payment of the Guaranteed Obligations and sell, exchange,
release, surrender, realize upon or otherwise deal with in any manner and
in any order any property by whomsoever at any time pledged or mortgaged
to secure, or howsoever securing, the Guaranteed Obligations or any
liabilities (including any of those hereunder) incurred directly or
indirectly in respect thereof or hereof, and/or any offset there
against;(c) exercise or refrain from exercising any rights against the
Companies or others or otherwise act or refrain from acting;(d) release or
substitute any one or more endorsers, guarantors, the Companies or other
obligors;(e) settle or compromise any of the Guaranteed Obligations, any
security therefor or any liability (including any of those hereunder)
incurred directly or indirectly in respect thereof or hereof, and may
subordinate the payment of all or any part thereof to the payment of any
liability (whether due or not) of the Companies to its creditors other
than the Purchaser;(f) apply any sums by whomsoever paid or howsoever
realized to any liability or liabilities of the Companies to the Purchaser
regardless of what liability or liabilities of the Companies remain
unpaid; and/or (g) consent to or waive any breach of, or any act, omission
or default under, this Agreement or any of the instruments or agreements
referred to herein, or otherwise amend, modify or supplement this
Agreement or any of such other instruments or agreements.
(vii) Reliance. It is not necessary for the Purchaser to
inquire into the capacity or powers of the Companies or the officers,
directors, partners or agents acting or purporting to act on its behalf,
and any indebtedness made or created in reliance upon the professed
exercise of such powers shall be guaranteed hereunder.
(viii) Subordination. Any indebtedness of the Companies now or
hereafter held by the Subsidiary Guarantors is hereby subordinated to the
indebtedness of the Companies to the Purchaser; and such indebtedness of
the Companies to the Subsidiary Guarantors, if the Purchaser, after an
Event of Default has occurred, so requests, shall be collected, enforced
and received by the Subsidiary Guarantors as trustee for the Purchaser and
be paid over to the Purchaser on account of the indebtedness of the
Companies to the Purchaser, but without affecting or impairing in any
manner the liability of the Subsidiary Guarantors under the other
provisions of this Guarantee. Prior to the transfer by any of the
Subsidiary Guarantors of any note or negotiable instrument evidencing any
Guaranteed Obligations of the Companies to the Subsidiary Guarantors, the
Subsidiary Guarantors shall mark such note or negotiable instrument with a
legend that the same is subject to this subordination. Without limiting
the generality of the foregoing, he Subsidiary Guarantors hereby agree
with the Purchaser that they will not exercise any right of subrogation
which they may at any time otherwise have a result of
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this guarantee (whether contractual, under Section 509 of the Bankruptcy
Code, or otherwise) until all Guaranteed Obligations have been paid in
full in cash (it being understood that the Subsidiary Guarantors is not
waiving any right of subrogation that it may otherwise have but is only
waiving the exercise thereof as provided above).
(ix) Waiver. (a) The Subsidiary Guarantors waive any right to
require the Purchaser to (i) proceed against the Companies, any other
guarantor or any other party, (ii) proceed against or exhaust any security
held from the Companies, any other guarantor or any other party or (iii)
pursue any other remedy in the Purchaser's power whatsoever. The
Subsidiary Guarantors waive any defense based on or arising out of any
defense of the Companies, any other guarantor or any other party other
than payment in full of the Guaranteed Obligations, including without
limitation any defense based on or arising out of the disability of the
Companies, any other guarantor or any other party, or the unenforceability
of the Guaranteed Obligations or any part thereof from any cause, or the
cessation from any cause of the liability of the Companies other than
payment in full of the Guaranteed Obligations. The Purchaser may exercise
any other right or remedy the Purchaser may have against the Companies or
any other party, without affecting or impairing in any way the liability
of the Subsidiary Guarantors hereunder except to the extent the Guaranteed
Obligations have been paid. The Subsidiary Guarantors waive any defense
arising out of any such election by the Purchaser, even though such
election operates to impair or extinguish any right of reimbursement or
subrogation or other right or remedy of the Subsidiary Guarantors against
the Companies or any other party or any security.(b) The Subsidiary
Guarantors waive all presentments, demands for performance, protests and
notices, including without limitation notices of nonperformance, notices
of protest, notices of dishonor, notices of acceptance of this Guarantee,
and notices of the existence, creation or incurring of new or additional
indebtedness. The Subsidiary Guarantors assume all responsibility for
being and keeping itself informed of the financial condition and assets of
the Companies, and of all other circumstances bearing upon the risk of
non-payment of the Guaranteed Obligations and the nature, scope and extent
of the risks which the Subsidiary Guarantors assumes and incurs hereunder,
and agrees that the Purchaser shall have no duty to advise the Subsidiary
Guarantors of information known to them regarding such circumstances or
risks.
(i) Guarantee Continuing. This Guarantee is a continuing one
and all liabilities to which it applies or may apply under the terms
hereof shall be conclusively presumed to have been created in reliance
hereon. No failure or delay on the part of the Purchaser or of any holder
of any Note in exercising any right, power or privilege hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of
any right, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, power or privilege.
The rights and remedies herein expressly specified are cumulative and not
exclusive of any rights or remedies which the Purchaser or any subsequent
holder of a Note would otherwise have. No notice to or demand on the
Subsidiary Guarantors in any case shall entitle the Subsidiary Guarantors
to any other or further notice or demand in similar or other circumstances
or constitute a waiver of the
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rights of the Purchaser or any holder, creator or purchaser to any other
or further action in any circumstances without notice or demand.
(ii) Binding Nature of Guarantee. This Guarantee shall be
binding upon the Subsidiary Guarantors and their successors and assigns
and shall inure to the benefit of the Purchaser and its successors and
assigns.
(iii) Judgments Binding. If claim is ever made upon the
Purchaser, any subsequent holder of a Note for repayment or recovery of
any amount or amounts received in payment or on account of any of the
Guaranteed Obligations and any of the aforesaid payees repays all or part
of said amount by reason of (a) any judgment, decree or order of any court
or administrative body having jurisdiction over such payee or any of its
property, or (b) any settlement or compromise of any such claim effected
by such payee with any such claimant (including the Companies) then and in
such event the Subsidiary Guarantors agrees that any such judgment,
decree, order, settlement or compromise shall be binding upon the
Subsidiary Guarantors notwithstanding any revocation hereof or the
cancellation of any Note, or other instrument evidencing any liability of
the Companies, and the Subsidiary Guarantors shall be and remain liable to
the aforesaid payees hereunder for the amount so repaid or recovered to
the same extent as if such amount had never originally been received by
any such payee.
(iv) Subordination of Rights of Purchaser. Notwithstanding
anything to the contrary within this Section 19.10, the rights of
Purchaser as against any and all Subsidiary Guarantors shall be
subordinated, and subject in right of payment, to the prior payment in
full in cash of all Senior Indebtedness to the extent and in the manner
set forth in Section 9 hereof.
19.11 CONSENT TO JURISDICTION AND SERVICE OF PROCESS. EACH OF THE
COMPANIES AND EACH CO-OBLIGOR SUBSIDIARY HEREBY CONSENTS TO THE JURISDICTION OF
ANY STATE OR FEDERAL COURT LOCATED WITHIN THE STATE OF NEW YORK AND IRREVOCABLY
AGREES THAT, SUBJECT TO THE ELECTION, ALL ACTIONS OR PROCEEDINGS RELATING TO
THIS AGREEMENT OR THE NOTES MAY BE LITIGATED IN SUCH COURTS. THE COMPANIES AND
EACH CO-OBLIGOR SUBSIDIARY ACCEPT FOR THEMSELVES AND IN CONNECTION WITH THEIR
PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF THE
AFORESAID COURTS AND WAIVE ANY DEFENSE OF FORUM NON CONVENIENT, AND IRREVOCABLY
AGREE TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY (SUBJECT TO ANY APPEAL
AVAILABLE WITH RESPECT TO SUCH JUDGMENT) IN CONNECTION WITH THIS AGREEMENT OR
THE NOTES. THE CO-OBLIGOR SUBSIDIARIES HEREBY IRREVOCABLY APPOINT THE COMPANIES
TO SERVE AS THEIR AGENTS, TO RECEIVE ON THEIR BEHALF SERVICE OF ALL PROCESS IN
ANY SUCH PROCEEDING IN ANY SUCH COURT, SUCH SERVICE BEING HEREBY ACKNOWLEDGED BY
EACH OF THE COMPANIES AND EACH CO-OBLIGOR SUBSIDIARY TO BE EFFECTIVE AND BINDING
SERVICE IN EVERY RESPECT. THE COMPANIES AND EACH CO-OBLIGOR SUBSIDIARY
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HEREBY AGREE THAT SERVICE UPON EITHER OF THE COMPANIES BY MAIL SHALL CONSTITUTE
SUFFICIENT NOTICE AND SERVICE OF PROCESS. NOTHING HEREIN SHALL AFFECT THE RIGHT
TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT
OF THE PURCHASER TO BRING PROCEEDINGS OR OBTAIN OR ENFORCE JUDGMENTS AGAINST THE
COMPANIES OR ANY CO-OBLIGOR SUBSIDIARY IN THE COURTS OF ANY OTHER JURISDICTION.
19.12 WAIVER OF JURY TRIAL. EACH OF THE COMPANIES AND EACH CO-OBLIGOR
SUBSIDIARY HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR
CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT THE NOTES THE
WARRANTS OR THE SHARES, OR ANY DEALINGS AMONG THEM RELATING TO THE SUBJECT
MATTER OF THIS TRANSACTION. EACH OF THE COMPANIES AND EACH CO-OBLIGOR SUBSIDIARY
ALSO WAIVE ANY BOND OR SURETY OR SECURITY UPON SUCH BOND WHICH MIGHT, BUT FOR
THIS WAIVER, BE REQUIRED OF THE PURCHASER. THE SCOPE OF THIS WAIVER IS INTENDED
TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT
AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING WITHOUT
LIMITATION, CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER
COMMON LAW AND STATUTORY CLAIMS. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT
OR TO THE NOTES OR THE WARRANTS. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY
BE FILED AS A WRITTEN CONSENT TO A TRIAL (WITHOUT A JURY) BY THE COURT.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
UBIQUITEL HOLDINGS, INC.
By:___________________________________
Name:
Title:
UBIQUITEL, LLC
By:___________________________________
Name:
Title:
Accepted and agreed to as of the date
first above written by the undersigned
Purchaser:
BET ASSOCIATES, L.P.
By: Bruce Toll
Its General Partner
By:____________________________:
Bruce E. Toll
Member
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EXHIBIT A
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
OR UNDER ANY APPLICABLE LAW OR REGULATION OF ANY STATE AND IS NOT TRANSFERABLE
EXCEPT UPON THE CONDITIONS SPECIFIED IN SECTION 16 OF THE PURCHASE AGREEMENT
REFERRED TO HEREIN.
UBIQUITEL, LLC
12% Senior Subordinated Note
Due December ___, 2007
Dated:
FOR VALUE RECEIVED, the undersigned Ubiquitel, LLC, a Delaware limited
liability company (herein, together with any successor, referred to as the
"Company"), hereby promises to pay to _____________or registered assigns, the
principal sum of____________ ($_____) on December __, 2007, with interest
(computed on the basis of a 360 day year) on the unpaid balance of such
principal sum from the date hereof at the interest rate of 12% per annum,
payable, in arrears, quarterly on the first day of January, April, July and
October of each year, commencing April 1, 2000 (which first interest payment
shall be for the period from and including [[the closing date]] through and
including March 31, 2000), until the entire principal amount hereof shall have
become due and payable, whether at maturity or at a date fixed for prepayment or
by acceleration or declaration or otherwise, and at the Default Rate on any
overdue installment of principal (including any overdue prepayment of principal)
and on any overdue premium and (to the extent permitted by law) on any overdue
installment of interest until paid (whether or not any subordination provision
or other circumstance prevents such payment). The "Default Rate" shall be a per
annum interest rate equal to the lesser of (A) 16% per annum and (B) the highest
rate permitted by law.
If any payment of interest due hereunder becomes due and payable on a day
which is not a Business Day (as defined in the Purchase Agreement referred to
below), the due date thereof shall be the next preceding day which is a Business
Day, and the interest payable on such next preceding Business Day shall be the
interest which would otherwise have been payable on the due date which was not a
Business Day.
Payments of principal and interest shall be made in lawful money of the
United States of America as provided in the Purchase Agreement referred to
below, to the address or account designated by the holder hereof for such
purpose.
This Note is issued pursuant to Purchase Agreement dated as of December
__, 1999 between the Company and BET Associates, L.P. (the "Purchase
Agreement").
A-1
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This Note is subject to the provisions of and is entitled to the benefits
of the Purchase Agreement. The Purchase Agreement provides, inter alia, for
prepayments of principal upon the terms set forth therein. In addition, the
payment of the principal of, premium, if any, and interest on this Note is
subordinated in right of payment to the prior payment in full of certain other
obligations of the Company to the extent and in the manner set forth in the
Purchase Agreement. Each holder of this Note, by accepting the same, agrees to
and shall be bound by the provisions of the Purchase Agreement.
This Note is transferable only upon the terms and conditions specified in
the Purchase Agreement.
In case an Event of Default (as defined in the Purchase Agreement) shall
occur and be continuing, the principal of this Note may be declared, subject to
the subordination provisions, due and payable in the manner and with the effect
provided in the Purchase Agreement.
This Note is subordinated to Senior Indebtedness as provided in Section 9
of the Purchase Agreement.
No reference herein to the Purchase Agreement and no provision hereof or
thereof shall alter or impair the obligation of the Company, which is absolute
and unconditional, to pay the principal hereof and interest hereon at the
respective times and places specified herein and in the Purchase Agreement, but
the maturity of all Notes may be accelerated upon an Event of Default only in
the manner set forth in Section 13(b) of the Purchase Agreement.
This Note is delivered in and shall be construed and enforced in
accordance with and governed by the laws of the State of New York (other than
any conflict of laws rules which might result in the application of the laws of
any other jurisdiction).
Subject to the provisions of Section 15 of the Purchase Agreement, the
Company may treat the person in whose name this Note is registered as the owner
and holder of this Note for the purpose of receiving payment of principal of,
premium, if any, and interest on this Note and for all other purposes
whatsoever, and the Company shall not be affected by any notice to the contrary
(except that the Company shall comply with the provisions of Section 12 of the
Purchase Agreement regarding the issuance of a new Note or Notes to permitted
transferees).
IN WITNESS WHEREOF, Ubiquitel, LLC has caused this Note to be dated and to
be executed and issued on its behalf by its duly authorized officer.
UBIQUITEL, LLC
By:___________________________________
Name:
Title:
A-2
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EXHIBIT B
THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR UNDER ANY APPLICABLE LAW OR REGULATION OF ANY STATE AND IS NOT
TRANSFERABLE EXCEPT UPON THE CONDITIONS SPECIFIED IN SECTION 7(A) OF THIS
WARRANT.
UBIQUITEL HOLDINGS, INC.
WARRANT
Issue Date: December __, 1999
Void After: December __, 2009
This Warrant has been issued pursuant to the Purchase Agreement dated as of
December __, 1999 (the "Purchase Agreement") among Ubiquitel Holdings, Inc. (the
"Company"), Ubiquitel, LLC and BET Associates, L.P., and this Warrant and the
shares of Common Stock issuable upon exercise hereof (the "Warrant Shares")
shall be subject to, and entitled to the benefits of, the Purchase Agreement.
THIS CERTIFIES that, for value received, ____________ (the "Holder"), is
entitled, upon the terms and subject to the conditions hereinafter set forth, to
subscribe for and purchase from Ubiquitel Holdings, Inc., a Delaware
corporation, at the Exercise Price per share determined as provided herein, up
to _________ fully paid and nonassessable shares of the Company's Voting Common
Stock, par value $0.001 per share (the "Common Stock").
1. Definitions.
Terms used herein but not defined shall have the meanings assigned to such
terms in the Purchase Agreement. As used herein the following terms, unless the
context otherwise requires, shall have for all purposes hereof the following
meanings:
"Appraised Value" means, in respect of any share of Common Stock on any
date herein specified, the value attributable to such share of Common Stock if
all of the assets of the Company and the Subsidiaries were sold for the
appraised value thereof as of the last day of a fiscal month to end within 60
days prior to such date specified, and thereafter liquidated in accordance with
the terms of the Company's Certificate of Incorporation as determined in good
faith by the Board of Directors of the Company.
"Business Day" means any day that is not (i) a Saturday or Sunday or (ii)
a day on which banks are required or permitted to be closed in the Commonwealth
of Pennsylvania.
"Current Market Price" means, in respect of the Common Stock on any date
herein specified, the average of the daily closing prices for the thirty (30)
consecutive trading days commencing forty five (45) trading days before such
date. The closing price for each day shall be the last reported sale price
regular way or, in case no such sale takes place on such day, the
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average of the closing bid and asked prices regular way, in either case on the
principal national securities exchange or the NASDAQ National Market on which
the Company's Common Stock is listed or admitted to trading, or if the Company's
Common Stock is not listed or admitted to trading on any national securities
exchange or the NASDAQ National Market, the average of the highest reported bid
and lowest reported asked prices as furnished by the National Association of
Securities Dealers Inc. Automated Quotation System, or comparable system. If the
closing price cannot be so determined, then the Current Market Price shall be
determined (x) by the written agreement of the Company and the Holder, or (y) in
the event that no such agreement is reached within twenty (20) days after the
event giving rise to the need to determine the Current Market Price, by the
agreement of two arbitrators, one of whom shall be selected by the Company and
the other of whom shall be selected by the Holder.
2. Exercise Period. The purchase rights represented by this Warrant are
exercisable by the Holder, in whole or in part, at any time from time to time
during the Exercise Period, which shall commence at December __, 1999 (the
"Issue Date's.) and shall end at 5:00 p.m. Eastern Standard time on December __,
2009.
3. Exercise Price. The price per share at which this Warrant may be
exercised (the "Exercise Price") shall initially be $.01.
4. Exercise of Warrant. During the Exercise Period, this Warrant may be
exercised, in whole or in part and from time to time, by the surrender of this
Warrant and the Notice of Exercise annexed hereto duly executed at the principal
office of the Company (or such other office or agency of the Company as it may
designate) and upon payment of the Exercise Price of the shares thereby
purchased (the aggregate of the Exercise Price for all shares to be exercised
being referred to herein as the "Purchase Price"). Payment of the Purchase Price
may be made (i) by check or bank draft payable to the order of the Company, (ii)
by wire transfer to the account of the Company, or (iii) by delivery of this
Warrant with instructions that the Company retain as payment of the Purchase
Price the number of Warrant Shares remaining after distributing to the Holder
the number of shares determined by the formula in the next sentence (a "Cashless
Exercise"). In the event of a Cashless Exercise, the Holder shall receive the
number of Warrant Shares determined by multiplying the number of Warrant Shares
for which the Cashless Exercise is made by a fraction, the numerator of which
shall be the difference between the then Current Market Price per Warrant Share
and the Exercise Price, and the denominator of which shall be the then Current
Market Price per share of Common Stock. The remaining Warrant Shares for which
the Cashless Exercise has been made shall be deemed to have been paid by the
Company as the Exercise Price. Upon exercise, the Holder shall be entitled to
receive, promptly after payment in full, one or more certificates, issued in the
Holder's name or in such name or names as the Holder may direct, subject to the
limitations on transfer contained herein, for the number of shares of Common
Stock so purchased. The shares so purchased shall be deemed to be issued as of
the close of business on the date on which this Warrant shall have been
exercised.
5. Representations and Warranties.
The Company represents and warrants to the Holder as follows:
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(a) Corporate Action. The Company has all requisite corporate power
and authority, and has taken all necessary corporate action, to execute and
deliver this Warrant, and to authorize and reserve for issuance, and to issue
and deliver upon payment of the Purchase Price, the Warrant Shares.
(b) No Violation. Neither the execution nor delivery of this
Warrant, nor the consummation of the actions herein contemplated, nor compliance
with the terms and provisions hereof will conflict with, or result in a breach
of, or constitute a default or an event permitting acceleration under, any of
the terms, provisions or conditions of the Certificate of Incorporation or
Bylaws of the Company or any indenture, mortgage, deed of trust, note, bank
loan, credit agreement, franchise, license, lease, permit, judgment, decree,
order, statute, rule or regulation or any other agreement, understanding or
instrument to which the Company is a party or by which it is bound.
6. Antidilution Adjustments.
6.1. Adjustment of Exercise Price. The Exercise Price shall be
subject to adjustment, from time to time, as follows:
(a) Adjustments for Stock Dividends, Recapitalizations, Etc. In case
the Company shall, after the Closing Date, (i) pay a stock dividend or make a
distribution (on or in respect of its Common Stock) in shares of its Common
Stock, (ii) subdivide the outstanding shares of its Common Stock, (iii) combine
the outstanding shares of its Common Stock into a smaller number of shares, or
(iv) issue by reclassification of shares of its Common Stock, any shares of
capital stock of the Company, then, in any such case, the current Exercise Price
in effect immediately prior to such action shall be adjusted to a price such
that if the Holder was to exercise this Warrant in full immediately after such
action, such Holder would be entitled to receive the number of shares of capital
stock of the Company which Holder would have owned immediately following such
action had such Warrant been exercised immediately prior thereto (with any
record date requirement being deemed to have been satisfied), and, in any such
case, such Exercise Price shall thereafter be subject to further adjustments
under this Section 6. An adjustment made pursuant to this subsection (a) shall
become effective retroactively immediately after the record date in the case of
a dividend or distribution and after the effective date in the case of a
subdivision, combination or reclassification.
(b) Distribution of Assets. In case the Company shall declare and
make any distribution of its assets (including cash and evidence of
indebtedness) to holders of Common Stock as a dividend, by way of return of
capital or otherwise, then the Holder shall be entitled upon exercise of this
Warrant for the purchase of any or all of the Warrant Shares, to receive the
amount of such assets which would have been payable to the Holder had the Holder
been the holder of such shares of Common Stock subject to such exercise on the
record date for the determination of stockholders entitled to such distribution.
(c) Adjustments for Issuances of Additional Stock. Subject to the
exceptions referred to in Section 6.1(e) hereof, in case the Company shall at
any time or from time to time after the Issue Date issue (in a transaction to
which Section 6.1(a) or 6.1(b) is not applicable) any
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additional shares of the Company's Common Stock ("Additional Common Stock"), for
a consideration per share either (i) less than the then Current Market Price per
share of the Company's Common Stock immediately prior to the issuance of such
Additional Common Stock, or (ii) without consideration, then (in the case of
either clause (i) or (ii)), and thereafter successively upon each such issuance,
the current Exercise Price shall forthwith be reduced to the price determined by
multiplying such current Exercise Price by a fraction, of which (1) the
numerator shall be (i) the number of shares of the Company's Common Stock
outstanding immediately prior to such issuance (on a fully diluted basis) plus
(ii) the number of shares of the Company's Common Stock which the aggregate
amount of consideration received by the Company upon issuance of the Additional
Common Stock would purchase at the then Current Market Price per share of the
Company's Common Stock, and (2) the denominator shall be (i) the number of
shares of the Company's Common Stock outstanding plus (ii) the number of shares
of Additional Common Stock; provided, however, that such adjustment shall be
made only if such adjustment results in a current Exercise Price less than the
current Exercise Price in effect immediately prior to the issuance of such
Additional Common Stock.
(d) Certain Rules in Applying the Adjustment for Additional Stock
Issuances. For purposes of any adjustment as provided in Section 6.1(c) hereof,
the following provisions shall also be applicable:
(1) Cash Consideration. In case of the issuance of Additional
Common Stock for cash, the consideration received by the Company therefor
shall be deemed to be the net cash proceeds received by the Company for
such Additional Common, Stock after deducting any commissions or other
expenses paid or incurred by the Company for any underwriting of, or
otherwise in connection with the issuance of, such Additional Common
Stock.
(2) Non-Cash Consideration. In case of the issuance of
Additional Common Stock for a consideration other than cash, or a
consideration a part of which shall be other than cash, the amount of the
consideration other than cash so received or to be received by the Company
shall be deemed to be the value of such consideration at the time of its
receipt by the Company as determined in good faith by the Board of
Directors of the Company, except that where the non-cash consideration
consists of the cancellation, surrender or exchange of outstanding
obligations of the Company (or where such obligations are otherwise
converted into shares of the Company's Common Stock), the value of the
non-cash consideration shall be deemed to be the principal amount of the
obligations canceled, surrendered, satisfied, exchanged or converted. If
the Company receives consideration, part or all of which consists of
publicly traded securities (i.e., in lieu of cash), the value of such
non-cash consideration shall be the aggregate market value of such
securities (based on the latest reported sale price regular way) as of the
close of the day immediately preceding the date of their receipt by the
Company.
(3) Options, Warrants, Convertibles, Etc. In case of the
issuance, whether by distribution or sale to holders of its Common Stock
or to others, by the Company of (i) any security that is convertible into
Common Stock or (ii) any rights,
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options or warrants to purchase the Company's Common Stock (other than
this Warrant and except as stated in Section 6.1(e) hereof), if inclusion
thereof in calculating adjustments under this Section 6.1 would result in
a current Exercise Price lower than if excluded, the Company shall be
deemed to have issued, for the consideration described below, the number
of shares of the Company's Common Stock into which such convertible
security may be converted when first convertible, or the number of shares
of the Company's Common Stock deliverable upon the exercise of such
rights, options or warrants when first exercisable, as the case may be
(and such shares shall be deemed to be Additional Common Stock for
purposes of Section 6.1(c) hereof). The consideration deemed to be
received by the Company at the time of the issuance of such convertible
securities or such rights, options or warrants shall be the consideration
so received determined as provided in Section 6.1(d)(1) and (2) hereof
after deducting any commissions or other expenses paid or incurred by the
Company for any underwriting of, or otherwise in connection with, the
issuance of such convertible securities or rights, options or warrants,
plus (x) any consideration or adjustment payment to be received by the
Company in connection with such conversion or, as applicable, (y) the
aggregate price at which shares of the Company's Common Stock are to be
delivered upon the exercise of such rights, options or warrants when first
exercisable (or, if no price is specified and such shares are to be
delivered at an option price related to the market value of the subject
Common Stock, an aggregate option price bearing the same relation to the
market value of the subject Common Stock at the time such rights, options
or warrants were granted). If, subsequently, (1) such number of shares
into which such convertible security is convertible, or which are
deliverable upon the exercise of such rights, options or warrants, is
increased or (2) the conversion or exercise price of such convertible
security, rights, options or warrants is decreased, then the calculations
under the preceding two sentences (and any resulting adjustment to the
current Exercise Price under Section 6.1(c) hereof) with respect to such
convertible security, rights, options or warrants, as the case may be,
shall be recalculated as of the time of such issuance but giving effect to
such changes (but any such recalculation shall not result in the current
Exercise Price being higher than that which would be calculated without
regard to such issuance). On the expiration or termination of such rights,
options or warrants, or rights to convert, the Exercise Price hereunder
shall be readjusted (up or down as the case may be) to such current
Exercise Price as would have been obtained had the adjustments made with
respect to the issuance of such rights, options, warrants or convertible
securities been made upon the basis of the delivery of only the number of
shares of the Company's Common Stock actually delivered upon the exercise
of such rights, options or warrants or upon the conversion of any such
securities and at the actual exercise or Exercise Prices (but any such
recalculation shall not result in the current Exercise Price being higher
than that which would be calculated without regard to such issuance).
(4) Number of Shares Outstanding. The number of shares of the
Company's Common Stock as at the time outstanding shall exclude all shares
of the Company's Common Stock then owned or held by or for the account of
the Company but shall include the aggregate number of shares of the
Company's Common Stock at the time deliverable in respect of the
convertible securities, rights, options and warrants
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referred to in Section 6.1 (d)(3) and 6.1(e) hereof, provided that to the
extent that such rights, options, warrants or conversion privileges are
not exercised, such shares of the Company's Common Stock shall be deemed
to be outstanding only until the expiration dates of the rights, warrants,
options or conversion privileges or the prior cancellation thereof.
(e) Exclusions from the Adjustment for Additional Stock Issuances.
No adjustment of the current Exercise Price under Section 6.1(c) hereof shall be
made as a result of or in connection with:
(1) the issuance of Shares upon exercise of this Warrant;
(2) the issuance of the Company's Common Stock to officers,
employees, directors and consultants of the Company or any Subsidiary, or
the grant to or exercise by any such persons of options to purchase Common
Stock of the Company, all (x) as part of incentive compensation for such
persons and (y) pursuant to the Company's stock option plans described on
the Disclosure Schedule to the Purchase Agreement or other incentive
plans, in each case adopted by the Company's Board of Directors, with
approval by a majority of the Company's independent directors and approval
by the Company's shareholders;
(3) the issuance of the Company's Common Stock upon exercise
of this Warrant to purchase Common Stock issued to [Banque Paribas] dated
as of the date hereof, or
(4) the issuance of the Company's Common Stock upon conversion
of the Company's Series A Preferred Stock.
(f) Accountant's Certification. Whenever the current Exercise Price
is adjusted as provided in this Section 6.1, the Company will promptly obtain a
certificate of a firm of independent public accountants of recognized national
standing selected by the Board of Directors of the Company (who may be the
regular auditors of the Company) setting forth the current Exercise Price as so
adjusted, the computation of such adjustment and a brief statement of the facts
accounting for such adjustment, and will mail to the Holder a copy of such
certificate from such firm of independent public accountants.
(g) Antidilution Adjustments under Other Securities. Without
limiting any other rights available hereunder to the Holder, if there is an
antidilution adjustment (x) under any security which is convertible into Common
Stock of the Company whether issued prior to or after the date hereof (except
for this Warrant) or (y) under any right, option or warrant to purchase Common
Stock of the Company whether issued prior to or after the date hereof which (in
the case of clause (x) or (y)) results in a reduction in the exercise or
purchase price with respect to such security, right, option or warrant or
results in an increase in the number of shares obtainable under such security,
right, option or warrant, then an adjustment shall be made under this Section
6.1(g) to the current Exercise Price hereunder. Any such adjustment under this
Section 6.1(g) shall be whichever of the following results in a lower current
Exercise Price: (A) a
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reduction in the current Exercise Price equal to the percentage reduction in
such exercise or purchase price with respect to such security, right, option or
warrant or (B) a reduction in the current Exercise Price which will result in
the same percentage increase in the number of Warrant Shares available under
this Warrant as the percentage increase in the number of shares available under
such security, right, option or warrant. Any such adjustment under this Section
6.1(g) shall only be made if it would result in a lower current Exercise Price
than that which would be determined pursuant to any other antidilution
adjustment otherwise required under this Warrant as a result of the event or
circumstance which triggered the adjustment to the security, right, option or
warrant described in clause (x) or (y) above (and if any such adjustment is so
made under this Section 6.1(g), then such other antidilution adjustment
otherwise required under this Section 6 shall not be made as a result of such
event or circumstance).
(h) Other Adjustments. In case any event shall occur as to which any
of the provisions of this Section 6.1 are not strictly applicable but the
failure to make any adjustment would not fairly protect the exercise rights
represented by this Warrant in accordance with the essential intent and
principles of this Section 6.1, then, in each such case, the Company shall
appoint a firm of independent public accountants of recognized national standing
selected by the Board of Directors of the Company (who may be the regular
auditors of the Company), which shall give their opinion upon the adjustment, if
any, on a basis consistent with the essential intent and principles established
in this Section 6.1, necessary to preserve, without dilution, the exercise
rights represented by this Warrant. Upon receipt of such opinion, the Company
will promptly mail copies thereof to the Holder and shall make the adjustments
described therein.
(i) Adjustment of Number of Warrant Shares. Whenever the Exercise
Price payable upon exercise of this Warrant is adjusted pursuant to this Section
6.1 (and "Exercise Price Adjustment"), the number of Warrant Shares purchasable
upon exercise of this Warrant shall simultaneously be adjusted by multiplying
the number of Warrant Shares issuable upon exercise of this Warrant immediately
prior to such Exercise Price Adjustment by the Exercise Price in effect
immediately prior to such Exercise Price Adjustment dividing the product so
obtained by the Exercise Price, as adjusted pursuant to this Section 6.1.
(j) Meaning of "Issuance". References in this Warrant to "issuances"
of stock by the Company include issuances by the Company of previously unissued
shares and issuances or other transfers by the Company of treasury stock.
6.2. Company's Consolidation or Merger. If the Company shall at any
time consolidate with or merge with or into another Person, or the Company shall
sell, transfer or lease all or substantially all of its assets, or the Company
shall change its Common Stock into property or other securities, then, in any
such case, the Holder shall thereupon (and thereafter) be entitled to receive,
upon the exercise of such Warrant, in whole or in part, the securities or other
property to which (and upon the same terms and with the same rights as) the
Holder would have been entitled if such exercise had occurred immediately prior
to such consolidation or merger, such sale of assets or such change (with any
record date requirement being deemed to have been satisfied), and such
conversion rights shall thereafter continue to be subject to further adjustments
under Section 6.1 hereof. The Company shall take such steps in connection with
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such consolidation or merger, such sale of assets or such change as may be
necessary to assure such Holder that the provisions of this Warrant and the
Purchase Agreement (including, without limitation, Section 15 of the Purchase
Agreement) shall thereafter be applicable in relation to any securities or
property thereafter deliverable upon the exercise of the Warrant, including, but
not limited to, obtaining a written obligation to supply such securities or
property upon such exercise and to be so bound by the Warrant.
6.3. Notice to Holders.
In case at any time
(i) the Company shall take any action which would require an
adjustment in the current Exercise Price pursuant to Section 6.1; or
(ii) there shall be any reorganization, reclassification or
change of the Company's Common Stock (other than a change in par value or
from par value to no par value or from no par value to par value), or any
consolidation or merger to which the Company is a party and for which
approval of any stockholders of the Company is required, or any sale,
transfer or lease of all or substantially all of the assets of the
Company; or
(iii) there shall be a voluntary or involuntary dissolution,
liquidation or winding-up of the Company, then, in any one or more of such
cases, the Company shall give written notice to the Holder, not less than
twenty (20) days before any record date or other date set for definitive
action, of the date on which such action, distribution, reorganization,
reclassification, change, sale, transfer, lease, consolidation, merger,
dissolution, liquidation or winding-up shall take place, as the case may
be. Such notice shall also set forth such facts as shall indicate the
effect of any such action (to the extent such effect may be known at the
date of such notice) on the current Exercise Price and the kind and amount
of the shares and other securities and property deliverable upon exercise
of the Warrant. Such notice shall also specify any date as of which the
holders of the Common Stock of record shall be entitled to exchange their
Common Stock for securities or other property deliverable upon any such
reorganization, reclassification, change, sale, transfer, lease,
consolidation, merger, dissolution, liquidation or winding-up, as the case
may be.
7. Transfer.
(a) Exercise or Transfer Without Registration. The Holder agrees not
to transfer this Warrant except in accordance with Section 15 of the Purchase
Agreement.
(b) Registration Rights. The Holder is entitled to the benefits of
Section 15 of the Purchase Agreement with respect to registration of the Warrant
Shares under the Securities Act.
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8. Further Covenants of the Company.
(c) Reservation of Stock. The Company shall at all times reserve and
keep available, solely for issuance and delivery upon the exercise of this
Warrant, that number of Warrant Shares from time to time issuable upon the
exercise of this Warrant.
(d) No Liens. All Warrant Shares that are issued upon the exercise
of rights represented by this Warrant shall be fully paid, nonassessable, and
free from all taxes, liens and charges in respect of the issue thereof (other
than taxes in respect of any transfer occurring contemporaneously with such
issue).
(e) Fractional Shares. No fractional shares of Common Stock are to
be issued upon the exercise of this Warrant, but the Company shall pay a cash
adjustment in respect of any fraction of a share which would otherwise be
issuable in an amount equal to the same fraction of the highest market price per
share of Common Stock on the day of exercise, as determined by the Company.
9. Call and Put Provisions
9.1. Call Rights Upon the later of (a) the sixth anniversary of the
Issue Date and (b) the later of (x) one year after the Put Effective Date
(defined below) and (y) the date on which there are no limitations under any
agreements to which the Company is a party on the ability of the Company to
honor an Optional Put Notice (defined below), the Company may deliver a notice
(the "Optional Call Notice") of any redemption hereunder (an "Optional Call") to
Holder at its registered address appearing on the books and records of the
Company. The Optional Call Notice shall state (1) that the Company is exercising
its right to redeem this Warrant and (2) the date of redemption (the "Optional
Call Date"), which date and time shall be thirty (30) days after the date of
delivery of the Optional Call Notice. On the Optional Call Date, the Company
shall make payment of the Optional Call Amount (as defined below) to or upon the
order of the Holder as specified by the Holder in writing to the Company at
least one (1) business day prior to the Optional Call Date. If the Company
exercises its right to redeem this Warrant in accordance with this Section 9.1,
the Company shall make payment to the Holder of an amount in cash (the "Optional
Call Amount") equal to 120% of the Current Market Price multiplied by the number
of Warrant Shares issuable pursuant to this Warrant. Notwithstanding the
delivery of an Optional Call Notice, the Holder shall at all times prior to the
Optional Call Date maintain the right to exercise all or any portion of this
Warrant in accordance with the terms hereof and any portion so exercised after
receipt of an Optional Call Notice and prior to the Optional Call Date set forth
in such notice and payment of the aggregate Optional Call Amount shall be
deducted from the portion of this Warrant which is otherwise subject to
redemption pursuant to such notice.
9.2. Put Rights Upon the earlier of (a) a Change of Control, (b)
repayment by the Company or the Subsidiaries of at least 75% of the original
principal balance of the Senior Subordinated Notes, (c) an Event of Default and
(d) the fifth anniversary of the Issue Date, the Holder may deliver a notice
(the "Optional Put Notice") of a put hereunder (an "Optional Put") to the
Company; provided, however, no notice may be delivered if there exists or would
exist
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after giving effect to such put a default under any Senior Indebtedness. The
Optional Put Notice shall state (1) that the Holder is exercising its right to
put this Warrant, (2) the date of such put (the "Optional Put Date"), which date
and time shall be thirty (30) days after the date of delivery of the Optional
Put Notice and (3) payment instructions. On the Optional Put Date, the Company
shall make payment of the Optional Put Amount (as defined below) to or upon the
order of the Holder as specified by the Holder in the Put Notice. If the Holder
exercises its right to put this Warrant in accordance with this Section 9.2, the
Company shall make payment to the Holder of an amount in cash (the "Optional Put
Amount") equal to the Current Market Price multiplied by the number of Warrant
Shares issuable pursuant to this Warrant. Notwithstanding the delivery of an
Optional Put Notice, the Holder shall at all times prior to the Optional Put
Date maintain the right to exercise all or any portion of this Warrant in
accordance with the terms hereof and any portion so exercised after delivery of
an Optional Put Notice and prior to the Optional Put Date set forth in such
notice and receipt of the aggregate Optional Put Amount shall be deducted from
the portion of this Warrant which is otherwise subject to repurchase pursuant to
such notice.
9.3. Put and Call Expiration. The put and call provisions set forth
in this Article 9 shall expire after the completion by the Company of a
Qualified Public Offering. "Qualified Public Offering" shall mean a firm
commitment underwritten initial public offering pursuant to an effective
registration statement under the 1933 Act covering the offer or sale of any
securities of the Company for the account of the Company or any selling
shareholder in an offering which, after deducting for underwriters commissions
and expenses related to the issuance, provides proceeds to the Company of not
less than $30,000,000.
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10. Loss, Theft, Destruction or Mutilation of Warrant. Upon receipt by the
Company of evidence reasonably satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and in case of loss, theft or
destruction, of indemnity or security reasonably satisfactory to it, and upon
reimbursement to the Company of all reasonable expenses incidental thereto, and
upon surrender and cancellation of this Warrant, if mutilated, the Company will
make and deliver a new warrant of like tenor and dated as of the date of such
cancellation in lieu of this Warrant.
11. Remedies. The Company stipulates that the remedies at law of the
Holder in the event of any default or threatened default by the Company in the
performance of or compliance with any of the terms of this Warrant are not
adequate and may be enforced by a decree for the specific performance of any
agreement contained herein or by an injunction against a violation of any of the
terms hereof or otherwise.
12. Miscellaneous. All notices, certificates and other communications from
or at the request of the Company to the Holder shall be mailed by first class,
registered or certified mail, postage prepaid, to such address as may have been
furnished to the Company in writing by the Holder. This Agreement and any of the
terms hereof may be changed, waived, discharged or terminated only by an
instrument in writing signed by the party against which enforcement of such
change, waiver, discharge or termination is sought. This Agreement shall be
construed and enforced in accordance with and governed by the laws of the
Commonwealth of Pennsylvania. The headings in this Agreement are for reference
only and shall not limit or otherwise affect any of the terms hereof.
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed in
its corporate name by its duly authorized officer and to be dated as of the
issue date set forth on the first page of this Warrant.
UBIQUITEL HOLDINGS, INC.
By____________________________________
Name:
Title:
Attest:
____________________________________
Secretary
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NOTICE OF EXERCISE OF WARRANT
TO: UBIQUITEL HOLDINGS, INC.
1. Pursuant to the terms of the attached Warrant, the undersigned hereby
elects to purchase ________ shares of Common Stock of Ubiquitel Holdings, Inc.
(the "Company"), and tenders herewith payment of the Exercise Price of such
shares in full.
2. Pursuant to the terms of the attached Warrant, the undersigned hereby
elects to make a Cashless Exercise as provided for in Section 4 of such Warrant
with respect to ________ Warrant Shares.
(Check and complete the appropriate paragraph)
Please issue a certificate or certificates representing said shares of
Common Stock, in the name of the undersigned or in such other name(s) as is/are
specified immediately below or, if necessary, on an attachment hereto:
Name Address
---- -------
DATE:___________________________ HOLDER:_______________________________
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EXHIBIT C
DISCLOSURE SCHEDULE
C-1
<PAGE>
EXHIBIT D
MATTERS TO BE COVERED IN OPINION OF
COUNSEL TO THE COMPANY
1. Ubiquitel Holdings, Inc. is a corporation duly incorporated and validly
existing under the laws of its jurisdiction of incorporation and has all
requisite corporate power and corporate authority to own its properties and
operate its business as presently conducted.
2. The authorized capital stock of Ubiquitel Holdings, Inc. consists
of________ shares of Voting Common Stock, ________ shares of Non-Voting Stock
and ________ shares of Preferred Stock. All of the outstanding shares of the
capital stock of the Company have been validly authorized and issued and are
fully paid and non-assessable. To the best of such counsel's knowledge, there
are no outstanding options, warrants, rights, convertible securities or other
agreements under which the Company may become obligated to issue, sell or
transfer shares of its capital stock or other securities, other than as
disclosed on the Disclosure Schedule.
3. Ubiquitel, LLC is a limited liability company, duly formed and validly
existing under the laws of its jurisdiction of incorporation and has all
requisite limited liability company power and authority to own its properties
and operate its business as presently conducted. [[Ubiquitel Holdings, Inc. is
the sole member of Ubiquitel, LLC and is the sole owner of its membership
interests.]]
4. The execution, delivery and performance by the Companies of the
Purchase Agreement (including the issuance of the Notes, the Warrants and the
Shares as contemplated by the Purchase Agreement) have been duly authorized by
all necessary corporate actions required on behalf of the Company. The Purchase
Agreement, the Notes and the Warrants have been duly executed and delivered by
the Companies and constitute a legal, valid and binding obligations of each
Company party thereto, subject to any applicable bankruptcy, reorganization,
insolvency, fraudulent conveyance, moratorium or other laws affecting the
enforcement of creditors' rights generally.
5. The execution, delivery and performance by each Co-obligor Subsidiary
organized under the laws of the State of New York of its joinder has been duly
authorized by all necessary corporate action by such Co-obligor Subsidiary.
6. None of the execution, delivery or performance by the Companies of the
Purchase Agreement (including without limitation the issuance of the Notes, the
Warrants and the Shares as contemplated by the Purchase Agreement) violates or
conflicts with or will violate or conflict with any provision of (A) the
articles of incorporation, bylaws, certificate of formation or operating
agreement of either Company, (B) any law, rule or regulation, (C) any order,
judgment, writ, injunction or decree known to such counsel applicable to such
Company or any of its
D-1
<PAGE>
properties (or to which such Company or its properties may be bound), or (D) any
agreement, indenture or other instrument known to such counsel.
7. When issued upon exercise in accordance with the terms of the Warrants
the Shares will be validly issued, fully paid and non-assessable.
8. There are no taxes or other governmental charges payable by the
Companies or the Purchaser in connection with the execution, delivery and
performance by the Companies of the Purchase Agreement (including without
limitation the issuance of the Notes, the Warrants and the Shares under the
Purchase Agreement).
9. Based in part on representations of the Purchaser in the Purchase
Agreement, the offer, sale, purchase, issuance and delivery of the Notes and
Warrants pursuant to the Purchase Documents constitute exempted transactions
under the Securities Act of 1933, as amended (the "Act"), and neither the
registration of the Notes and Warrants under the Act nor the qualification of an
indenture with respect to the Notes under the Trust Indenture Act of 1939, as
amended, is required in connection with any such offer, sale, purchase, issue or
delivery of the Notes and Warrants. In addition, assuming the holder of a
Warrant is, at the time of exercise the Purchaser or a Person that acquired the
Warrant in accordance with the terms and conditions of Section 15 of the
Purchase Agreement, the issuance and delivery of Shares upon the exercise of the
Warrant by such holder will likewise constitute an exempted transaction under
the Act.
10. The offer, sale, purchase, issuance and delivery of the Notes pursuant
to the Purchase Documents do not violate Regulations T, U or X of the Board of
Governors of the Federal Reserve System.
D-2
<PAGE>
EXHIBIT E
JOINDER FOR GUARANTOR SUBSIDIARIES
The terms and provisions of the Purchase Agreement dated December 28, 1999
(the "Purchase Agreement") regarding the issuance of 12% Senior Subordinated
Notes of Ubiquitel, LLC in the aggregate principal amount of $8,000,000 are
hereby accepted and agreed to, and the undersigned, as a wholly-owned subsidiary
of Ubiquitel, LLC, hereby agrees to be a Guarantor Subsidiary as provided for in
Section 19.10 of the Purchase Agreement, with the effect set forth therein.
[[Wholly-owned Subsidiary]]
By:___________________________________
Name:
Title:
E-1
<PAGE>
Exhibit 10.17
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT, entered into and effective as of the 29th day
of November 1999 by and between UbiquiTel Holdings, Inc., a Delaware corporation
(the "Company") and Donald A. Harris ("Employee").
WHEREAS, the Company desires to employ Employee in the position of Chief
Executive Officer, and Employee desires to serve in such capacity on behalf of
the Company.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements hereinafter set forth, the Company and Employee hereby
agree as follows:
1. Employment.
(a) Term. This Agreement begins on the date hereof, and terminates
on the date three years from the date hereof, unless sooner terminated by either
party as hereinafter provided.
(b) Duties. Employee shall serve as the Chief Executive Officer
("CEO") of the Company and in such capacity shall perform the functions and jobs
described on Exhibit A. Employee shall also serve as a member of the board of
directors of the Company pursuant to the terms and conditions of a Stockholders'
Voting Agreement to be entered into by and among the Company, Employee and the
other holders of the capital stock of the Company, without additional
compensation.
(c) Best Efforts. During the period of his employment, Employee
shall devote his best efforts and such time and attention as shall be necessary
to promote the business and affairs of the Company and its affiliated companies,
as such business and affairs now exist or hereafter may be changed or
supplemented, and shall, during the term of his employment hereunder, be engaged
in other business activities only to the extent that such activities do not
interfere or conflict with his obligations to the Company hereunder, including,
without limitation, obligations pursuant to the Noncompetition and
Confidentiality Agreement entered into pursuant to Section 6 below. The
foregoing shall not be construed as preventing Employee from investing his
assets in such form or manner as will not require any significant services on
his part in the operation of the affairs of the businesses or entities in which
such investments are made; provided, however, that Employee shall not invest in
any business competitive with the Company, except that Employee shall be
permitted to own not more than 5% of he stock of those companies whose
securities are listed on a national securities exchange or on the NASDAQ system.
The Company agrees that it will not require Employee to relocate his principal
residence during the period of his employment hereunder.
2. Compensation
(a) As compensation for the services to be rendered hereunder, the
Company shall pay Employee an annual gross salary of Two Hundred Thousand
Dollars ($200,000.00) for the first year of the term hereof. This amount shall
be increased by 5% for each subsequent year.
<PAGE>
The salary will be paid in accordance with the Company's existing payroll
policies, and shall be subject to applicable withholding taxes. Employee will
also be eligible for payments from the Company in respect of bonuses in amounts
and at such times as determined in the sole discretion of the disinterested
members of the Company's Board of Directors.
(b) Management Stock Incentive Plan. Company also has set aside
1,275,000 shares of the Company's common stock, which represents 5% of the fully
diluted equity capitalization of the Company, as incentive compensation for
Employee (it being understood that such 5% is part of the 8.8% interest in the
Company's common stock that as of the date of this Agreement the Company has
reserved for management employees generally). The Company hereby grants an
option to purchase such stock, at the option price of $1.00 per share, with
vesting ratably over a period of three years, provided that full vesting would
occur upon termination of Employee's employment hereunder by the Company without
Cause (as defined in Section 5.1.(3) below) or by Employee pursuant to Section
5(b) hereof. The Company shall deliver an option agreement reflecting the
foregoing terms and such other terms and conditions mutually acceptable to
Employee and the disinterested members of the Company's Board of Directors, as
soon as practicable following the date hereof.
3. Expenses. The Company will reimburse Employee for all necessary and
reasonable travel, entertainment and other business expenses incurred by him in
the performance of his duties hereunder, upon receipt of a signed itemized list
of such expenditures with appropriate backup documentation, or in accordance
with such other reasonable accounting procedures as the Company may adopt
generally from time to time. The Company will also reimburse Employee for legal
fees incurred in connection with his employment by the Company, in an amount up
to $3,000, upon receipt of appropriate documentation of such fees.
4. Vacation; Benefits. Employee shall be entitled to four (4) weeks' paid
vacation per calendar year, which amounts shall not compound or accrue from year
to year if unused. Employee shall be entitled to paid holidays in accordance
with the Company's holiday policy and to participate in the Company's health,
life insurance, 401(k) plan, long and short term disability, dental, retirement,
and medical programs, if any, as well as executive bonus, benefit or incentive
programs, if any, pursuant to their respective terms and conditions. Nothing in
this Agreement shall preclude the Company or any affiliate of the Company from
terminating or amending any employee benefit plan or program from time to time
after the effective date of this Agreement.
5. Termination.
(a) Termination by the Company.
(1) For Cause. The Company may terminate Employee's employment
hereunder any time for "cause," as herein defined, in which case the Company's
sole liability to Employee shall be for unpaid salary and benefits through the
date of termination and unreimbursed expenses incurred by Employee pursuant to
Sections 3 and 4 above.
2
<PAGE>
(2) Without Cause. The Company also may terminate Employee's
employment without cause at any time, but in that event must pay to Employee an
amount equal to one year's salary and benefits, plus all unreimbursed expenses
incurred by Employee pursuant to Sections 3 and 4 above. In addition, all
unvested stock options granted to Employee pursuant to Section 2(b) above shall
immediately vest upon such termination without cause.
(3) "Cause" Defined. As used in this Agreement, termination
for "cause" shall mean termination as a result of:
(i) Employee's failure to cure any default, breach or
failure to perform any of his material obligations under the terms of this
Agreement within thirty (30) days' written notice from the Company describing in
detail Employee's default, breach or failure to perform, unless a failure to
cure more promptly than such thirty (30) day period would result in a material
adverse effect on the Company, in which case that cure period shall be equal to
the time required to avoid a material adverse effect on the Company; or
(ii) misconduct, including but not limited to
dishonesty, insubordination, or other acts on Employee's part materially
detrimental to the goodwill of the Company or materially damaging to the
Company's relationships with its customers, employees or others with whom it
does business; or
(iii) acts of moral turpitude which, in the reasonable
opinion of the disinterested members of the Company's Board of Directors are
materially harmful to the business or reputation of the Company; or
(iv) refusal to obey reasonable and lawful directions of
the disinterested members of the Company's Board of Directors.
(b) Termination by Employee. (1) Employee may terminate his
employment hereunder in the event that the Company fails to cure any breach of,
or failure to perform, one or more of its material obligations under this
Agreement after thirty (30) days' written notice from Employee to the Board of
Directors of the Company describing in detail the Company's breach or failure to
perform. In the event of any such termination, the Company's sole obligations to
Employee shall be for unpaid salary and reimbursement of expenses pursuant to
Section 3 through the effective date of termination specified in Employee's
notice and for vesting of unvested stock rights pursuant to Section 2(b) above.
(2) Employee may resign his employment hereunder other than for breach or
failure to perform by the Company at any time by giving thirty (30) days'
written to the Board of Directors. In the event of any such termination, the
Company's sole obligations to Employee shall be for unpaid salary and benefits
and reimbursement of expenses pursuant to Sections 3 and 4 and for vesting of
unvested stock options through the effective date of termination specified in
Employee's notice.
(c) Termination by Death or Disability. In the event of Employee's
death or permanent disability during the term of this Agreement, his employment
shall terminate on the date of death or date of permanent disability (as
determined by the disinterested members of the Board of Directors). In the event
of such termination, the Company's sole obligations to
3
<PAGE>
Employee (or Employee's estate) shall be for unpaid salary and benefits and
reimbursement of expenses pursuant to Sections 3 and 4 through the effective
date of termination and for vesting of all unvested stock options pursuant to
Section 2(b) above.
6. Restrictive Covenants. As a condition to, and in consideration of, the
execution of this Agreement by the Company, Employee agrees to be bound by the
terms of the Noncompetition and Confidentiality Agreement attached hereto as
Exhibit B.
7. Enforcement. Employee acknowledges that the services to be rendered
under this Agreement by him are special, unique and of an extraordinary
character, and that irreparable injury will result to the Company and its
business and property if he breaches any of the covenants and agreements
contained in this Agreement or in any of the Exhibits hereto. Therefore,
Employee expressly agrees that in the event of any such breach of that covenant
or agreement by Employee or any of Employee's partners, agents, employers,
employees, or any persons acting for or with Employee, in addition to any other
rights or remedies available to it. At law or in equity, other than specific
performance to enforce the obligation of Employee to provide services to the
Company.
8. Survival. The provisions of Sections 6 and 7 shall survive, along with
Exhibit B, the termination of this Agreement.
9. Return of Documents. Upon termination of his employment, Employee
agrees to return all documents belonging to the Company in his possession
including, but not limited to, contacts, agreements, licenses, business plans,
equipment, software, software programs, products, work-in-progress, source code,
object code, computer disks, books, notes and all copies thereof, whether in
written, electronic or other form. In addition, Employee shall certify to the
Company in writing as of the effective date of termination that none of the
assets or business records belonging to the Company are in his possession,
remain under his control or have been transferred to any third person.
10. Effect of Waiter. The waiver by either party of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of any
subsequent breach hereof. No waiver shall be valid unless in writing.
11. Assignment. This Agreement may not be assigned by either party without
the express prior written consent of the other party hereto, except that the
Company may assign this Agreement to any subsidiary or affiliate of the Company,
provided that no such assignment shall relieve the Company of its obligations
hereunder without the written consent of Employee.
12. Entire Agreement. This Agreement sets forth the entire agreement of
the parties hereto and supersedes any and all prior agreements and
understandings concerning Employee's employment by the Company. This Agreement
may be changed only by a written document signed by Employee and the Company.
13. Severability. If any one or more of the provisions, or portions of any
provision, of this Agreement shall be held to be invalid, illegal or
unenforceable, the validity, legality or
4
<PAGE>
enforceability of the remaining provisions or parts hereof shall not in any way
be affected or impaired thereby.
14. Governing Law/Jurisdiction. This Agreement shall be governed by, and
construed and enforced in accordance with, the substantive and procedural laws
of the State of Delaware without regard to rules governing conflicts of law.
15. Arbitration. Any controversy, claim or dispute arising out of or
relating to this Agreement or Employee's employment by the Company, including,
but not limited to, common law and statutory claims for discrimination, wrongful
discharge, and unpaid wages, shall be resolved by arbitration in Wilmington,
Delaware pursuant to then prevailing American Arbitration Association commercial
arbitration rules of Dispute Resolution and Arbitration procedures; provided,
that nothing in this subsection shall be construed as precluding the Company
from bringing an action for injunctive or other equitable relief. The Company
may elect to proceed to court without first resorting to arbitration in the
event that Employee breaches any provision of the Noncompetition and
Confidentiality Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date and year first above written.
DATE: THE COMPANY:
-------------------------------
UbiquiTel Holdings, Inc.
By:
----------------------------------
Its:
---------------------------------
DATE: Nov. 29, 1999
------------------------------ EMPLOYEE:
By: /s/ Donald A. Harris
---------------------------------
Exhibits:
A - Job Description
B - Noncompetition and Confidentiality Agreement
5
<PAGE>
EXHIBIT A
Job Descripton Suggested by Employee
Employee will be President and Chief Executive Officer of the Company and a
member of the Board of Directors of the Company. In such capacity, he will have
overall responsibility for the implementation of the Company's business plan
(the "Plan") and general authority over the management and supervision of the
business and operations of the Company, subject to control of the Board. He
shall also perform such other duties as may be assigned to him by the Board and
the Bylaws. The Employee's powers and duties will include the following:
Approval of all ordinary course of business matters of the Company
unless specifically limited or reserved by the Board;
In addition to matters covered by the Plan, approval of any project,
or set of related projects, involving total capital expenditures of
less than $1,000,000;
In addition to matters covered by the Plan, approval of any
operating lease obligation, or set of related lease obligations,
involving expenditures over the life of the obligations of less than
$1,000,000;
In addition to matters covered by the Plan, approval of any
commercial contract, or set of related commercial contracts, in the
ordinary course of business of the Company for the sale of products
of the Company involving commitments of, or assumption of
liabilities by, the Company during the term of such contract(s) less
than $1,000,000;
The hiring and firing of employees and contractors of the Company,
subject to notification and approval of the Board regarding hiring
and firing of officers and key employees of the Company;
Recommendation of performance goals and awards for employees of the
Company other than Employee under the incentive compensation plans
of the Company;
Approval of individual merit salary increases, excluding those of
Company officers, subject to the Board's approval of overall annual
merit salary adjustments.
6
<PAGE>
Exhibit B
Noncompetition and Confidentiality Agreement
In consideration of the employment of Employee, and the compensation,
training and access to confidential information provided to Employee, and in
consideration of the terms and conditions contained herein and for other good
and valuable considerations, the Company and Employee agree as follows:
Business. The Company is a Sprint PCS affiliate and is in the business of
offering, providing, marketing and procuring customers for commercial mobile
radio service, including personal communications service ("PCS") and other
wireless and similarly situated voice, radio, telephone, paging and messaging
services and ancillary services (the "Business").
Confidentiality. Employee acknowledges and understands that Employee will
be given access to certain confidential, secret and proprietary information and
materials owned by the Company or which relate to the Company's Business,
including but not limited to, all information not generally known to the public
that relates to the business, technology, subscribers, finances, plans,
proposals or practices of the Company, and it includes, without limitation, the
identity of all actual and prospective subscribers and customers, customer
lists, files and all information relating to individual customers and
subscribers, including their address and phone numbers, all business plans and
proposals, all marketing plans and proposals, all technical plans and proposals,
all research and development, all budgets, wage and salary information, and
projections, all nonpublic financial information, information on suppliers, and
information on all persons for whom the Company performs services or to whom the
Company makes sales during the course of the Company's business, and all other
information the Company designates as "confidential" (hereafter the
"Confidential Information"). The Company and Employee each acknowledge and agree
that all Confidential Information shall be considered trade secrets of the
Company and shall be entitled to all protections given by law to trade secrets.
Employee shall not disclose any Confidential Information, or use it for any
purpose, other than in advancing the business interests of the Company.
Confidential Information shall apply to every form in which information shall
exist, whether written, film, tape, computer disk or other form of media,
including original materials and any copies thereof.
Immediately upon termination of employment with the Company for any
reason, Employee shall deliver to the Company all property of the Company,
including but not limited to Confidential Information, all books, records, notes
or other writings or media containing any Confidential Information, and all
copies thereof. Employee shall also, unless otherwise directed in writing by the
Company, promptly erase all Confidential Information from all computers and
other information storage devices and media under Employee's direct or indirect
control, or return such devices or media to the Company.
Covenant Not to Compete. Employee agrees that, during the term of
Employee's employment and for a period of one year immediately following the
termination of such employment for any reason whatsoever (the "Restricted
Period"), Employee shall not, either directly or indirectly, with or without
compensation, individually or as employee, broker, agent,
7
<PAGE>
consultant, contractor, advisor, solicitor, greater than 5% stockholder, trust
beneficiary, proprietor, partner, or person interested in, affiliated with or
rendering services to any other entity, engage in, provide, offer to provide, or
assist anyone in providing, services to or for a business that provides wireless
telecommunications services similar to those services offered by the Company in
any territory in which the Company is a Sprint PCS affiliate.
Non-Solicitation of Customers and Employees. Employee further agrees that
during that portion of the Restricted Period following termination, Employee
shall not interfere with the established business relationship between the
Company and its Customers, shall not call upon any Customer of the Company's
Business for the purpose of soliciting, selling, providing or delivering
services or products of the kind which are the subject of the Company's
Business, and shall not render or provide any service to any Customer, including
any person who was a Customer of the Company during the time that Employee was
employed, with the Company, that is the same as or similar to the service
provided in the Company's Business, Employee further agrees that during the
Restricted Period, neither Employee nor any person or entity otherwise connected
with Employee shall act, directly or indirectly, as a reseller of any such
services in the area.
Employee further agrees that while employed by the Company and during the
Restricted Period, Employee shall not directly or indirectly induce or attempt
to influence any employee of the Company to terminate his/her employment with
the Company or to work for Employee or any other person or entity.
Reasonableness of Restrictions. Employee acknowledges that the
restrictions contained in this Agreement are reasonable in time, scope and
geographic restraints, and do not unreasonably restrict Employee's ability to
obtain other employment. Employee further warrants that the restrictions do not
impose an undue hardship on Employee, and do not deprive Employee of an ability
to earn a living.
Remedies for Breach of Covenants. In the event of any breach or threatened
breach of any of the provisions herein, in addition to any other rights or
remedies available to the Company, the Company shall have the right to seek
monetary damages and equitable relief, including specific performance by means
of temporary, preliminary or permanent injunctions against Employee or against
Employee's partners, agents, representatives, servants, employers, employees,
family members and/or any and all persons acting directly or indirectly by or
with Employee, to prevent or restrain such breach. With respect to any such
equitable actions or proceedings, Employee agrees that no adequate legal remedy
exists, and hereby waives any defense that an adequate remedy at law exists and
any requirement that the Company prove damages. Employee further waives any
requirement that the Company furnish any bond or other security, and agrees that
to the extent a bond is required by law, it shall be in the amount of $100.00.
Employee agrees that the Company's rights to seek injunctive and other equitable
relief shall be and are cumulative and not exclusive and shall be in addition to
any other remedies that the Company may have.
8
<PAGE>
Choice of Law; Attorneys' Fees. This Agreement will be governed by the
laws of the State of Delaware. If any action is necessary to enforce or
Interpret the terms of this Agreement, each party shall bear such party's own
expenses of litigation, including without limitation, attorneys and experts fees
and costs, and any costs of appeal.
Business Opportunities. Employee agrees that he shall promptly disclose to
the Company any business opportunity of which Employee becomes aware during his
employment with the Company which relates to any product or services planned,
under development, developed, produced or marketed by the Company and which
employee becomes aware in the course of or as a result of Employee's employment
with the Company. Employee agrees that he will not take advantage of or divert
any such opportunity for the direct or indirect gain, profit or benefit of
Employee or any other person or entity.
Other Restrictions. Employee warrants that he/she is not subject to any
restrictive covenants or other legal disability, which would prevent Employee
from entering into this Agreement and from complying with its provisions to
their fullest extent. Employee understand and agrees that Employee is not
expected to, and shall not disclose trade secret or confidential information
from any previous employer or any other party.
9
<PAGE>
Exhibit 10.18
EXECUTION COPY
================================================================================
CREDIT AGREEMENT
among
UBIQUITEL INC.,
UBIQUITEL OPERATING COMPANY,
VARIOUS BANKS,
PARIBAS,
as Lead Arranger
and
PARIBAS,
as Administrative Agent
$250,000,000
---------------------------------
Dated as of March 31, 2000
---------------------------------
================================================================================
<PAGE>
TABLE OF CONTENTS
Page
----
Section 1. Amount and Terms of Credit.......................................1
1.01 The Commitments..................................................1
1.02 Minimum Amount of Each Borrowing.................................3
1.03 Notice of Borrowing..............................................3
1.04 Disbursement of Funds............................................4
1.05 Notes............................................................5
1.06 Conversions......................................................6
1.07 Pro Rata Borrowings..............................................7
1.08 Interest.........................................................7
1.09 Interest Periods.................................................8
1.10 Increased Costs, Illegality, etc................................10
1.11 Compensation....................................................12
1.12 Replacement of Banks............................................12
1.13 Change of Lending Office........................................13
Section 2. Letters of Credit...............................................13
2.01 Letters of Credit...............................................13
2.02 Minimum Stated Amount...........................................14
2.03 Letter of Credit Requests.......................................15
2.04 Letter of Credit Participations.................................15
2.05 Agreement to Repay Letter of Credit Drawings....................17
2.06 Increased Costs.................................................17
Section 3. Fees; Reductions of Commitment..................................18
3.01 Fees............................................................18
3.02 Voluntary Termination of Unutilized Commitments.................19
3.03 Mandatory Reduction of Commitments..............................20
Section 4. Prepayments; Payments; Taxes....................................21
4.01 Voluntary Prepayments...........................................21
4.02 Mandatory Repayments and Commitment Reductions..................23
4.03 Method and Place of Payment.....................................28
4.04 Net Payments....................................................28
Section 5. Conditions Precedent to Loans on the Initial Borrowing Date.....30
5.01 Execution of Agreement; Notes...................................30
5.02 Officer's Certificate...........................................30
5.03 Opinions of Counse..............................................30
(i)
<PAGE>
Page
----
5.04 Corporate Documents; Proceedings................................30
5.05 Plans; Shareholders' Agreements; Management Agreements;
Employment Agreements; Collective Bargaining Agreements;
Debt Agreements; Affiliate Contracts; Tax Sharing Agreements
and Material Contracts........................................31
5.06 Consent and Agreement...........................................32
5.07 Pledge Agreement................................................32
5.08 Security Agreement..............................................33
5.09 Material Adverse Change, etc....................................34
5.10 Litigation......................................................34
5.11 Fees, etc.......................................................34
5.12 Solvency Certificate; Insurance Analyses........................34
5.13 Approvals.......................................................35
5.14 Financial Statements; Projections; Management Letter Reports....35
5.15 Indebtedness....................................................36
5.16 Equity Documents................................................36
5.17 Landlord Waivers................................................36
5.18 Sprint Agreements...............................................36
5.19 Escrow Agreement................................................36
5.20 Guaranty........................................................36
5.21 Capital Structure...............................................37
5.22 Consent Letter..................................................37
5.23 B Term Loans....................................................37
5.24 Leases..........................................................37
5.25 Notes Financing.................................................37
5.26 Equity Bridge Commitment........................................38
5.27 Refinancing.....................................................38
5.28 Cash Collateral Agreement.......................................39
Section 6. Conditions Precedent to All Credit Events.......................39
6.01 No Default; Representations and Warranties......................39
6.02 Material Adverse Change, etc....................................39
6.03 Litigation......................................................39
6.04 Notice of Borrowing; Letter of Credit Request...................39
6.05 Pro Forma Compliance............................................40
6.06 Loan Proceeds...................................................40
Section 7. Representations, Warranties and Agreements......................40
7.01 Corporate Status................................................41
7.02 Corporate or Company Power and Authority........................41
7.03 No Violation....................................................41
7.04 Governmental Approvals..........................................42
7.05 Financial Statements; Financial Condition; Undisclosed
Liabilities; Projections; etc.................................42
7.06 LITIGATION......................................................43
(ii)
<PAGE>
Page
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7.07 True and Complete Disclosure....................................43
7.08 Use of Proceeds; Margin Regulations.............................43
7.09 Tax Returns and Payments........................................44
7.10 Compliance with ERISA...........................................44
7.11 The Security Documents..........................................45
7.12 Representations and Warranties in Documents.....................46
7.13 Properties......................................................46
7.14 Capitalization..................................................46
7.15 Subsidiaries....................................................47
7.16 Compliance with Statutes, etc...................................47
7.17 Investment Company Act..........................................47
7.18 Public Utility Holding Company Act..............................47
7.19 Environmental Matters...........................................47
7.20 Labor Relations.................................................48
7.21 Patents, Licenses, Franchises and Formulas......................48
7.22 Indebtedness....................................................49
7.23 Restrictions on or Relating to Subsidiaries.....................49
7.24 Special Purpose Corporation ....................................49
7.25 The Transaction.................................................50
7.26 Material Contracts..............................................50
7.27 Senior Subordinated Notes.......................................50
7.28 Preferred Stock Issuance........................................50
7.29 Liabilities of Leases Subsidiary................................50
7.30 Bridge Commitment...............................................51
7.31 Sprint Management Agreement.....................................51
7.32 Conversion......................................................51
Section 8. Affirmative Covenants...........................................51
8.01 Information Covenants...........................................51
8.02 Books, Records and Inspections..................................54
8.03 Maintenance of Property, Insurance..............................54
8.04 Corporate Franchises............................................55
8.05 Compliance with Statutes, etc...................................55
8.06 Compliance with Environmental Laws..............................55
8.07 ERISA...........................................................56
8.08 End of Fiscal Years; Fiscal Quarters............................57
8.09 Performance of Obligations......................................57
8.10 Payment of Taxes................................................57
8.11 Interest Rate Protection........................................58
8.12 Use of Proceeds.................................................58
8.13 UCC Searches....................................................58
8.14 Intellectual Property Rights....................................58
8.15 Approvals.......................................................58
8.16 Registry........................................................59
(iii)
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8.17 Further Actions.................................................59
8.18 Concentration Account...........................................60
8.19 Ownership of Subsidiaries.......................................60
8.20 Certain Transactions............................................60
Section 9. Negative Covenants..............................................62
9.01 Liens...........................................................62
9.02 Consolidation, Merger, Purchase or Sale of Assets, etc..........63
9.03 Dividends.......................................................64
9.04 Leases..........................................................65
9.05 Indebtedness....................................................65
9.06 Advances, Investments and Loans.................................66
9.07 Transactions with Affiliates....................................67
9.08 Capital Expenditures............................................68
9.09 Fixed Charge Coverage Ratio.....................................68
9.10 Interest Coverage Ratio.........................................69
9.11 Total Capital Ratios............................................69
9.12 Minimum Covered POPS............................................70
9.13 Leverage Ratios.................................................70
9.14 Minimum Revenues................................................72
9.15 Minimum Subscribers.............................................73
9.16 Limitation on Voluntary Payments and Modification;
Limitation on Modifications of Certificate of Incorporation,
By-Laws Certificate of Limited Partnership, Agreement of
Limited Partnership and Certain Other Agreements; etc.........73
9.17 Limitation on Certain Restrictions on Subsidiaries..............74
9.18 Limitation on Issuance of Equity Interests......................74
9.19 Business........................................................75
9.20 Limitation on Creation of Subsidiaries..........................75
9.21 Concentration Account...........................................75
9.22 Sprint Agreements...............................................75
9.23 Limitations on Leases Subsidiary................................75
Section 10. Events of Default..............................................75
10.01 Payments.......................................................76
10.02 Representations, etc...........................................76
10.03 Covenants......................................................76
10.04 Default Under Other Agreements.................................76
10.05 Bankruptcy, etc................................................76
10.06 ERISA..........................................................77
10.07 Security Documents.............................................78
10.08 Judgments......................................................78
10.09 Sprint Agreements..............................................78
10.10 Change in Control..............................................78
(iv)
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Section 11. Definitions and Accounting Terms...............................79
11.01 Defined Terms..................................................79
Section 12. The Administrative Agent......................................107
12.01 Appointment...................................................107
12.02 Nature of Duties..............................................108
12.03 Lack of Reliance on the Administrative Agent..................108
12.04 Certain Rights of the Administrative Agent....................108
12.05 Reliance......................................................109
12.06 Indemnification...............................................109
12.07 The Administrative Agent in Its Individual Capacity...........109
12.08 Holders.......................................................109
12.09 Resignation by the Administrative Agent.......................110
12.10 Special Provisions Regarding the Lead Arranger................110
Section 13. Miscellaneous.................................................110
13.01 Payment of Expenses, etc......................................110
13.02 Right of Setoff...............................................111
13.03 Notices.......................................................112
13.04 Benefit of Agreement..........................................112
13.05 No Waiver; Remedies Cumulative................................113
13.06 Payments Pro Rata.............................................114
13.07 Calculations; Computations....................................114
13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE;
WAIVER OF JURY TRIAL........................................114
13.09 Counterparts..................................................115
13.10 Effectiveness.................................................115
13.11 Headings Descriptive..........................................116
13.12 Amendment or Waiver...........................................116
13.13 Survival......................................................117
13.14 Domicile of Loans.............................................117
13.15 Post-Closing Obligations......................................118
13.16 Sprint Spectrum L.P.'s Purchase Rights........................118
13.17 Existing Paribas Credit Agreement.............................118
SCHEDULE I Commitments
SCHEDULE II Insurance
SCHEDULE III Financial Statements
SCHEDULE IV Projections
SCHEDULE V Real Property
SCHEDULE VI ERISA
SCHEDULE VII Capitalization
SCHEDULE VIII Material Contracts
(v)
<PAGE>
SCHEDULE IX Existing Liens
SCHEDULE X Affiliate Transactions
EXHIBIT A-1 Notice of Borrowing
EXHIBIT A-2 Notice of Conversion
EXHIBIT B-1 A Term Note
EXHIBIT B-2 B Term Note
EXHIBIT B-3 Revolving Note
EXHIBIT B-4 Swingline Note
EXHIBIT C Letter of Credit Request
EXHIBIT D Section 4 04(b)(ii) Certificate
EXHIBIT E Form of Opinion of Greenberg Traurig
EXHIBIT F Officers' Certificate of Credit Parties
EXHIBIT G Pledge Agreement
EXHIBIT H Security Agreement
EXHIBIT I Consent Letter
EXHIBIT J Bank Assignment and Assumption Agreement
EXHIBIT K Solvency Certificate
EXHIBIT L Consent and Agreement
EXHIBIT M Cash Collateral Agreement
EXHIBIT N Escrow Agreement
EXHIBIT O Guaranty
(vi)
<PAGE>
CREDIT AGREEMENT, dated as of March 31, 2000, among UBIQUITEL INC.,
a Delaware corporation ("Holdings"), UBIQUITEL OPERATING COMPANY, a Delaware
corporation (the "Borrower"), the financial institutions party hereto from time
to time (each a "Bank" and, collectively, the "Banks"), PARIBAS, as lead
arranger (the "Lead Arranger") and PARIBAS, as administrative agent (the
"Administrative Agent"). Unless otherwise defined herein, all capitalized terms
used herein and defined in Section 11 are used herein as therein defined.
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, subject to and upon the terms and conditions herein set
forth, the Banks are willing to make available to the Borrower the respective
credit facilities provided for herein;
NOW, THEREFORE, IT IS AGREED:
Section 1. Amount and Terms of Credit.
1.01 The Commitments. (a) Subject to and upon the terms and
conditions set forth herein, each Bank with an A Term Loan Commitment severally
agrees to make, at any time and from time to time on and after the Initial
Borrowing Date and on or prior to the A Term Loan Commitment Termination Date, a
term loan or term loans (each, an "A Term Loan" and, collectively, the "A Term
Loans") to the Borrower, which A Term Loans (i) shall, at the option of
Borrower, be Base Rate Loans or Eurodollar Loans; provided that (x) except as
otherwise specifically provided in Section 1.10(b), all A Term Loans comprising
the same Borrowing shall at all times be of the same Type and (y) no Eurodollar
Loans may be incurred prior to the Syndication Termination Date and (ii) shall
not exceed for any Bank, in initial aggregate principal amount, that amount
which equals the A Term Loan Commitment of such Bank on such date (before giving
effect to any reductions thereto on such date pursuant to Section 3.03(b)(i) or
3.03(b)(ii) but after giving effect to any reductions thereto on or prior to
such date pursuant to Section 3.03(b)(iii) or 3.03(b)(iv)). Once repaid, A Term
Loans incurred hereunder may not be reborrowed.
(b) Subject to and upon the terms and conditions set forth herein,
each Bank with a B Term Loan Commitment severally agrees to make, on the Initial
Borrowing Date, a term loan (each, a "B Term Loan" and, collectively, the "B
Term Loans") to the Borrower, which B Term Loans (i) shall, at the option of the
Borrower, be Base Rate Loans or Eurodollar Loans; provided that (x) except or
otherwise specifically provided in Section 1.10(b), all B Term Loans comprising
the same Borrowing shall at all times be of the same Type and (y) no Eurodollar
Loans may be incurred prior to the Syndication Termination Date and (ii) shall
not exceed for any Bank, in initial aggregate principal amount, that amount
which equals the B Term Loan Commitment of such Bank on such date (before giving
effect to any reductions thereto on such date pursuant to Section 3.03(c)(i) or
3.03(c)(ii) but after giving effect to any reductions thereto on or prior to
such date pursuant to Section 3.03(c)(iii)). Once repaid, B Term Loans incurred
hereunder may not be reborrowed.
<PAGE>
(c) Subject to and upon the terms and conditions set forth herein,
each Bank with a Revolving Loan Commitment severally agrees at any time and from
time to time after the date on which the Total A Term Loan Commitment has been
reduced to zero and prior to the Revolving Loan Maturity Date, to make a loan or
loans (each a "Revolving Loan" and, collectively, the "Revolving Loans") to the
Borrower, which Revolving Loans (i) shall, at the option of the Borrower, be
Base Rate Loans or Eurodollar Loans; provided that (x) except as otherwise
specifically provided in Section 1.10(b), all Revolving Loans comprising the
same Borrowing shall at all times be of the same Type and (y) no Eurodollar
Loans may be incurred prior to the Syndication Termination Date, (ii) may be
repaid and reborrowed in accordance with the provisions hereof and (iii) shall
not exceed for any Bank at any time outstanding that aggregate principal amount
which, when added to the product of (x) such Bank's Percentage and (y) the sum
of (I) the aggregate amount of all Letter of Credit Outstandings (exclusive of
Unpaid Drawings which are repaid with the proceeds of, and simultaneously with
the incurrence of, the respective incurrence of Revolving Loans) and (II) the
aggregate principal amount of all Swingline Loans then outstanding (exclusive of
Swingline Loans which are repaid with the proceeds of, and simultaneously with
the incurrence of, the respective incurrence of Revolving Loans), equals the
Revolving Loan Commitment of such Bank at such time.
(d) Subject to and upon the terms and conditions herein set forth,
the Swingline Bank agrees to make at any time and from time to time after the
date on which the Total Term Loan Commitment has been reduced to zero and prior
to the Swingline Expiry Date, a loan or loans to the Borrower (each a "Swingline
Loan," and collectively, the "Swingline Loans"), which Swingline Loans (i) shall
be made and maintained as Base Rate Loans; (ii) may be repaid and reborrowed in
accordance with the provisions hereof; (iii) shall not exceed in aggregate
principal amount at any time outstanding, when combined with the aggregate
principal amount of (x) all Revolving Loans then outstanding and (y) all Letter
of Credit Outstandings at such time (exclusive of Unpaid Drawings which are
repaid with the proceeds of, and simultaneously with the incurrence of, the
respective incurrence of Swingline Loans), an amount equal to the Total
Revolving Loan Commitment at such time (after giving effect to any reductions to
the Total Revolving Loan Commitment on such date); and (iv) shall not exceed in
aggregate principal amount at any time outstanding the Maximum Swingline Amount.
The Swingline Bank shall not be obligated to make any Swingline Loans at a time
when a Bank Default exists unless the Swingline Bank has entered into
arrangements satisfactory to it and the Borrower to eliminate the Swingline
Bank's risk with respect to the Defaulting Bank's or Banks' participation in
such Swingline Loans, including by cash collateralizing such Defaulting Bank's
or Banks' Percentage of the outstanding Swingline Loans. The Swingline Bank
shall not make any Swingline Loan after receiving a written notice from the
Borrower or the Required Banks stating that a Default or an Event of Default
exists and is continuing until such time as the Swingline Bank shall have
received written notice of (i) rescission of all such notices from the party or
parties originally delivering such notice, (ii) the waiver of such Default or
Event of Default by the Required Banks, (iii) the Administrative Agent in good
faith believes that such Default or Event of Default has ceased to exist or (iv)
the consent of the Required Banks to make Swingline Loans notwithstanding the
existence of such Default or Event of Default.
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<PAGE>
(e) On any Business Day, the Swingline Bank may, in its sole
discretion, give notice to the Banks that its outstanding Swingline Loans shall
be funded with a Borrowing of Revolving Loans, provided that such notice shall
be deemed to have been automatically given upon the occurrence of a Default or
an Event of Default under Section 10.05 or upon the exercise of any of the
remedies provided in the last paragraph of Section 10, in which case a Borrowing
of Revolving Loans constituting Base Rate Loans (each such Borrowing, a
"Mandatory Borrowing") shall be made on the immediately succeeding Business Day
from all Banks with a Revolving Loan Commitment (without giving effect to any
terminations and/or reductions thereto pursuant to the last paragraph of Section
10) pro rata on the basis of their respective Percentages (determined before
giving effect to any termination of the Revolving Loan Commitments pursuant to
the last paragraph of Section 10) and the proceeds thereof shall be applied
directly to the Swingline Bank to repay the Swingline Bank for such outstanding
Swingline Loans. Each such Bank hereby irrevocably agrees to make Revolving
Loans upon one Business Day's notice pursuant to each Mandatory Borrowing in the
amount and in the manner specified in the preceding sentence and on the date
specified in writing by the Swingline Bank notwithstanding (i) the amount of the
Mandatory Borrowing may not comply with the minimum amount for Borrowings
otherwise required hereunder, (ii) whether any conditions specified in Section 6
are then satisfied, (iii) whether a Default or an Event of Default then exists,
(iv) the date of such Mandatory Borrowing and (v) any reduction in the Total
Revolving Loan Commitment after any such Swingline Loans were made. In the event
that any Mandatory Borrowing cannot for any reason be made on the date otherwise
required above (including, without limitation, as a result of the commencement
of a proceeding under the Bankruptcy Code with respect to the Borrower), then
each such Bank hereby agrees that it shall forthwith purchase (as of the date
the Mandatory Borrowing would otherwise have occurred, but adjusted for any
payments received from the Borrower on or after such date and prior to such
purchase) from the Swingline Bank (without recourse or warranty) such
participations in the outstanding Swingline Loans as shall be necessary to cause
such Banks to share in such Swingline Loans ratably based upon their respective
Percentages (determined before giving effect to any termination of the Revolving
Loan Commitments pursuant to the last paragraph of Section 10); provided that
(x) all interest payable on the Swingline Loans shall be for the account of the
Swingline Bank until the date as of which the respective participation is
required to be purchased and, to the extent attributable to the purchased
participation, shall be payable to the participant from and after such date and
(y) at the time any purchase of participations pursuant to this sentence is
actually made, the purchasing Bank shall be required to pay the Swingline Bank
interest on the principal amount of participation purchased for each day from
and including the day upon which the Mandatory Borrowing would otherwise have
occurred to but excluding the date of payment for such participation, at the
rate otherwise applicable to Revolving Loans maintained as Base Rate Loans
hereunder for each day thereafter.
1.02 Minimum Amount of Each Borrowing. The aggregate principal
amount of each Borrowing under a Facility hereunder shall not be less than the
Minimum Borrowing Amount for such Facility and, if greater, shall be in integral
multiples of $1,000,000 in the case of all Loans (other than Swingline Loans)
and $100,000 in the case of Swingline Loans. More than one Borrowing may occur
on the same date, but at no time shall there be outstanding more than eight
Borrowings of Eurodollar Loans.
-3-
<PAGE>
1.03 Notice of Borrowing. (a) Whenever the Borrower desires to make
a Borrowing hereunder (excluding Borrowings of Swingline Loans and Mandatory
Borrowings), it shall give the Administrative Agent at its Notice Office, prior
to 11:00 a.m. (New York time) at least one Business Day's prior written notice
(or telephonic notice promptly confirmed in writing) of each Borrowing of Base
Rate Loans and at least three Business Days' prior written notice (or telephonic
notice promptly confirmed in writing) of each Borrowing of Eurodollar Loans.
Each such notice (each a "Notice of Borrowing"), except as otherwise expressly
provided in Section 1.10, shall be irrevocable and shall be given by the
Borrower in the form of Exhibit A-1, appropriately completed to specify (i) the
aggregate principal amount of the Loans to be made pursuant to such Borrowing,
(ii) the date of such Borrowing (which shall be a Business Day), (iii) whether
the Loans being made pursuant to such Borrowing shall constitute A Term Loans, B
Term Loans or Revolving Loans and (iv) whether the Loans being made pursuant to
such Borrowing are to be initially maintained as Base Rate Loans or Eurodollar
Loans and, if Eurodollar Loans, the initial Interest Period to be applicable
thereto. Any notice received after 11:00 a.m. (New York time) shall be deemed to
be received on the next succeeding Business Day. The Administrative Agent shall
promptly give each Bank which is required to make Loans of the Tranche specified
in the respective Notice of Borrowing notice of such proposed Borrowing, of such
Bank's proportionate share thereof and of the other matters specified in the
Notice of Borrowing.
(b) (i) Whenever the Borrower desires to make a Borrowing of
Swingline Loans hereunder, it shall give the Swingline Bank not later than 11:00
a.m. (New York time) on the date that the Swingline Loan is to be made, written
notice (or telephonic notice confirmed in writing) of each Swingline Loan to be
made hereunder. Each such notice shall be irrevocable and specify in each case
(A) the date of Borrowing (which shall be a Business Day) and (B) the aggregate
principal amount of Swingline Loans to be made pursuant to such Borrowing.
(ii) Without in any way limiting the obligation of the Borrower to
confirm in writing any telephonic notice permitted to be given hereunder, the
Administrative Agent, the respective Issuing Bank (in the case of Letters of
Credit) or the Swingline Bank, as the case may be, may, prior to receipt of
written confirmation, act without liability upon the basis of telephonic notice
believed by the Administrative Agent, the respective Issuing Bank (in the case
of Letters of Credit) or the Swingline Bank, as the case may be, in good faith
to be from the Chief Executive Officer/President, the Chief Financial Officer or
Controller of the Borrower. In each such case, the Administrative Agent's, such
Issuing Bank's or the Swingline Bank's record of the terms of such telephonic
notice shall be conclusive absent manifest error.
(iii) Mandatory Borrowings shall be made upon the notice specified
in Section 1.01(e), with the Borrower irrevocably agreeing, by its incurrence of
any Swingline Loan, to the making of the Mandatory Borrowings as set forth in
Section 1.01(e).
1.04 Disbursement of Funds. No later than 12:00 Noon (New York time)
on the date specified in each Notice of Borrowing (or (x) in the case of
Swingline Loans, no later than the close of business on the date specified
pursuant to Section 1.03(b)(i)) or (y) in the case of Mandatory Borrowings, not
later than 12:00 Noon (New York time) on the date specified in
-4-
<PAGE>
Section 1.01(e)), each Bank with a Commitment of the respective Tranche will
make available its pro rata portion (determined in accordance with Section 1.07)
of each such Borrowing requested to be made on such date (or in the case of
Swingline Loans, the Swingline Bank shall make available the full amount
thereof). All such amounts shall be made available in Dollars and in immediately
available funds at the Payment Office of the Administrative Agent, and the
Administrative Agent will make available to the Borrower at the Payment Office
the aggregate of the amounts so made available by the Banks. Unless the
Administrative Agent shall have been notified in writing by any Bank prior to
the date of Borrowing that such Bank does not intend to make available to the
Administrative Agent such Bank's portion of any Borrowing to be made on such
date, the Administrative Agent may assume that such Bank has made such amount
available to the Administrative Agent on such date of Borrowing and the
Administrative Agent may, in reliance upon such assumption, make available to
the Borrower a corresponding amount. If such corresponding amount is not in fact
made available to the Administrative Agent by such Bank, the Administrative
Agent shall be entitled to recover such corresponding amount on demand from such
Bank. If such Bank does not pay such corresponding amount forthwith upon the
Administrative Agent's demand therefor, the Administrative Agent shall promptly
notify the Borrower, and the Borrower shall immediately pay such corresponding
amount to the Administrative Agent. The Administrative Agent shall also be
entitled to recover on demand from such Bank or the Borrower, as the case may
be, interest on such corresponding amount in respect of each day from the date
such corresponding amount was made available by the Administrative Agent to the
Borrower, until the date such corresponding amount is recovered by the
Administrative Agent, at a rate per annum equal to (i) if recovered from such
Bank, the cost to the Administrative Agent of acquiring overnight federal funds
and (ii) if recovered from the Borrower, the rate of interest applicable to the
respective Borrowing, as determined pursuant to Section 1.08. Nothing in this
Section 1.04 shall be deemed to relieve any Bank from its obligation to make
Loans hereunder or to prejudice any rights which the Borrower may have against
any Bank as a result of any failure by such Bank to make Loans hereunder.
1.05 Notes. (a) The Borrower's obligation to pay the principal of,
and interest on, the Loans made by each Bank shall be evidenced (i) if A Term
Loans, by a promissory note duly executed and delivered by the Borrower
substantially in the form of Exhibit B-1, with blanks appropriately completed in
conformity herewith (each, an "A Term Note" and, collectively, the "A Term
Notes"), (ii) if B Term Loans, by a promissory note duly executed and delivered
by the Borrower substantially in the form of Exhibit B-2, with blanks
appropriately completed in conformity herewith (each, a "B Term Note" and,
collectively, the "B Term Notes"), (iii) if Revolving Loans, by a promissory
note duly executed and delivered by the Borrower substantially in the form of
Exhibit B-3, with blanks appropriately completed in conformity herewith (each a
"Revolving Note" and, collectively, the "Revolving Notes"), and (iv) if
Swingline Loans, by a promissory note duly executed and delivered by the
Borrower substantially in the form of Exhibit B-4, with blanks appropriately
completed in conformity herewith (the "Swingline Note").
(b) The A Term Note issued to each Bank with an A Term Loan
Commitment shall (i) be executed by the Borrower, (ii) be payable to the order
of such Bank or its registered assigns and be dated the Initial Borrowing Date,
(iii) be in a stated principal amount equal to the
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<PAGE>
A Term Loan Commitment of such Bank on the Initial Borrowing Date and be payable
in the principal amount of the A Term Loan evidenced thereby, (iv) mature on the
A Term Loan Maturity Date, (v) bear interest as provided in the appropriate
clause of Section 1.08 in respect of the Base Rate Loans and Eurodollar Loans,
as the case may be, evidenced thereby, (vi) be subject to voluntary repayment as
provided in Section 4.01, and mandatory repayment as provided in Section 4.02
and (vii) be entitled to the benefits of this Agreement and be secured by the
Security Documents.
(c) The B Term Note issued to each Bank with a B Term Loan
Commitment shall (i) be executed by the Borrower, (ii) be payable to the order
of such Bank or its registered assigns and be dated the Initial Borrowing Date,
(iii) be in a stated principal amount equal to the B Term Loans made by such
Bank on the Initial Borrowing Date and be payable in the principal amount of the
B Term Loans evidenced thereby, (iv) mature on the B Term Loan Maturity Date,
(v) bear interest as provided in the appropriate clause of Section 1.08 in
respect of the Base Rate Loans and Eurodollar Loans, as the case may be,
evidenced thereby, (vi) be subject to voluntary repayment as provided in Section
4.01 and mandatory repayment as provided in Section 4.02 and (vii) be entitled
to the benefits of this Agreement and be secured by the Security Documents.
(d) The Revolving Note issued to each Bank with a Revolving Loan
Commitment shall (i) be executed by the Borrower, (ii) be payable to the order
of such Bank or its registered assigns and be dated the Initial Borrowing Date,
(iii) be in a stated principal amount equal to the Revolving Loan Commitment of
such Bank and be payable in the principal amount of the Revolving Loans
evidenced thereby, (iv) mature on the Revolving Loan Maturity Date, (v) bear
interest as provided in the appropriate clause of Section 1.08 in respect of the
Base Rate Loans and Eurodollar Loans, as the case may be, evidenced thereby,
(vi) be subject to voluntary repayment as provided in Section 4.01, and
mandatory repayment as provided in Section 4.02 and (vii) be entitled to the
benefits of this Agreement and be secured by the Security Documents.
(e) The Swingline Note issued to the Swingline Bank shall (i) be
executed by the Borrower, (ii) be payable to the order of the Swingline Bank or
its registered assigns and be dated the Initial Borrowing Date, (iii) be in a
stated principal amount equal to the Maximum Swingline Amount and be payable in
the principal amount of the outstanding Swingline Loans evidenced thereby from
time to time, (iv) mature on the Swingline Expiry Date, (v) bear interest as
provided in the appropriate clause of Section 1.08 in respect of the Base Rate
Loans evidenced thereby, (vi) be subject to voluntary repayment as provided in
Section 4.01, and mandatory repayment as provided in Section 4.02 and (vii) be
entitled to the benefits of this Agreement and be secured by the Security
Documents.
(f) Each Bank will note on its internal records the amount of each
Loan made by it and each payment in respect thereof and will prior to any
transfer of any of its Notes endorse on the reverse side thereof the outstanding
principal amount of Loans evidenced thereby. Failure to make any such notation
or the making of an incorrect notation shall not affect the Borrower's
obligations in respect of such Loans.
-6-
<PAGE>
1.06 Conversions. The Borrower shall have the option to convert, on
any Business Day, all or a portion at least equal to the applicable Minimum
Borrowing Amount for such Tranche of the outstanding principal amount of the
Loans (other than Swingline Loans, which may not be converted pursuant to this
Section 1.06), made pursuant to one or more Borrowings (so long as of the same
Tranche) of one Type of Loan into a Borrowing or Borrowings (of the same
Tranche) of the other Type of Loan; provided that:
(i) except as otherwise provided in Section 1.10(b), Eurodollar
Loans may be converted into Base Rate Loans only on the last day of an
Interest Period applicable to the Loans being converted and no such
partial conversion of Eurodollar Loans shall reduce the outstanding
principal amount of such Eurodollar Loans made pursuant to a single
Borrowing to less than the applicable Minimum Borrowing Amount for such
Tranche applicable thereto;
(ii) unless the Required Banks otherwise agree, Base Rate Loans may
only be converted into Eurodollar Loans if no Default or Event of Default
is in existence on the date of the conversion;
(iii) no conversion pursuant to this Section 1.06 shall result in a
greater number of Borrowings than is permitted under Section 1.02; and
(iv) prior to the Syndication Termination Date, no Loan may be
converted into Eurodollar Loans.
Each such conversion shall be effected by the Borrower by giving the
Administrative Agent at its Notice Office prior to 12:00 Noon (New York time) at
least three Business Days' prior written notice (or telephonic notice promptly
confirmed in writing) (each a "Notice of Conversion") which notice shall be in
the form of Exhibit A-2, appropriately completed to specify the Loans to be so
converted, the Borrowing(s) pursuant to which such Loans were made and, if to be
converted into Eurodollar Loans, the Interest Period to be initially applicable
thereto. The Administrative Agent shall give each Bank prompt notice of any such
proposed conversion affecting any of its Loans.
1.07 Pro Rata Borrowings. All Borrowings of Loans (other than
Swingline Loans) under this Agreement shall be incurred from the Banks pro rata
on the basis of their respective A Term Loan Commitments, B Term Loan
Commitments or Revolving Loan Commitments, as the case may be; provided that all
Borrowings of Revolving Loans made pursuant to a Mandatory Borrowing shall be
incurred by the Borrower from the Banks pro rata on the basis of their
Percentages. It is understood that no Bank shall be responsible for any default
by any other Bank of its obligation to make Loans hereunder and that each Bank
shall be obligated to make the Loans provided to be made by it hereunder
regardless of the failure of any other Bank to make its Loans hereunder.
1.08 Interest. (a) The Borrower agrees to pay interest in respect of
the unpaid principal amount of each Base Rate Loan made to it from the date of
the Borrowing thereof until the earlier of (i) the maturity thereof (whether by
acceleration or otherwise) of such Base Rate
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Loan and (ii) the conversion of such Base Rate Loan to a Eurodollar Loan
pursuant to Section 1.06, at a rate per annum which shall at all times be equal
to the sum of the Applicable Margin plus the Base Rate in effect from time to
time.
(b) The Borrower agrees to pay interest in respect of the unpaid
principal amount of each Eurodollar Loan made to it from the date of the
Borrowing thereof until the earlier of (i) the maturity thereof (whether by
acceleration or otherwise) of such Eurodollar Loan and (ii) the conversion of
such Eurodollar Loan to a Base Rate Loan pursuant to Section 1.06, 1.09 or
1.10(b), as applicable, at a rate per annum which shall, during each Interest
Period applicable thereto, be equal to the sum of the Applicable Margin plus the
Quoted Rate for such Interest Period.
(c) Overdue principal and, to the extent permitted by law, overdue
interest in respect of each Loan and any other overdue amount payable hereunder
shall, in each case, bear interest at a rate per annum equal to the greater of
(x) 2% per annum in excess of the rate otherwise applicable to Base Rate Loans
of the respective Tranche of Loans from time to time and (y) the rate which is
2% in excess of the rate borne by such Loans. Interest which accrues under this
Section 1.08(c) shall be payable on demand.
(d) Accrued (and theretofore unpaid) interest shall be payable (i)
in respect of each Base Rate Loan, quarterly in arrears on each Quarterly
Payment Day, (ii) in respect of each Eurodollar Loan on (x) the date of any
prepayment or repayment thereof (on the amount prepaid or repaid), (y) the date
of any conversion into a Base Rate Loan pursuant to Section 1.06, 1.09 or
1.10(b), as applicable (on the amount converted) and (z) on the last day of each
Interest Period applicable thereto and, in the case of an Interest Period in
excess of three months, on each date occurring at three month intervals after
the first day of such Interest Period and (iii) in respect of each Loan, at
maturity (whether by acceleration or otherwise) and, after such maturity, on
demand.
(e) Upon each Interest Determination Date, the Administrative Agent
shall determine the Quoted Rate for the Interest Period applicable to Eurodollar
Loans and shall promptly notify the Borrower and the Banks thereof. Each such
determination shall, absent manifest error, be final and conclusive and binding
on all parties hereto.
(f) All computations of interest hereunder shall be made in
accordance with Section 13.07(b).
1.09 Interest Periods. At the time it gives any Notice of Borrowing
or Notice of Conversion in respect of the making of, or conversion into, a
Eurodollar Loan (in the case of the initial Interest Period applicable thereto)
or prior to 11:00 a.m. (New York time) on the third Business Day prior to the
expiration of an Interest Period applicable to such Eurodollar Loan (in the case
of any subsequent Interest Period), the Borrower shall have the right to elect,
by giving the Administrative Agent notice thereof, the interest period (each an
"Interest Period") applicable to such Eurodollar Loan, which Interest Period
shall, at the option of the Borrower, be a one, two, three or six-month period;
provided that:
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(i) all Eurodollar Loans comprising a single Borrowing shall at all
times have the same Interest Period;
(ii) the initial Interest Period for any Eurodollar Loan shall
commence on the date of Borrowing of such Loan (including the date of any
conversion thereto from a Borrowing of Base Rate Loans) and each Interest
Period occurring thereafter in respect of such Loan shall commence on the
day on which the next preceding Interest Period applicable thereto
expires;
(iii) if any Interest Period relating to a Eurodollar Loan begins on
a day for which there is no numerically corresponding day in the calendar
month at the end of such Interest Period, such Interest Period shall end
on the last Business Day of such calendar month;
(iv) if any Interest Period would otherwise expire on a day which is
not a Business Day, such Interest Period shall expire on the next
succeeding Business Day; provided, however, that if any Interest Period
for a Eurodollar Loan would otherwise expire on a day which is not a
Business Day but is a day of the month after which no further Business Day
occurs in such month, such Interest Period shall expire on the next
preceding Business Day;
(v) no Interest Period for a Borrowing under a Tranche shall be
selected which extends beyond the respective Maturity Date of such
Tranche;
(vi) no Interest Period may be selected at any time when any Default
or Event of Default is then in existence;
(vii) no Interest Period in respect of any Borrowing of A Term Loans
shall be selected which extends beyond any date upon which a mandatory
repayment of such A Term Loans will be required to be made under Section
4.02(A)(b) if, after giving effect to the selection of such Interest
Period, the aggregate principal amount of such A Term Loans maintained as
Eurodollar Loans which have Interest Periods expiring after such date will
be in excess of the aggregate principal amount of such A Term Loans then
outstanding less the aggregate amount of such required prepayment;
(viii) no Interest Period in respect of any Borrowing of B Term
Loans shall be selected which extends beyond any date upon which a
mandatory repayment of such B Term Loans will be required to be made
pursuant to Section 4.02(A)(c) if, after giving effect to the selection of
such Interest Period, the aggregate principal amount of B Term Loans
maintained as Eurodollar Loans which have Interest Periods expiring after
such date will be in excess of the aggregate principal amount of B Term
Loans then outstanding less the aggregate amount of such required
prepayment; and
(ix) no Interest Period may be selected prior to the Syndication
Termination Date.
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If upon the expiration of any Interest Period applicable to a
Borrowing of Eurodollar Loans the Borrower has failed to elect a new Interest
Period to be applicable to such Eurodollar Loans as provided above or a Default
or Event of Default then exists, the Borrower shall be deemed to have elected to
convert such Eurodollar Loans into Base Rate Loans effective as of the
expiration date of such current Interest Period.
1.10 Increased Costs, Illegality, etc. (a) In the event that any
Bank shall have determined (which determination shall, absent manifest error, be
final and conclusive and binding upon all parties hereto but, with respect to
clause (i) below, may be made only by the Administrative Agent):
(i) on any Interest Determination Date that, by reason of any
changes arising after the date of this Agreement affecting the interbank
Eurodollar market, adequate and fair means do not exist for ascertaining
the applicable interest rate on the basis provided for in the definition
of Quoted Rate; or
(ii) at any time, that such Bank shall incur increased costs or
reductions in the amounts received or receivable hereunder with respect to
any Eurodollar Loan because of (x) any change since the date of this
Agreement in any applicable law or governmental rule, regulation, order,
guideline or request (whether or not having the force of law) or in the
interpretation or administration thereof and including the introduction of
any new law or governmental rule, regulation, order, guideline or request,
such as, for example, but not limited to: (A) a change in the basis of
taxation of payments to any Bank of the principal of or interest on the
Notes or any other amounts payable hereunder (except for changes in the
rate of tax on, or determined by reference to, the net income or profits
of such Bank imposed by the jurisdiction in which its principal office or
applicable lending office is located) or (B) a change in official reserve
requirements (but, in all events, excluding reserves required under
Regulation D to the extent included in the computation of the Quoted Rate)
and/or (y) other circumstances since the date of this Agreement affecting
such Bank or the interbank Eurodollar market or the position of such Bank
in such market; or
(iii) at any time, that the making or continuance of any Eurodollar
Loan has been made (x) unlawful by any law or governmental rule,
regulation or order, (y) impossible by compliance by any Bank in good
faith with any governmental request (whether or not having the force of
law) or (z) impracticable as a result of a contingency occurring after the
date of this Agreement which materially and adversely affects the
interbank Eurodollar market;
then, and in any such event, such Bank (or the Administrative Agent, in the case
of clause (i) above) shall promptly give notice (if by telephone, promptly
confirmed in writing) to the Borrower, and, except in the case of clause (i)
above, to the Administrative Agent of such determination (which notice the
Administrative Agent shall promptly transmit to each of the other Banks).
Thereafter (x) in the case of clause (i) above, Eurodollar Loans shall no longer
be available until such time as the Administrative Agent notifies the Borrower
and the Banks that
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the circumstances giving rise to such notice by the Administrative Agent no
longer exist, and any Notice of Borrowing or Notice of Conversion given by the
Borrower with respect to Eurodollar Loans which have not yet been incurred
(including by way of conversion) shall be deemed rescinded by the Borrower, (y)
in the case of clause (ii) above, the Borrower shall pay to such Bank, upon
receipt of written demand therefor, such additional amounts (in the form of an
increased rate of, or a different method of calculating, interest or otherwise
as such Bank in its sole discretion shall determine) as shall be required to
compensate such Bank for such increased costs or reductions in amounts received
or receivable hereunder (a written notice as to the additional amounts owed to
such Bank, showing in reasonable detail the basis for the calculation thereof,
submitted to the Borrower by such Bank shall, absent manifest error, be final
and conclusive and binding on all the parties hereto) and (z) in the case of
clause (iii) above, the Borrower shall take one of the actions specified in
Section 1.10(b) as promptly as possible and, in any event, within the time
period required by law.
(b) At any time that any Eurodollar Loan is affected by the
circumstances described in Section 1.10(a)(ii) or (iii), the Borrower may (and
in the case of a Eurodollar Loan affected by the circumstances described in
Section 1.10(a)(iii) shall) either (i) if the affected Eurodollar Loan is then
being made initially or pursuant to a conversion, by giving the Administrative
Agent telephonic notice (confirmed in writing) on the same date that such
Borrower was notified by the affected Bank or the Administrative Agent pursuant
to Section 1.10(a)(ii) or (iii), cancel the respective Borrowing or conversion,
or (ii) if the affected Eurodollar Loan is then outstanding, upon at least three
Business Days' written notice to the Administrative Agent, require the affected
Bank to convert such Eurodollar Loan into a Base Rate Loan; provided that if
more than one Bank is affected at any time, then all affected Banks must be
treated the same pursuant to this Section 1.10(b).
(c) If any Bank shall have determined that after the date hereof,
the adoption or effectiveness of any applicable law, rule or regulation
regarding capital adequacy, or any change therein, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by such Bank or any corporation controlling such Bank
with any request or directive regarding capital adequacy (whether or not having
the force of law) of any such authority, central bank or comparable agency, has
or would have the effect of reducing the rate of return on such Bank's or such
other corporation's capital or assets as a consequence of such Bank's Commitment
or Commitments hereunder or its obligations hereunder to a level below that
which such Bank or such other corporation could have achieved but for such
adoption, effectiveness, change or compliance (taking into consideration such
Bank's or such other corporation's policies with respect to capital adequacy),
then from time to time, upon written demand by such Bank (with a copy to the
Administrative Agent), accompanied by the notice referred to in the last
sentence of this clause (c), the Borrower shall pay to such Bank such additional
amount or amounts as will compensate such Bank or such other corporation for
such reduction. In determining such additional amounts, each Bank will act
reasonably and in good faith and will use reasonable averaging and attribution
methods. Each Bank, upon determining that any additional amounts will be payable
pursuant to this Section 1.10(c), will give prompt written notice thereof to the
Borrower (a copy of which shall be sent by such Bank to the
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Administrative Agent), which notice shall set forth the basis of the calculation
of such additional amounts, although the failure to give any such notice shall
not release or diminish the Borrower's obligations to pay additional amounts
pursuant to this Section 1.10(c) upon the subsequent receipt of such notice. A
Bank's reasonable good faith determination of compensation owing under this
Section 1.10(c) shall, absent manifest error, be final and conclusive and
binding on all the parties hereto.
1.11 Compensation. The Borrower shall compensate each Bank, upon its
written request (which request shall set forth in reasonable detail the basis
for requesting such compensation), for all losses, expenses and liabilities
(including, without limitation, any loss, expense or liability incurred by
reason of the liquidation or reemployment of deposits or other funds required by
such Bank to fund its Eurodollar Loans) which such Bank may sustain: (i) if for
any reason (other than a default by such Bank or the Administrative Agent) a
Borrowing of, or conversion from or into, Eurodollar Loans does not occur on a
date specified therefor in a Notice of Borrowing or Notice of Conversion
(whether or not withdrawn by such Borrower or deemed withdrawn pursuant to
Section 1.10(a)); (ii) if any repayment (including any repayment made pursuant
to Section 4.02 or as a result of an acceleration of the Loans pursuant to
Section 10 or as a result of the replacement of a Bank pursuant to Section 1.12
or 13.12(b)) or conversion of any of its Eurodollar Loans occurs on a date which
is not the last day of an Interest Period with respect thereto; (iii) if any
prepayment of any of its Eurodollar Loans is not made on any date specified in a
notice of prepayment given by such Borrower; or (iv) as a consequence of (x) any
other default by such Borrower to repay its Loans when required by the terms of
this Agreement or any Note held by such Bank or (y) any election made pursuant
to Section 1.10(b). A Bank's basis for requesting compensation pursuant to this
Section, and a Bank's calculations of the amount thereof, shall, absent manifest
error, be final and conclusive and binding on all the parties hereto.
1.12 Replacement of Banks. (x) If any Bank becomes a Defaulting Bank
or otherwise defaults in its obligations to make Loans or fund Unpaid Drawings,
(y) if any Bank (other than the Administrative Agent) refuses to consent to
certain proposed changes, waivers, discharges or terminations with respect to
this Agreement which have been approved by the Required Banks as provided in
Section 13.12(b) or (z) upon the occurrence of any event giving rise to the
operation of Section 1.10(a)(ii) or (iii), Section 1.10(c), Section 2.06 or
Section 4.04 with respect to any Bank (other than the Administrative Agent)
which results in such Bank charging to the Borrower increased costs in an amount
materially in excess of those being charged by the other Banks, then the
Borrower shall have the right, if no Default or Event of Default then exists, to
replace such Bank (the "Replaced Bank") with any other Bank or with one or more
Eligible Transferee or Transferees, none of whom shall constitute a Defaulting
Bank or shall be in default in its obligations to make Loans or fund Unpaid
Drawings at the time of such replacement (collectively, the "Replacement Banks")
reasonably acceptable to the Administrative Agent, the Swingline Bank and each
Issuing Bank with outstanding Letters of Credit (unless the respective
Replacement Bank is not acquiring any Revolving Loan Commitment); provided that:
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(i) at the time of any replacement pursuant to this Section 1.12,
the Replacement Bank shall enter into one or more assignment agreements
pursuant to Section 13.04(b) (and with all fees payable pursuant to said
Section 13.04(b) to be paid by the Replacement Bank) pursuant to which the
Replacement Bank shall acquire all of the Commitments and outstanding
Loans of, and participations in Letters of Credit by, the Replaced Bank
and, in connection therewith, shall pay to (x) the Replaced Bank in
respect thereof an amount equal to the sum of (A) an amount equal to the
principal of, and all accrued interest on, all outstanding Loans of the
Replaced Bank, and (B) an amount equal to such Replaced Bank's Percentage
of all Unpaid Drawings that have been funded by (and not reimbursed to)
such Replaced Bank, together with all then unpaid interest with respect
thereto at such time and (C) an amount equal to all accrued, but
theretofore unpaid, Fees owing to the Replaced Bank pursuant to Section
3.01 hereof, (y) the Issuing Bank or Banks an amount equal to such
Replaced Bank's Percentage of any Unpaid Drawing (which at such time
remains an Unpaid Drawing) to the extent such amount was not theretofore
funded by such Replaced Bank and (z) the Swingline Bank an amount equal to
such Bank's Percentage of any Mandatory Borrowing to the extent such
amount was not theretofore funded by such Replaced Bank; and
(ii) all obligations of the Borrower owing to the Replaced Bank
(other than those specifically described in clause (i) above in respect of
which the assignment purchase price has been, or is concurrently being,
paid) shall be paid in full by the Borrower to such Replaced Bank
concurrently with such replacement.
Upon the execution of the respective assignment documentation, the payment of
amounts referred to in clauses (i) and (ii) above, recordation of the assignment
on the Register by the Administrative Agent pursuant to Section 8.16 and, if so
requested by the Replacement Bank, delivery to the Replacement Bank of the
appropriate Notes executed by the Borrower, the Replacement Bank shall become a
Bank hereunder and the Replaced Bank shall cease to constitute a Bank hereunder
with respect to the Loans and Commitments so transferred, except with respect to
indemnification provisions under this Agreement, which shall survive as to such
Replaced Bank, and the Percentages of the Banks shall be automatically adjusted
at such time to the extent necessary to give effect to such replacement.
1.13 Change of Lending Office. Each Bank agrees that, upon the
occurrence of any event giving rise to the operation of Section 1.10(a)(ii) or
(iii), 1.10(c), 2.06 or 4.04 with respect to such Bank, it will, if requested by
the Borrower, use reasonable efforts (subject to overall policy considerations
of such Bank) to designate another lending office for any Loans or Letters of
Credit affected by such event; provided, that such designation is made on such
terms that, in the sole judgment of such Bank, such Bank and its lending office
suffer no economic, legal or regulatory disadvantage, with the object of
avoiding the consequences of the event giving rise to the operation of any such
Section. Nothing in this Section 1.13 shall affect or postpone any of the
obligations of the Borrower or the right of any Bank provided in Section 1.10,
2.06 or 4.04.
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Section 2. Letters of Credit.
2.01 Letters of Credit. (a) Subject to and upon the terms and
conditions herein set forth, the Borrower may request any Issuing Bank at any
time and from time to time after the date on which the Total Term Loan
Commitment has been reduced to zero and prior to the tenth Business Day
immediately preceding the Revolving Loan Maturity Date to issue, for the account
of the Borrower and for the benefit of any holder (or any trustee, agent or
other similar representative for any such holders) of L/C Supportable
Indebtedness, an irrevocable standby letter of credit in a form customarily used
by such Issuing Bank or in such other form as has been approved by such Issuing
Bank in support of said L/C Supportable Indebtedness (each such letter of
credit, a "Letter of Credit" and, collectively, the "Letters of Credit"). All
Letters of Credit shall be denominated in Dollars.
(b) Each Issuing Bank (other than Paribas) may agree in its sole
discretion and Paribas hereby agrees that it will (subject to the terms and
conditions contained herein), at any time and from time to time after the date
on which the Total Term Loan Commitment has been reduced to zero and prior to
the tenth Business Day immediately preceding the Revolving Loan Maturity Date,
following its receipt of the respective Letter of Credit Request, issue for the
account of the Borrower one or more Letters of Credit in support of such L/C
Supportable Indebtedness as is permitted to remain outstanding without giving
rise to a Default or Event of Default hereunder; provided that the respective
Issuing Bank shall be under no obligation to issue any Letter of Credit if at
the time of such issuance:
(i) any order, judgment or decree of any governmental authority or
arbitrator shall purport by its terms to enjoin or restrain such Issuing
Bank from issuing such Letter of Credit or any requirement of law
applicable to such Issuing Bank or any request or directive (whether or
not having the force of law) from any governmental authority with
jurisdiction over such Issuing Bank shall prohibit, or request that such
Issuing Bank refrain from, the issuance of letters of credit generally or
such Letter of Credit in particular or shall impose upon such Issuing Bank
with respect to such Letter of Credit any restriction or reserve or
capital requirement (for which such Issuing Bank is not otherwise
compensated) not in effect on the date hereof, or any unreimbursed loss,
cost or expense which was not applicable, in effect or known to such
Issuing Bank as of the date hereof and which such Issuing Bank in good
faith deems material to it;
(ii) such Issuing Bank shall have received a notice of the type
described in the second sentence of Section 2.03(b) from any Bank prior to
the issuance of such Letter of Credit; or
(iii) a Bank Default exists, unless such Issuing Bank has entered
into arrangements satisfactory to it and the Borrower to eliminate such
Issuing Bank's risk with respect to the Bank which is the subject of the
Bank Default, including by cash collateralizing such Bank's Percentage of
the Letter of Credit Outstandings.
(c) Notwithstanding the foregoing, (i) no Letter of Credit shall be
issued the Stated Amount of which, when added to the Letter of Credit
Outstandings (exclusive of Unpaid
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Drawings which are repaid on the date of, prior to the issuance of, the
respective Letter of Credit) at such time, would exceed (x) $5,000,000 or (y)
when added to the aggregate principal amount of all Revolving Loans then
outstanding and Swingline Loans then outstanding, the Total Revolving Loan
Commitment then in effect (after giving effect to any reductions to the Total
Revolving Loan Commitment on such date) and (ii) each Letter of Credit shall by
its terms terminate on or before the earlier of (x) the date which occurs 12
months after the date of the issuance thereof (although any such Letter of
Credit may be renewable for successive periods of up to 12 months, but not
beyond the Revolving Loan Maturity Date, if agreed by, and on terms acceptable
to, the Issuing Bank) and (y) the tenth Business Day immediately preceding the
Revolving Loan Maturity Date.
2.02 Minimum Stated Amount. The Stated Amount of each Letter of
Credit shall be not less than $1,000,000 or such lesser amount as is acceptable
to the Issuing Bank.
2.03 Letter of Credit Requests. (a) Whenever the Borrower desires
that a Letter of Credit be issued for its account, the Borrower shall give the
Administrative Agent and the respective Issuing Bank at least 10 Business Days'
(or such shorter period as is acceptable to the respective Issuing Bank in any
given case) written notice prior to the proposed date of issuance (which shall
be a Business Day). Each notice shall be in the form of Exhibit C (each a
"Letter of Credit Request").
(b) The making of each Letter of Credit Request shall be deemed to
be a representation and warranty by the Borrower that such Letter of Credit may
be issued in accordance with, and will not violate the requirements of, Section
2.01(c). Unless the Issuing Bank has received notice from any Bank before it
issues a Letter of Credit that one or more of the conditions specified in
Section 6 are not then satisfied, or that the issuance of such Letter of Credit
would violate Section 2.01(c), then such Issuing Bank may issue the requested
Letter of Credit for the account of the Borrower in accordance with the Issuing
Bank's usual and customary practices.
2.04 Letter of Credit Participations. (a) Immediately upon the
issuance by the respective Issuing Bank of any Letter of Credit, such Issuing
Bank shall be deemed to have sold and transferred to each Bank with a Revolving
Loan Commitment, other than such Issuing Bank (each such Bank, in its capacity
under this Section 2.04, a "Participant"), and each such Participant shall be
deemed irrevocably and unconditionally to have purchased and received from such
Issuing Bank, without recourse or warranty, an undivided interest and
participation, to the extent of such Participant's Percentage in such Letter of
Credit, each substitute letter of credit, each drawing made thereunder and the
obligations of the Borrower under this Agreement with respect thereto, and any
security therefor or guaranty pertaining thereto. Upon any change in the
Revolving Loan Commitments of the Banks pursuant to Section 13.04, it is hereby
agreed that, with respect to all outstanding Letters of Credit and Unpaid
Drawings, there shall be an automatic adjustment to the participations pursuant
to this Section 2.04 to reflect the new Percentages of the assignor and assignee
Bank or of all Banks with Revolving Loan Commitments, as the case may be.
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(b) In determining whether to pay under any Letter of Credit, the
Issuing Bank shall not have any obligation relative to the respective
Participants other than to confirm that any documents required to be delivered
under such Letter of Credit appear to have been delivered and that they appear
to comply on their face with the requirements of such Letter of Credit. Any
action taken or omitted to be taken by any Issuing Bank under or in connection
with any Letter of Credit if taken or omitted in the absence of gross negligence
or willful misconduct, shall not create for such Issuing Bank any resulting
liability to the Borrower, any Bank, any Participant or any other Person.
(c) In the event that any Issuing Bank makes any payment under any
Letter of Credit and the Borrower shall not have reimbursed such amount in full
to the Issuing Bank pursuant to Section 2.05(a), such Issuing Bank shall
promptly notify the Administrative Agent, which shall promptly notify each
Participant of such failure, and each Participant shall promptly and
unconditionally pay to the Administrative Agent for the account of such Issuing
Bank the amount of such Participant's Percentage of such unreimbursed payment in
Dollars and in same day funds. If the Administrative Agent so notifies, prior to
11:00 A.M. (New York time) on any Business Day, any Participant required to fund
a payment under a Letter of Credit, such Participant shall make available to the
Administrative Agent at the Payment Office of the Administrative Agent for the
account of such Issuing Bank in Dollars such Participant's Percentage of the
amount of such payment on such Business Day in same day funds. If and to the
extent such Participant shall not have so made its Percentage of the amount of
such payment available to the Administrative Agent for the account of such
Issuing Bank, such Participant agrees to pay to the Administrative Agent for the
account of such Issuing Bank, forthwith on demand such amount, together with
interest thereon, for each day from such date until the date such amount is paid
to the Administrative Agent for the account of such Issuing Bank at the
overnight federal funds rate. The failure of any Participant to make available
to the Administrative Agent for the account of such Issuing Bank its Percentage
of any payment under any Letter of Credit shall not relieve any other
Participant of its obligation hereunder to make available to the Administrative
Agent for the account of such Issuing Bank its Percentage of any Letter of
Credit on the date required, as specified above, but no Participant shall be
responsible for the failure of any other Participant to make available to the
Administrative Agent for the account of such Issuing Bank such other
Participant's Percentage of any such payment.
(d) Whenever any Issuing Bank receives a payment of a reimbursement
obligation as to which the Administrative Agent has received for the account of
such Issuing Bank any payments from the Participants pursuant to clause (c)
above, such Issuing Bank shall pay to the Administrative Agent and the
Administrative Agent shall promptly pay each Participant which has paid its
Percentage thereof, in Dollars and in same day funds, an amount equal to such
Participant's share (based on the proportionate aggregate amount funded by such
Participant to the aggregate amount funded by all Participants) of the principal
amount of such reimbursement obligation and interest thereon accruing after the
purchase of the respective participations.
(e) The obligations of the Participants to make payments to the
Administrative Agent for the account of each Issuing Bank with respect to
Letters of Credit
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issued shall be irrevocable and not subject to any qualification or exception
whatsoever and shall be made in accordance with the terms and conditions of this
Agreement under all circumstances, including, without limitation, any of the
following circumstances:
(i) any lack of validity or enforceability of this Agreement or any
of the Credit Documents;
(ii) the existence of any claim, setoff, defense or other right
which the Borrower may have at any time against a beneficiary named in a
Letter of Credit, any transferee of any Letter of Credit (or any Person
for whom any such transferee may be acting), the Administrative Agent, any
Participant, or any other Person, whether in connection with this
Agreement, any Letter of Credit, the transactions contemplated herein or
any unrelated transactions (including any underlying transaction between
the Borrower and the beneficiary named in any such Letter of Credit);
(iii) any draft, certificate or any other document presented under
any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(iv) the surrender or impairment of any security for the performance
or observance of any of the terms of any of the Credit Documents; or
(v) the occurrence of any Default or Event of Default.
2.05 Agreement to Repay Letter of Credit Drawings. (a) The Borrower
hereby agrees to reimburse the respective Issuing Bank, by making payment to the
Administrative Agent in immediately available funds at the Payment Office (or by
making the payment directly to such Issuing Bank at such location as may
otherwise have been agreed upon by the Borrower and such Issuing Bank), for any
payment or disbursement made by such Issuing Bank under any Letter of Credit
(each such amount so paid until reimbursed, an "Unpaid Drawing"), immediately
after, and in any event on the date of, such payment or disbursement, with
interest on the amount so paid or disbursed by such Issuing Bank, to the extent
not reimbursed prior to 12:00 Noon (New York time) on the date of such payment
or disbursement, from and including the date paid or disbursed to but excluding
the date such Issuing Bank is reimbursed by the Borrower therefor at a rate per
annum which shall be the Base Rate in effect from time to time plus 4-3/4% in
each case with such interest to be payable on demand.
(b) The obligations of the Borrower under this Section 2.05 to
reimburse the respective Issuing Bank with respect to Unpaid Drawings
(including, in each case, interest thereon) shall be absolute and unconditional
under any and all circumstances and irrespective of any setoff, counterclaim or
defense to payment which the Borrower may have or have had against any Bank
(including in its capacity as Issuing Bank or as Participant), including,
without limitation, any defense based upon the failure of any drawing under a
Letter of Credit (each a "Drawing") to conform to the terms of the Letter of
Credit or any nonapplication or misapplication by the beneficiary of the
proceeds of such Drawing; provided, however, that the Borrower shall not be
obligated to reimburse any Issuing Bank for any wrongful payment made
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by such Issuing Bank under a Letter of Credit as a result of acts or omissions
constituting willful misconduct or gross negligence on the part of such Issuing
Bank.
2.06 Increased Costs. If at any time after the date hereof any
Issuing Bank or any Participant determines that the introduction of or any
change in any applicable law, rule, regulation, order, guideline or request or
in the interpretation or administration thereof by any governmental authority
charged with the interpretation or administration thereof, or compliance by such
Issuing Bank or any Participant, or any corporation controlling such Person,
with any request or directive by any such authority (whether or not having the
force of law), shall either (i) impose, modify or make applicable any reserve,
deposit, capital adequacy or similar requirement against letters of credit
issued by such Issuing Bank or participated in by any Participant, or (ii)
impose on such Issuing Bank or any Participant, or any corporation controlling
such Person, any other conditions relating, directly or indirectly, to this
Agreement or any Letter of Credit; and the result of any of the foregoing is to
increase the cost to such Issuing Bank or any Participant of issuing,
maintaining or participating in any Letter of Credit, or reduce the amount of
any sum received or receivable by such Issuing Bank or any Participant hereunder
or reduce the rate of return on its capital with respect to Letters of Credit,
then, upon demand to the Borrower by such Issuing Bank or any Participant (a
copy of which demand shall be sent by such Issuing Bank or such Participant to
the Administrative Agent), the Borrower shall pay to such Issuing Bank or such
Participant such additional amount or amounts as will compensate such Bank for
such increased cost or reduction in the amount receivable or reduction on the
rate of return on its capital. Such Issuing Bank or any Participant, upon
determining that any additional amounts will be payable pursuant to this Section
2.06, will give prompt written notice thereof to the Borrower, which notice
shall include a certificate submitted to the Borrower by such Issuing Bank or
such Participant (a copy of which certificate shall be sent by such Issuing Bank
or such Participant to the Administrative Agent), setting forth the basis for
the calculation of such additional amount or amounts necessary to compensate
such Issuing Bank or such Participant, although failure to give any such notice
shall not release or diminish the Borrower's obligations to pay additional
amounts pursuant to this Section 2.06. The certificate required to be delivered
pursuant to this Section 2.06 shall, absent manifest error, be final, conclusive
and binding on the Borrower.
Section 3. Fees; Reductions of Commitment.
3.01 Fees. (a) The Borrower agrees to pay to the Administrative
Agent for distribution to each Bank with an A Term Loan Commitment or a
Revolving Loan Commitment a commitment commission (the "AR Commitment
Commission") for the period from and including the Effective Date to and
excluding the later of (x) the date on which the Total A Term Loan Commitment
has been terminated in full and (y) the Revolving Loan Maturity Date (or such
earlier date as the Total Commitment shall have been terminated), computed at a
rate for each day equal to the Applicable Commitment Commission Percentage per
annum on the daily average Aggregate Unutilized Commitment of such Bank. Accrued
AR Commitment Commission shall be due and payable quarterly in arrears on each
Quarterly Payment Date and on the later of (x) the date on which the Total A
Term Loan Commitment has been terminated in
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full and (y) the Revolving Loan Maturity Date (or such earlier date upon which
the Total Commitment is terminated).
(b) The Borrower agrees to pay the Administrative Agent for
distribution to each Bank with a B Term Loan Commitment a commitment commission
(the "B Commitment Commission") for the period from and including the Effective
Date to and excluding the date on which the Total B Term Loan Commitment has
been terminated in full, computed at a rate for each day equal to the Applicable
Margin for B Term Loans maintained as Eurodollar Loans on the Total B Term Loan
Commitment. Accrued B Commitment Commission shall be due and payable quarterly
in arrears on each Quarterly Payment Date and on the date on which the Total B
Term Loan Commitment has been terminated in full.
(c) The Borrower agrees to pay to each Issuing Bank, for its own
account, a facing fee in respect of each Letter of Credit issued by such Issuing
Bank hereunder (the "Facing Fee"), for the period from and including the date of
issuance of such Letter of Credit to and including the date of termination of
such Letter of Credit, equal to 1/4 of 1% per annum of the daily Stated Amount
of such Letter of Credit; provided that in no event shall the annual Facing Fee
with respect to each Letter of Credit be less than $1,000. Accrued Facing Fees
shall be due and payable quarterly in arrears to the Issuing Bank in respect of
each Letter of Credit issued by it on each Quarterly Payment Date and on the
Revolving Loan Maturity Date (or such earlier date upon which the Total
Revolving Loan Commitment is terminated).
(d) The Borrower agrees to pay to the Administrative Agent for
distribution to each Bank with a Revolving Loan Commitment a fee in respect of
each Letter of Credit issued hereunder (the "Letter of Credit Fee"), for the
period from and including the date of issuance of such Letter of Credit to and
including the date of termination of such Letter of Credit, computed at a rate
per annum equal to the Applicable Margin then in effect for Revolving Loans
which are Eurodollar Loans of the daily average Stated Amount of such Letter of
Credit. Letter of Credit Fees shall be distributed by the Administrative Agent
to the Banks on the basis of the respective Percentages as in effect from time
to time. Accrued Letter of Credit Fees shall be due and payable quarterly in
arrears on each Quarterly Payment Date and on the Revolving Loan Maturity Date
(or such earlier date upon which to Total Revolving Loan Commitment is
terminated).
(e) The Borrower hereby agrees to pay in immediately available funds
directly to the Issuing Bank upon each issuance of, drawing under, and/or
amendment of, a Letter of Credit issued by the Issuing Bank such amount as shall
at the time of such issuance, drawing or amendment be the administrative charge
which the Issuing Bank is customarily charging for issuances of, drawings under
(including wire charges) or amendments of, letters of credit issued by it or
such alternative amounts as may have been agreed upon in writing by the Borrower
and the Issuing Bank.
(f) The Borrower shall pay to the Administrative Agent when and as
due, for its own account, such fees as may be agreed to in writing from time to
time between the Borrower and the Administrative Agent.
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(g) All computations of Fees shall be made in accordance with
Section 13.07(b).
3.02 Voluntary Termination of Unutilized Commitments. (a) Upon at
least five Business Days' prior written notice (or telephonic notice promptly
confirmed in writing) to the Administrative Agent at its Notice Office (which
notice the Administrative Agent shall promptly transmit to each of the Banks)
and at the end of any applicable Interest Period, the Borrower shall have the
right, without premium or penalty, to terminate the Total A Term Loan
Commitment, the Total B Term Loan Commitment or the Total Unutilized Revolving
Loan Commitment in whole or in part; provided that (i) each such reduction shall
apply proportionately to reduce the A Term Loan Commitment, the B Term Loan
Commitment or the Revolving Loan Commitment, as the case may be, of each Bank
with such a Commitment and (ii) any partial reduction pursuant to this Section
3.02 shall be in an aggregate principal amount of at least $5,000,000 and, if
greater, in integral multiples of at least $1,000,000.
(b) In the event of certain refusals by a Bank to consent to certain
proposed changes, waivers, discharges or terminations with respect to this
Agreement which have been approved by the Required Banks as provided in Section
13.12(b), the Borrower shall have the right, so long as no Default or Event of
Default has occurred and is continuing, upon five Business Days' prior written
notice to the Administrative Agent at its Notice Office (which notice the
Administrative Agent shall promptly transmit to each of the Banks), to terminate
all of the Revolving Loan Commitment and/or the A Term Loan Commitment of such
Bank, so long as all Loans, together with accrued and unpaid interest, Fees and
all other amounts, owing to such Bank are repaid concurrently with the
effectiveness of such termination pursuant to Section 4.01(b) and the Borrower
shall pay to the Administrative Agent at such time an amount in cash and/or Cash
Equivalents equal to such Bank's applicable Percentage of the outstanding
Letters of Credit (which cash and/or Cash Equivalents shall be held by the
Administrative Agent as security for the obligations of the Borrower hereunder
in respect of the outstanding Letters of Credit pursuant to a cash collateral
agreement to be entered into in form and substance reasonably satisfactory to
the Administrative Agent, (at which time Annex I shall be deemed modified to
reflect such changed amounts), and at such time, unless the respective Bank
continues to act as a Bank with respect to Term Loans hereunder, such Bank shall
no longer constitute a "Bank" for purposes of this Agreement, except with
respect to indemnifications and similar provisions under this Agreement, which
shall survive as to such repaid Bank.
3.03 Mandatory Reduction of Commitments. (a) The Total Commitment
(and the A Term Loan Commitment, the B Term Loan Commitment and the Revolving
Loan Commitment of each Bank with such a Commitment) shall terminate on June 30,
2000 unless the Initial Borrowing Date has occurred on or before such date.
(b) In addition to any other mandatory commitment reductions
pursuant to this Section 3.03, the Total A Term Loan Commitment (and the A Term
Loan Commitment of each Bank with such a Commitment) shall (i) be reduced on
each date on which a Borrowing of A Term Loans is effected by an amount equal to
the amount of such Borrowing of A Term Loans made on such date, (ii) terminate
in its entirety on the A Term Loan Commitment Termination
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Date (after giving effect to the making of the A Term Loans on such date), (iii)
prior to the termination of the Total A Term Loan Commitment as provided in
clause (ii) above, be reduced from time to time to the extent required by
Section 4.02 and (iv) be reduced on each A Term Loan Commitment Required
Reduction Date by the amount by which the Required A Term Loan Drawdown Amount
for such date exceeds the aggregate principal amount of A Term Loans then
outstanding on such date.
(c) In addition to any other mandatory commitment reductions
pursuant to this Section 3.03, the Total B Term Loan Commitment (and the B Term
Loan Commitment of each Bank with such a Commitment) shall (i) be reduced on
each date on which a Borrowing of B Term Loans is effected by an amount equal to
the amount of such Borrowing of B Term Loans made on such date, (ii) terminate
in its entirety on the Initial Borrowing Date (after giving effect to the making
of the B Term Loans on such date) and (iii) prior to the termination of the
Total B Term Loan Commitment as provided in clause (ii) above, be reduced from
time to time to the extent required by Section 4.02.
(d) In addition to any other mandatory commitment reductions
pursuant to this Section 3.03, the Total Revolving Loan Commitment (and the
Revolving Loan Commitment of each Bank with such a Commitment) shall be
permanently reduced by the amount set forth opposite each date set forth below
(to the extent any day set forth below is not a Business Day then the required
date of the commitment reduction shall be the immediately preceding Business
Day):
Revolving Loan Commitment Reduction Date Amount
---------------------------------------- ------
December 31, 2005 $6,875,000
March 31, 2006 6,875,000
June 30, 2006 6,875,000
September 30, 2006 6,875,000
December 31, 2006 6,875,000
March 31, 2007 6,875,000
June 30, 2007 6,875,000
September 30, 2007 6,875,000
(e) In addition to any other mandatory commitment reductions
pursuant to this Section 3.03, the Total Term Loan Commitment (and the Term Loan
Commitment of each Bank with such a Commitment) shall be reduced at the time any
payment is required to be made on the principal amount of Term Loans (or would
be required to be made of Term Loans then outstanding) pursuant to Section
4.02(B)(a), by an amount equal to the maximum amount of Term Loans that would be
required to be repaid pursuant to Section 4.02(B)(a) assuming that Term Loans
were outstanding in an aggregate principal amount equal to the Total Term Loan
Commitment.
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<PAGE>
(f) In addition to any other mandatory commitment reductions
pursuant to this Section 3.03, the Total Revolving Loan Commitment (and the
Revolving Loan Commitment of each Bank with such a Commitment) shall be reduced
at the time any payment is required to be made on the principal amount of
Revolving Loans (or would be required to be made if Revolving Loans were then
outstanding) pursuant to Section 4.02(B)(a), by an amount equal to the maximum
amount of Revolving Loans that would be required to be repaid pursuant to
Section 4.02(B)(a) assuming that Revolving Loans were outstanding in an
aggregate principal amount equal to the Total Revolving Loan Commitment.
(g) Each reduction to the Total A Term Loan Commitment, Total B Term
Loan Commitment and the Total Revolving Loan Commitment, pursuant to this
Section 3.03 shall be applied proportionately to reduce the A Term Loan
Commitment, B Term Loan Commitment or the Revolving Loan Commitment, as the case
may be, of each Bank with such a Commitment.
Section 4. Prepayments; Payments; Taxes.
4.01 Voluntary Prepayments. (a) The Borrower shall have the right to
prepay Loans, without premium or penalty, in whole or in part from time to time
on the following terms and conditions:
(i) the Borrower shall give the Administrative Agent prior to 11:00
a.m. (New York time) at its Notice Office at least five Business Days'
prior written notice (and on the date of such prepayment in the case of
Swingline Loans) of its intent to prepay the Loans, whether A Term Loans,
B Term Loans, Revolving Loans or Swingline Loans shall be prepaid, the
amount of such prepayment and the Types of Loans to be prepaid and, in the
case of Eurodollar Loans, the specific Borrowing or Borrowings pursuant to
which made, which notice the Administrative Agent shall promptly transmit
to each of the Banks;
(ii) each prepayment shall be in an aggregate principal amount of at
least $5,000,000 and, if greater, in integral multiples of $1,000,000, in
the case of all Loans (other than Swingline Loans), and $100,000, in the
case of Swingline Loans; provided that no partial prepayment of Eurodollar
Loans made pursuant to any Borrowing shall reduce the outstanding Loans
made pursuant to such Borrowing to an amount less than the Minimum
Borrowing Amount;
(iii) no prepayments of Eurodollar Loans made pursuant to this
Section 4.01 may be made on a day other than the last day of an Interest
Period applicable thereto;
(iv) each prepayment in respect of any Loans made pursuant to a
Borrowing shall be applied pro rata among such Loans;
(v) each prepayment of A Term Loans or B Term Loans pursuant to this
Section 4.01 must consist of a prepayment of A Term Loans (in an amount
equal to the A
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TL Percentage of such prepayment) and B Term Loans (in an amount equal to
the B TL Percentage of such prepayment) on a pro rata basis; and
(vi) each prepayment of A Term Loans and B Term Loans pursuant to
this Section 4.01 shall be applied to reduce the then remaining Scheduled
Repayments of the respective Tranche being repaid on a pro rata basis
(based upon the then remaining principal amount of each such Scheduled
Repayments).
(b) In the event of certain refusals by a Bank to consent to certain
proposed changes, waivers, discharges or terminations with respect to this
Agreement which have been approved by the Required Banks as provided in Section
13.12(b), the Borrower shall have the right, so long as no Default or Event of
Default has occurred and is continuing, upon five Business Days' prior written
notice to the Administrative Agent at its Notice Office (which notice the
Administrative Agent shall promptly transmit to each of the Banks) to repay all
Loans, together with accrued and unpaid interest, Fees and all other amounts
owing to such Bank (or owing to such Bank with respect to each Tranche which
gave rise to the need to obtain such Bank's individual consent) in accordance
with said Section 13.12(b) so long as (A) in the case of the repayment of
Revolving Loans of any Bank with a Revolving Loan Commitment pursuant to this
clause (b) the Revolving Loan Commitment of such Bank is terminated concurrently
with such repayment pursuant to Section 3.02(a) (at which time Schedule I shall
be deemed modified to reflect the changed Commitments), and (B) in the case of
the repayment of A Term Loans or B Term Loans of any Bank the consents required
by Section 13.12(b) in connection with the repayment pursuant to this clause (b)
shall have been obtained.
4.02 Mandatory Repayments and Commitment Reductions.
(A) Requirements:
(a) On any day on which the sum of (x) the aggregate outstanding
principal amount of the Revolving Loans, (y) the aggregate amount of all
Swingline Loans and (z) Letter of Credit Outstandings at such time, exceeds the
Total Revolving Loan Commitment as then in effect, the Borrower shall prepay the
principal of Swingline Loans and after the Swingline Loans have been repaid in
full, the principal of Revolving Loans in an amount equal to such excess. If,
after giving effect to the prepayment of all outstanding Swingline Loans and
Revolving Loans, the aggregate amount of the Letter of Credit Outstandings
exceeds the Total Revolving Loan Commitment as then in effect, the Borrower
shall pay to the Administrative Agent at its Payment Office on such date an
amount of cash or Cash Equivalents equal to the amount of such excess, such cash
or Cash Equivalents to be held as security for all Obligations of the Borrower
hereunder with respect to the Letter of Credit Outstandings in a cash collateral
account established and maintained (including the investments made pursuant
thereto) by the Administrative Agent pursuant to a cash collateral agreement in
form and substance satisfactory to the Administrative Agent (the "Letter of
Credit Cash Collateral Account").
(b) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02(A), the Borrower shall be required to
repay on each date set forth below (to the extent any day set forth below is not
a Business Day then the required date of
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repayment shall be the immediately preceding Business Day) A Term Loans, to the
extent then outstanding, in an amount equal to that percentage as is set forth
opposite such date multiplied by the aggregate principal amount of the A Term
Loans (the "Tranche A Reference Amount") outstanding on the A Term Loan
Commitment Termination Date (each such repayment as the same may be reduced as
provided in Sections 4.01 and 4.02(B), a "Scheduled A Term Loan Repayment"):
Percentage of
-------------
Tranche A
---------
Scheduled A Term Loan Repayment Date Reference Amount
------------------------------------ ----------------
June 30, 2004 2.0833%
September 30, 2004 2.0833
December 31, 2004 2.0833
March 31, 2005 2.0833
June 30, 2005 3.1250
September 30, 2005 3.1250
December 31, 2005 3.1250
March 31, 2006 3.1250
June 30, 2006 13.5417
September 30, 2006 13.5417
December 31, 2006 13.5417
March 31, 2007 13.5417
June 30, 2007 12.50
September 30, 2007 12.50
(c) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02(A), the Borrower shall be required to
repay on each date set forth below the principal amount of B Term Loans, to the
extent then outstanding, set forth below opposite such date (each such repayment
as the same may be reduced as provided in Sections 4.01 and 4.02(B), a
"Scheduled B Term Loan Repayment"):
Scheduled B Term Loan Repayment Date Amount
------------------------------------ ------
June 30, 2004 $187,500
September 30, 2004 187,500
December 31, 2004 187,500
March 31, 2005 187,500
June 30, 2005 187,500
September 30, 2005 187,500
December 31, 2005 187,500
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March 31, 2006 187,500
June 30, 2006 187,500
September 30, 2006 187,500
December 31, 2006 187,500
March 31, 2007 187,500
June 30, 2007 2,812,500
September 30, 2007 2,812,500
December 31, 2007 2,812,500
March 31, 2008 2,812,500
June 30, 2008 30,750,000
September 30, 2008 30,750,000
(d) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02, on the date of the receipt thereof by
the Borrower, Holdings or any of their respective Subsidiaries, an amount equal
to:
(i) 100% of the cash proceeds (net of underwriting discounts and
commissions and all other reasonable costs associated with such
transaction) from any sale or issuance after the Effective Date of equity
of the Borrower, Holdings or any of their respective Subsidiaries by
Holdings or any of its Subsidiaries (excluding the Equity Financing or the
Bridge Refinancing), and
(ii) 100% of the cash proceeds (net of underwriting discounts and
commissions, loan fees and all other reasonable costs associated with such
transaction) from any incurrence of any Indebtedness by the Borrower,
Holdings or any of their respective Subsidiaries (other than Indebtedness
permitted by Section 9.05 as said Section is in effect on the Effective
Date, including, without limitation, the Senior Subordinated Discount
Notes Financing),
shall be applied as provided in Section 4.02(B).
(e) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02, no later than 90 days after the last
day of each fiscal year of Holdings, an amount equal to 50% of Excess Cash Flow
of the Borrower, Holdings and its Subsidiaries for the relevant Excess Cash Flow
Payment Period shall be applied as provided in Section 4.02(B).
(f) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02, on each date on or after the Effective
Date on which the Borrower, Holdings or any of their respective Subsidiaries
receives cash proceeds from any sale of assets or other dispositions (including
capital stock and partnership interests and securities other than
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capital stock and partnership interests the proceeds from the sale of which is
recaptured under Section 4.02(A)(d), but excluding (1) sales of inventory in the
ordinary course of business and (2) the sale of obsolete, worn-out or uneconomic
equipment so long as the aggregate amount of Net Sale Proceeds excluded pursuant
to this clause (2) does not exceed $1,000,000 in the aggregate for all such
asset sales in any fiscal year of the Borrower), an amount equal to 100% of the
Net Sale Proceeds thereof shall be applied as provided in Section 4.02(B). If
the Borrower is required to apply any portion of asset sale proceeds to prepay
or offer to prepay Indebtedness evidenced by the Senior Subordinated Discount
Notes or, the Bridge Financing and Bridge Refinancing (under the terms of the
documentation relating thereto), then notwithstanding anything contained in this
Agreement to the contrary the Borrower shall apply such asset sale proceeds as
provided in Section 4.02(B).
(g) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02, on each date on or after the Effective
Date of the receipt thereof by the Borrower, Holdings or any of their respective
Subsidiaries, an amount equal to 100% of the cash proceeds of any Recovery Event
(net of reasonable costs incurred in connection with such Recovery Event
(including the estimated marginal increase in income taxes which will be payable
as a result of such Recovery Event by the Borrower, Holdings or any of their
respective Subsidiaries)) shall be applied as provided in Section 4.02(B);
provided that such proceeds not in excess of $1,000,000 in the aggregate for all
Recovery Events occurring during one fiscal year of the Borrower shall not be
required to be so applied on such date to the extent that the Borrower delivers
a certificate to the Administrative Agent on or prior to such date stating that
such proceeds shall be used to replace or restore any properties or assets in
respect of which such proceeds were paid within a period specified in such
certificate not to exceed 180 days after the date of receipt of such proceeds
(which certificate shall set forth estimates of the proceeds to be so expended);
and provided further, that if all or any portion of such proceeds not so applied
pursuant to Section 4.02(B) are not so used within the period specified in the
proviso, such remaining portion shall be applied on the last day of such
specified period as provided in Section 4.02(B).
(h) Notwithstanding anything to the contrary contained elsewhere in
this Agreement, all then outstanding Loans of a Tranche shall be repaid in full
on the Maturity Date for such Tranche.
(B) Application:
(a) Each mandatory repayment of Loans pursuant to Section 4.02(A)(d)
through (g), inclusive, shall be applied:
(i) first, to prepay the principal of outstanding A Term Loans and B
Term Loans (or if the Initial Borrowing Date has not yet occurred, as a
mandatory reduction to the Total A Term Loan Commitment and the Total B
Term Loan Commitment (it being understood and agreed that the amount of
such reductions shall be deemed to be an application of proceeds for
purposes of this Section 4.02(B)(a)(i) even though cash is not actually
applied)) on a pro rata basis, with the A Term Facility to receive the A
TL
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Percentage and the B Term Facility to receive the B TL Percentage, in each
case of the total amount to be applied as a mandatory repayment of A Term
Loans and B Term Loans (or mandatory reductions to the Total A Term Loan
Commitment and Total B Term Loan Commitment) pursuant to this Section
4.02(B), and which prepayments of A Term Loans and B Term Loans (or
mandatory reductions to the Total A Term Loan Commitment and Total B Term
Loan Commitment) shall be applied to reduce the then remaining Scheduled A
Term Loan Repayments and Scheduled B Term Loan Repayments on a pro rata
basis (based on the then remaining amounts of such Schedule A Term Loan
Repayments and Scheduled B Term Loan Repayments);
(ii) second, to reduce the Total A Term Loan Commitment (it being
understood and agreed that the amount of such reduction shall be deemed to
be an application of proceeds for purposes of this Section 4.02(B)(a)(ii)
even though cash is not actually applied);
(iii) third, to prepay the principal of outstanding Swingline Loans
with a corresponding reduction to the Total Revolving Loan Commitment;
(iv) fourth, to prepay the principal of outstanding Revolving Loans
with a corresponding reduction to the Total Revolving Loan Commitment;
(v) fifth, to cash collateralize Letter of Credit Outstandings by
depositing cash in the Letter of Credit Cash Collateral Account in an
amount equal to such Letter of Credit Outstandings (it being understood
that the Total Revolving Loan Commitment shall be reduced by the amount of
cash collateral required to be deposited by this clause (v)); and
(vi) sixth, to reduce the remaining Total Revolving Loan Commitment
(after giving effect to any reductions thereto pursuant to the application
of preceding clauses (iii)-(v)), with the amount of such reduction to be
deemed to be an application of proceeds for the purposes of this Section
4.02(B)(a) even though cash is not actually applied.
(b) Notwithstanding anything to the contrary contained in this
Section 4.02 or elsewhere in this Agreement, so long as A Term Loans are then
outstanding, each Bank with outstanding B Term Loans shall have the option to
waive receipt of all or any portion of a mandatory repayment of B Term Loans
required pursuant to this Section 4.02 and allocable to such Bank. In the event
any such Bank desires to waive such Bank's right to receive any such mandatory
repayment, in whole or in part, such Bank shall so advise the Administrative
Agent no later than the close of business five Business Days prior to such
repayment, which notice shall also include the amounts such Bank desires to
receive in respect of such repayment, if any. In the event that any such Bank
waives all or part of such right to receive any such mandatory repayment, the
Administrative Agent shall apply 100% of the amount so waived by such Bank to
the then outstanding A Term Loans.
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(c) Notwithstanding anything to the contrary contained in this
Section 4.02 or elsewhere in this Agreement (including, without limitation, in
Section 13.12), the Borrower shall have the option, in its sole discretion, to
give the Banks with outstanding A Term Loans or B Term Loans the option to waive
a mandatory repayment of such Loans pursuant to Section 4.02, in each case, upon
the terms and provisions set forth in this Section 4.02. If the Borrower elects
to exercise the option referred to in the preceding sentence, the Borrower shall
give to the Administrative Agent written notice of its intention to give the
Banks the right to waive a mandatory repayment at least five Business Days prior
to such repayment, which notice the Administrative Agent shall promptly forward
to all Banks with outstanding A Term Loans or B Term Loans (indicating in such
notice the amount of such repayment to be applied to each such Bank's
outstanding Revolving Loans). The Borrower's offer to permit such Banks to waive
any such mandatory repayment may apply to all or part of such repayment,
provided that any offer to waive part of such repayment must be made ratably to
such Banks on the basis of their outstanding A Term Loans or B Term Loans. In
the event any such Bank desires to waive such Bank's right to receive any such
mandatory repayment, in whole or in part, such Bank shall so advise the
Administrative Agent no later than the close of business two Business Days after
the date of such notice from the Administrative Agent, which notice shall also
include the amount such Bank desires to receive in respect of such repayment. If
any Bank does not reply to the Administrative Agent within the two Business
Days, it will be deemed not to have waived any part of such repayment. If any
Bank does not specify an amount it wishes to receive, it will be deemed to have
accepted 100% of the total payment. In the event that any such Bank waives all
or part of such right to receive any such mandatory repayment, the
Administrative Agent shall apply 100% of the amount so waived by such Bank to
the A Term Loans, so long as such A Term Loans are outstanding, as set forth in
clause (b) above, and if no such A Term Loans shall be outstanding, to the
Revolving Loans, Total A Term Loan Commitment and other Loans and Commitments in
accordance with Section 4.02(B) as if there were no A Term Loans or B Term Loans
outstanding.
(d) With respect to each repayment of Loans required by this Section
4.02, the Borrower may designate the Types of Loans which are to be repaid and,
in the case of Eurodollar Loans, the specific Borrowing or Borrowings of the
respective Tranche pursuant to which made; provided that: (i) repayments of
Eurodollar Loans pursuant to this Section 4.02 may only be made on the last day
of an Interest Period applicable thereto unless all Eurodollar Loans of the
respective Tranche with Interest Periods ending on such date of required
repayment and all Base Rate Loans of the respective Tranche have been paid in
full; (ii) if any repayment of Eurodollar Loans made pursuant to a single
Borrowing shall reduce the outstanding Eurodollar Loans made pursuant to such
Borrowing to an amount less than the applicable Minimum Borrowing Amount, such
Borrowing shall immediately be converted into Base Rate Loans; and (iii) each
repayment of any Loans made pursuant to a single Borrowing shall be applied pro
rata among such Loans. In the absence of a designation by the Borrower as
described in the preceding sentence, the Administrative Agent shall, subject to
the above, make such designation in its sole discretion.
4.03 Method and Place of Payment. Except as otherwise specifically
provided herein, all payments under this Agreement or any Note shall be made to
the Administrative Agent for the account of the Bank or Banks entitled thereto
not later than 12:00 Noon (New York
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time) on the date when due and shall be made in Dollars in immediately available
funds at the Payment Office of the Administrative Agent. Whenever any payment to
be made hereunder or under any Note shall be stated to be due on a day which is
not a Business Day, the due date thereof shall be extended to the next
succeeding Business Day and, with respect to payments of principal, interest
shall be payable at the applicable rate during such extension.
4.04 Net Payments. (a) All payments made by the Borrower hereunder,
or by the Borrower under any Note, will be made without setoff, counterclaim or
other defense. Except as provided in Section 4.04(b), all such payments will be
made free and clear of, and without deduction or withholding for, any present or
future taxes, levies, imposts, duties, fees, assessments or other charges of
whatever nature now or hereafter imposed by any jurisdiction or by any political
subdivision or taxing authority thereof or therein with respect to such payments
(but excluding, except as provided in the second succeeding sentence, any tax
imposed on or measured by the net income of a Bank pursuant to the laws of the
jurisdiction or any political subdivision or taxing authority thereof or therein
in which the principal office or applicable lending office of such Bank is
located) and all interest, penalties or similar liabilities with respect thereto
(collectively, "Taxes"). If any Taxes are so levied or imposed, the Borrower
agrees to pay the full amount of such Taxes, and such additional amounts as may
be necessary so that every payment of all amounts due hereunder or under any
Note, after withholding or deduction for or on account of any Taxes, will not be
less than the amount provided for herein or in such Note. If any amounts are
payable in respect of Taxes pursuant to the preceding sentence, then the
Borrower shall be obligated to reimburse each Bank, upon the written request of
such Bank, for taxes imposed on or measured by the net income of such Bank
pursuant to the laws of the jurisdiction or any political subdivision or taxing
authority thereof or therein in which the principal office or applicable lending
office of such Bank is located as such Bank shall determine are payable by such
Bank in respect of such amounts so paid to or on behalf of such Bank pursuant to
the preceding sentence and in respect of any amounts paid to or on behalf of
such Bank pursuant to this sentence. The Borrower will furnish to the
Administrative Agent within 45 days after the date of the payment of any Taxes
due pursuant to applicable law certified copies of tax receipts evidencing such
payment by such Borrower. The Borrower agrees to indemnify and hold harmless
each Bank, and reimburse such Bank upon its written request, for the amount of
any Taxes so levied or imposed and paid by such Bank.
(b) Each Bank that is not a United States person (as such term is
defined in Section 7701(a)(30) of the Code) agrees to deliver to the Borrower
and the Administrative Agent on or prior to the Effective Date, or in the case
of a Bank that is an assignee or transferee of an interest under this Agreement
pursuant to Section 13.04 (unless the respective Bank was already a Bank
hereunder immediately prior to such assignment or transfer), on the date of such
assignment or transfer to such Bank, (i) two accurate and complete original
signed copies of Internal Revenue Service Form W-8 ECI or Form W-8 BEN (with
respect to a complete exemption under an income tax treaty) (or successor forms)
certifying to such Bank's entitlement to a complete exemption from United States
withholding tax with respect to payments to be made under this Agreement and
under any Note, or (ii) if the Bank is not a "bank" within the meaning of
Section 881(c)(3)(A) of the Code and cannot deliver either Internal Revenue
Service Form W-8 ECI or Form W-8 BEN (with respect to a complete exemption under
an income tax
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treaty) pursuant to clause (i) above, (x) a certificate substantially in the
form of Exhibit D (any such certificate, a "Section 4.04(b)(ii) Certificate")
and (y) two accurate and complete original signed copies of Internal Revenue
Service Form W-8 BEN (with respect to the portfolio interest exemption) (or
successor form) certifying to such Bank's entitlement to a complete exemption
from United States withholding tax with respect to payments of interest to be
made under this Agreement and under any Note. In addition, each Bank agrees that
from time to time after the Effective Date, when a lapse in time or change in
circumstances renders the previous certification obsolete or inaccurate in any
material respect, it will deliver to the Borrower and the Administrative Agent
two new accurate and complete original signed copies of Internal Revenue Service
Form W-8 ECI or Form W-8 BEN (with respect to a complete exemption under an
income tax treaty), Form W-8 BEN (with respect to the portfolio interest
exemption) and a Section 4.04(b)(ii) Certificate, as the case may be, and such
other forms as may be required in order to confirm or establish the entitlement
of such Bank to a continued exemption from or reduction in United States
withholding tax with respect to payments under this Agreement and any Note, or
it shall immediately notify the Borrower and the Administrative Agent of its
inability to deliver any such Form or Certificate, in which case such Bank shall
not be required to deliver any such form of certificate pursuant to this Section
4.04(b). Notwithstanding anything to the contrary contained in Section 4.04(a),
but subject to the immediately succeeding sentence, (x) the Borrower shall be
entitled, to the extent it is required to do so by law, to deduct or withhold
income or similar taxes imposed by the United States (or any political
subdivision or taxing authority thereof or therein) from interest, fees or other
amounts payable hereunder for the account of any Bank which is not a United
States person (as such term is defined in Section 7701(a)(30) of the Code) for
U.S. Federal income tax purposes to the extent that such Bank has not provided
to the Borrower U.S. Internal Revenue Service Forms that establish a complete
exemption from such deduction or withholding and (y) the Borrower shall be
obligated pursuant to Section 4.04(a) hereof to gross-up payments to be made to
a Bank in respect of income or similar taxes imposed by the United States if (I)
such Bank has not provided the Borrower the Internal Revenue Service Forms
required to be provided the Borrower pursuant to this Section 4.04(b) or (II) in
the case of a payment, other than interest, to a Bank described in clause (ii)
above, to the extent that such forms do not establish a complete exemption from
withholding of such taxes. Notwithstanding anything to the contrary contained in
the preceding sentence or elsewhere in this Section 4.04, the Borrower agrees to
pay additional amounts and to indemnify each Bank in the manner set forth in
Section 4.04(a) (without regard to the identity of the jurisdiction requiring
the deduction or withholding) in respect of any amounts deducted or withheld by
it as described in the immediately preceding sentence as a result of any changes
after the Effective Date in any applicable law, treaty, governmental rule,
regulation, guideline or order, or in the interpretation thereof, relating to
the deducting or withholding of income or similar Taxes.
Section 5. Conditions Precedent to Loans on the Initial Borrowing
Date. The obligation of each Bank to make Loans on the Initial Borrowing Date is
subject at the time of such Loan to the satisfaction of the following
conditions:
5.01 Execution of Agreement; Notes. On or prior to the Initial
Borrowing Date (i) the Effective Date shall have occurred and (ii) there shall
have been delivered to the
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Administrative Agent for the account of each of the Banks the appropriate A Term
Note, B Term Note or Revolving Note executed by the Borrower and for the account
of the Swingline Bank, the Swingline Note executed by the Borrower, in each case
in the amount, maturity and as otherwise provided herein.
5.02 Officer's Certificate. On the Initial Borrowing Date, the
Administrative Agent shall have received a certificate dated the Initial
Borrowing Date signed on behalf of the Borrower by the Chief Executive Officer,
President or Chief Financial Officer or any Vice President of the Borrower,
stating that all of the conditions in Sections 5.09, 5.10, 5.13, 5.14, 5.15,
5.16, 5.18(i) and (iii), 5.23, 5.24, 5.25, 5.26, 5.27, 5.28(a), 6.01, 6.02,
6.03, 6.05 and 6.06 have been satisfied on such date; provided the certificate
shall not be required to certify as to the acceptability of any items to the
Administrative Agent and/or the Banks or as to whether the Administrative Agent
and/or the Banks are satisfied with any of the matters described in said
Sections.
5.03 Opinions of Counsel. On the Initial Borrowing Date, the
Administrative Agent shall have received from: (i) Greenberg Traurig, counsel to
the Borrower, Holdings and their respective Subsidiaries, an opinion addressed
to the Administrative Agent, the Collateral Agent and each of the Banks and
dated the Initial Borrowing Date covering the matters set forth in Exhibit E and
(ii) if requested by the Administrative Agent, local counsel (satisfactory to
the Administrative Agent), legal opinions addressed to the Administrative Agent,
the Collateral Agent and each of the Banks and dated the Initial Borrowing Date
covering the perfection and priority of the security interests granted pursuant
to the Security Documents and such other matters incident to the transactions
contemplated herein as the Administrative Agent or the Required Banks shall
request, with such legal opinions to be in form and substance satisfactory to
the Required Banks.
5.04 Corporate Documents; Proceedings. (a) On the Initial Borrowing
Date, the Administrative Agent shall have received a certificate, dated the
Initial Borrowing Date, signed by the Chief Executive Officer, President, Chief
Financial Officer, President or any Vice President of each Credit Party, and
attested to by the Secretary or any Assistant Secretary of such Credit Party, in
the form of Exhibit F with appropriate insertions, together with copies of the
Certificate of Incorporation and By-Laws of such Credit Party and the
resolutions or, consents or similar evidence of authority of such Credit Party
referred to in such certificate, and the foregoing shall be acceptable to the
Administrative Agent and the Required Banks in their sole discretion.
(b) All corporate and legal proceedings and all instruments and
agreements relating to the transactions contemplated by this Agreement and the
other Documents shall be satisfactory in form and substance to the
Administrative Agent and the Required Banks, and the Administrative Agent shall
have received all information and copies of all documents and papers, including
records of corporate proceedings, limited liability company proceedings,
governmental approvals, good standing certificates and bring-down telegrams, if
any, which the Administrative Agent or the Required Banks may have requested in
connection therewith, such documents and papers where appropriate to be
certified by proper corporate or governmental authorities.
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5.05 Plans; Shareholders' Agreements; Management Agreements;
Employment Agreements; Collective Bargaining Agreements; Debt Agreements;
Affiliate Contracts; Tax Sharing Agreements and Material Contracts. On or prior
to the Initial Borrowing Date, there shall have been delivered to the Banks true
and correct copies, certified as true and complete by an appropriate officer of
Holdings of:
(i) all Plans (and for each Plan that is required to file an annual
report on Internal Revenue Service Form 5500-series, a copy of the most
recent such report (including, to the extent required, the related
financial and actuarial statements and opinions and other supporting
statements, certifications, schedules and information), and for each Plan
that is a "single-employer plan," as defined in Section 4001(a)(15) of
ERISA, the most recently prepared actuarial valuation therefor) and any
other "employee benefit plans," as defined in Section 3(3) of ERISA, and
any other material agreements, plans or arrangements, with or for the
benefit of current or former employees of any Credit Party or any ERISA
Affiliate (provided that the foregoing shall apply in the case of any
multiemployer plan, as defined in 4001(a)(3) of ERISA, only to the extent
that any document described therein is in the possession of any Credit
Party or any ERISA Affiliate or reasonably available thereto from the
sponsor or trustee of any such plan) (collectively, the "Employee Benefit
Plans");
(ii) all agreements entered into by any Credit Party governing the
terms and relative rights of its capital stock (including, without
limitation, the Existing Shareholders Agreement) and any agreements
entered into by shareholders relating to any such entity with respect to
their capital stock (collectively, the "Shareholders' Agreements");
(iii) all agreements entered into by any Credit Party governing the
terms and relative rights of its partnership interests and any agreements
entered into by the partners relating to any such entity with respect to
their partnership interests (collectively, the "Partnership Agreements");
(iv) all agreements with members of, or with respect, to the
management of any Credit Party other than Employment Agreements
(collectively, the "Management Agreements");
(v) any employment agreements entered into by any Credit Party with
an officer or director of any Credit Party (collectively, the "Employment
Agreements");
(vi) all collective bargaining agreements applying or relating to
any employee of any Credit Party (collectively, the "Collective Bargaining
Agreements");
(vii) all agreements evidencing or relating to Indebtedness of any
Credit Party whether or not such agreement is to remain outstanding after
giving effect to the incurrence of Loans on the Initial Borrowing Date
(collectively, the "Debt Agreements");
(viii) all tax sharing, tax allocation and other similar agreements
entered into by any Credit Party (collectively, the "Tax Sharing
Agreements");
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(ix) all contracts, agreements or understandings entered into
between any Credit Party on the one hand, and any of its Affiliates, on
the other hand (collectively, the "Affiliate Contracts");
(x) all material contracts and licenses of any Credit Party, that
are to remain in effect after giving effect to the consummation of the
Transaction, including, without limitation, each Sprint Agreement
(collectively, the "Material Contracts");
(xi) all Equity Financing Documents; and
(xii) all Sprint Agreements.
all of which Employee Benefit Plans, Shareholders' Agreements, Partnership
Agreements Management Agreements, Employment Agreements, Collective Bargaining
Agreements, Debt Agreements, Tax Sharing Agreements, Affiliate Contracts and
Material Contracts shall be in form and substance satisfactory to the
Administrative Agent and the Required Banks and shall be in full force and
effect on the Initial Borrowing Date.
5.06 Consent and Agreement. On or prior to the Initial Borrowing
Date, (i) the Consent and Agreement shall have been executed and delivered and
be in full force and effect, (ii) there shall have been delivered to the
Administrative Agent true and correct copies of the Consent and Agreement and
(iii) all terms and provisions of the Consent and Agreement shall be in form and
substance satisfactory to the Administrative Agent and the Required Banks and
shall not have been amended without the consent of the Administrative Agent and
the Required Banks.
5.07 Pledge Agreement. (a) On the Initial Borrowing Date, each
Credit Party (other than the Leases Subsidiary) shall have duly authorized,
executed and delivered a Pledge Agreement substantially in the form of Exhibit G
(as modified, supplemented or amended from time to time, the "Pledge Agreement")
and shall have delivered to the Collateral Agent, as Pledgee thereunder, all of
the Pledge Agreement Collateral, if any, referred to therein then owned by such
Credit Party, (x) endorsed in blank in the case of promissory notes constituting
Pledge Agreement Collateral and (y) together with executed and undated
irrevocable stock powers in the case of capital stock, or other securities, as
the case may be, constituting Pledge Agreement Collateral or other acceptable
instruments of transfer and:
(i) evidence that all other actions necessary or, in the reasonable
opinion of counsel to the Administrative Agent, appropriate to perfect and
protect the first priority security interest created by the Pledge
Agreement have been taken;
(ii) acknowledgment copies of all UCC-l financing statements filed,
registered or recorded (or other evidence satisfactory to the
Administrative Agent that there has been filed, registered or recorded all
financing statements necessary and advisable to perfect the security
interest of the Secured Creditors);
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(iii) consents and/or acknowledgments from the requisite persons to
permit the granting of the security interests purported to be granted
pursuant to the Pledge Agreement as the Administrative Agent shall have
reasonably requested; and
(iv) copies of lien and judgment searches as the Administrative
Agent shall reasonably request (and such termination statements or other
documents as may be necessary to release any Lien in favor of any third
party not otherwise permitted by Section 9.01).
5.08 Security Agreement. On the Initial Borrowing Date, each Credit
Party (other than the Leases Subsidiary) shall have duly authorized, executed
and delivered a Security Agreement in the form of Exhibit H (as modified,
supplemented or amended from time to time, the "Security Agreement") covering
all of the Borrower's present and future Security Agreement Collateral, together
with:
(i) proper financing statements (Form UCC-1 or such other financing
statements or similar notices as shall be required by local law) fully
executed for filing under the UCC or other appropriate filing offices of
each jurisdiction as may be necessary or, in the reasonable opinion of the
Collateral Agent, desirable to perfect the security interests purported to
be created by the Security Agreement;
(ii) certified copies of Requests for Information or Copies (Form
UCC-11), or equivalent reports, listing all judgment liens, tax liens or
effective financing statements that name Holdings or any of its
Subsidiaries, or a division or other operating unit of any such Person, as
debtor and that are filed in the jurisdictions referred to in said clause
(i), together with copies of such other financing statements (none of
which shall cover the Collateral except to the extent evidencing Permitted
Liens or for which the Collateral Agent shall receive termination
statements (Form UCC-3 or such other termination statements as shall be
required by local law) fully executed for filing);
(iii) evidence of the completion of all other recordings and filings
of, or with respect to, the Security Agreement as may be necessary or, in
the opinion of the Collateral Agent, desirable to perfect the security
interests intended to be created by such Security Agreement; and
(iv) evidence that all other actions necessary or, in the opinion of
the Collateral Agent, desirable to perfect and protect the security
interests purported to be created by the Security Agreement have been
taken.
5.09 Material Adverse Change, etc. Since December 31, 1999, nothing
shall have occurred (and the Banks shall have become aware of no facts or
conditions not previously known) which the Administrative Agent or the Required
Banks shall determine (a) could reasonably be expected to have a material
adverse effect on the rights or remedies of the Banks or the Administrative
Agent, or on the ability of any Credit Party to perform its obligations to the
Administrative Agent and the Banks under this Agreement or any other Credit
Document, (b) could reasonably be expected to have a materially adverse effect
on the performance, business,
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assets, nature of assets, liabilities (contingent or otherwise), operations,
properties, condition (financial or otherwise), solvency or prospects of the
Borrower, Holdings and their respective Subsidiaries taken as a whole
(including, without limitation, the loss of any Sprint Agreement) or (c)
indicates the inaccuracy in any material respect of the information previously
provided to the Administrative Agent or the Banks (taken as a whole) in
connection with their analysis of the transactions contemplated hereby or
indicates that the information previously provided omitted to disclose any
material information.
5.10 Litigation. On the Initial Borrowing Date, no litigation by any
entity (private or governmental) shall be pending or threatened with respect to
this Agreement, any other Document or any documentation executed in connection
herewith or with respect to the transactions contemplated hereby, or which the
Administrative Agent or Required Banks shall determine could reasonably be
expected to have a materially adverse effect on the Transaction or on the
performance, business, assets, nature of assets, liabilities (contingent or
otherwise), operations, properties, condition (financial or otherwise), solvency
or prospects of the Borrower, Holdings and their respective Subsidiaries taken
as a whole (it being understood that solely with respect to the Initial
Borrowing Date, the existence of the litigation initiated by Eli Bakovsky and
currently pending against Holdings in the Superior Court of New Jersey (Civil
Division - Bergen County) (the "Bakovsky Litigation"), in its current status,
shall not be deemed to have such a material adverse effect; provided, that if a
judgment in the amount of $1,000,000 or more is entered in connection with the
Bakovsky Litigation or Holdings or any of its Subsidiaries shall have paid
compensation or entered into a settlement with respect to such litigation in an
amount of $1,000,000 or more, such event shall be deemed to have such a material
adverse effect).
5.11 Fees, etc. On each of the Effective Date and on or prior to the
Initial Borrowing Date, the Borrower shall have paid in full to the
Administrative Agent and the Banks all costs, fees and expenses (including,
without limitation, all reasonable legal fees and expenses) payable to the
Administrative Agent and the Banks to the extent then due pursuant hereto or as
otherwise agreed between the Borrower and the Administrative Agent.
5.12 Solvency Certificate; Insurance Analyses. On the Initial
Borrowing Date, the Borrower shall cause to be delivered to the Administrative
Agent and the Banks: (i) a certificate from the chief financial officer of
Holdings, in the form of Exhibit K hereto, supporting the conclusions that after
giving effect to the Transaction and the incurrence of all financings
contemplated herein that each Credit Party, and all Credit Parties taken as a
whole, as the case may be, are not insolvent and will not be rendered insolvent
by the Indebtedness incurred in connection therewith, will not be left with
unreasonably small capital with which to engage in their respective businesses
and will not have incurred debts beyond their ability to pay such debts as they
mature and become due and (ii) evidence (including, without limitation,
certificates with respect to each insurance policy listed on Schedule II) of
insurance, complying with the requirements of Section 8.03, with respect to the
business and properties of the Borrower, Holdings and their respective
Subsidiaries, in scope, form and substance satisfactory to the Administrative
Agent and the Required Banks and naming each of the Collateral Agent, the
Administrative Agent and the Banks as an additional insured and the Collateral
Agent as loss
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payee and stating that such insurance shall not be canceled or revised without
30 days' prior written notice by the insurer to the Collateral Agent.
5.13 Approvals. All necessary governmental and third party approvals
in connection with the Transaction (other than the Public Offering) and the
transactions contemplated by the Documents and otherwise referred to herein or
therein (including, but not limited to, those approvals required in respect of
existing permits, landlord consents and transfers of contract rights) shall have
been obtained and remain in effect, and all applicable waiting periods shall
have expired without any action being taken by any competent authority which
restrains, prevents or imposes, in the sole judgment of the Administrative Agent
or the Required Banks, adverse conditions upon the consummation of the
Transaction (other than the Public Offering) or the other transactions
contemplated by the Documents and otherwise referred to herein or therein.
Additionally, there shall not exist any judgment, order, injunction or other
restraint issued or filed or a hearing seeking injunction relief or other
restraint pending or notified prohibiting or imposing materially adverse
conditions upon the consummation of the Transaction, the transactions
contemplated by the Documents, the making of the Loans or the issuance of
Letters of Credit.
5.14 Financial Statements; Projections; Management Letter Reports.
(a) On or prior to the Initial Borrowing Date, the Banks shall have received the
pro forma (after giving effect to the Transaction and the related financing
thereof) consolidated balance sheet of Holdings as at the Initial Borrowing
Date, which financial statements shall be prepared in accordance with generally
accepted accounting principles consistent with past practices and shall be in
form and substance satisfactory to the Administrative Agent and the Required
Banks, and shall not disclose any material adverse differences in the business,
properties, assets, liabilities (contingent or otherwise), results of
operations, condition (financial or otherwise), solvency or prospects of the
Borrower, Holdings and their respective Subsidiaries taken as a whole from that
previously disclosed to the Administrative Agent and the Required Banks.
(b) On the Initial Borrowing Date, the Banks shall have received
detailed consolidated financial projections, certified by the Chief Financial
Officer of Holdings, for Holdings and its Subsidiaries, which include the
projected results of Holdings, after giving effect to the Transaction and the
other transactions contemplated herein, for the period commencing on the Initial
Borrowing Date and ending after the B Term Loan Maturity Date (the
"Projections"), which Projections, and the supporting assumptions and
explanations thereto, and the accounting practices and procedures to be utilized
by Holdings following the Initial Borrowing Date, shall be satisfactory in form
and substance to the Administrative Agent and the Required Banks and shall be as
set forth on Schedule IV hereto.
(c) On or prior to the Initial Borrowing Date, the Administrative
Agent shall have received a copy of any "management letter" received by the
Borrower, Holdings or any of their respective Subsidiaries from its certified
public accountants.
5.15 Indebtedness. On the Initial Borrowing Date and after giving
effect to the Loans incurred on the Initial Borrowing Date and the other
transactions contemplated hereby,
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neither the Borrower, Holdings nor any of their respective Subsidiaries shall
have any Indebtedness or preferred stock outstanding except for the Loans, the
Senior Subordinated Discount Notes or Senior Subordinated Bridge Notes, as
applicable, and the Preferred Stock.
5.16 Equity Documents. On or prior to the Initial Borrowing Date,
there shall have been delivered to the Banks true and correct copies of all
Equity Financing Documents relating to the Private Placement Financing and the
Preferred Stock Issuance and all of the terms and conditions of such Equity
Financing Documents (including, without limitation, with respect to the terms of
the Preferred Stock, distributions, voting and redemption rights) shall be in
form and substance satisfactory to the Administrative Agent and the Required
Banks.
5.17 Landlord Waivers. On the Initial Borrowing Date, the Collateral
Agent shall have received agreements from certain landlords of Real Property
leased by the Borrower, Holdings or any of their respective Subsidiaries
acknowledging, among other things, the Collateral Agent's security interests in
property maintained on the leased premises and waiving its own security
interest, if any, thereon and the Collateral Agent's authority to obtain access
to such property and covering such other matters as the Collateral Agent may
reasonably request.
5.18 Sprint Agreements. On the Initial Borrowing Date, (i) the
Sprint Agreements shall be in full force and effect, (ii) the Required Banks
shall be satisfied with all terms and conditions of the Sprint Agreements and
(iii) the condition set forth in Section 11.3.6 and Section 1.7 of the Sprint
Management Agreement, as amended by Section 7 of Addendum I to the Sprint
Management Agreement and Section 2 of Addendum II to the Sprint Management
Agreement (or any other amendment or addendum relevant thereto), shall have been
satisfied or otherwise waived.
5.19 Escrow Agreement. (a) On or prior to the Initial Borrowing
Date, the Borrower shall have duly authorized, executed and delivered an escrow
agreement in the form of Exhibit N (as modified, supplemented, or amended from
time to time, the "Escrow Agreement").
(b) On the Initial Borrowing Date, all proceeds of the Loans
incurred on the Initial Borrowing Date shall have been deposited into the Escrow
Account pursuant to the Escrow Agreement. In accordance with the terms of the
Escrow Agreement, the proceeds of the Loans shall remain the property of the
Banks who extended such Loans and neither the Borrower nor any of its Affiliates
shall have any interest in such Loans until such time as such amount shall be
released from the Escrow Account in accordance with the terms and conditions of
the Escrow Agreement.
5.20 Guaranty. On the Initial Borrowing Date, Holdings and each
Subsidiary of Holdings (other than the Borrower and the Leases Subsidiary) shall
have duly authorized, executed and delivered a guaranty in the form of Exhibit O
(as modified, supplemented or amended from time to time, the "Guaranty").
5.21 Capital Structure. After giving effect to the Transaction,
Holdings shall own all of the capital stock of the Borrower. The pro forma
consolidated capital structure of Holdings, after giving effect to the
Transaction, shall be consistent with the capital structure
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contemplated herein. The legal and capital structure of Holdings and its
Subsidiaries shall be satisfactory to the Administrative Agent and shall not
differ in any material respect from the description of such structure previously
provided to the Administrative Agent (it being understood that the capital
structure contemplated herein and previously presented to the Administrative
Agent and approved thereby is deemed to be satisfactory to the Administrative
Agent). All agreements relating to such legal and capital structure shall be
reasonably satisfactory to the Administrative Agent.
5.22 Consent Letter. The Administrative Agent shall have received a
letter from CT Corporation System, substantially in the form of Exhibit I
hereto, indicating its consent to its appointment by the Borrower, Holdings and
their respective Subsidiaries as their agent to receive service of process as
specified in Section 13.08 of this Agreement or Section 21(A) of the Guaranty,
as the case may be.
5.23 B Term Loans. On the Initial Borrowing Date, and subject to the
other provisions of this Section 5, the Borrower shall have incurred all of the
B Term Loans available on such date and the B Term Loan Commitment shall have
been reduced to zero.
5.24 Leases. (a) On or prior to the Initial Borrowing Date, the
Borrower shall have duly incorporated a Wholly-Owned Subsidiary of the Borrower
whose sole purpose and objective shall be to hold and maintain the Tower Site
Leases and other leases incidental to the Borrower's operation and maintenance
of the Service Area Network (the "Leases Subsidiary"). The Borrower shall have
delivered all corporate documents and other documents executed with respect to
the Leases Subsidiary, which documents shall be in form and substance
satisfactory to the Administrative Agent.
(b) On or prior to the Initial Borrowing Date, (i) the Borrower
shall have transferred all of the Tower Site Leases to the Leases Subsidiary,
(ii) the Borrower shall have delivered to the Administrative Agent all documents
executed and delivered in connection with such transfer, which documents shall
be in form and substance satisfactory to the Administrative Agent, (iii) the
Borrower shall have pledged all of the capital stock of the Leases Subsidiary in
accordance with and pursuant to the Pledge Agreement, (iv) the Leases Subsidiary
shall have no obligations or liabilities other than as permitted by Section 9.23
and (v) the Borrower and the Leases Subsidiary shall have executed and delivered
the Leases Subsidiary Funding Agreement.
5.25 Notes Financing. (a) On the Initial Borrowing Date, the
Borrower shall have received $125,000,000 of gross cash proceeds from the
issuance by the Borrower of senior subordinated discount notes (the "Senior
Subordinated Discount Notes Financing") pursuant to the Senior Subordinated
Discount Notes Documents (which documents the Administrative Agent acknowledges
currently contemplate accompanying warrants for Holdings' Common Stock), all of
which Senior Subordinated Discount Notes Documents (including, without
limitation, the level, scope and amount of the accompanying warrants for
Holding's Common Stock) shall be in form and substance satisfactory to the
Administrative Agent. Notwithstanding anything herein to the contrary, in the
event the Borrower is unable to consummate the Senior Subordinated Discount
Notes Financing on the Initial Borrowing Date, the Borrower shall, on the
Initial
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Borrowing Date, issue the Senior Subordinated Bridge Notes in an amount of
$125,000,000 (the "Bridge Financing") pursuant to the Bridge Financing
Documents, all of which Bridge Financing Documents shall be in form and
substance satisfactory to the Administrative Agent.
(b) On the Initial Borrowing Date, the Borrower shall have deposited
and utilized the proceeds of the Notes Financing described in clause (a) above
in accordance with, and for the purposes set forth in, Section 8.20(f).
5.26 Equity Bridge Commitment. On or prior to the Initial Borrowing
Date, Holdings and DLJ shall have executed and delivered the Preferred Stock
Purchase Agreement, which Preferred Stock Purchase Agreement shall be in full
force and effect and all proceeds received therefrom shall have been applied in
accordance with Section 5.28(b) hereof.
5.27 Refinancing. (a) On the Initial Borrowing Date, all
Indebtedness (including all prepayment penalties and accrued interest associated
therewith) of the Borrower, Holdings and their respective Subsidiaries
(consisting of approximately $8,000,000) shall be repaid in full (including
without limitation, any and all Indebtedness incurred to finance the build-out
of the PCS Network in Reno, Nevada and Lake Tahoe, California and all
Indebtedness then outstanding under the BET Senior Subordinated Notes)
(including all fees and other amounts owing in connection therewith) (the
"Refinanced Indebtedness"), all commitments under the documents evidencing
Refinanced Indebtedness shall be terminated and all letters of credit issued
pursuant to the documents evidencing the Refinanced Indebtedness and all
guaranties supporting such Refinanced Indebtedness shall be terminated.
(b) On the Initial Borrowing Date, all security interests in respect
of, and Liens securing, the Refinanced Indebtedness shall be terminated and
released, and the Administrative Agent shall have received all such releases as
may have been requested by the Administrative Agent, which releases shall be in
form and substance reasonably satisfactory to the Administrative Agent. Without
limiting the foregoing, there shall have been delivered to the Administrative
Agent on or prior to the relevant date, (w) proper termination statements (or
the appropriate equivalent) for filing or registration in each jurisdiction
where a filing or registration was made with respect to the Borrower, Holdings
or any of their respective Subsidiaries in connection with the security
interests created with respect to the Refinanced Indebtedness and the
documentation related thereto, (x) terminations or reassignments of any security
interest in, or Liens on, any patents, trademarks, copyrights, or similar
interests of the Borrower, Holdings or any of their respective Subsidiaries on
which filings have been made, (y) terminations of all mortgages, leasehold
mortgages, assignments, fiduciary assignments of rights and deeds of trust
created with respect to property of the Borrower, Holdings or any of their
respective Subsidiaries, in each case, to secure the obligations under the
Refinanced Indebtedness, all of which shall be in form and substance reasonably
satisfactory to the Administrative Agent and (z) all collateral owned by the
Borrower, Holdings or any of their respective Subsidiaries in the possession of
any of the creditors in respect of the Refinanced Indebtedness or any collateral
agent or trustee under any related security document shall have been returned to
the Borrower, Holdings or such Subsidiary.
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5.28 Cash Collateral Agreement. (a) On or prior to the Initial
Borrowing Date, the Borrower shall have duly authorized, executed and delivered
a Cash Collateral Agreement substantially in the form of Exhibit M (as modified,
supplemented, or amended from time to time, the "Cash Collateral Agreement").
(b) On the Initial Borrowing Date, all proceeds of the Notes
Financing, the Preferred Stock Issuance (other than proceeds thereof utilized
prior to the Initial Borrowing Date) and the Series A Preferred Stock Issuance
(other than proceeds thereof utilized prior to the Initial Borrowing Date)
received by the Borrower on or prior to the Initial Borrowing Date shall have
been deposited into a cash collateral account (the "Cash Collateral Account")
pursuant to the Cash Collateral Agreement.
Section 6. Conditions Precedent to All Credit Events. The obligation
of each Bank to make Loans (including Loans made on the Initial Borrowing Date)
and the obligation of an Issuing Bank to issue any Letter of Credit, is subject,
at the time of each such Credit Event (except as hereinafter indicated), to the
satisfaction of the following conditions:
6.01 No Default; Representations and Warranties. At the time of each
such Credit Event and also after giving effect thereto (i) there shall exist no
Default or Event of Default and (ii) all representations and warranties
contained herein and in the other Credit Documents shall be true and correct in
all material respects with the same effect as though such representations and
warranties had been made on the date of the making of such Credit Event.
6.02 Material Adverse Change, etc. Nothing shall have occurred since
December 31, 1999 which (i) could reasonably be expected to have a material
adverse effect on the rights or remedies of the Banks or the Administrative
Agent, or on the ability of any Credit Party to perform its obligations to the
Banks under this Agreement or any other Credit Document or (ii) which could
reasonably be expected to have a materially adverse effect on the performance,
business, assets, nature of assets, liabilities (contingent or otherwise),
operations, properties, condition (financial or otherwise), solvency or
prospects of the Borrower, Holdings and their respective Subsidiaries taken as a
whole.
6.03 Litigation. At the time of each such Credit Event and also
after giving effect thereto, no litigation by any entity (private or
governmental) shall be pending or threatened with respect to this Agreement or
any other Credit Document executed in connection herewith or the transactions
contemplated hereby, which the Required Banks shall determine could reasonably
be expected to have a materially adverse effect on the performance, business,
assets, nature of assets, liabilities (contingent or otherwise), operations,
properties, condition (financial or otherwise), solvency or prospects of the
Borrower, Holdings and their respective Subsidiaries taken as a whole.
6.04 Notice of Borrowing; Letter of Credit Request. (a) Prior to the
making of each Loan (other than a Swingline Loan or a Mandatory Borrowing), the
Administrative Agent shall have received a Notice of Borrowing meeting the
requirements of Section 1.03. Prior to the making of each Swingline Loan, the
Swingline Bank shall have received the notice referred to in Section 1.03(b)(i).
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(b) Prior to the issuance of each Letter of Credit, the Issuing Bank
shall have received a Letter of Credit Request meeting the requirements of
Section 2.03.
6.05 Pro Forma Compliance. At the time of each Credit Event, the
Borrower shall have delivered to each of the Banks a certificate of its chief
financial officer demonstrating that the Borrower would have complied with the
financial covenants set forth in Sections 9.09, 9.10, 9.11 and 9.13, to the
extent then applicable, at the end of the immediately preceding fiscal quarter
on a pro forma basis as if the A Term Loans, B Term Loans, Revolving Loans,
Swingline Loans or Letters of Credit had been incurred or issued at the
beginning of the period for which such financial covenants were tested at the
end of such immediately preceding fiscal quarter and determined as if all such
Indebtedness had been outstanding from the first day of the relevant calculation
period (and the interest expense associated with such Indebtedness, shall be
determined at the rates which would have been applicable had such debt been
outstanding for the whole such period).
6.06 Loan Proceeds. At the time of each Credit Event and until the
Section 8.20 Events shall have occurred, the aggregate proceeds of all Loans
incurred at the time of each such Credit Event shall have been deposited into
the Escrow Account pursuant to the Escrow Agreement. In accordance with the
terms of the Escrow Agreement, the proceeds of such Loans shall remain the
property of the Banks who extended such Loans and neither the Borrower nor any
of its Affiliates shall have any interest in such Loans until such time as such
amount shall be released from the Escrow Account in accordance with the terms
and conditions of the Escrow Agreement.
The acceptance of the benefits of each Credit Event shall constitute
a representation and warranty by each of Holdings and the Borrower to each of
the Banks that all the conditions specified in Section 5 and in this Section 6
and applicable to such Credit Event exist as of that time. All of the Notes,
certificates, legal opinions and other documents and papers referred to in
Section 5 and in this Section 6, unless otherwise specified, shall be delivered
to the Administrative Agent at the Notice Office for the account of each of the
Banks and, except for the Notes, in sufficient counterparts for each of the
Banks and, unless otherwise specified, shall be in form and substance
satisfactory to the Banks.
Section 7. Representations, Warranties and Agreements. In order to
induce the Banks to enter into this Agreement and to make the Loans, and issue
(or participate in) the Letters of Credit as provided herein, each of Holdings
and the Borrower make the following representations, warranties and agreements
as to itself and as to each of its Subsidiaries, as of the Initial Borrowing
Date (both before and after giving effect to the Credit Events occurring on such
date, the Transaction and the other transactions contemplated by the Documents,
and all references to each of Holdings and the Borrower herein and elsewhere in
this Agreement, shall, unless otherwise specifically indicated, be references to
each of Holdings and the Borrower after giving effect to the Transaction) and as
of the date of each subsequent Credit Event which representations, warranties
and agreements shall survive the execution and delivery of this Agreement and
the Notes and any subsequent Credit Event, with the occurrence of each Credit
Event on or after the Initial Borrowing Date being deemed to constitute a
representation and
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warranty that the matters specified in this Section 7 are true and correct on
and as of the Initial Borrowing Date and on the date of each such Credit Event.
7.01 Corporate Status. Each of the Borrower, Holdings and their
respective Subsidiaries (i) is a duly organized and validly existing corporation
or limited liability company in good standing under the laws of the jurisdiction
of its organization, (ii) has the corporate or company power and authority to
own its property and assets and to transact the business in which it is engaged
and presently proposes to engage and (iii) is duly qualified and is authorized
to do business and is in good standing in each jurisdiction where the ownership,
leasing or operation of property or the conduct of its business requires such
qualifications except for failures to be so qualified which, in the aggregate,
could not reasonably be expected to have a material adverse effect on the
performance, business, assets, nature of assets, liabilities (contingent or
otherwise), operations, properties, condition (financial or otherwise), solvency
or prospects of the Borrower, Holdings and their respective Subsidiaries taken
as a whole.
7.02 Corporate or Company Power and Authority. Each of the Borrower,
Holdings and their respective Subsidiaries has the corporate or company power to
execute, deliver and perform the terms and provisions of each of the Documents
to which it is party and has taken all necessary corporate action to authorize
the execution, delivery and performance by it of each of such Documents. Each of
the Borrower, Holdings and their respective Subsidiaries has duly executed and
delivered each of the Documents to which it is party, and each of such Documents
constitutes its legal, valid and binding obligation enforceable in accordance
with its terms, except as the enforceability thereof may be limited by
bankruptcy, reorganization, moratorium or similar laws relating to or limiting
creditors' rights generally or by general equitable principles (regardless of
whether the issue of enforceability is considered in a proceeding in equity or
at law).
7.03 No Violation. Neither the execution, delivery or performance by
the Borrower, Holdings or any of their respective Subsidiaries of the Documents
to which it is a party, nor compliance by it with the terms and provisions
thereof, (i) will contravene any provision of any applicable law, statute, rule
or regulation or any order, writ, injunction or decree of any court or
governmental instrumentality, (ii) will conflict with or result in any breach of
any of the terms, covenants, conditions or provisions of, or constitute a
default under, or result in the creation or imposition of (or the obligation to
create or impose) any Lien (except pursuant to the Security Documents) upon any
of the property or assets of the Borrower, Holdings or any of their respective
Subsidiaries pursuant to the terms of any indenture, mortgage, deed of trust,
credit agreement or loan agreement, or any other agreement, contract or
instrument to which the Borrower, Holdings or their respective Subsidiaries is a
party or by which it or any of its property or assets is bound or to which it
may be subject or (iii) will violate any provision of the Certificate of
Incorporation, By-Laws, limited liability company agreement (or similar
organizational documents) of the Borrower, Holdings or any of their respective
Subsidiaries, except with respect to each of (i) and (ii) and with respect to
any Document (other than any Credit Document), such breach, conflict,
contravention or non-compliance as could not, individually or in the aggregate,
reasonably be expected to have a material adverse effect on the performance,
business, assets, nature of assets, liabilities (contingent or otherwise),
operations,
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properties, conditions (financial or otherwise), solvency or prospects of the
Borrower, Holdings or their respective Subsidiaries, taken as a whole.
7.04 Governmental Approvals. No order, consent, approval, license,
authorization or validation of, or filing, recording or registration with
(except as have been obtained or made on or prior to the Initial Borrowing Date
and are in full force and effect), or exemption by, any governmental or public
body or authority, or any subdivision thereof, is required to authorize, or is
required in connection with, (i) the execution, delivery and performance of any
Document or (ii) the legality, validity, binding effect or enforceability of any
such Document.
7.05 Financial Statements; Financial Condition; Undisclosed
Liabilities; Projections; etc. (a) The consolidated balance sheet of Holdings
for the fiscal period ended December 31, 1999, and the related consolidated
statement of operations, consolidated statement of stockholders' equity and
consolidated statements of cash flows for the fiscal periods ended on such
dates, copies of which have heretofore been furnished to each Bank prior to the
Effective Date and attached hereto as Schedule III, present fairly in all
material respects the financial condition of Holdings and its Subsidiaries on a
consolidated basis at the date thereof. The statements of assets and the
statements of revenues regarding the Spokane district for the fiscal period
ended December 31, 1999, copies of which have heretofore been furnished to each
Bank prior to the Effective Date and attached hereto as Schedule III, present
fairly in all material respects the financial condition of the Spokane district,
at the date thereof. Such financial statements have been prepared in accordance
with generally accepted accounting principles and practices consistently applied
except to the extent provided in the notes to said financial statements. Since
December 31, 1999 (and assuming that the Acquisition shall have been consummated
at such time), there has been no material adverse change in the performance,
business, assets, nature of assets, liabilities (contingent or otherwise),
operations, properties, condition (financial or otherwise), solvency or
prospects of Holdings and its Subsidiaries taken as a whole.
(b) On and as of the Initial Borrowing Date, on a pro forma basis
after giving effect to the Transaction and all other transactions contemplated
by the Documents and to all Indebtedness (including, without limitation, the
Loans) being incurred in connection with the Transaction, and Liens created, and
to be created, by each Credit Party in connection therewith: (a) the sum of the
assets (including all contribution and subrogation rights and other intangible
assets), at a fair valuation, of each Credit Party will exceed its debts; (b) no
Credit Party has incurred or intends to, or believes that it will, incur debts
beyond its ability to pay such debts as such debts mature; and (c) each Credit
Party will have sufficient capital with which to conduct its business. For
purposes of this Section 7.05(b) "debt" means any liability on a claim, and
"claim" means (i) right to payment, whether or not such a right is reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured, or unsecured or (ii) right to
an equitable remedy for breach of performance if such breach gives rise to a
payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured, unmatured, subordinated, disputed,
undisputed, secured or unsecured.
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(c) Except as fully reflected in the financial statements and the
notes related thereto described in Section 7.05(a), there were as of the Initial
Borrowing Date (and after giving effect to the Transaction and the other
transactions contemplated hereby and by the Documents) no liabilities or
obligations with respect to the Borrower, Holdings or any of their respective
Subsidiaries of any nature whatsoever (whether absolute, accrued, contingent or
otherwise and whether or not due) which, either individually or in aggregate,
could reasonably be expected to be material to the Borrower, Holdings and their
respective Subsidiaries taken as a whole. As of the Initial Borrowing Date,
neither the Borrower, Holdings nor any of their respective Subsidiaries knows of
any basis for the assertion against the Borrower, Holdings or any of their
respective Subsidiaries of any liability or obligation of any nature whatsoever
that is not fully reflected in the financial statements and the notes related
thereto described in Section 7.05(a) which, either individually or in the
aggregate, could reasonably be expected to be material to the Borrower, Holdings
and their respective Subsidiaries taken as a whole. As of the Initial Borrowing
Date (and after giving effect to the Transaction) none of the Borrower, Holdings
or any of their respective Subsidiaries will have any outstanding Indebtedness
or preferred stock other than (i) the Loans, (ii) the Senior Subordinated
Discount Notes or Senior Subordinated Bridge Notes, as applicable, and (iii) the
Preferred Stock.
(d) On and as of the Initial Borrowing Date, the Projections have
been prepared in good faith by the Borrower and there are no statements or
conclusions in any of the Projections which are based upon or include
information known to Holdings or the Borrower to be misleading or which fail to
take into account material information regarding the matters reported therein.
On the Initial Borrowing Date, Holdings and the Borrower believe that the
Projections were reasonable and attainable (although actual results may differ
from the Projections and no representation is made that the Projections will in
fact be attained).
7.06 Litigation. There are no actions, suits or proceedings pending
or, to the best knowledge of the Borrower, Holdings or any of their respective
Subsidiaries, threatened (i) with respect to any Document, or (ii) that are
reasonably likely to materially and adversely affect the performance, business,
assets, nature of assets, liabilities (contingent or otherwise), operations,
properties, condition (financial or otherwise), solvency or prospects of the
Borrower, Holdings and their respective Subsidiaries taken as a whole.
7.07 True and Complete Disclosure. All factual information (taken as
a whole) heretofore or contemporaneously furnished by or on behalf of the
Borrower, Holdings or any Subsidiary thereof in writing to any Bank (including,
without limitation, all information contained in the Documents) for purposes of
or in connection with this Agreement or any transaction contemplated herein is,
and all other such factual information (taken as a whole with all information
previously furnished) hereafter furnished by or on behalf of the Borrower,
Holdings or any Subsidiary thereof in writing to any Bank will be, true and
accurate in all material respects on the date as of which such information is
dated or certified and not incomplete by omitting to state any material fact.
7.08 Use of Proceeds; Margin Regulations. (a) All proceeds of the
Loans incurred by the Borrower shall be used to (x) finance Capital Expenditures
in connection with the
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Borrower's build-out of the Service Area Network (including, without limitation,
the financing of the development, construction, acquisition and installation of
additional wireless telecommunication assets associated with the build-out of
the PCS Network in the Service Area) and (y) for other general corporate and
working capital purposes (including, without limitation, the funding of
operational costs).
(b) No part of the proceeds of any Loan will be used to purchase or
carry any Margin Stock or to extend credit for the purpose of purchasing or
carrying any Margin Stock. Neither the making of any Loan nor the use of the
proceeds thereof nor the occurrence of any other Credit Event will violate or be
inconsistent with the provisions of Regulation T, U or X of the Board of
Governors of the Federal Reserve System.
7.09 Tax Returns and Payments. Each of the Borrower, Holdings and
their respective Subsidiaries has timely filed or caused to be timely filed
(including pursuant to any valid extensions of time for filing) with the
appropriate taxing authority, all returns, statements, forms and reports for
taxes (the "Returns") required to be filed by or with respect to the income,
properties or operations of the Borrower, Holdings and/or any of their
respective Subsidiaries. The Returns accurately reflect in all material respects
all liability for taxes of the Borrower, Holdings and their respective
Subsidiaries as a whole for the periods covered thereby. Each of the Borrower,
Holdings and their respective Subsidiaries have paid all material taxes payable
by them which have become due other than those contested in good faith and for
which adequate reserves have been established in accordance with generally
accepted accounting principles. There is no material action, suit, proceeding,
investigation, audit, or claim now pending or, to the best knowledge of the
Borrower, Holdings or any of their respective Subsidiaries, threatened by any
authority regarding any taxes relating to the Borrower, Holdings or any of their
respective Subsidiaries. As of the Initial Borrowing Date, neither the Borrower,
Holdings nor any of their respective Subsidiaries has entered into an agreement
or waiver or been requested to enter into an agreement or waiver extending any
statute of limitations relating to the payment or collection of taxes of the
Borrower, Holdings or any of their respective Subsidiaries, or is aware of any
circumstances that would cause the taxable years or other taxable periods of the
Borrower, Holdings or any of their respective Subsidiaries not to be subject to
the normally applicable statute of limitations. Neither the Borrower, Holdings
nor any of their respective Subsidiaries has provided, with respect to
themselves or property held by them, any consent under Section 341 of the Code.
None of the Borrower, Holdings or any of their respective Subsidiaries has
incurred, or will incur, any material tax liability in connection with the
Transaction or any other transactions contemplated hereby.
7.10 Compliance with ERISA. Schedule VII sets forth each Plan; each
Plan (and each related trust, insurance contract or fund) is in substantial
compliance with its terms and with all applicable laws, including, without
limitation, ERISA and the Code; each Plan (and each related trust, if any) which
is intended to be qualified under Section 401(a) of the Code has received a
determination letter from the Internal Revenue Service to the effect that it
meets the requirements of Sections 401(a) and 501(a) of the Code; no Reportable
Event has occurred; no Plan which is a multiemployer plan (as defined in Section
4001(a)(3) of ERISA) is insolvent or in reorganization; no Plan has an Unfunded
Current Liability; no Plan which is subject to Section
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412 of the Code or Section 302 of ERISA has an accumulated funding deficiency,
within the meaning of such sections of the Code or ERISA, or has applied for or
received a waiver of an accumulated funding deficiency or an extension of any
amortization period, within the meaning of Section 412 of the Code or Section
303 or 304 of ERISA; all contributions required to be made with respect to a
Plan have been timely made; neither the Borrower, Holdings nor any Subsidiary
thereof, nor any ERISA Affiliate has incurred any material liability (including
any indirect, contingent or secondary liability) to or on account of a Plan
pursuant to Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204
or 4212 of ERISA or Section 401(a)(29), 4971 or 4975 of the Code or expects to
incur any such liability under any of the foregoing sections with respect to any
Plan; no condition exists which presents a material risk to the Borrower,
Holdings or any Subsidiary thereof, or any ERISA Affiliate of incurring a
liability to or on account of a Plan pursuant to the foregoing provisions of
ERISA and the Code; no proceedings have been instituted to terminate or appoint
a trustee to administer any Plan which is subject to Title IV of ERISA; no
action, suit, proceeding, hearing, audit or investigation with respect to the
administration, operation or the investment of assets of any Plan (other than
routine claims for benefits) is pending, expected or threatened; using actuarial
assumptions and computation methods consistent with Part 1 of subtitle E of
Title IV of ERISA, the aggregate liabilities of the Borrower, Holdings, their
respective Subsidiaries and their respective ERISA Affiliates to all Plans which
are multiemployer plans (as defined in Section 4001(a)(3) of ERISA) in the event
of a complete withdrawal therefrom, as of the close of the most recent fiscal
year of each such Plan ended prior to the date of the most recent Credit Event,
would not exceed $50,000; each group health plan (as defined in Section 607(1)
of ERISA or Section 4980B(g)(2) of the Code) which covers or has covered
employees or former employees of the Borrower, Holdings, any Subsidiary thereof,
or any ERISA Affiliate has at all times been operated in compliance with the
provisions of Part 6 of subtitle B of Title I of ERISA and Section 4980B of the
Code; no lien imposed under the Code or ERISA on the assets of the Borrower,
Holdings or any Subsidiary of Holdings or the Borrower, or any ERISA Affiliate
exists or is likely to arise on account of any Plan; and the Borrower, Holdings
and their respective Subsidiaries may cease contributions to or terminate any
employee benefit plan maintained by any of them without incurring any material
liability.
7.11 The Security Documents. (a) The provisions of the Security
Agreement are effective to create in favor of the Collateral Agent for the
benefit of the Secured Creditors a legal, valid and enforceable security
interest in all right, title and interest of the respective Credit Parties in
the Collateral described therein and the Collateral Agent, for the benefit of
the Secured Creditors, has a fully perfected Lien on, and security interest in,
all right, title and interest of the respective Credit Parties, in all of the
Collateral described therein, subject to no other Liens other than Permitted
Liens. The recordation of the Security Agreement in the United States Patent and
Trademark Office together with filings on Form UCC-1 made pursuant to the
Security Agreement will be effective, under federal and state law, to perfect
the security interest granted to the Collateral Agent in the trademarks and
patents covered by the Security Agreement and the filing of the Security
Agreement with the United States Copyright Office together with filings on Form
UCC-1 made pursuant to the Security Agreement will be effective under federal
and state law to perfect the security interest granted to the Collateral Agent
in the copyrights covered by the Security Agreement. Each of the Credit Parties
party to the Security Agreement has good
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and merchantable title to all Collateral described therein, free and clear of
all Liens except those described above in this clause (a).
(b) The security interests created in favor of the Collateral Agent,
as Pledgee for the benefit of the Secured Creditors, under the Pledge Agreements
constitute first perfected security interests in the Pledged Securities
described in the Pledge Agreements, subject to no security interests of any
other Person. No filings or recordings are required in order to perfect (or
maintain the perfection or priority of) the security interests created in the
Pledged Securities and the proceeds thereof under the Pledge Agreements.
7.12 Representations and Warranties in Documents. All
representations and warranties set forth in the Documents are true and correct
in all material respects at the time as of which such representations and
warranties were made and on the Initial Borrowing Date.
7.13 Properties. None of Holdings or their respective Subsidiaries
owns any real property. Any material Leaseholds leased by the Borrower, Holdings
or any of their respective Subsidiaries, as of the Initial Borrowing Date, and
the nature of the interest therein, is correctly set forth in Schedule V. The
Real Property leased by the Borrower, Holdings or their respective Subsidiaries
is leased pursuant to valid and enforceable leases, which are in full force and
effect. All rents and additional rents due to date under each of such Leases
have been paid, and all other obligations of the lessees thereunder have been
performed. Neither the Borrower, Holdings or any of their respective
Subsidiaries has received notice of any default under any of the Leases. Each of
the leased Real Properties is in a state of good maintenance and repair and is
adequate and suitable for the purposes for which it is presently being used.
Neither the Borrower, Holdings or any of their respective Subsidiaries are a
party to any other real property leases. The Borrower, Holdings and their
respective Subsidiaries will procure executed Landlord Lender Agreements (as
provided by the Administrative Agent) from the landlords in any current and
future leases.
7.14 Capitalization. (a) On the Initial Borrowing Date and after
giving effect to the Transaction, the authorized capital stock of Holdings
consists of (i) 150,000,000 shares of Common Stock, of which 3,417,000 shares
are issued and outstanding and 17,008,500 shares are reserved for issuance upon
the conversion of the Preferred Stock, 2,040,000 shares are reserved for
issuance pursuant to Holdings' 2000 Equity Incentive Plan and 2,489,075 shares
are reserved for issuance upon the exercise of a warrant held by BET Associates,
L.P., (ii) 17,000,000 shares of Nonvoting Common Stock, 16,000,000 of which are
issued and outstanding and 574,402 are reserved for issuance for outstanding
warrants, and (iii) 125,000,000 shares of Preferred Stock, of which 17,008,500
shares have been designated as the Series A Preferred Stock and all of which are
issued and outstanding and owned by persons and in the amounts set forth on
Schedule VII hereto, 35,000,000 shares have been designated as Non-Voting
Preferred Stock of which 2,110,347 are issued and outstanding and owned by
persons and in the amounts set forth on Schedule VII hereto, and 35,000,000
shares have been designated as Voting Preferred Stock, none of which are issued
and outstanding..
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(b) On the Initial Borrowing Date and after giving effect to the
Transaction, the capital stock of the Borrower and all owners thereof, shall be
as set forth on Schedule VII.
(c) Except as set forth on Schedule VII, neither the Borrower,
Holdings nor any of their respective Subsidiaries has any outstanding securities
convertible into or exchangeable for any of its equity interests or outstanding
rights to subscribe for or to purchase, or warrants or options for the purchase,
or any agreements providing for the issuance (contingent or otherwise) of, or
any calls, commitments or claims of any character relating to, its partnership
or other equity interests, as the case may be.
(d) On the Initial Borrowing Date (i) all outstanding shares of
Common Stock and Preferred Stock and (ii) all outstanding common stock of the
Borrower have been duly and validly issued, are fully paid and nonassessable and
all such Common Stock (other than non-voting Common Stock), Preferred Stock and
common stock of the Borrower are free of any preemptive rights. In connection
with the issuance and sale of all such Common Stock and Preferred Stock, it is
not necessary to register such securities under the Securities Act.
7.15 Subsidiaries. On the Initial Borrowing Date, the Borrower and
the Leases Subsidiary are the only direct or indirect subsidiaries of Holdings.
7.16 Compliance with Statutes, etc. Each of the Borrower, Holdings
and their respective Subsidiaries is in compliance with all applicable statutes,
regulations and orders of, and all applicable restrictions imposed by, all
governmental bodies, domestic or foreign, in respect of the conduct of its
business and the ownership of its property (including applicable statutes,
regulations, orders and restrictions relating to environmental standards and
controls), except with respect to each of the foregoing such noncompliance as
could not, individually or in the aggregate, reasonably be expected to have a
material adverse effect on the performance, business, assets, nature of assets,
liabilities (contingent or otherwise), operations, properties, condition
(financial or otherwise), solvency or prospects of the Borrower, Holdings and
their respective Subsidiaries taken as a whole.
7.17 Investment Company Act. None of the Borrower, Holdings nor any
of their respective Subsidiaries is an "investment company" or a company
"controlled" by an "investment company," within the meaning of the Investment
Company Act of 1940, as amended.
7.18 Public Utility Holding Company Act. None of the Borrower,
Holdings nor any of their respective Subsidiaries is a "holding company," or a
"subsidiary company" of a "holding company," or an "affiliate" of a "holding
company" or of a "subsidiary company" of a "holding company" within the meaning
of the Public Utility Holding Company Act of 1935, as amended.
7.19 Environmental Matters. (a) The Borrower, Holdings and each of
their respective Subsidiaries have complied with, and on the date of such Credit
Event are in compliance with, in all respects, all applicable Environmental Laws
and the requirements of any permits issued under such Environmental Laws except
such noncompliances which, in the
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aggregate, could not reasonably be expected to have a material adverse effect on
the performance, business, assets, nature of assets, liabilities (contingent or
otherwise), operations, properties, condition (financial or otherwise), solvency
or prospects of the Borrower, Holdings and their respective Subsidiaries. There
are no past, pending or, to the best knowledge of the Borrower or Holdings,
threatened material Environmental Claims against the Borrower or Holdings or any
of their respective Subsidiaries or any Real Property currently owned or
operated by the Borrower, Holdings or any of their respective Subsidiaries.
There are no facts, circumstances, conditions or occurrences concerning the
business or operations of the Borrower, Holdings or any of their respective
Subsidiaries or any Real Property owned or operated at any time by the Borrower,
Holdings or any of their respective Subsidiaries or, to the knowledge of the
Borrower, Holdings or any of their respective Subsidiaries, any property
adjoining any such Real Property that could reasonably be expected (i) to form
the basis of an Environmental Claim against the Borrower, Holdings or any of
their respective Subsidiaries or any Real Property owned or operated by the
Borrower, Holdings or any of their respective Subsidiaries or (ii) to cause such
Real Property to be subject to any restrictions on the ownership, occupancy, use
or transferability of such Real Property under any Environmental Law except such
Environmental Claims and restrictions which individually or in the aggregate
could not reasonably be expected to have a material adverse effect on the
performance, business, assets, nature of assets, liabilities (contingent or
otherwise), operations, properties, condition (financial or otherwise), solvency
or prospects of the Borrower, Holdings and their respective Subsidiaries taken
as a whole.
(b) Neither the Borrower, Holdings nor any of their respective
Subsidiaries has, at any time, generated, used, treated, stored, transported or
released Hazardous Materials on, to or from any Real Property at any time owned,
leased or at any time operated by the Borrower, Holdings or any of their
respective Subsidiaries other than in compliance in all material respects with
Environmental Laws.
(c) There are not now and never have been any underground storage
tanks owned or operated by the Borrower, Holdings or any of their respective
Subsidiaries.
(d) No Real Property owned or operated at any time by the Borrower,
Holdings or any of their respective Subsidiaries is located on any site listed
on, or proposed in the Federal Register for listing on, the Superfund National
Priorities List, or listed on the Comprehensive Environmental Response
Compensation and Liability Information System or their state equivalents.
7.20 Labor Relations. Neither the Borrower, Holdings nor any of
their respective Subsidiaries is engaged in any unfair labor practice that could
reasonably be expected to have a material adverse effect on the Borrower,
Holdings and their respective Subsidiaries taken as a whole. There is (i) no
significant unfair labor practice complaint pending against the Borrower,
Holdings or any of their respective Subsidiaries or, to the best knowledge of
the Borrower, Holdings or any of their respective Subsidiaries, threatened
against any of them, before the National 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 Borrower,
Holdings or any of their respective Subsidiaries or, to the best knowledge of
the
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Borrower, Holdings or any of their respective Subsidiaries, threatened against
any of them and (ii) no significant strike, labor dispute, slowdown or stoppage
pending against the Borrower, Holdings or any of their respective Subsidiaries
or, to the best knowledge of the Borrower, Holdings or any of their respective
Subsidiaries, threatened against the Borrower, Holdings or any of their
respective Subsidiaries.
7.21 Patents, Licenses, Franchises and Formulas. (a) Each of the
Borrower, Holdings and their respective Subsidiaries has a license to use or
otherwise has the right to use, free and clear of pending or threatened Liens,
all the material patents, patent applications, trademarks, service marks, trade
names, trade secrets, copyrights, proprietary information, computer programs,
data bases, licenses, franchises and formulas, or rights with respect to the
foregoing (collectively, "Intellectual Property"), and has obtained all licenses
and other rights of whatever nature, necessary for the present conduct of its
business, without any known conflict with the rights of others which, or the
failure to obtain which, as the case may be, could reasonably be expected to
have a material adverse effect on the performance, business, assets, nature of
assets, liabilities (contingent or otherwise), operations, properties, condition
(financial or otherwise), solvency or prospects of the Borrower, Holdings and
their respective Subsidiaries taken as a whole.
(b) The Borrower and Holdings, together with their respective
Subsidiaries, have the right to practice under and use all of their respective
Intellectual Property.
(c) Neither the Borrower, Holdings nor any of their respective
Subsidiaries has knowledge of any claim by any third party contesting the
validity, enforceability, use or ownership of the Intellectual Property, or of
any existing state of facts that would support a claim that use by the Borrower,
Holdings or any of their respective Subsidiaries of any such Intellectual
Property has infringed or otherwise violated any Intellectual Property right of
any other Person and that to the best knowledge of the Borrower, Holdings and
their respective Subsidiaries no claim is threatened except for such claims that
could not individually or in the aggregate reasonably be expected to have a
material adverse affect on the performance, business, assets, nature of assets,
liabilities (contingent or otherwise), operations, properties, condition
(financial or otherwise), solvency or prospects of the Borrower, Holdings and
their respective Subsidiaries taken as a whole.
7.22 Indebtedness. Neither the Borrower, Holdings nor any of their
respective Subsidiaries has any Indebtedness or Disqualified Stock (other than
the Loans and the Notes Financing and prior to the Initial Borrowing Date, the
Refinanced Indebtedness). Schedule VII sets forth a true and complete list of
all capital stock of the Borrower, Holdings and each of their respective
Subsidiaries as of the Initial Borrowing Date after giving effect to the
Transaction and the other transactions contemplated hereby.
7.23 Restrictions on or Relating to Subsidiaries. There does not
exist any encumbrance or restriction on the ability of (i) any Subsidiary of the
Borrower or Holdings to pay dividends or make any other distributions on its
capital stock, partnership interests, or any other interest or participation in
its profits owned by the Borrower or Holdings or any Subsidiary
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thereof, or to pay any Indebtedness owed to the Borrower or Holdings or a
Subsidiary thereof, (ii) any Subsidiary of the Borrower or Holdings to make
loans or advances to the Borrower or Holdings or any Subsidiary thereof or (iii)
the Borrower or Holdings or any Subsidiary thereof to transfer any of its
properties or assets to the Borrower or Holdings or any Subsidiary thereof,
except for such encumbrances or restrictions existing under or by reason of (x)
applicable law, (y) this Agreement, the other Credit Documents, the Public
Offering Documents or the Private Placement Documents, as applicable, the
Preferred Stock Purchase Agreement or the Senior Subordinated Discount Notes
Documents or the Bridge Financing Documents, as applicable, or (z) customary
provisions restricting subletting or assignment of any lease governing a
leasehold interest of the Borrower, Holdings or a Subsidiary thereof.
7.24 Special Purpose Corporation . Holdings was formed solely to
enter into the Sprint Agreements and effect transactions similar to the
Transaction and operate the Service Area Network, and except in connection
therewith (and as contemplated by this Agreement), as at the Effective Date has
no significant assets or liabilities (other than the capital stock of the
Borrower) and has engaged in no business activities.
7.25 The Transaction. All aspects of the Transaction have been
effected in accordance with the Documents and all applicable law. At the time of
consummation thereof, all consents and approvals of, and filings and
registrations with, and all other actions in respect of, all governmental
agencies, authorities or instrumentalities required in order to consummate the
Transaction shall have been obtained, given, filed or taken and are in full
force and effect (or effective judicial relief with respect thereto has been
obtained). All applicable waiting periods with respect thereto have or, prior to
the time when required, will have, expired without, in all such cases, any
action being taken by any competent authority which restrains, prevents or
imposes material adverse conditions upon the consummation of the Transaction.
Additionally, at the time of consummation thereof, there does not exist any
judgment, order or injunction prohibiting or imposing material adverse
conditions upon the consummation of the Transaction.
7.26 Material Contracts. All Material Contracts of the Borrower,
Holdings and each of their respective Subsidiaries as of the Initial Borrowing
Date (including, but not limited to, all of the Sprint Agreements which are
designated as such on Schedule VIII) are listed on Schedule VIII.
7.27 Senior Subordinated Notes. The subordination provisions of the
Senior Subordinated Discount Notes (or the Senior Subordinated Bridge Notes) and
the senior subordinated guaranties relating to such notes, are enforceable
against the Borrower, other Subsidiaries of the Borrower and the holders
thereof, as the case may be, and the Loans and other Obligations hereunder and
obligations arising pursuant to the Interest Rate Protection or Other Hedging
Agreements are within the definition of "Senior Debt" included in such
subordination provisions.
7.28 Preferred Stock Issuance. (a) Holdings has consummated the
Preferred Stock Issuance in accordance with the Preferred Stock Purchase
Agreement and has contributed
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to the Borrower gross cash proceeds therefrom of at least $25,000,000 (less
certain customary corporate expenses incurred by Holdings in connection
therewith).
(b) On the Effective Date and on the Initial Borrowing Date, the
Preferred Stock Purchase Agreement is in full force and effect and there is no
"termination event" or other "default" existing thereunder.
(c) On the Effective Date and on the Initial Borrowing Date,
Holdings is in full compliance with the terms and conditions set forth in
Sections 5 and 6 of the Preferred Stock Purchase Agreement (other than Sections
6(b), 6(c)(ii) (and delivery of documentation and certificates relating
thereto), 6(d) and 6(e) (as it relates to the Notes Financing or the Equity
Financing) thereof) with respect to the Private Placement Financing.
7.29 Liabilities of Leases Subsidiary. The Leases Subsidiary does
not have any obligations or liabilities other than those permitted under Section
9.23.
7.30 Bridge Commitment. On the Effective Date, the Bridge Commitment
Letter is in full force and effect and there does not exist any "default"
thereunder.
7.31 Sprint Management Agreement. On the Effective Date, the
conditions set forth in Section 1.7 of the Sprint Management Agreement, as
amended by Addendum II to such agreement, shall have been satisfied.
7.32 Conversion. The Borrower's conversion from a limited liability
company to a corporation, consummated prior to the Effective Date, did not have
and currently does not have any tax consequences that are reasonably likely to
have a material adverse effect on the performance, business, assets, nature of
assets, liabilities (contingent or otherwise), operations, properties, condition
(financial or otherwise), solvency or prospects of the Borrower, Holdings and
their respective Subsidiaries taken as a whole.
Section 8. Affirmative Covenants. Each of Holdings and the Borrower
covenants and agrees that on and after the Effective Date and until the Total
Commitment and all Letters of Credit have terminated and the Loans, Notes and
Unpaid Drawings, together with interest, Fees and all other Obligations incurred
hereunder and thereunder, are paid in full:
8.01 Information Covenants. Holdings will furnish, or cause to be
furnished, to the Administrative Agent:
(a) Monthly Reports. Within 30 days after the end of each fiscal
month other than the last fiscal month of any final quarter of Holdings, a
Subscribers Report, all of which shall be certified by the chief financial
officer or controller of Holdings.
(b) Quarterly Financial Statements. Within 45 days after the close
of each of the first three quarterly accounting periods in each fiscal year of
Holdings, the consolidated and consolidating balance sheets of Holdings and its
Subsidiaries and the Borrower and its Subsidiaries as at the end of such
quarterly period and the related consolidated and consolidating
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statements of earnings and stockholders' equity and statement of cash flows for
such quarter, in each case for such quarterly period and for the elapsed portion
of the fiscal year ended with the last day of such quarterly period, in each
case, setting forth comparative figures for the related periods in the prior
fiscal year and comparable budgeted figures for such period, all of which shall
be certified by the chief financial officer or controller of Holdings, subject
to normal year-end audit adjustments and shall be accompanied by a management
discussion and analysis of the results of operations and financial condition
with respect to such period.
(c) Annual Financial Statements. Within 90 days after the close of
each fiscal year of Holdings, the consolidated and consolidating balance sheets
of Holdings and its Subsidiaries and the Borrower and its Subsidiaries as at the
end of such fiscal year and the related consolidated and consolidating
statements of earnings and stockholders' equity and statement of cash flows for
such fiscal year and setting forth comparative figures for the preceding fiscal
year and comparable budgeted figures for such period and certified, (x) in the
case of the consolidating statements, by the chief financial officer of Holdings
and (y) in the case of the consolidated financial statements of Holdings and its
Subsidiaries and the Borrower and its Subsidiaries, by any of the "big five" or
other independent certified public accountants of recognized national standing
reasonably acceptable to the Required Banks, together with a signed opinion of
such accounting firm (which opinion shall not be qualified in any respect)
stating that in the course of its regular audit of the financial statements of
Holdings and the Borrower which audit was conducted in accordance with generally
accepted auditing standards, such accounting firm obtained no knowledge of any
Default or Event of Default which has occurred and is continuing or, if in the
opinion of such accounting firm such a Default or Event of Default has occurred
and is continuing, a statement as to the nature thereof and shall be accompanied
by a management discussion and analysis of the results of operations and
financial condition with respect to such period.
(d) Management Letters. Promptly after the receipt thereof by the
Borrower, Holdings or any of their respective Subsidiaries, a copy of any
"management letter" received by the Borrower, Holdings or any of their
respective Subsidiaries from its certified public accountants.
(e) Budgets. As soon as available but in no event later than 30 days
after the first day of the fiscal year of Holdings, a budget for Holdings and
its Subsidiaries in form customarily prepared by Holdings (including budgeted
statements of earnings and sources and uses of cash and balance sheets) for each
calendar month of such fiscal year and on an annual basis for the next
succeeding fiscal year prepared in reasonable detail with appropriate
presentation and discussion of the principal assumptions upon which such budgets
are based, accompanied by the statement of the chief financial officer or
controller of Holdings to the effect that, to the best of his knowledge, the
budget is a reasonable estimate for the periods covered thereby.
(f) Officer's Certificates. At the time of the delivery of the
financial statements provided for in Section 8.01(a), (b) and (c), a certificate
of the chief financial officer of Holdings to the effect that no Default or
Event of Default has occurred and is continuing or, if
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any Default or Event of Default has occurred and is continuing, specifying the
nature and extent thereof, which certificate, (x) in the case of certificates
delivered pursuant to Section 8.01(b) or (c), shall set forth the calculations
required to establish whether Holdings and its Subsidiaries were in compliance
with the provisions of Sections 3.03, 4.02, 9.02, 9.04, 9.05, 9.06 and 9.08
through 9.15, inclusive at the end of such fiscal quarter or year, as the case
may be, and (y) in the case of certificates delivered pursuant to Section
8.01(c), the amount of Excess Cash Flow for the relevant Excess Cash Flow
Payment Period.
(g) Notice of Default or Litigation. Promptly, and in any event
within two Business Days after an officer of the Borrower, Holdings or any of
their respective Subsidiaries obtains knowledge thereof, notice of (i) the
occurrence of any event which constitutes a Default or Event of Default, (ii)
any litigation or governmental investigation or proceeding pending (x) against
the Borrower, Holdings or their respective Subsidiaries which could reasonably
be expected to materially and adversely affect the performance, business,
assets, nature of assets, liabilities (contingent or otherwise), operations,
properties, condition (financial or otherwise), solvency or prospects of the
Borrower, Holdings and their respective Subsidiaries taken as a whole or (y)
with respect to any Document and (iii) any other event which could reasonably be
expected to materially and adversely affect the performance, business, assets,
nature of assets, liabilities (contingent or otherwise), operations, properties,
condition (financial or otherwise), solvency or prospects of the Borrower,
Holdings and their respective Subsidiaries taken as a whole.
(h) Other Reports and Filings. Promptly upon transmission thereof,
copies of any financial information, proxy materials and other information and
reports, if any, which any Credit Party (x) has filed with the Securities and
Exchange Commission (the "SEC ") or (y) has delivered to holders of, or any
agent or trustee with respect to, Indebtedness of any Credit Party in its
capacity as such a holder, agent, or trustee.
(i) Environmental Matters. Promptly upon, and in any event within
two Business Days after an officer of the Borrower, Holdings or of any of their
respective Subsidiaries obtains knowledge thereof, notice of any of the
following environmental matters: (i) any pending or threatened material
Environmental Claim against the Borrower, Holdings or any of their respective
Subsidiaries or any Real Property owned or operated at any time by the Borrower,
Holdings or any of their respective Subsidiaries; (ii) any condition or
occurrence on or arising from any Real Property owned or operated at any time by
the Borrower, Holdings or any of their respective Subsidiaries that (a) could
reasonably be anticipated to result in a material noncompliance by the Borrower,
Holdings or any of their respective Subsidiaries with any applicable
Environmental Law, or (b) could reasonably be anticipated to form the basis of a
material Environmental Claim against the Borrower, Holdings or any of their
respective Subsidiaries or any Real Property owned or operated by the Borrower,
Holdings or any of their respective Subsidiaries; (iii) any condition or
occurrence on any Real Property owned or operated by the Borrower, Holdings or
any of their respective Subsidiaries or any property adjoining such Real
Property that could reasonably be anticipated to cause such Real Property to be
subject to any material restrictions on the ownership, occupancy, use or
transferability of such Real Property under any Environmental Law; and (iv) the
taking of any removal or remedial action in
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response to a material Release or material threatened Release or the actual or
alleged presence of any Hazardous Material on or from any Real Property owned or
operated at any time by the Borrower, Holdings or any of their respective
Subsidiaries in each case as required by any Environmental Law or any
governmental or other administrative agency. All such notices shall describe in
reasonable detail the nature of the claim, investigation, condition, occurrence
or removal or remedial action and the Borrower's, Holdings' or such Subsidiary's
response thereto. In addition, the Borrower, Holdings will provide the Banks
with copies of all material communications with any government or governmental
agency relating to material Environmental Claims, all material communications
with any person relating to material Environmental Claims, and such detailed
reports of any Environmental Claim as may reasonably be requested by the
Required Banks.
(j) Annual Meetings with Banks. Within 120 days after the close of
each fiscal year of Holdings, Holdings shall, at the request of the
Administrative Agent or Required Banks, hold a meeting (at a mutually agreeable
location and time) with all Banks who choose to attend such meeting at which
meeting shall be reviewed the financial results of the previous fiscal year and
the financial condition of Holdings and its Subsidiaries and the budgets
presented for the current fiscal year of Holdings and its Subsidiaries.
(k) Sprint Agreements. Promptly upon delivery or receipt thereof,
all material notices delivered by the Borrower or any of its Affiliates pursuant
to the Sprint Agreements to any of Sprint Corporation or any of its Affiliates
and any material notices delivered by Sprint Corporation or any of its
Affiliates to the Borrower or any of its Affiliates and at least three Business
Days prior to the execution and delivery thereof, any amendments, modifications,
or termination of any, and any new, Sprint Agreement.
(l) Other Information. From time to time, such other information or
documents (financial or otherwise) with respect to any Credit Party, as the
Administrative Agent or the Required Banks may reasonably request.
8.02 Books, Records and Inspections. Each of the Borrower and
Holdings will, and will cause each of its Subsidiaries to, keep proper books of
record and account in which full, true and correct entries, in conformity with
United States generally accepted accounting principles and all requirements of
law, shall be made of all dealings and transactions in relation to its business
and activities. Each of the Borrower and Holdings will, and will cause each of
its Subsidiaries to, permit officers and designated representatives of the
Administrative Agent or any Bank to visit and inspect, under guidance of
officers of the Borrower, Holdings or of such Subsidiary, any of the properties
of the Borrower, Holdings or such Subsidiary, and to examine the books of
account of the Borrower, Holdings or such Subsidiary and discuss the affairs,
finances and accounts of the Borrower, Holdings or of such Subsidiary with, and
be advised as to the same by, its and their officers, all at such reasonable
times and intervals and to such reasonable extent as the Administrative Agent or
such Bank may request.
8.03 Maintenance of Property, Insurance. (a) Schedule II sets forth
a true and complete listing of all insurance maintained by the Borrower,
Holdings and each of their
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respective Subsidiaries as of the Effective Date. Each of the Borrower and
Holdings will, and will cause each of its Subsidiaries to, (i) keep all material
property useful and necessary in its business in good working order and
condition (ordinary wear and tear excepted), (ii) maintain with financially
sound and reputable insurance companies insurance on all its property in at
least such amounts and against at least such risks as are described on Schedule
II, and (iii) furnish to each Bank, upon written request, full information as to
the insurance carried. The provisions of this Section 8.03 shall be deemed to be
supplemental to, but not duplicative of, the provisions of any of the Security
Documents that require the maintenance of insurance.
(b) Each of the Borrower and Holdings will at all times keep, and
will cause each of its Subsidiaries to keep, its property insured in favor of
the Collateral Agent, and all policies (including mortgage policies) or
certificates (or certified copies thereof) with respect to such insurance (and
any other insurance maintained by the Borrower, Holdings or their respective
Subsidiaries (other than employee benefit insurance)) (i) shall be endorsed to
the Collateral Agent's satisfaction for the benefit of the Collateral Agent
(including, without limitation, by naming the Collateral Agent as loss payee and
naming the Collateral Agent, the Administrative Agent and each Bank as an
additional insured) with respect to Collateral, (ii) shall state that such
insurance policies shall not be canceled or revised without 30 days' prior
written notice thereof by the respective insurer to the Collateral Agent, (iii)
shall provide that the respective insurers irrevocably waive any and all rights
of subrogation with respect to the Collateral Agent, (iv) shall contain the
standard noncontributory mortgagee clause endorsement in favor of the Collateral
Agent with respect to hazard insurance coverage, (v) shall provide that any
losses shall be payable notwithstanding (A) any act or neglect of the Borrower,
Holdings or any of their respective Subsidiaries, (B) the occupation or use of
the properties for purposes more hazardous than those permitted by the terms of
the respective policy if such coverage is obtainable at commercially reasonable
rates and is of the kind from time to time customarily insured against by
Persons owning or using similar property and in such amounts as are customary,
(C) any foreclosure or other proceeding relating to the insured properties or
(D) any change in the title to or ownership or possession of the insured
properties and (vi) shall be deposited with the Collateral Agent. If the
Borrower, Holdings or any of their respective Subsidiaries shall fail to
maintain insurance in accordance with this Section 8.03, or if the Borrower,
Holdings or any of their respective Subsidiaries shall fail to endorse and
deposit all policies or certificates with respect thereto, the Collateral Agent
shall have the right (but shall be under no obligation) to procure such
insurance and each of the Borrower and Holdings agrees, to reimburse the
Collateral Agent for all costs and expenses of procuring such insurance.
8.04 Corporate Franchises. Each of the Borrower and Holdings will
do, and will cause each of its Subsidiaries to do or cause to be done, all
things necessary to preserve and keep in full force and effect its existence and
its rights, franchises, licenses and patents necessary for the operation of its
respective businesses; provided, however, that nothing in this Section 8.04
shall prevent the withdrawal by the Borrower, Holdings or any of their
respective Subsidiaries of its qualification as a foreign corporation in any
jurisdiction where such withdrawal could not reasonably be expected to have a
material adverse effect on the performance, business, assets, nature of assets,
liabilities (contingent or otherwise), properties, operations, condition
(financial
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or otherwise), solvency or prospects of the Borrower, Holdings and of their
respective Subsidiaries taken as a whole.
8.05 Compliance with Statutes, etc. Each of the Borrower and
Holdings will, and will cause each of its Subsidiaries to, comply with all
applicable statutes, regulations and orders of, and all applicable restrictions
imposed by, all governmental bodies, domestic or foreign, in respect of the
conduct of its business and the ownership of its property except such
noncompliances as could not, individually or in the aggregate, reasonably be
expected to have a material adverse effect on the performance, business, assets,
nature of assets, liabilities (contingent or otherwise), operations, properties,
condition (financial or otherwise), solvency or prospects of the Borrower,
Holdings and of their respective Subsidiaries taken as a whole.
8.06 Compliance with Environmental Laws. (a) Each of the Borrower
and Holdings will comply, and will cause each of its Subsidiaries to comply, in
all material respects with all Environmental Laws applicable to ownership or use
of the Real Property, will promptly pay or cause its Subsidiaries to pay all
costs and expenses incurred in such compliance, and will keep or cause to be
kept all such Real Properties free and clear of any Liens imposed pursuant to
such Environmental Laws. None of the Borrower, Holdings nor any Subsidiary
thereof will generate, use, treat, store, release or dispose of, or permit the
generation, use, treatment, storage, Release or disposal of Hazardous Materials
on any Real Property, or transport or permit the transportation of Hazardous
Materials to or from any Real Property, other than in compliance with applicable
law.
(b) At the request of the Administrative Agent or the Required Banks
at any time and from time to time during the existence of this Agreement: (i) if
an Event of Default exists under this Agreement, (ii) upon the reasonable belief
by the Administrative Agent that the Borrower, Holdings or any of their
respective Subsidiaries has breached any representation or covenant herein with
respect to any environmental matters and such breach is continuing, or (iii) in
the event notice is provided under Section 8.01(i) herein, the Borrower or
Holdings, as applicable, will provide, at its sole cost and expense, an
environmental site assessment report reasonable in scope concerning any Real
Property of the Borrower, Holdings or their respective Subsidiaries, prepared by
an environmental consulting firm approved by the Administrative Agent and the
Required Banks, indicating the presence or Release of Hazardous Materials on or
from any of the Real Property and the potential cost of any removal or remedial
action in connection with any Hazardous Materials on such Real Property. If
Holdings or the Borrower, as applicable, fails to provide the same after thirty
days' notice, the Administrative Agent may order the same, and the Borrower or
Holdings shall grant and hereby grants to the Administrative Agent and the Banks
and their agents access to such Real Property and specifically grants the
Administrative Agent and the Banks an irrevocable non-exclusive license to
undertake such an assessment all at the Borrower's or Holdings' expense.
8.07 ERISA. As soon as possible and, in any event, within ten (10)
days after the Borrower, Holdings, any Subsidiary thereof or any ERISA Affiliate
knows or has reason to know of the occurrence of any of the following, Holdings
will deliver to each of the Banks a certificate signed on behalf of Holdings by
the chief financial officer of Holdings setting forth the full
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details as to such occurrence and the action, if any, that the Borrower,
Holdings, such Subsidiary or such ERISA Affiliate is required or proposes to
take, together with any notices required or proposed to be given to or filed by
the Borrower, Holdings, such Subsidiary, the Plan administrator or such ERISA
Affiliate to or with the PBGC or any other government agency, or a Plan
participant and any notices received by the Borrower, Holdings, such Subsidiary
or ERISA Affiliate from the PBGC or any other government agency, or a Plan
participant with respect thereto: that a Reportable Event has occurred (except
to the extent that Holdings has previously delivered to the Banks a certificate
and notices (if any) concerning such event pursuant to the next clause hereof);
that a contributing sponsor (as defined in Section 4001(a)(13) of ERISA) of a
Plan subject to Title IV of ERISA is subject to the advance reporting
requirement of PBGC Regulation Section 4043.61 (without regard to subparagraph
(b)(1) thereof), and an event described in subsection .62, .63, .64, .65, .66,
.67 or .68 of PBGC Regulation Section 4043 is reasonably expected to occur with
respect to such Plan within the following 30 days; that an accumulated funding
deficiency, within the meaning of Section 412 of the Code or Section 302 of
ERISA, has been incurred or an application may be or has been made for a waiver
or modification of the minimum funding standard (including any required
installment payments) or an extension of any amortization period under Section
412 of the Code or Section 303 or 304 of ERISA with respect to a Plan; that any
contribution required to be made with respect to a Plan has not been timely
made; that a Plan has been or may be terminated, reorganized, partitioned or
declared insolvent under Title IV of ERISA; that a Plan has an Unfunded Current
Liability; that proceedings may be or have been instituted to terminate or
appoint a trustee to administer a Plan which is subject to Title IV of ERISA;
that a proceeding has been instituted pursuant to Section 515 of ERISA to
collect a delinquent contribution to a Plan; that the Borrower, Holdings, any
Subsidiary thereof or any ERISA Affiliate will or may incur any liability
(including any indirect, contingent, or secondary liability) to or on account of
the termination of or withdrawal from a Plan under Section 4062, 4063, 4064,
4069, 4201, 4204 or 4212 of ERISA or with respect to a Plan under Section
401(a)(29), 4971, 4975 or 4980 of the Code or Section 409 or 502(i) or 502(1) of
ERISA or with respect to a group health plan (as defined in Section 607(1) of
ERISA or Section 4980B(g)(2) of the Code) under Section 4980B of the Code; or
that the Borrower, Holdings or any Subsidiary thereof may incur any material
liability pursuant to any employee welfare benefit plan (as defined in Section
3(1) of ERISA) that provides benefits to retired employees or other former
employees (other than as required by Section 601 of ERISA) or any Plan. Holdings
will deliver to each of the Banks copies of any records, documents or other
information that must be furnished to the PBGC with respect to any Plan pursuant
to Section 4010 of ERISA. Holdings will also deliver to each of the Banks a
complete copy of the annual report (on Internal Revenue Service Form
5500-series) of each Plan (including, to the extent required, the related
financial and actuarial statements and opinions and other supporting statements,
certificates, schedules and information) required to be filed with the Internal
Revenue Service. In addition to any certificates or notices delivered to the
Banks pursuant to the first sentence hereof, copies of annual reports and any
records, documents or other information required to be furnished to the PBGC or
any other government agency and any material notices received by the Borrower,
Holdings, any Subsidiary thereof or any ERISA Affiliate with respect to any
Plan, shall be delivered to the Banks no later than ten (10) days after the date
such annual report has been filed with the Internal Revenue Service or such
records, documents and/or
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information has been furnished to the PBGC or any other government agency or
such notice has been received by the Borrower, Holdings, the Subsidiary or the
ERISA Affiliate, as applicable.
8.08 End of Fiscal Years; Fiscal Quarters. Each of the Borrower and
Holdings will cause its, and will cause each of its Subsidiaries', fiscal years
to end on December 31 and each of its, and each of its Subsidiaries', first
three fiscal quarters to end on March 31, June 30 and September 30.
8.09 Performance of Obligations. Each of the Borrower and Holdings
will, and will cause each of its Subsidiaries to, perform all of its obligations
under the terms of each mortgage, indenture, security agreement and other debt
instrument by which it is bound, except such non-performances as could not,
individually or in the aggregate, reasonably be expected to have a material
adverse effect on the performance, business, assets, nature of assets,
liabilities (contingent or otherwise), operations, properties, condition
(financial or otherwise), solvency or prospects of the Borrower, Holdings and
their respective Subsidiaries taken as a whole.
8.10 Payment of Taxes. Each of the Borrower and Holdings will pay
and discharge, and will cause each of its Subsidiaries to pay and discharge, all
taxes, assessments and governmental charges or levies imposed upon it or upon
its income or profits, or upon any properties belonging to it, prior to the date
on which penalties would otherwise attach thereto, and all lawful claims which,
if unpaid, might become a lien or charge upon any properties of the Borrower,
Holdings or any of their respective Subsidiaries not otherwise permitted under
Section 9.01; provided that neither the Borrower, Holdings nor any of their
respective Subsidiaries shall be required to pay any such tax, assessment,
charge, levy or claim which is being contested in good faith and by proper
proceedings if it has maintained adequate reserves with respect thereto in
accordance with generally accepted accounting principles.
8.11 Interest Rate Protection. The Borrower shall no later than 60
days following the date on which the Total Term Loan Commitment has been reduced
to zero enter into arrangements acceptable to the Administrative Agent
establishing a fixed or maximum interest rate acceptable to the Administrative
Agent for an aggregate notional amount of at least 50% of the outstanding
principal amount of Indebtedness other than the Senior Subordinated Discount
Notes or the Senior Subordinated Bridge Notes, as applicable, on such date for a
period of at least three years.
8.12 Use of Proceeds. All proceeds of the Loans shall be used as
provided in Section 7.08.
8.13 UCC Searches. On or prior to the 60th day following the Initial
Borrowing Date, the Borrower or Holdings shall deliver to the Administrative
Agent (at the Borrower's or Holdings' own cost) copies of Request for
Information or Copies (UCC-11), or equivalent reports for the purpose of
verifying that all financing statements necessary or, in the opinion of the
Collateral Agent desirable, to perfect the security interests purported to be
created by the Security Agreement shall have been properly recorded and filed.
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8.14 Intellectual Property Rights. Each of the Borrower and Holdings
will, and will cause each of its Subsidiaries to, make all filings in connection
with the transfer of the Intellectual Property rights. Each of the Borrower and
Holdings will, and will cause each of its Subsidiaries to, maintain in full
force and effect all Intellectual Property rights necessary or appropriate to
the business of the Borrower, Holdings or any Subsidiary thereof and take no
action (including, without limitation, the licensing of Intellectual Property),
or fail to take an action, as the case may be, in connection with such
Intellectual Property rights which could reasonably be expected to result in a
material adverse effect on the performance, business, assets, nature of assets,
liabilities (contingent or otherwise), properties, operations, condition
(financial or otherwise), solvency or prospects of the Borrower, Holdings and
their respective Subsidiaries taken as a whole. Each of the Borrower and
Holdings will, and will cause each of its Subsidiaries to, diligently prosecute
all pending applications filed in connection with seeking or seeking to perfect
the Intellectual Property rights and take all other reasonable actions necessary
for the protection and maintenance of the Intellectual Property rights necessary
or appropriate to the business of the Borrower, Holdings or any Subsidiary
thereof at all times from and after the Initial Borrowing Date other than any
such actions the failure of which, in the aggregate, could not reasonably be
expected to have a material adverse effect on the performance, business, assets,
nature of assets, liabilities (contingent or otherwise), operations, properties,
condition (financial or otherwise), solvency or prospects of the Borrower,
Holdings and their respective Subsidiaries taken as a whole.
8.15 Approvals. Holdings shall obtain and maintain in effect all
necessary governmental and third party approvals in connection with the Equity
Financing, and all applicable waiting periods shall have expired without any
action being taken by any competent authority which restrains, prevents or
imposes, in the sole judgment of the Administrative Agent or the Required Banks,
adverse conditions upon the consummation of the Equity Financing, at the
relevant time thereof. Additionally, there shall not exist any judgment, order,
injunction or other restraint issued or filed or a hearing seeking injunction
relief or other restraint pending or notified prohibiting or imposing materially
adverse conditions upon the consummation of the Equity Financing at the relevant
time thereof.
8.16 Registry. The Borrower hereby designates the Administrative
Agent to serve as the Borrower's agent, solely for purposes of this Section
8.16, to maintain a register (the "Register") on which it will record the
Commitments from time to time of each of the Banks, the Loans made by each of
the Banks and each repayment in respect of the principal amount of the Loans of
each Bank. Failure to make any such recordation, or any error in such
recordation shall not affect the Borrower's obligations in respect of such
Loans. With respect to any Bank, the transfer of the Commitments of such Bank
and the rights to the principal of, and interest on, any Loan made pursuant to
such Commitments shall not be effective until such transfer is recorded on the
Register maintained by the Administrative Agent with respect to ownership of
such Commitments and Loans and prior to such recordation all amounts owing to
the transferor with respect to such Commitments and Loans shall remain owing to
the transferor. The registration of an assignment or transfer of all or part of
any Commitments and Loans shall be recorded by the Administrative Agent on the
Register only upon the acceptance by the Administrative Agent of a properly
executed and delivered assignment and assumption agreement pursuant to Section
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13.04(b). Coincident with the delivery of such an assignment and assumption
agreement to the Administrative Agent for acceptance and registration of
assignment or transfer of all or part of a Loan, or as soon thereafter as
practicable, the assigning or transferor Bank shall surrender the Note
evidencing such Loan, and thereupon one or more new Notes in the same aggregate
principal amount shall be issued to the assigning or transferor Bank and/or the
new Bank. The Borrower agrees to indemnify the Administrative Agent from and
against any and all losses, claims, damages and liabilities of whatsoever nature
which may be imposed on, asserted against or incurred by the Administrative
Agent in performing its duties under this Section 8.16.
8.17 Further Actions. (a) Each Credit Party shall grant to the
Collateral Agent, for the benefit of the Secured Creditors, a security interest
in any Real Property owned or leased by any such Credit Party and any other
assets (exclusive of vehicles) of such Credit Party not already subject to a
mortgage or other Security Document upon the acquisition thereof. Each Credit
Party shall take all actions requested by the Administrative Agent or the
Required Banks (including, without limitation, the execution of UCC-1 Financing
Statements, obtaining of mortgage policies, title surveys and real estate
appraisals satisfying the requirements of all applicable laws) in connection
with the granting and perfection of such security interests. Without limiting
the foregoing, each Credit Party specifically agrees to provide the Collateral
Agent with written notice advising the Collateral Agent that a Credit Party has
entered into a Leasehold. Such notice shall be delivered in the manner set forth
in Section 13.03 of this Agreement, and shall be delivered within three (3)
Business Days of the execution of the Leasehold by the Credit Party. The notice
shall include a full and complete copy of the instrument creating the Leasehold,
together with all associated documents (including, without limitation, a copy of
the underlying lease for the real property, if applicable), and a legal
description of the Leasehold adequate to enable the Collateral Agent to
effectively file a UCC-1 Financing Statement covering the fixtures, equipment
and other Collateral located on or affixed to the Leasehold.
(b) The security interests required to be granted pursuant to clause
(a) above shall be granted pursuant to mortgages, deeds of trust and security
agreements, in each case satisfactory in form and substance to the
Administrative Agent and the Required Banks, which mortgages and security
agreements shall create valid and enforceable perfected security interests prior
to the rights of all third Persons and subject to no other Liens except
Permitted Liens. The mortgages and other instruments related thereto and
security agreements shall be duly recorded or filed in such manner and in such
places and at such times as are required by law to establish, perfect, preserve
and protect the Liens, in favor of the Collateral Agent for the benefit of the
Secured Creditors, required to be granted pursuant to such documents and all
taxes, fees and other charges payable in connection therewith shall be paid in
full by the Borrower. At the time of the execution and delivery of the
additional documents, the Borrower shall cause to be delivered to the Collateral
Agent such opinions of counsel, mortgage policies, title surveys, real estate
appraisals, certificates of title and other related documents as may be
reasonably requested by the Administrative Agent or the Required Banks to assure
themselves that this Section 8.17 has been complied with.
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8.18 Concentration Account. On or prior to the earlier to occur of
the Equity Financing or the Notes Financing, each of the Borrower and Holdings
shall, and shall have caused each of its Subsidiaries to, have duly authorized,
executed and delivered a Concentration Account Consent Letter in such form as
approved by the Collateral Agent (each as modified, amended or supplemented from
time to time in accordance with the terms thereof and hereof, a "Concentration
Account Consent Letter") with the Collateral Agent and the Concentration Account
Bank, acknowledging that the Concentration Account listed on a notice sent to
the Collateral Agent at the time of creation of such account maintained at the
Concentration Account Bank is under the exclusive dominion and control of the
Collateral Agent and that all moneys, instruments and other securities deposited
in such Concentration Account are to be held by the Concentration Account Bank
for the benefit of the Collateral Agent subject to the right of the account
parties to utilize such deposited amounts in accordance with the Concentration
Account Consent Letter. Each Credit Party represents and warrants that it does
not now maintain, and will not in the future maintain, any other bank account
with any bank other than the applicable Concentration Account; provided,
however, that each such Credit Party shall be permitted to establish new
Concentration Accounts pursuant to the terms of the Security Agreement.
8.19 Ownership of Subsidiaries. (a) Holdings shall at all times
directly own 100% of the capital stock of the Borrower.
(b) The Borrower shall at all times own 100% of the capital stock of
the Leases Subsidiary.
8.20 Certain Transactions. (a) On or prior to July 31, 2000,
Holdings shall have received at least $100,000,000 of gross cash proceeds from
(x) the sale of its Common Stock to the public (the "Public Offering") pursuant
to the Public Offering Documents, all of which Public Offering Documents shall
be in form and substance satisfactory to the Administrative Agent, or (y) the
private placement of its Series B Preferred Stock (the "Private Placement
Financing") pursuant to the Private Placement Documents, all of which Private
Placement Documents shall be in form and substance satisfactory to the
Administrative Agent.
(b) On or prior to the July 31, 2000, Holdings shall have
contributed all of the cash proceeds received from the Public Offering or the
Private Placement Financing (other than certain amounts retained by Holdings to
pay for general corporate expenses, in an aggregate amount not to exceed
$250,000) to the Borrower as a capital contribution (the "Equity Contribution").
There shall have been delivered to the Administrative Agent and the Required
Banks true and correct copies of all Equity Contribution Documents all of which
shall be in full force in effect and in form and substance satisfactory to the
Administrative Agent.
(c) On or prior to June 30, 2000, there shall have been delivered to
the Administrative Agent true and correct copies of the Acquisition Documents,
all of which Acquisition Documents shall be in form and substance satisfactory
to the Administrative Agent and in full force and effect. The Acquisition
Documents shall not have been amended unless such amendment is approved by the
Administrative Agent and the Required Banks.
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(d) On or prior to June 30, 2000, (i) the Acquisition shall have
been consummated in all material respects in accordance with the Acquisition
Documents and all applicable laws, (ii) all material conditions precedent to the
consummation of the Acquisition contained in the Acquisition Documents shall
have been satisfied and not waived without the consent of the Administrative
Agent and the Required Banks including, without limitation, the payment of the
Acquisition Price and (iii) the Administrative Agent shall have completed its
due diligence for the Spokane wireless market and shall be reasonably satisfied
with the results thereof.
(e) On or prior to June 30, 2000, there shall have been delivered to
the Administrative Agent true and correct copies of all legal opinions required
to be provided in connection with the Acquisition Documents. Each such legal
opinion shall (x) be in form and substance reasonably satisfactory to the
Administrative Agent and (y) contain an express authorization permitting the
Lenders to rely on such opinion.
(f) The Borrower shall utilize the full amount of cash proceeds
received from the Notes Financing, Preferred Stock Issuance, Series A Preferred
Stock Issuance and the Equity Financing, as applicable, to make payments owing
in connection with the Transaction or for the purposes described in the next
sentence prior to the utilization of any proceeds of the Loans for such
purposes. To the extent the amount of cash proceeds received from the Preferred
Stock Issuance, Series A Preferred Stock Issuance, Notes Financing and the
Equity Financing, as applicable, is, on the relevant transaction date, in excess
of amounts required to pay Transaction Fees and Expenses, to finance the
Acquisition, to finance Capital Expenditures in connection with the Borrower's
build-out of the Service Area Network (including, without limitation, the
financing of the development, construction, acquisition and installation of
additional wireless telecommunication assets associated with the build-out of
the PCS Network in the Service Area) and other general corporate and working
capital purposes (including the funding of operational costs of the Borrower
prior to the borrowing of Loans hereunder (except the incurrence of B Term Loans
required hereunder) or the release of B Term Loan proceeds to the Borrower from
the Escrow Account pursuant to the Escrow Agreement), the excess thereof shall
be deposited into the Cash Collateral Account and be subject to the Cash
Collateral Agreement.
Section 9. Negative Covenants. Each of Holdings and the Borrower
hereby covenants that on and after the Effective Date and until the Total
Commitment and all Letters of Credit have terminated and the Loans, Notes and
Unpaid Drawings, together with interest, Fees and all other Obligations incurred
hereunder and thereunder, are paid in full:
9.01 Liens. Holdings will not, and will not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon or with
respect to any property or assets (real or personal, tangible or intangible) of
Holdings or any of its Subsidiaries, whether now owned or hereafter acquired, or
sell any such property or assets subject to an understanding or agreement,
contingent or otherwise, to repurchase such property or assets (including sales
of accounts receivable with recourse to Holdings or any of its Subsidiaries), or
assign any right to receive income or permit the filing of any financing
statement under the UCC or any other similar notice of Lien under any similar
recording or notice statute; provided that the provisions
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of this Section 9.01 shall not prevent Holdings or any of its Subsidiaries from
creating, incurring, assuming or permitting the existence of the following
(liens described below are herein referred to as "Permitted Liens"):
(i) inchoate Liens with respect to Holdings or any of its
Subsidiaries for taxes not yet due or Liens for taxes being contested in
good faith and by appropriate proceedings for which adequate reserves have
been established in accordance with generally accepted accounting
principles;
(ii) Liens in respect of property or assets of the Borrower or any
of its Subsidiaries imposed by law, which were incurred in the ordinary
course of business and do not secure Indebtedness for borrowed money, such
as carriers', warehousemen's, materialmen's, mechanics' and landlords'
liens and other similar Liens arising in the ordinary course of business,
and (x) which do not in the aggregate materially detract from the value of
Holdings' or any of its Subsidiaries' property or assets or materially
impair the use thereof in the operation of the business of Holdings or its
Subsidiaries or (y) which are being contested in good faith by appropriate
proceedings, which proceedings have the effect of preventing the
forfeiture or sale of the property or assets subject to any such Lien;
(iii) Liens of Holdings or its Subsidiaries in existence on the
Initial Borrowing Date which are listed, and the property subject thereto
described, on Schedule IX;
(iv) Liens created pursuant to the Security Documents;
(v) Liens on property of the Borrower and its Subsidiaries subject
to, and securing only, Capitalized Lease Obligations to the extent such
Capitalized Lease Obligations are permitted by Section 9.05(iii); provided
that such Liens only serve to secure the payment of Indebtedness arising
under such Capitalized Lease Obligation and the Lien encumbering the asset
giving rise to the Capitalized Lease Obligation does not encumber any
other asset of Holdings or any of its Subsidiaries;
(vi) Liens (other than any Lien imposed by ERISA) on property of the
Borrower or any of its Subsidiaries incurred or deposits made in the
ordinary course of business in connection with (x) workers' compensation,
unemployment insurance and other types of social security or (y) to secure
the performance of tenders, statutory obligations, surety and appeal
bonds, bids, leases, government contracts, trade contracts, performance
and return-of-money bonds and other similar obligations (exclusive of
obligations for the payment of borrowed money); provided that the
aggregate amount of cash and the fair market value of the property
encumbered by Liens described in this clause (vi)(y) shall not exceed
$200,000;
(vii) Liens placed upon equipment or machinery used in the ordinary
course of the business of the Borrower or any of its Subsidiaries within
60 days following the time of purchase thereof by the Borrower or any of
its Subsidiaries and improvements and accretions thereto to secure
Indebtedness incurred to pay all or a portion of the purchase
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price thereof or any Indebtedness incurred to refinance such Indebtedness,
provided that (x) the aggregate principal amount of all Indebtedness
secured by Liens permitted by this clause (vii) does not exceed at any one
time outstanding the amounts permitted pursuant to 9.05 (iii) with respect
to all machinery and equipment and (y) in all events, the Lien encumbering
the equipment or machinery so acquired and improvements and accretions
thereto does not encumber any other asset of the Borrower or any of its
Subsidiaries;
(viii) Liens arising from precautionary UCC-1 financing statement
filings regarding operating leases entered into by the Borrower or any of
its Subsidiaries in the ordinary course of business;
(ix) inchoate Liens (where there has been no execution or levy and
no pledge or delivery of collateral) arising from and out of judgments or
decrees in existence at such time not constituting an Event of Default;
and
(x) prior to the Initial Borrowing Date, Liens securing the
Refinanced Indebtedness.
9.02 Consolidation, Merger, Purchase or Sale of Assets, etc.
Holdings will not, and will not permit any of its Subsidiaries to, wind up,
liquidate or dissolve its affairs or enter into any transaction of merger or
consolidation, or convey, sell, lease or otherwise dispose of (or agree to do
any of the foregoing at any future time) all or any part of its property or
assets, or enter into any partnerships, joint ventures or sale-leaseback
transactions, or purchase or otherwise acquire (in one or a series of related
transactions) any part of the property or assets (other than purchases or other
acquisitions by the Borrower or any of its Subsidiaries of inventory, materials
and equipment in the ordinary course of business) of any Person, except that:
(i) Capital Expenditures by the Borrower and its Subsidiaries shall
be permitted to the extent not in violation of Section 9.08;
(ii) so long as there shall not exist a Default or Event of Default
(both before and after giving effect to such sale), the Borrower and its
Subsidiaries may sell obsolete, worn-out or uneconomic equipment so long
as the aggregate amount of Net Sale Proceeds from such sales pursuant to
this clause (ii) in any one fiscal year does not exceed $200,000;
(iii) each of the Borrower and its Subsidiaries may lease (as
lessee) real or personal property to the extent permitted by Sections 9.04
and 9.08;
(iv) investments may be made to the extent permitted by Section
9.06;
(v) each of the Borrower and its Subsidiaries may make sales of
inventory in the ordinary course of business;
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(vi) the Borrower and its Subsidiaries may sell or otherwise dispose
of assets (other than the capital stock of, or other equity interests in,
any Subsidiary), so long as (A) no Default or Event of Default then exists
or would result therefrom, (B) each such sale is at arm's-length and the
Borrower or such Subsidiary receives at least fair market value (as
determined by the Borrower or such Subsidiary, as the case may be)
therefor, (C) the consideration received by the Borrower or such
Subsidiary therefor consists solely of cash, (D) the aggregate Net Sale
Proceeds from all assets sold or otherwise disposed of pursuant to this
clause (vi), shall not exceed $2,000,000 in the aggregate during any
fiscal year of the Borrower and (E) the Net Sale Proceeds therefrom are
applied as (and to the extent) required by Section 4.02; and
(vii) the Transaction shall be permitted as contemplated by the
Documents.
To the extent the Required Banks waive the provisions of this Section 9.02 with
respect to the sale of any Collateral (to the extent the Required Banks are
permitted to waive such provisions in accordance with Section 13.12), or any
Collateral is sold as permitted by this Section 9.02, such Collateral shall be
sold free and clear of the Liens created by the Security Documents, and the
Administrative Agent and Collateral Agent shall be authorized to take any
actions deemed appropriate in order to effect the foregoing.
9.03 Dividends. Holdings will not, nor will Holdings permit any of
its Subsidiaries to, declare or pay any Dividends with respect to Holdings or
any of its Subsidiaries, except that:
(i) any Subsidiary of the Borrower may pay Dividends to the Borrower
or any Wholly-Owned Subsidiary of the Borrower;
(ii) the Borrower may pay cash Dividends to Holdings at times and in
amounts necessary for Holdings to make required federal, state or local
tax payments payable by Holdings, provided that, (x) immediately after the
receipt of such cash Dividends, Holdings uses the proceeds thereof to make
such required tax payments and (y) any refund shall be promptly returned
by Holdings to the Borrower;
(iii) Holdings may pay cash Dividends to the holders of its Series A
Preferred Stock and Series B Preferred Stock in accordance with clause (b)
of the definition of Transaction Fees and Expenses; and
(iv) Holdings may acquire non-voting Common Stock pursuant to the
Founders Stock Agreement provided, that the aggregate amount used to
acquire such stock does not exceed $25,000 in the aggregate.
9.04 Leases. Neither Holdings nor its Subsidiaries will incur any
expense (including, without limitation, operating expenses, any property taxes
paid as additional rent or lease payments, every sum or charge paid or payable
under the terms of any lease) under any agreement to rent or lease any real or
personal property (or any extension or renewal thereof) (excluding Capitalized
Lease Obligations, any expense in connection with the Tower Site Leases
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entered into by the Borrower with Spectrasite in the ordinary course of
business, any expense in connection with the rental or lease of retail stores or
telephone switching equipment, all of which shall be in the ordinary course of
business) except the Borrower may incur such expenses in an aggregate amount not
to exceed $750,000 in any fiscal year.
9.05 Indebtedness. Holdings will not, and will not permit any of its
Subsidiaries to, contract, create, incur, assume or suffer to exist any
Indebtedness, except:
(i) Indebtedness incurred pursuant to this Agreement and the other
Credit Documents;
(ii) Indebtedness of the Borrower or any of its Subsidiaries (other
than the Leases Subsidiary) under any Interest Rate Protection or Other
Hedging Agreement or under any similar type of agreement to the extent
such is entered into to satisfy the requirements of Section 8.11;
(iii) Indebtedness of the Borrower and its Subsidiaries (other than
the Leases Subsidiary) evidenced by Capitalized Lease Obligations to the
extent permitted pursuant to Section 9.08 and Indebtedness secured by
Liens permitted by Section 9.01(vii); provided that the aggregate amount
of Indebtedness evidenced by Capitalized Lease Obligations under all
Capital Leases when aggregated with the amount of Indebtedness secured by
Liens permitted by Section 9.01(vii) outstanding at any one time shall not
exceed $2,000,000;
(iv) Indebtedness evidenced by the Senior Subordinated Discount
Notes less the amount of principal repayments thereof and senior
subordinated guaranties with respect thereto in the form agreed to on the
Effective Date and from parties also guaranteeing the Obligations on a
senior basis;
(v) In the event Indebtedness is not incurred pursuant to clause
(iv) above, Indebtedness incurred pursuant to the Bridge Financing and the
Bridge Refinancing;
(vi) general unsecured Indebtedness of the Borrower and its
Subsidiaries (other than the Leases Subsidiary) owing to financial
institutions in an aggregate principal amount not to exceed $10,000,000 at
any time outstanding, provided, that the aggregate principal amount of
such Indebtedness incurred by (x) the Borrower does not exceed $5,000,000
at any time outstanding (including all Indebtedness incurred pursuant to
clause (iii) above) and (y) the Borrower's Subsidiaries (i) does not
exceed $5,000,000 at any time outstanding and all such Indebtedness shall
be non-recourse to the Borrower and incurred solely in connection with the
transactions contemplated in Section 9.06(ix) hereof; and
(vii) prior to the Initial Borrowing Date, the Refinanced
Indebtedness.
9.06 Advances, Investments and Loans. Holdings will not, and will
not permit any of its Subsidiaries to, directly or indirectly lend money or
credit or make advances to any
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Person, or purchase or acquire any stock, obligations or securities of, or any
other interest in, or make any capital contribution to, any other Person, or
purchase or own a futures contract or otherwise become liable for the purchase
or sale of currency or other commodities at a future date in the nature of a
futures contract, or hold any cash or Cash Equivalents, except that the
following shall be permitted:
(i) the Borrower and its Subsidiaries may acquire and hold
receivables owing to any of them, if created or acquired in the ordinary
course of business and payable or dischargeable in accordance with
customary terms;
(ii) Holdings and its Subsidiaries may acquire and hold cash and
Cash Equivalents; provided that (I) all such cash or Cash Equivalents
(other than up to $100,000) shall be held by Holdings or such Subsidiary
in the Concentration Account in accordance with the terms of the
Concentration Account Consent Letter; provided further, that at any time
that any Revolving Loans or Swingline Loans are outstanding, the aggregate
amount of cash and Cash Equivalents permitted to be held by Holdings and
its Subsidiaries shall not exceed (exclusive of amounts held in the Cash
Collateral Account pursuant to the Cash Collateral Agreement) $200,000 for
any period of three consecutive Business Days and (II) all proceeds from
the Notes Financing, the Preferred Stock Issuance, the Series A Preferred
Stock Issuance and the Equity Financing not used to pay Transaction Fees
and Expenses, to finance Capital Expenditures in connection with the
Borrower's build-out of the Service Area Network and other general
corporate and working capital purposes shall be maintained in a Cash
Collateral Account pursuant to the Cash Collateral Agreement and only
released therefrom in accordance with the Cash Collateral Agreement;
(iii) the Borrower may enter into interest rate protection
agreements to the extent such is entered into to satisfy the requirements
of Section 8.11;
(iv) the Borrower and its Subsidiaries may make Capital Expenditures
to the extent permitted by Section 9.08;
(v) the Transaction shall be permitted in accordance with the
provisions of Sections 5 and 8.20;
(vi) the Borrower and its Subsidiaries may endorse negotiable
instruments for collection in the ordinary course of business;
(vii) the Borrower and its Subsidiaries may make loans and advances
in the ordinary course of business consistent with past practices to their
respective employees for moving, travel and emergency expenses and other
similar expenses, so long as the aggregate principal amount thereof at any
one time outstanding (determined without regard to any write-downs or
write-offs of such loans and advances) shall not exceed $100,000;
(viii) Dividends may be paid to the extent permitted by Section
9.03; and
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(ix) so long as no Default or Event of Default exists or would exist
immediately after giving effect to the respective investment, the Borrower
and its Subsidiaries shall be permitted to make investments in any Joint
Venture on any date in an amount not to exceed the Available J.V. Basket
Amount on such date (after giving effect to all prior and contemporaneous
adjustments thereto, except as a result of such investment), it being
understood and agreed that to the extent the Borrower or one or more other
Credit Parties (after the respective investment has been made) receives a
cash return from the respective Joint Venture of amounts previously
invested pursuant to this clause (x) (which cash return may be made by way
of repayment of principal in the case of loans and cash equity returns
(whether as a distribution, dividend or redemption) in the case of equity
investments) or a return in the form of an asset or stock distribution
from the respective Joint Venture of any asset or stock previously
contributed pursuant to this clause (x), then the amount of such cash
return of investment or the fair market value of such distributed asset or
stock (as determined in good faith by senior management of the Borrower),
as the case may be, shall, upon the Administrative Agent's receipt of a
certification of the amount of the return of investment from an authorized
officer of the Borrower, apply to increase the Available J.V. Basket
Amount (provided that the aggregate amount of increases to the Available
J.V. Basket Amount described above shall not exceed the amount of returned
investment and, in no event, shall the amount of the increases made to the
Available J.V. Basket Amount in respect of any investment exceed the
amount previously invested pursuant to this clause (x)), provided, that
the aggregate amount of cash invested in a Joint Venture shall not exceed
$5,000,000 plus the amount of any increase to the Available J.V. Basket as
provided above;
9.07 Transactions with Affiliates. Except for those transactions
listed on Schedule X, Holdings will not, and will not permit any of its
Subsidiaries to, enter into any transaction or series of related transactions,
whether or not in the ordinary course of business, with any Affiliate of
Holdings unless such transaction or series of related transactions is in writing
and on terms that are no less favorable to Holdings or such Subsidiary, as the
case may be, than those that would be available in a comparable transaction in
arm's-length dealings with an unrelated third party; except that (i) Holdings
and its Subsidiaries may effect the Transaction, (ii) loans and advances made in
accordance with Section 9.06(vii) shall be permitted, (iii) Holdings and the
Borrower may pay customary fees to non-officer directors of the Borrower; (iv)
the Borrower and its Subsidiaries may enter into the Employment Agreements, and
(v) Dividends may be paid in accordance with Section 9.03. In no event may any
management, closing or similar fees be paid or payable by Holdings or any of its
Subsidiaries to any Affiliate of Holdings.
9.08 Capital Expenditures. (a) Holdings will not and will not permit
any of its Subsidiaries to, make or commit to make any expenditure for fixed or
capital assets (including, without limitation, expenditures for maintenance and
repairs which should be capitalized in accordance with generally accepted
accounting principles and including Capitalized Lease Obligations (collectively,
"Capital Expenditures"), except that the Borrower and its Subsidiaries may make
Capital Expenditures so long as the aggregate amount thereof does not exceed
during any period or fiscal year, the amount set forth below opposite such date:
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Fiscal Year Ended Amount
----------------- ------
Effective Date-December
31, 2000 $130,000,000
December 31, 2001 70,000,000
December 31, 2002 40,000,000
December 31, 2003 40,000,000
December 31, 2004 40,000,000
December 31, 2005 45,000,000
December 31, 2006 and
each fiscal year
thereafter 25,000,000
(b) Notwithstanding anything to the contrary contained in Section
9.08(a), to the extent that Capital Expenditures incurred during any period set
forth in Section 9.08(a) are less than the amount set forth opposite such period
above, 100% of such unused amount may be carried forward to the immediately
succeeding fiscal year and utilized to make Capital Expenditures in excess of
the amount permitted above in the following fiscal year; provided, that, (x)
amounts carried forward from the immediately preceding fiscal year, if any,
shall be utilized in full during the next fiscal year to incur Capital
Expenditures before the relevant amount set forth opposite such next fiscal year
shall be utilized to incur Capital Expenditures during such fiscal year and (y)
no amounts once carried forward to the next fiscal year may be carried forward
again to any fiscal year thereafter.
(c) Notwithstanding the foregoing, the Borrower shall be permitted
to make expenditures in connection with the consummation of the Acquisition, on
or prior to June 30, 2000, in an amount not to exceed the Acquisition Price,
which expenditures shall not be included in the amounts set forth above.
9.09 Fixed Charge Coverage Ratio. Holdings will cause the Borrower
not to permit, and the Borrower will not permit, the Fixed Charge Coverage Ratio
for any fiscal quarter ending on a date set forth below, to be less than the
ratio set forth below opposite such date:
Fiscal Quarter Ended Ratio
-------------------- -----
December 31, 2004 to
September 30, 2005 1.05:1.00
December 31, 2005 to
September 30, 2007 1.10:1.00
December 31, 2007 and
each fiscal quarter
thereafter 1.20:1.00
9.10 Interest Coverage Ratio. Holdings will cause the Borrower not
to permit, and the Borrower will not permit, the ratio of its Consolidated
EBITDA for any fiscal quarter ending on a date set forth below to its
Consolidated Interest Expense for the period (taken
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together as one accounting period) of four consecutive fiscal quarters ended on
such date, to be less than the ratio set forth opposite such date below:
Fiscal Quarter Ended Ratio
-------------------- -----
March 31, 2004 1.20:1.00
June 30, 2004 1.75:1.00
September 30, 2004 to
September 30, 2006 2.25:1.00
December 31, 2006 to
September 30, 2007 3.00:1.00
December 31, 2007
and each fiscal quarter
thereafter 4.00:1.00
9.11 Total Capital Ratios. (A) Consolidated Indebtedness to Total
Capital. Holdings will cause the Borrower not to permit, and the Borrower will
not permit, the ratio of its Consolidated Indebtedness as at the end of any
fiscal quarter ended on a date set forth below to Total Capital to be greater
than:
Fiscal Quarter Ended Ratio
-------------------- -----
June 30, 2000 0.65:1.00
September 30, 2000
and each fiscal quarter
thereafter 0.70:1.00
(B) Consolidated Senior Indebtedness to Total Capital. Holdings will
cause the Borrower not to permit, and the Borrower will not permit, the ratio of
its Consolidated Senior Indebtedness as at the end of any fiscal quarter ended
on a date set forth below to its Total Capital to be greater than:
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Fiscal Quarter Ended Ratio
-------------------- -----
June 30, 2000 0.275:1.00
September 30, 2000 0.350:1.00
December 31, 2000 0.350:1.00
March 31, 2001 0.375:1.00
June 30, 2001 0.375:1.00
September 30, 2001 0.420:1.00
December 31, 2001 0.420:1.00
March 31, 2002 0.470:1.00
June 30, 2002 0.470:1.00
September 30, 2002 and
each fiscal quarter
thereafter 0.500:1.00
9.12 Minimum Covered POPS. Holdings will cause the Borrower not to
permit, and the Borrower will not permit, on the last day of any period ending
on or after any date set forth below, Covered Pops as a percentage of the total
number of Pops in the Service Area to be less than the percentage set forth
opposite such date below:
Fiscal Quarter Ended Percentage
-------------------- ----------
December 31, 2000 25.0%
March 31, 2001 25.0%
June 30, 2001 40.0%
September 30, 2001 42.5%
December 31, 2001 45.0%
March 31, 2002 47.0%
June 30, 2002 50.0%
September 30, 2002 50.0%
December 31, 2002 50.0%
March 31, 2003 55.0%
June 30, 2003 55.0%
September 30, 2003 55.0%
December 31, 2003 55.0%
March 31, 2004 55.0%
June 30, 2004 55.0%
September 30, 2004 and
each fiscal quarter
thereafter 60.0%
9.13 Leverage Ratios. (A) Consolidated Indebtedness to Consolidated
EBITDA. Holdings will cause the Borrower not to permit, and the Borrower will
not permit, the ratio of Consolidated Indebtedness as at the end of any fiscal
quarter ended on a date set forth below to Consolidated EBITDA for the period
(taken together as one accounting period) of four
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consecutive fiscal quarters ended on such date, to be greater than the ratio set
forth opposite such date below:
Fiscal Quarter Ended Ratio
-------------------- -----
March 31, 2004 16.00:1.00
June 30, 2004 10.50:1.00
September 30, 2004 8.75:1.00
December 31, 2004
March 31, 2005-September 7.25:1.00
30, 2006
December 31, 2006 and 4.25:1.00
each fiscal quarter
thereafter 3:00:1.00
(B) Consolidated Indebtedness to Adjusted Consolidated EBITDA.
Holdings will cause the Borrower not to permit, and the Borrower will not
permit, the ratio of Consolidated Indebtedness as at the end of any fiscal
quarter ended on a date set forth below to Adjusted Consolidated EBITDA for the
period (taken together as one accounting period) of four consecutive fiscal
quarters ended on such date, to be greater than the ratio set forth opposite
such date:
Fiscal Quarter Ended Ratio
-------------------- -----
December 31, 2002 14.00:1.00
March 31, 2003 10.75:1.00
June 30, 2003 8.50:1.00
September 30, 2003 6.50:1.00
December 31, 2003 5.25:1.00
March 31, 2004 4.75:1.00
June 30, 2004 4.00:1.00
September 30, 2004 3.75:1.00
December 31, 2004 and
each fiscal quarter
thereafter 3.50:1.00
(C) Consolidated Senior Indebtedness to Consolidated EBITDA.
Holdings will cause the Borrower not to permit, and the Borrower will not
permit, the ratio of Consolidated Senior Indebtedness as at the end of any
fiscal quarter ended on a date set forth below to Consolidated EBITDA for the
period (taken together as one accounting period) of four consecutive fiscal
quarters ended on such date, to be greater than the ratio set forth opposite
such date below:
Fiscal Quarter Ended Ratio
-------------------- -----
March 31, 2004 7.75:1.00
June 30, 2004 5.00:1.00
September 30, 2004 4.00:1.00
December 31, 2004-
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Fiscal Quarter Ended Ratio
-------------------- -----
September 30, 2005 3.25:1.00
December 31, 2005 and
each fiscal quarter
thereafter 2.50:1.00
(D) Consolidated Senior Indebtedness to Adjusted Consolidated
EBITDA. Holdings will cause the Borrower not to permit, and the Borrower will
not permit, the ratio of Consolidated Senior Indebtedness as at the end of any
fiscal quarter ended on a date set forth below to Adjusted Consolidated EBITDA
for the period (taken together as one accounting period) of four consecutive
fiscal quarters ended on such date, to be greater than the ratio set forth
opposite such date below:
Fiscal Quarter Ended Ratio
-------------------- -----
December 31, 2002 7.25:1.00
March 31, 2003 5.50:1.00
June 30, 2003 4.25:1.00
September 30, 2003 3.25:1.00
December 31, 2003 2.75:1.00
March 31, 2004 2.25:1.00
June 30, 2004 and each
fiscal quarter thereafter 2.00:1.00
9.14 Minimum Revenues. Holdings will cause the Borrower not to
permit, and the Borrower will not permit, its Consolidated Revenues for any
period of four consecutive fiscal quarters ended on a date set forth below (or,
if less, the number of fiscal quarters commenced after March 31, 2000) ending on
a date set forth below to be less than the number set forth opposite such date
set forth below:
Fiscal Quarter Ended Amount
-------------------- ------
June 30, 2000 $ 900,000
September 30, 2000 2,500,000
December 31, 2000 5,100,000
March 31, 2001 10,600,000
June 30, 2001 17,500,000
September 30, 2001 27,700,000
December 31, 2001 37,500,000
March 31, 2002 51,000,000
June 30, 2002 64,600,000
September 30, 2002 81,000,000
December 31, 2002 97,600,000
March 31, 2003 111,900,000
June 30, 2003 127,600,000
September 30, 2003 147,600,000
December 31, 2003 169,000,000
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Fiscal Quarter Ended Amount
-------------------- ------
March 31, 2004 188,500,000
June 30, 2004 209,500,000
September 30, 2004 225,100,000
December 31, 2004 242,200,000
9.15 Minimum Subscribers. Holdings will cause the Borrower not to
permit, and the Borrower will not permit, the number of its Subscribers at the
end of any month ended on or after a date set forth below to be less than the
number of Subscribers set forth opposite such date set forth below:
Fiscal Quarter Ended Amount
-------------------- ------
June 30, 2000 8,000
September 30, 2000 8,500
December 31, 2000 13,500
March 31, 2001 28,500
June 30, 2001 48,000
September 30, 2001 67,500
December 31, 2001 89,000
March 31, 2002 111,000
June 30, 2002 135,000
September 30, 2002 150,000
December 31, 2002 182,000
March 31, 2003 205,000
June 30, 2003 235,000
September 30, 2003 260,000
December 31, 2003 285,000
March 31, 2004 310,000
June 30, 2004 335,000
September 30, 2004 360,000
December 31, 2004 385,000
9.16 Limitation on Voluntary Payments and Modification; Limitation
on Modifications of Certificate of Incorporation, By-Laws Certificate of Limited
Partnership, Agreement of Limited Partnership and Certain Other Agreements; etc.
Holdings will not, and will not permit any of its Subsidiaries to
(i) make (or give any notice in respect of) any voluntary or
optional payment or prepayment on or redemption (including pursuant to any
change of control provision) or acquisition for value of (including,
without limitation, by way of depositing with the trustee with respect
thereto money or securities before due for the purpose of paying when
due), the Senior Subordinated Discount Notes or the Senior Subordinated
Bridge Notes, as applicable, or the Preferred Stock;
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(ii) amend or modify, or permit the amendment or modification of,
any provision of the Documents or any agreement relating to any of the
foregoing, or the Senior Subordinated Discount Notes Documents or the
Bridge Financing Documents, as applicable, except for amendments which
provide for less restrictive provisions with respect to the Borrower,
Holdings and their respective Subsidiaries;
(iii) without the prior approval of the Administrative Agent, amend,
modify or change its Certificate of Incorporation (including, without
limitation, by the filing or modification of any certificate of
designation), By-Laws, operating agreement or any agreement entered into
by it, with respect to its capital stock or other equity interests, or
enter into any new agreement with respect to its capital stock or other
equity interests;
(iv) amend, modify or change, terminate, or enter into any new
Shareholders' Agreement if such amendment, modification, change,
termination or execution will be adverse to the interests of the Banks;
(v) amend, modify, change or terminate any Tax Sharing Agreement or
enter into any new Tax Sharing Agreement;
(vi) amend, modify or change, or enter into any new Management
Agreement, Employee Benefit Plan (except as required by law) or Employment
Agreement except if the aggregate cost to Holdings and its Subsidiaries as
a result of such amendments, modifications, changes to such plans and
agreements and new plans and agreements is not reasonably likely to have a
material adverse effect on the performance, business, property, assets,
nature of assets, liabilities (contingent or otherwise), condition
(financial or otherwise), solvency or prospects of Holdings and its
Subsidiaries taken as a whole;
(vii) amend, modify, change or terminate any Sprint Agreement in any
material respect or enter into any new agreement with Sprint Corporation
or any of its Affiliates.
9.17 Limitation on Certain Restrictions on Subsidiaries. Holdings
will not, and will not permit any of its Subsidiaries to, directly or
indirectly, create or otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any Subsidiary of Holdings to (i)
pay dividends or make any other distributions on its capital stock to Holdings
or any Subsidiary of Holdings or any other interest or participation in its
profits owned by Holdings or any Subsidiary of Holdings, or pay any Indebtedness
owed to Holdings or a Subsidiary of Holdings, (ii) make loans or advances to
Holdings or any of Holdings' Subsidiaries or (iii) transfer any of its
properties or assets to Holdings or the Borrower, except for such encumbrances
or restrictions existing under or by reason of (w) applicable law, (x) this
Agreement, the other Credit Documents and the Senior Subordinated Note Documents
or the Bridge Financing Documents, as applicable, (y) customary provisions
restricting subletting or assignments of any lease governing a leasehold
interest of Holdings or a Subsidiary of Holdings or (z) the asset transfer
restrictions imposed by purchase money financing permitted pursuant to Section
9.05(iii) hereof.
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9.18 Limitation on Issuance of Equity Interests. (a) Holdings will
not permit any of its Subsidiaries to issue any equity interests or any options
or warrants to purchase, or instruments convertible into, equity interests,
except for issuances of common stock to Holdings so long as such issuances are
pledged in accordance with the Pledge Agreement (including, without limitation,
any issuance of common stock by the Borrower in connection with a Bridge
Refinancing).
(b) Holdings will not issue any Disqualified Stock, except (i)
pursuant to the Private Placement Financing and (ii) for stock or share splits,
stock or share dividends and similar issuances payable on the Series A or Series
B Preferred Stock in accordance with the Certificates of Designations; provided
that no Default or Event of Default will exist as of the date of any issuance
made pursuant to clauses (i), (ii), (iii) or (iv) above.
9.19 Business. Holdings shall engage in no business and have no
assets other than owning the capital stock of the Borrower. The Borrower will
not, and will not permit any of its Subsidiaries, to engage (directly or
indirectly) in any business other than a Permitted Business.
9.20 Limitation on Creation of Subsidiaries. Except with the prior
approval of the Administrative Agent and the Required Banks, Holdings will not,
and will not permit any of its Subsidiaries to, establish, create or acquire any
new Subsidiary, except as set forth in Section 9.06(ix) hereof and provided that
(i) Holdings shall provide notice thereof to the Administrative Agent at least
15 days prior to the acquisition of any such Subsidiary, (ii) such Subsidiary,
acquired pursuant to Section 9.06(ix) or so approved by the Administrative Agent
and the Required Banks, executes a counterpart of the Guaranty, the Pledge
Agreement and the Security Agreement, (iii) the capital stock of such Subsidiary
is pledged pursuant to the Pledge Agreement and all documents and certificates
with respect thereto are delivered to the Collateral Agent and (iv) to the
extent required by the Agent or the Required Banks, take any action required
pursuant to Section 8.17.
9.21 Concentration Account. Holdings will not, and will not permit
any of its Subsidiaries to, directly or indirectly, open, maintain or otherwise
have any checking, savings or other deposit accounts at any bank or other
financial institution where cash or Cash Equivalents is or may be deposited or
maintained with any Person, other than the Concentration Account.
9.22 Sprint Agreements. Holdings will not, and will not permit any
of its Subsidiaries to (i) exercise any of its remedies under the Sprint
Management Agreement, including, but not limited to, its remedies under Section
11.5 of the Sprint Management Agreement and (ii) build-out material New Areas
under and as defined in the Sprint Management Agreement.
9.23 Limitations on Leases Subsidiary. The Borrower shall not permit
the Leases Subsidiary to incur, assume or permit to exist any liabilities (other
than liabilities incurred in the ordinary course of business which are incident
to being the lessee of real property and taxes and other liabilities in the
ordinary course in order to maintain its existence) or to engage in any business
or activities other than the owning or leasing, as lessee, of the Tower Site
Leases.
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Section 10. Events of Default. Upon the occurrence of any of the
following specified events (each an "Event of Default"):
10.01 Payments. The Borrower shall (i) default in the payment when
due of any principal of any Loan or any Note or any Unpaid Drawing or (ii)
default, and such default shall continue unremedied for two or more Business
Days, in the payment when due of any interest on any Loan or Note or Unpaid
Drawing, or any Fees or any other amounts owing by it hereunder or thereunder;
or
10.02 Representations, etc. Any representation, warranty or
statement made by any Credit Party herein or in any other Credit Document or in
any certificate delivered pursuant hereto or thereto shall prove to be untrue in
any material respect on the date as of which made or deemed made; or
10.03 Covenants. Any Credit Party shall (i) default in the due
performance or observance by it of any term, covenant or agreement contained in
Section 8.01(g)(i), 8.08, 8.11, 8.16, 8.17, 8.20, 9 or 13.15, or (ii) default in
the due performance or observance by it of any other term, covenant or agreement
contained in this Agreement, and such default shall continue unremedied for a
period of 15 days after written notice thereof to the Borrower by the
Administrative Agent or any Bank; or
10.04 Default Under Other Agreements. (i) Holdings or any of its
Subsidiaries shall default in any payment of any Indebtedness (other than the
Indebtedness referred to in Section 10.01) beyond the period of grace (not to
exceed 10 days), if any, provided in the instrument or agreement under which
such Indebtedness was created, (ii) Holdings or any of its Subsidiaries shall
default in the observance or performance of any agreement or condition relating
to any Indebtedness (other than the Indebtedness referred to in Section 10.01)
or contained in any instrument or agreement evidencing, securing or relating
thereto, or any other event shall occur or condition exist, the effect of which
default or other event or condition is to cause, or to permit the holder or
holders of such Indebtedness (or a trustee or agent on behalf of such holder or
holders) to cause (determined without regard to whether any notice or grace
period after notice is required), any Indebtedness to become due prior to its
stated maturity and such default shall not have been cured or waived, or (iii)
any Indebtedness (other than the Indebtedness referred to in Section 10.01) of
Holdings or any of its Subsidiaries shall be declared to be due and payable, or
required to be prepaid other than by a regularly scheduled required prepayment,
prior to the stated maturity thereof; provided that it shall not constitute an
Event of Default pursuant to this Section 10.04 unless the aggregate amount of
all Indebtedness referred to in the preceding clauses (i) through (iii) above
exceeds $1,000,000 at any one time; or
10.05 Bankruptcy, etc. The Borrower, Holdings or any of their
respective Subsidiaries shall commence a voluntary case concerning itself under
Title 11 of the United States Code entitled "Bankruptcy," as now or hereafter in
effect, or any successor thereto (the "Bankruptcy Code"); or an involuntary case
is commenced against the Borrower, Holdings or any of their respective
Subsidiaries and the petition is not controverted within 10 days, or is not
dismissed or discharged, within 60 days, after commencement of the case; or a
custodian (as
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defined in the Bankruptcy Code) is appointed for, or takes charge of, all or
substantially all of the property of the Borrower, Holdings or any of their
respective Subsidiaries, or the Borrower, Holdings or any of their respective
Subsidiaries commences any other proceeding under any reorganization,
arrangement, adjustment of debt, relief of debtors, dissolution, insolvency or
liquidation or similar law of any jurisdiction whether now or hereafter in
effect relating to the Borrower, Holdings or any of their respective
Subsidiaries, or there is commenced against the Borrower, Holdings or any of
their respective Subsidiaries any such proceeding which remains undismissed or
undischarged for a period of 60 days, or the Borrower, Holdings or any of their
respective Subsidiaries is adjudicated insolvent or bankrupt; or any order of
relief or other order approving any such case or proceeding is entered; or the
Borrower, Holdings or any of their respective Subsidiaries suffers any
appointment of any custodian or the like for it or any substantial part of its
property to continue undischarged or unstayed for a period of 60 days; or the
Borrower, Holdings or any of their respective Subsidiaries makes a general
assignment for the benefit of creditors; or any corporate action is taken by the
Borrower, Holdings or any of their respective Subsidiaries for the purpose of
effecting any of the foregoing; or
10.06 ERISA. (a) Any Plan shall fail to satisfy the minimum funding
standard required for any plan year or part thereof under Section 412 of the
Code or Section 302 of ERISA or a waiver of such standard or extension of any
amortization period is sought or granted under Section 412 of the Code or
Section 303 or 304 of ERISA, a Reportable Event shall have occurred, a
contributing sponsor (as defined in Section 4001(a)(13) of ERISA) of a Plan
subject to Title IV of ERISA shall be subject to the advance reporting
requirement of PBGC Regulation Section 4043.61 (without regard to subparagraph
(b)(1) thereof) and an event described in subsection .62, .63, .64, .65, .66,
.67 or .68 of PBGC Regulation Section 4043 shall be reasonably expected to occur
with respect to such Plan within the following 30 days, any Plan which is
subject to Title IV of ERISA shall have had or is likely to have a trustee
appointed to administer such Plan, any Plan which is subject to Title IV of
ERISA is, shall have been or is likely to be terminated or to be the subject of
termination proceedings under ERISA, any Plan shall have an Unfunded Current
Liability, a contribution required to be made with respect to a Plan has not
been timely made, the Borrower, Holdings or any Subsidiary thereof or any ERISA
Affiliate has incurred or is likely to incur any liability to or on account of a
Plan or under Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201,
4204 or 4212 of ERISA or Section 401(a)(29), 4971 or 4975 of the Code or on
account of a group health plan (as defined in Section 607(1) of ERISA or Section
4980B(g)(2) of the Code) under Section 4980B of the Code, the Borrower, Holdings
or any Subsidiary thereof has incurred or is likely to incur liabilities
pursuant to one or more employee welfare benefit plans (as defined in Section
3(1) of ERISA) that provide benefits to retired employees or other former
employees (other than as required by Section 601 of ERISA) or Plans, a
"default," within the meaning of Section 4219(c)(5) of ERISA, shall occur with
respect to any Plan; any applicable law, rule or regulation is adopted, changed
or interpreted, or the interpretation or administration thereof is changed, in
each case after the date hereof, by any governmental authority or agency or by
any court (a "Change in Law"), or, as a result of a Change in Law, an event
occurs following a Change in Law, with respect to or otherwise affecting any
Plan; (b) there shall result from any such event or events the imposition of a
lien, the granting of a security interest, or a liability or a material risk of
incurring a liability; and (c) such lien, security interest or liability,
individually, and/or in the aggregate, in the opinion of the
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Required Banks, has had, or could reasonably be expected to have, a material
adverse effect upon the business, property, assets, nature of assets,
operations, liabilities (contingent or otherwise), condition (financial or
otherwise), solvency or prospects of the Borrower, Holdings or any Subsidiary
thereof; or
10.07 Security Documents. At any time after the execution and
delivery thereof, any of the Security Documents shall cease to be in full force
and effect or shall cease to give the Collateral Agent for the benefit of the
Secured Creditors the Liens, rights, powers and privileges purported to be
created thereby (including, without limitation, a perfected security interest
in, and Lien on, all of the Collateral), in favor of the Collateral Agent,
superior to and prior to the rights of all third Persons (except as permitted by
Section 7.11), and subject to no other Liens (except as permitted by Section
7.11), or any Credit Party shall default in the due performance or observance of
any term, covenant or agreement on its part to be performed or observed pursuant
to any of the Security Documents and such default shall continue beyond any
grace period specifically applicable thereto pursuant to the terms of such
Security Document; or
10.08 Judgments. One or more judgments or decrees shall be entered
against Holdings or any of its Subsidiaries involving in the aggregate for
Holdings and its Subsidiaries a liability (not paid or fully covered by a
reputable insurance company) in excess of $500,000 for all such judgments and
decrees and any such judgments or decrees shall not be satisfied, vacated,
discharged or stayed or bonded pending appeal for any period of 30 consecutive
days; or any judgment or decree shall be entered against Holdings or any of its
Subsidiaries or any settlement shall be reached or compensation shall be paid by
Holdings or any of its Subsidiaries with respect to the Bakovsky Litigation in
excess of $1,000,000; or
10.09 Sprint Agreements. At any time (i) any provision of the Sprint
Agreements or the Consent and Agreement shall cease to be in full force and
effect or Sprint Corporation or any of its Affiliates shall deny or disaffirm
its obligations under any such agreement, (ii) Sprint PCS shall exercise its
right to purchase the Operating Assets under Section 11.6.1 of the Sprint
Management Agreement, (iii) Sprint PCS shall exercise its rights with respect to
the Disaggregated License under Section 11.6.2 of the Sprint Management
Agreement, (iv) an Event of Termination shall occur or any event that if not
cured or notice were to be given of such event would constitute an Event of
Termination under the Sprint Management Agreement shall occur (whether or not
waived) or (v) Sprint PCS shall amend or modify any Program Requirements (as
defined in the Sprint Management Agreement), guidelines or policies set forth in
the Sprint Agreements which the Required Banks determine could reasonably be
expected to have a material adverse effect on the performance, business,
property, assets, nature of assets, liabilities (contingent or otherwise),
condition (financial or otherwise), solvency or prospects of the Borrower,
Holdings and their respective Subsidiaries; or
10.10 Change in Control. There shall be a Change in Control;
then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing, the Administrative Agent, upon the written request of
the Required Banks, shall by written notice to the Borrower, take any or all of
the following actions, without prejudice to the
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rights of the Administrative Agent, any Bank or the holder of any Note to
enforce its claims against any Credit Party (provided that, if an Event of
Default specified in Section 10.05 shall occur with respect to the Borrower, the
result which would occur upon the giving of written notice by the Administrative
Agent to the Borrower as specified in clauses (i) and (ii) below shall occur
automatically without the giving of any such notice): (i) declare the Total
Commitment terminated, whereupon all Commitments of each Bank shall forthwith
terminate immediately and any Fees shall forthwith become due and payable
without any other notice of any kind; (ii) declare the principal of and any
accrued interest in respect of all Loans and the Notes and all Obligations owing
hereunder and thereunder to be, whereupon the same shall become, forthwith due
and payable without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by each Credit Party; (iii) terminate any Letter
of Credit which may be terminated in accordance with its terms; (iv) direct the
Borrower to pay (and the Borrower agrees that upon receipt of such notice, or
upon the occurrence of an Event of Default specified in Section 10.05, it will
pay) to the Collateral Agent at the Payment Office such additional amount of
cash, to be held as security by the Collateral Agent for the benefit of the
Banks in a cash collateral account established and maintained by the Collateral
Agent pursuant to a cash collateral agreement in form and substance satisfactory
to the Collateral Agent, as is equal to the aggregate Stated Amount of all
Letters of Credit then outstanding; (v) exercise any rights or remedies under
any of the Guaranties; and (vi) enforce, as Collateral Agent, all of the Liens
and security interests created pursuant to the Security Documents.
Section 11. Definitions and Accounting Terms.
11.01 Defined Terms. As used in this Agreement, the following terms
shall have the following meanings (such meanings to be equally applicable to
both the singular and plural forms of the terms defined):
"A Term Loan" shall have the meaning provided in Section 1.01(a).
"A Term Loan Commitment" shall mean, with respect to each Bank, the
amount set forth opposite such Bank's name in Schedule I directly below the
column entitled "A Term Loan Commitment," as the same may be reduced or
terminated pursuant to Section 3.03, 4.02 and/or 10.
"A Term Loan Commitment Required Reduction Date" shall mean each of
the dates set forth in clauses (i), (ii) and (iii) of the definition of Required
A Term Loan Drawdown Amount.
"A Term Loan Commitment Termination Date" shall mean the second
anniversary of the Initial Borrowing Date.
"A Term Loan Facility" shall mean the term loan facility evidenced
by the Total A Term Loan Commitment.
"A Term Loan Maturity Date" shall mean the seven year and
sixth-month anniversary of the Initial Borrowing Date.
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"A Term Note" shall have the meaning provided in Section 1.05(a).
"A TL Percentage" shall mean, at any time, a fraction (expressed as
a percentage), the numerator of which is equal to the aggregate principal amount
of all A Term Loans outstanding at such time (or, if prior to the Initial
Borrowing Date, the Total A Term Loan Commitment), and the denominator of which
is equal to the aggregate principal amount of all A Term Loans and B Term Loans
outstanding at such time (or, if prior to the Initial Borrowing Date, the Total
Term Loan Commitment at such time).
"Acquisition" shall mean the acquisition by the Borrower, Holdings
or any of their respective Subsidiaries of certain assets of Sprint PCS in the
Spokane market pursuant to the Acquisition Documents, for an aggregate principal
amount not to exceed $35,000,000.
"Acquisition Documents" shall mean all documents executed or
delivered in connection with the Acquisition, as amended, modified or
supplemented from time to time in accordance with the terms thereof and hereof.
"Acquisition Price" shall mean the aggregate principal amount
payable under the Acquisition Documents for the purchase of the assets described
therein, not to exceed at any time $35,000,000.
"Additional Collateral" shall mean all property (whether real or
personal) in which security interests are granted (or purported to be granted)
(and continue to be in effect at the time of determination) pursuant to Section
8.17.
"Additional Security Documents" shall mean all mortgages, pledge
agreements, security agreements and other security documents entered into
pursuant to Section 8.17 with respect to Additional Collateral.
"Adjusted Consolidated EBITDA" for any period shall mean
Consolidated EBITDA adjusted by adding thereto the amount of Subscriber
Acquisition Costs for such period.
"Adjusted Consolidated Net Income" for any period shall mean
Consolidated Net Income for such period plus the sum of the amount of all net
non-cash charges (including, without limitation, depreciation, amortization,
deferred tax expense, non-cash interest expense and other non-cash charges)
included in arriving at Consolidated Net Income for such period less the sum of
the amount of all net non-cash gains or losses (exclusive of items reflected in
Adjusted Working Capital) and gains or losses from sales of assets (other than
sales of inventory in the ordinary course of business) included in arriving at
Consolidated Net Income for such period.
"Adjusted Working Capital" shall mean Consolidated Current Assets
(excluding cash and Cash Equivalents) minus Consolidated Current Liabilities.
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"Administrative Agent" shall mean Paribas in its capacity as
Administrative Agent for the Banks hereunder, and shall include any successor to
the Administrative Agent appointed pursuant to Section 12.09.
"Affiliate" shall mean, with respect to any Person, any other Person
directly or indirectly controlling (including but not limited to all directors
and officers of such Person), controlled by, or under direct or indirect common
control with, such Person; provided, however, that for purposes of Section 5.05
and 9.07, an Affiliate of Holdings shall include any Person that directly or
indirectly (including through limited partner or general partner interests) owns
more than 5% of any class of capital stock of Holdings and for all purposes of
this Agreement, neither the Administrative Agent, the Collateral Agent, any Bank
or any of their respective Affiliates, shall be considered an Affiliate of the
Borrower or any of its Subsidiaries. A Person shall be deemed to control another
Person if such Person possesses, directly or indirectly, the power to direct or
cause the direction of the management and policies of such other Person, whether
through the ownership of voting securities, by contract or otherwise.
"Affiliate Contracts" shall have the meaning provided in Section
5.05.
"Aggregate AR Commitment" shall mean the sum of (1) such Total A
Term Loan Commitment on such date, plus (2) the Total Revolving Loan Commitment
as of such date.
"Aggregate Unutilized Commitment" with respect to any Bank at any
time shall mean the sum of (i) such Bank's Unutilized Revolving Loan Commitment
at such time, plus (ii) such Bank's A Term Loan Commitment at such time.
"Agreement" shall mean this Credit Agreement, as modified,
supplemented or amended from time to time.
"Applicable Commitment Commission Percentage" shall mean, for any
day, a percentage per annum equal to (i) if the Total Aggregate Unutilized
Commitment on such day is greater than or equal to 66% of the Aggregate AR
Commitment, 1.375%, (ii) if the Total Aggregate Unutilized Commitment on such
day is less than 66% of the Aggregate AR Commitment and greater than or equal to
33% of the Aggregate AR Commitment, 1.125%, and (iii) if the Total Aggregate
Unutilized Commitment on such day is less than 33% of the Aggregate AR
Commitment, 0.750%.
"Applicable Margin" shall mean a percentage per annum equal to (i)
(A) in the case of A Term Loans which are maintained as Base Rate Loans, 2.00%
less the applicable Leverage Reduction Discount, if any, (B) in the case of B
Term Loans which are maintained as Base Rate Loans, 2.50% and (C) in the case of
Revolving Loans which are maintained as Base Rate Loans, 2.00% less the
applicable Leverage Reduction Discount, if any, and (ii) (A) in the case of A
Term Loans which are maintained as Eurodollar Loans, 3.25% less the applicable
Leverage Reduction Discount, if any, (B) in the case of B Term Loans which are
maintained as Eurodollar Loans, 3.75% and (C) in the case of Revolving Loans
which are maintained as Eurodollar Loans, 3.25% less the applicable Leverage
Reduction Discount, if any.
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"AR Commitment Commission" shall have the meaning provided in
Section 3.01(a).
"Available J.V. Basket Amount" shall mean, on any date of
determination, an amount equal to the sum (without duplication) of (i)
$10,000,000 minus (ii) the aggregate amount of investments made (including for
such purpose the fair market value of any assets or stock contributed to any
Joint Venture or the fair market value of Common Stock issued in connection
therewith (as determined, in each case, in good faith by senior management of
the Borrower), net of Indebtedness assigned to, and assumed by, the respective
Joint Venture in connection therewith) pursuant to Section 9.05(x) after the
Effective Date, minus (iii) the aggregate amount of Indebtedness or other
obligations (whether absolute, accrued, contingent or otherwise and whether or
not due) of any Joint Venture for which the Borrower or any of its Subsidiaries
(other than the respective Joint Venture) is liable on such date of
determination, minus (iv) all payments and contributions made by the Borrower or
any of its Subsidiaries (other than the respective Joint Venture) in respect of
Indebtedness or other obligations of the respective Joint Venture (including,
without limitation, payments in respect of obligations described in preceding
clause (iii)) after the Effective Date plus (v) the amount of any increase to
the Available J.V. Basket Amount made after the Effective Date in accordance
with the provisions of Section 9.05(x).
"B Commitment Commission" shall have the meaning set forth in
Section 3.01(b).
"B Term Loan" shall have the meaning provided in Section 1.01(b).
"B Term Loan Commitment" shall mean, with respect to each Bank, the
amount set forth opposite such Bank's name in Schedule I directly below the
column entitled "B Term Loan Commitment," as the same may be reduced or
terminated pursuant to Section 3.03, 4.02 and/or 10.
"B Term Loan Facility" shall mean the term loan facility evidenced
by the Total B Term Loan Commitment.
"B Term Loan Maturity Date" shall mean the eight year and six-month
anniversary of the Initial Borrowing Date.
"B Term Note" shall have the meaning provided in Section 1.05(a).
"B TL Percentage" shall mean, at any time, a fraction (expressed as
a percentage), the numerator of which is equal to the aggregate principal amount
of all B Term Loans outstanding at such time (or, if prior to the Initial
Borrowing Date, the Total B Term Loan Commitment), and denominator of which is
equal to the aggregate principal amount of all A Term Loans and B Term Loans
outstanding at such time (or, if prior to the Initial Borrowing Date, the Total
Term Loan Commitment at such time).
"Bakovsky Litigation" shall have the meaning set forth in Section
5.10 hereof.
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"Bank" shall mean each financial institution listed on Schedule I,
as well as any institution which becomes a "Bank" hereunder pursuant to Section
13.04.
"Bank Default" shall mean (i) the refusal (which has not been
retracted) of a Bank to make available its portion of any Borrowing or to fund
its portion of any unreimbursed payment under Section 2.04(c) or (ii) a Bank
having notified in writing the Borrower and/or the Administrative Agent that it
does not intend to comply with its obligations under Section 1.01 or 2,
including in either case as a result of any takeover of such Bank by any
regulatory authority or agency.
"Bankruptcy Code" shall have the meaning provided in Section 10.05.
"Base Rate" shall mean the higher of (i) 1/2 of 1% in excess of the
Federal Funds Rate and (ii) the Prime Lending Rate.
"Base Rate Loan" shall mean (i) each Swingline Loan and (ii) any
Loan designated or deemed designated as such by the Borrower at the time of the
incurrence thereof or conversion thereto.
"BET Senior Subordinated Notes" shall mean the Borrower's senior
subordinated notes, due December 28, 2007, issued pursuant to the Purchase
Agreement.
"Borrower" shall have the meaning provided in the preamble of this
Agreement.
"Borrowing" shall mean the borrowing of one Type of Loan of a single
Tranche from all the Banks having Commitments with respect to such Tranche (or
from the Swingline Bank in the case of Swingline Loans) on a pro rata basis on a
given date (or resulting from a conversion or conversions on such date) having
in the case of Eurodollar Loans the same Interest Period; provided that Base
Rate Loans incurred pursuant to Section 1.10(b) shall be considered part of the
related Borrowing of Eurodollar Loans.
"Borrowing Date" shall mean the date upon which a Borrowing is
consummated subsequent to the Initial Borrowing Date, in accordance with the
terms and conditions set forth herein.
"Bridge Commitment Letter" shall mean that certain bridge commitment
letter, dated as of February 22, 2000, among Holdings, the Borrower and DLJ
Bridge Finance, Inc.
"Bridge Financing" shall have the meaning set forth in Section
5.25(a).
"Bridge Financing Documents" shall mean all documents executed or
delivered in connection with the Bridge Financing (including, without
limitation, the Bridge Commitment Letter), as amended, modified or supplemented
from time to time in accordance with the terms thereof and hereof.
"Bridge Refinancing" shall mean the refinancing of the Senior
Subordinated Bridge Notes with cash proceeds received from the issuance of
capital stock, senior subordinated
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notes or the incurrence of additional subordinated loans by the Borrower,
Holdings or any of their respective Subsidiaries, pursuant to the Bridge
Refinancing Documents, which Bridge Refinancing Documents shall be in form and
substance satisfactory to the Administrative Agent.
"Bridge Refinancing Documents" shall mean all documents executed or
delivered in connection with the Bridge Refinancing, as amended modified or
supplemented from time to time in accordance with the terms thereof and hereof.
"Business Day" shall mean (i) for all purposes other than as covered
by clause (ii) below, any day except Saturday, Sunday and any day which shall be
in New York City a legal holiday or a day on which banking institutions are
authorized or required by law or other government action to close and (ii) with
respect to all notices and determinations in connection with, and payments of
principal and interest on, Eurodollar Loans, any day which is a Business Day
described in clause (i) above and which is also a day for trading by and between
banks in the New York interbank Eurodollar market.
"Capital Expenditures" shall have the meaning provided in Section
9.08.
"Capital Lease," as applied to any Person, shall mean any lease of
any property (whether real, personal or mixed) by that Person as lessee which,
in conformity with generally accepted accounting principles, is accounted for as
a capital lease on the balance sheet of that Person.
"Capitalized Lease Obligations" of any Person shall mean all rental
obligations under Capital Leases which, under GAAP, are or will be required to
be capitalized on the books of such Person, in each case taken at the amount
thereof accounted for as Indebtedness in accordance with such principles.
"Cash Collateral Account" shall have the meaning provided in Section
5.28(b) hereof.
"Cash Collateral Agreement" shall have the meaning provided in
Section 5.28(a).
"Cash Equivalents" shall mean, as to any Person, (i) securities
issued or directly and fully guaranteed or insured by the United States or any
agency or instrumentality thereof (provided that the full faith and credit of
the United States is pledged in support thereof) having maturities of not more
than six months from the date of acquisition, (ii) time deposits and
certificates of deposit of any commercial bank organized under the laws of the
United States, any State thereof or the District of Columbia having, or which is
the principal banking subsidiary of a bank holding company organized under the
laws of the United States, any State thereof, or the District of Columbia
having, capital, surplus and undivided profits aggregating in excess of
$200,000,000 and having a long-term unsecured debt rating of at least "A" or the
equivalent thereof from Standard & Poor's Corporation ("S&P") or "A2" or the
equivalent thereof from Moody's Investors Service, Inc. ("Moody's"), with
maturities of not more than six months from the date of acquisition by such
Person, (iii) repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clause (i) above entered into
with
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any bank meeting the qualifications specified in clause (ii) above, (iv)
commercial paper issued by any Person incorporated in the United States rated at
least A-1 or the equivalent thereof by S&P or at least P-1 or the equivalent
thereof by Moody's and in each case maturing not more than six months after the
date of acquisition by such Person, (v) investments in money market funds
substantially all of whose assets are comprised of securities of the types
described in clauses (i) through (iv) above.
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as the same may be amended from time to
time, 42 U.S.C. ss. 9601 et seq.
"Certificates of Designations" shall mean the Series B Nonvoting
Certificate of Designations, the Series B Voting Certificate of Designations and
the Series A Certificate of Designations.
"Change in Control" shall mean the occurrence of one or more of the
following: (i) Holdings shall cease to directly own at least 100% of the
aggregate capital stock of the Borrower, (ii) any Person or "group" (within the
meaning of Section 13(d) or 14(d) of the Securities Exchange Act, as in effect
on the Effective Date), other than the Permitted Holders, shall acquire,
directly or indirectly, beneficial ownership of 50% or more, on a fully diluted
basis, of the economic or voting interest in Holdings' capital stock, (iii)
Donald A. Harris shall have acquired any interest in or otherwise participated
in any way, including without limitation as a director, officer or employee,
with any Person or any Affiliate of such Person which is party to any management
agreement or similar agreement as a "Manager" (as such term is defined in such
management agreement or similar agreement) with respect to Sprint Spectrum L.P.
or any of its Affiliates, other than Holdings or any of its Subsidiaries, (iv)
the Board of Directors of Holdings shall cease to consist of Continuing
Directors, (v) there shall occur a "Change in Control" (as defined in the Sprint
Management Agreement), (vi) Sprint PCS shall have sold, transferred or disposed
of the Sprint PCS Network, (vii) any Person, entity or "group" (within the
meaning of Section 13(d) or 14(d) of the Securities Exchange Act) shall have
acquired beneficial ownership of 51% or more of any outstanding class of capital
stock of Sprint Corporation or Sprint PCS, having ordinary voting power in the
election of directors, (viii) Sprint Spectrum L.P., SprintCom, Inc., Sprint
Communications Company, L.P. or Wireless Co. shall cease to be Affiliates of
Sprint Corporation, (ix) Sprint PCS shall exercise its rights under Section
11.6.3 of the Sprint Management Agreement and (x) a "change in control" or
similar event shall occur as provided in the Senior Subordinated Discount Notes
Documents; provided, however, that any transaction in which MCI WorldCom or any
of its Affiliates acquires or enters into a business combination with Sprint
Corporation or any of its Affiliates shall not constitute a Change of Control
for purposes herein.
"Claims" shall have the meaning provided in the definition of
"Environmental Claims."
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the regulations promulgated and the rulings issued thereunder.
Section references to
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the Code are to the Code, as in effect at the date of this Agreement, and to any
subsequent provision of the Code, amendatory thereof, supplemental thereto or
substituted therefor.
"Collateral" shall mean all property (whether real or personal) with
respect to which any security interests have been granted (or purport to be
granted) pursuant to any Security Document, including, without limitation, all
Pledge Agreement Collateral, all Security Agreement Collateral and all cash and
Cash Equivalents delivered as collateral pursuant to this Agreement or any other
Credit Document.
"Collateral Agent" shall mean the Administrative Agent acting as
collateral agent for the Secured Creditors pursuant to the Security Documents.
"Collective Bargaining Agreements" shall have the meaning provided
in Section 5.05.
"Commitment" shall mean, with respect to each Bank, such Bank's Term
Loan Commitment and Revolving Loan Commitment, if any.
"Common Stock" shall mean the common stock of Holdings, with par
value per share of $.001.
"Concentration Account" shall mean a separate account which shall be
established and maintained with the Concentration Account Bank for the benefit
of the Secured Creditors by the Borrower and each of its Subsidiaries and in
which the Collateral Agent has a security interest pursuant to the Concentration
Account Consent Letter.
"Concentration Account Bank" shall mean PNC Bank, N.A. or such other
bank that may become a Concentration Account Bank in accordance with the
provisions of the Security Agreement.
"Concentration Account Consent Letter" shall have the meaning
provided in Section 8.18.
"Consent and Agreement" shall mean the Consent and Agreement in the
form of Exhibit L.
"Consolidated Current Assets" shall mean the consolidated current
assets of Holdings and its Subsidiaries.
"Consolidated Current Liabilities" shall mean the consolidated
current liabilities of Holdings and its Subsidiaries, but excluding the current
portion of any long-term Indebtedness which would otherwise be included therein.
"Consolidated EBIT" shall mean, for any period, the Consolidated Net
Income before interest income, Consolidated Interest Expense and provision for
taxes and without giving effect to any extraordinary gains or losses, gains or
losses from sales of assets (other than inventory sold in the ordinary course of
business).
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"Consolidated EBITDA" for any period shall mean Consolidated EBIT,
adjusted by adding thereto the amount of all amortization of intangibles and
depreciation that were deducted in arriving at Consolidated Net Income for such
period.
"Consolidated Indebtedness" shall mean, at any time, all
Indebtedness of Holdings and its Subsidiaries determined on a consolidated basis
(excluding all Indebtedness of the type described in clause (vii) of the
definition thereof, except to the extent amounts are owing with respect thereto
upon the termination of the respective agreement constituting such Indebtedness)
plus any original issue discount attributable to such Indebtedness; provided,
however, that with respect to the financial covenants set forth in Section 9.11
hereof, this definition shall not include any such original issue discount.
"Consolidated Interest Expense" shall mean, for any period, the
total consolidated cash interest expense of Holdings and its Subsidiaries for
such period (calculated without regard to any limitations on the payment
thereof) payable during such period in respect of all Indebtedness of Holdings
and its Subsidiaries, on a consolidated basis, for such period (including,
without duplication, that portion of Capitalized Lease Obligations of Holdings
and its Subsidiaries representing the interest factor for such period).
"Consolidated Net Income" shall mean, for any period, net income of
Holdings and its Subsidiaries for such period determined on a consolidated basis
(after provision for taxes); provided, however, the net income of any Subsidiary
of Holdings, which is not a Wholly-Owned Subsidiary and for which the investment
of Holdings therein is accounted for by the equity method of accounting, shall
have its net income included in the Consolidated Net Income of Holdings and its
Subsidiaries only to the extent of the amount of cash dividends or distributions
paid by such Subsidiary to Holdings.
"Consolidated Revenues" shall mean, for any period, the total
consolidated gross revenues of the Borrower and its Subsidiaries for such period
determined on a consolidated basis, including, without limitation, all access,
airtime, long distance, travel-out, travel-in, roaming-out, roaming-in, and
operator service revenues; provided, however, Consolidated Revenues shall not
include revenue from handset sales.
"Consolidated Senior Indebtedness" shall mean, at any time, an
amount equal to the amount of all Consolidated Indebtedness at such time less
the outstanding principal amount of the Senior Subordinated Discount Notes or
the Senior Subordinated Bridge Notes at such time.
"Contingent Obligation" shall mean, as to any Person, any obligation
of such Person guaranteeing or intended to guarantee any Indebtedness, leases,
dividends, distributions or other obligations ("primary obligations") of any
other Person (the "primary obligor") in any manner, whether directly or
indirectly, including, without limitation, any obligation of such Person,
whether or not contingent, (i) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (ii) to advance or
supply funds (x) for the purchase or payment of any such primary obligation or
(y) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary
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obligor, (iii) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation or (iv) otherwise
to assure or hold harmless the holder of such primary obligation against loss in
respect thereof; provided, however, that the term Contingent Obligation should
not include endorsements of instruments for deposit or collection in the
ordinary course of business. The amount of any Contingent Obligation shall be
deemed to be an amount equal to the stated or determinable amount of the primary
obligation in respect of which such Contingent Obligation is made or, if not
stated or determinable, the maximum reasonably anticipated liability in respect
thereof (assuming such Person is required to perform thereunder) as determined
by such Person in good faith.
"Continuing Directors" shall mean the directors of a Person on the
Effective Date and each other director, if (i) such other director's nomination
for election to the Board of Directors is recommended by a majority of the then
Continuing Directors, or (ii) such other director is nominated pursuant to the
Existing Shareholders' Agreement.
"Covered Pops" shall mean the aggregate number of Pops (based on the
most recent data released by the Census Bureau or any other source reasonably
satisfactory to the Administrative Agent) in geographic areas where the Borrower
has completed the construction of facilities necessary to permit Subscribers in
such area to utilize the Borrower's wireless services.
"Credit Documents" shall mean this Agreement, each Note, each Notice
of Borrowing, each Notice of Conversion, each Letter of Credit, each Letter of
Credit Request, each Guaranty, the Escrow Agreement and each Security Document.
"Credit Event" shall mean the making of any Loan or the issuance of
any Letter of Credit.
"Credit Party" shall mean the Borrower, Holdings and each of their
respective Subsidiaries.
"Debt Agreements" shall have the meaning provided in Section 5.05.
"Default" shall mean any event, act or condition which with notice
or lapse of time, or both, would constitute an Event of Default.
"Defaulting Bank" shall mean any Bank with respect to which a Bank
Default is then in effect.
"Disaggregated License" shall mean that portion of the License that
the Borrower may or is required to purchase under Section 11 of the Sprint
Management Agreement from Sprint PCS under certain circumstances, after Sprint
PCS' receipt of FCC approval of the necessary disaggregation and partition,
which portion comprises no less than the amount of spectrum sufficient to
operate on duplex CDMA carrier (including the required guard bands) within the
range of frequencies that Sprint PCS is authorized to use under such license,
and no more than 10 MHz of such range of frequencies (at the Borrower's
designation) covering the
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Service Area, and which includes the frequencies then in use in the Service Area
Network and, if applicable, adjacent frequencies, so long as such frequencies in
the aggregate do not exceed 10 MHz.
"Disqualified Stock" shall mean any capital stock which, by its
terms (or by the terms of any security into which it is convertible or for which
it is exchangeable), or upon the happening of any event (including a change of
control event unless any rights of the holder in respect thereof are made
subject to any applicable restrictions in Holdings' debt documents), (i) matures
(excluding any maturity as the result of an optional redemption by the issuer
thereof) or is mandatorily redeemable, pursuant to a sinking fund obligation or
otherwise, or is redeemable at the option of the holder thereof, in whole or in
part, on or prior to the first anniversary of the B Term Loan Maturity Date, or
(ii) is convertible into or exchangeable (unless at the sole option of the
issuer thereof) for (a) debt securities or (b) any capital stock referred to in
(i) above, in each case at any time prior to the first anniversary of the B Term
Loan Maturity Date.
"Dividend" with respect to any Person shall mean that such Person
has declared or paid a dividend, distribution or returned any equity capital to
its stockholders, partners or other equity holders or authorized or made any
other distribution, payment or delivery of property (other than common stock of
such Person) or cash to its stockholders, partners or other equity holders in
their capacity as stockholders, partners or other equity holders, or redeemed,
retired, purchased or otherwise acquired, directly or indirectly, for a
consideration any shares of any class of its capital stock outstanding or
partnership interests on or after the Effective Date (or any options or warrants
issued by such Person with respect to its capital stock or partnership
interests), or set aside any funds for any of the foregoing purposes, or shall
have permitted any of its Subsidiaries to purchase or otherwise acquire for a
consideration any shares of any class of the capital stock or partnership
interests of such Person outstanding on or after the Effective Date (or any
options or warrants issued by such Person with respect to its capital stock or
partnership interests). Without limiting the foregoing, "Dividends" and
"Distributions" with respect to any Person shall also include all cash payments
made or required to be made by such Person with respect to any stock or
partnership interests appreciation rights, equity incentive plans or any similar
plans or setting aside of any funds for the foregoing purposes.
"DLJ" shall mean DLJ Merchant Banking Partners II, L.P., a Delaware
limited partnership.
"Documents" shall mean the Credit Documents, the Equity Financing
Documents, the Senior Subordinated Discount Notes Documents and the Bridge
Financing Documents, as applicable.
"Dollars" and the sign "$" shall each mean freely transferable
lawful money of the United States.
"Drawing" shall have the meaning provided in Section 2.05(b).
"Effective Date" shall have the meaning provided in Section 13.10.
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"Eligible Transferee" shall mean and include a commercial bank,
financial institution, other "accredited investor" (as defined in Regulation D
of the Securities Act) other than individuals, or a "qualified institutional
buyer" as defined in Rule 144A of the Securities Act.
"Employee Benefit Plans" shall have the meaning provided in Section
5.05.
"Employment Agreements" shall have the meaning provided in Section
5.05.
"End Date" shall have the meaning provided in the definition of
Leverage Reduction Discount.
"Environmental Claims" shall mean any and all administrative,
regulatory or judicial actions, suits, demands, demand letters, claims, liens,
notices of noncompliance or violation, investigations or proceedings relating in
any way to any violation of, or liability under, any Environmental Law or any
permit issued, or any approval given, under any such Environmental Law
(hereafter, "Claims"), including, without limitation, (a) any and all Claims by
governmental or regulatory authorities for enforcement, cleanup, removal,
response, remedial or other actions or damages pursuant to any applicable
Environmental Law, and (b) any and all Claims by any third party seeking
damages, contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from Hazardous Materials arising from alleged injury
or threat of injury to health, safety or the environment.
"Environmental Law" shall mean any Federal, state, foreign or local
statute, law, rule, regulation, ordinance, code, policy and rule of common law
now or hereafter in effect (including, without limitation, the EPA guidance on
asbestos abatement and removal) and in each case as amended, and any judicial or
administrative interpretation thereof, including any judicial or administrative
order, consent decree or judgment, relating to the environment, health, safety
or Hazardous Materials, including, without limitation, CERCLA; RCRA; the Federal
Water Pollution Control Act, as amended, 33 U.S.C. ss. 1251 et seq.; the Toxic
Substances Control Act, 15 U.S.C.ss. 2601 et seq.; the Clean Air Act, 42
U.S.C.ss. 7401 et seq.; the Safe Drinking Water Act, 42 U.S.C.ss. 3803 et seq.;
the Oil Pollution Act of 1990, 33 U.S.C.ss. 2701 et seq.; the Occupational
Safety and Health Act, 29 U.S.C.ss.651 et seq.; and any applicable state and
local or foreign counterparts or equivalents.
"Equity Contribution" shall have the meaning provided in Section
8.20(b).
"Equity Contribution Documents" shall mean all documents executed or
delivered in connection with the issuance by the Borrower of any capital stock
to Holdings as contemplated in Section 8.20(b), as amended, modified or
supplemented from time to time in accordance with the terms hereof and thereof.
"Equity Financing" shall mean either the Public Offering or the
Private Placement Financing, as the context shall require.
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"Equity Financing Documents" shall mean all documents executed or
delivered in connection with the issuance by Holdings or any Subsidiaries of
Holdings of any common stock, preferred stock, partnership interests or
membership interests in connection with the Equity Financing, the Preferred
Stock Issuance and any other similar issuance, as applicable.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued thereunder. Section references to ERISA are to ERISA, as in effect at the
date of this Agreement, and to any subsequent provisions of ERISA, amendatory
thereof, supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in Section 3(9)
of ERISA) which together with the Borrower or a Subsidiary of the Borrower would
be deemed to be a "single employer" (i) within the meaning of Section 414(b),
(c), (m) or (o) of the Code or (ii) as a result of the Borrower or a Subsidiary
of the Borrower being or having been a general partner of such person.
"Escrow Account" shall have the meaning provided in the Escrow
Agreement.
"Escrow Agreement" shall have the meaning set forth in Section 5.19.
"Eurodollar Loan" shall mean each Loan designated as such by the
Borrower at the time of the incurrence thereof or conversion thereto.
"Event of Default" shall have the meaning provided in Section 10.
"Event of Termination" shall mean any of the events described in
Section 11.3 of the Sprint Management Agreement.
"Excess Cash Flow" shall mean, for any period, the remainder of (i)
the sum of (a) Adjusted Consolidated Net Income for such period, and (b) the
decrease, if any, in Adjusted Working Capital from the first day to the last day
of such period, minus (ii) the sum of (a) the amount of cash Capital
Expenditures (to the extent not financed with Indebtedness), made by the
Borrower on a consolidated basis during such period, (b) the amount of permanent
principal payments of Indebtedness for borrowed money of the Borrower (other
than repayments of Loans); provided that repayments of Loans shall be deducted
in determining Excess Cash Flow if such repayments were applied to Scheduled
Repayments required to be made during such period, were made as a voluntary
prepayment with internally generated funds (but in the case of a voluntary
prepayment of Revolving Loans or Swingline Loans, only to the extent accompanied
by a voluntary reduction to the Total Revolving Loan Commitment) during such
period, and (c) the increase, if any, in Adjusted Working Capital from the first
day to the last day of such period.
"Excess Cash Flow Payment Period" shall mean each fiscal year of
Holdings.
"Existing Paribas Credit Agreement" shall mean that certain Credit
Agreement, dated as of December 29, 1999, among Holdings, the Borrower, the
financial institutions party
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thereto from time to time and the Administrative Agent, as amended, modified or
supplemented from time to time.
"Existing Shareholders' Agreement" shall mean that certain
Shareholders' Agreement, dated as of February 16, 2000, by and among Holdings,
DLJ and the several shareholders named therein, as amended, supplemented or
modified from time to time.
"FCC" shall mean the Federal Communications Commission.
"Facility" shall mean any of the credit facilities established under
this Agreement, i.e., the A Term Loan Facility, the B Term Loan Facility or the
Revolving Loan Facility.
"Facing Fee" shall have the meaning provided in Section 3.01(c).
"Federal Funds Rate" shall mean for any period, a fluctuating
interest rate equal for each day during such period to the weighted average of
the rates on overnight Federal Funds transactions with members of the Federal
Reserve System arranged by Federal Funds Brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day which is a Business Day, the average of the quotations for such day on such
transactions received by the Administrative Agent from three Federal Funds
brokers of recognized standing selected by the Administrative Agent.
"Fees" shall mean all amounts payable pursuant to or referred to in
Section 3.01.
"Fixed Charge Coverage Ratio" for any period shall mean the ratio of
(x) Consolidated EBITDA less the amount of all Capital Expenditures made by the
Borrower or any of its Subsidiaries for such period to (y) Fixed Charges for
such period.
"Fixed Charges" for any period shall mean the sum of (i)
Consolidated Interest Expense for such period, (ii) the aggregate principal
amount of all scheduled payments of Indebtedness (including the principal
portion of rentals under Capitalized Lease Obligations but excluding repayment
of Revolving Loans and Swingline Loans not accompanied by a permanent reduction
to the Total Revolving Loan Commitment) required to be made during such period
and (iii) cash income or other similar taxes paid by Holdings and its
Subsidiaries during such period.
"Founders Stock Agreement" shall mean that certain founders stock
agreement, dated as of November 1, 1999, by and among Holdings, James Parsons,
Donald A. Harris, Paul F. Judge, The Walter Group, Inc. and U.S. Bancorp, as
amended, modified or supplemented from time to time in accordance with the terms
hereof and thereof.
"Guaranty" shall have the meaning set forth in Section 5.20.
"Hazardous Materials" means (a) petroleum or petroleum products,
radioactive materials, asbestos in any form that is friable, urea formaldehyde
foam insulation, transformers or other equipment that contain, dielectric fluid
containing levels of polychlorinated biphenyls,
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and radon gas; (b) any chemicals, materials or substances defined as or included
in the definition of "hazardous substances," "hazardous waste," "hazardous
materials," "extremely hazardous substances," "restricted hazardous waste,"
"toxic substances," "toxic pollutants," "contaminants," or "pollutants," or
words of similar meaning and regulatory effect, under any applicable
Environmental Law; and (c) any other chemical, material or substance, exposure
to which is prohibited, limited or regulated under applicable Environmental
Laws.
"Holdings" shall have the meaning provided in the preamble to this
Agreement.
"Holdings' 2000 Equity Incentive Plan" shall mean that certain
equity incentive plan of Holdings, effective as of February 1, 2000.
"Indebtedness" shall mean, as to any Person, without duplication,
(i) all indebtedness (including principal, interest, fees and charges) of such
Person for borrowed money or for the deferred purchase price of property or
services other than trade payables and accrued expenses arising in the ordinary
course of business, (ii) the maximum amount available to be drawn under all
letters of credit issued for the account of such Person and all unpaid drawings
in respect of such letters of credit, (iii) all Indebtedness of the types
described in clause (i), (ii), (iv), (v), (vi) or (vii) of this definition
secured by any Lien on any property owned by such Person, whether or not such
Indebtedness has been assumed by such Person, (iv) all Capitalized Lease
Obligations of such Person, (v) all obligations of such person to pay a
specified purchase price for goods or services, whether or not delivered or
accepted, i.e., take-or-pay and similar obligations, (vi) all Contingent
Obligations of such Person and (vii) all obligations under any Interest Rate
Protection or Other Hedging Agreement or under any similar type of agreement
entered into with a Person not a Bank.
"Indemnified Matters" shall have the meaning provided in Section
13.01.
"Indemnitees" shall have the meaning provided in Section 13.01.
"Initial Borrowing Date" shall mean the date on which the initial
Credit Event occurs.
"Intellectual Property" shall have the meaning provided in Section
7.21.
"Interest Determination Date" shall mean, with respect to any
Eurodollar Loan, the second Business Day prior to the commencement of any
Interest Period relating to such Eurodollar Loan.
"Interest Period" shall have the meaning provided in Section 1.09.
"Interest Rate Protection or Other Hedging Agreements" shall have
the meaning provided in the Security Documents.
"Issuing Bank" shall mean Paribas and any Bank which at the request
of the Borrower agrees, in such Bank's sole discretion, to become an Issuing
Bank for the purpose of
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issuing Letters of Credit pursuant to Section 2. The sole Issuing Bank on the
Initial Borrowing Date is Paribas.
"Joint Venture" shall mean any Person, other than an individual or a
Subsidiary of the Borrower, (i) in which the Borrower or a Subsidiary of the
Borrower holds or acquires an ownership interest (whether by way of capital
stock, partnership or limited liability company interest, or other evidence of
ownership) and (ii) which is engaged in a Permitted Business.
"L/C Supportable Indebtedness" shall mean (i) obligations of the
Borrower or any of its Subsidiaries incurred in the ordinary course of business
with respect to workers compensation, surety bonds and other similar statutory
obligations and (ii) such other obligations of the Borrower or any of its
Subsidiaries as are reasonably acceptable to the Issuing Bank and otherwise
permitted to exist pursuant to the terms of this Agreement.
"Leaseholds" of any Person means all the right, title and interest
of such Person as lessee or licensee in, to and under leases or licenses of
land, improvements and/or fixtures.
"Leases Subsidiary" shall have the meaning set forth in Section
5.24.
"Leases Subsidiary Funding Agreement" shall mean an agreement
between the Borrower and the Leases Subsidiary in form and substance
satisfactory to the Administrative Agent whereby (i) such Leases Subsidiary
agrees to provide to the Borrower the benefit of the use of the Tower Site
Leases, (ii) the Borrower agrees to pay to such Leases Subsidiary an amount
equal to all liabilities of such Leases Subsidiary as and when such liabilities
become due and payable less any amounts contributed by the Borrower to the
equity of such Leases Subsidiary to fund such liabilities, (iii) the Borrower
agrees to cause all obligations of such Leases Subsidiary to be performed and
all legal requirements of such Leases Subsidiary to be complied with and (iv)
the Borrower and the Leases Subsidiary agree, for the benefit of the
Administrative Agent and the Secured Creditors, to the assignment by the
Borrower of its rights thereunder to the Administrative Agent for the benefit of
the Secured Creditors.
"Letter of Credit" shall have the meaning provided in Section
2.01(a).
"Letter of Credit Cash Collateral Account" shall have the meaning
provided in Section 4.02(A)(a).
"Letter of Credit Fee" shall have the meaning provided in Section
3.01(d).
"Letter of Credit Outstandings" shall mean, at any time, the sum of
(i) the aggregate Stated Amount of all outstanding Letters of Credit and (ii)
the amount of all Unpaid Drawings.
"Letter of Credit Request" shall have the meaning provided in
Section 2.03(a).
"Leverage Reduction Discount" shall mean as follows:
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(i) on the Initial Borrowing Date and during any period in which
clause (ii) below does not apply, the Leverage Reduction Discount shall be
0%;
(ii) from and after the Start Date to and including the End Date and
subject to (iii) below, the following percentage, to the extent but only
to the extent that as of the last day of the most recent fiscal quarter
ending immediately prior to such Start Date for which a certificate has
been delivered to the Banks pursuant to the next succeeding sentence
hereinafter the ratio of Consolidated Indebtedness as of the most recent
fiscal quarter ending immediately prior to such Start Date to Consolidated
EBITDA for such fiscal quarter shall be as set forth below:
Consolidated Indebtedness to
Basis Points Consolidated EBITDA
------------ -------------------
25 less than 10.00:1.00 but greater than
or equal to 8.00:1.00
50 less than 8.00:1:00 but greater than
or equal to 7.00:1:00
75 less than 7.00:1:00 but greater than
or equal to 6.00:1:00
100 less than 6.00:1.00
(iii) notwithstanding (ii) above, if at any time (a) a Default or
Event of Default shall exist, or (b) the Consolidated EBITDA for the most
recent fiscal quarter shall be less than or equal to zero, the Leverage
Reduction Discount shall be 0%.
The Leverage Reduction Discount shall be determined by the delivery of a
certificate of the Borrower, certified by the Chief Financial Officer of the
Borrower, together with the financial statements required to be delivered
pursuant to Section 8.01(b) or (c), as the case may be, which certificate shall
set forth the Leverage Reduction Discount arising from the calculation of the
ratio of Consolidated Indebtedness to Annualized Consolidated EBITDA of the
Borrower for the fiscal quarter with respect to which such certificate is being
delivered and the basis for such calculations. The Leverage Reduction Discount
so determined shall apply, except as set forth above, to the period beginning on
the date such financial statements are delivered and ending on the earlier of
(the "End Date") (i) the next date of actual delivery of the financial
statements required to be delivered pursuant to Section 8.01(b) or (c) or (ii)
the date on which such financial statements are required to be delivered (the
day of delivery of such financial statements on which such period commences
being herein referred to as the "Start Date").
"License" means the PCS license(s) issued by the FCC described on
the Service Area Exhibit to the Sprint Management Agreement.
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"Lien" shall mean any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), preference,
priority or other security agreement of any kind or nature whatsoever
(including, without limitation, any conditional sale or other title retention
agreement, any financing or similar statement or notice filed under the UCC or
any other similar recording or notice statute, and any lease having
substantially the same effect as any of the foregoing).
"Loan" shall mean each Term Loan, each Revolving Loan and each
Swingline Loan.
"Management Agreements" shall have the meaning provided in Section
5.05.
"Mandatory Borrowings" shall have the meaning provided in Section
1.01(e).
"Margin Stock" shall have the meaning provided in Regulation U.
"Material Contracts" shall have the meaning provided in Section
5.05.
"Maturity Date" with respect to a Tranche shall mean either the A
Term Loan Maturity Date, the B Term Loan Maturity Date, the Revolving Loan
Maturity Date or the Swingline Expiry Date, as the case may be.
"Maximum Swingline Amount" shall mean $500,000.
"Minimum Borrowing Amount" shall mean (i) with respect to the A Term
Loan Facility, $1,000,000, (ii) with respect to the B Term Loan Facility,
$1,000,000 and (iii) with respect to the Revolving Loan Facility, $1,000,000.
"Net Sale Proceeds" shall mean for any sale of assets, the gross
cash proceeds (including any cash received by way of deferred payment pursuant
to a promissory note, receivable or otherwise, but only as and when received)
received from such sale, net of reasonable transaction costs (including, without
limitation, attorneys' fees), the amount of such gross cash proceeds required to
be used to permanently repay any Indebtedness which is secured by the respective
assets which were sold, and the estimated marginal increase in income taxes and
any stamp tax which will be payable by the Holdings' consolidated group as a
result of such sale.
"Net Subscriber Acquisition Costs" shall mean for any period the
product of (x) Subscriber Acquisition Costs for such period divided by (y) Net
Subscribers for such period.
"Net Subscribers" shall mean for any period the number of
Subscribers added during such period minus the number of Subscribers
disconnected during such period.
"Nonvoting Common Stock" shall mean the nonvoting common stock of
Holdings, with par value per share of $.001.
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"Nonvoting Preferred Stock" shall mean Holdings' 7% Senior
Pay-in-Kind, Nonvoting Convertible Preferred Stock, with par value per share of
$.001.
"Note" shall mean each A Term Note, each B Term Note, each Revolving
Note and the Swingline Note.
"Notes Financing" shall mean either the Senior Subordinated Discount
Notes Financing or the Bridge Financing, as the context shall require.
"Notice of Borrowing" shall have the meaning provided in Section
1.03(a).
"Notice of Conversion" shall have the meaning provided in Section
1.06.
"Notice Office" shall mean the office of the Administrative Agent
located at 787 Seventh Avenue, New York, NY 10019, Attention: Salo Aizenberg, or
such other office as the Administrative Agent may hereafter designate in writing
as such to the other parties hereto.
"Obligations" shall mean all amounts owing to the Administrative
Agent, the Collateral Agent or any Bank pursuant to the terms of this Agreement
or any other Credit Document.
"Operating Assets" shall mean the assets the Borrower or its
affiliates own and use in connection with the operation of the Service Area
Network, at the time of termination, to provide the Sprint PCS Products and
Services. Operating Assets does not include items such as furniture, fixtures
and buildings that the Borrower or its affiliates use in connection with other
businesses. Examples of Operating Assets include without limitation: switches,
towers, cell sites, systems, records and retail stores.
"Other Managers" means any person or entity with which Sprint PCS
has entered into an agreement similar to the Sprint Management Agreement under
which the person or entity designs, constructs and manages a service area
network and offers and promotes Sprint PCS Products or Services.
"Paribas" shall mean Paribas, a French banking organization acting
through its New York Branch.
"Participant" shall have the meaning provided in Section 2.04(a).
"Payment Office" shall mean the office of the Administrative Agent
located at 787 Seventh Avenue, New York, NY 10019, Attention: Salo Aizenberg, or
such other office as the Administrative Agent may hereafter designate in writing
as such to the other parties hereto.
"PBGC" shall mean the Pension Benefit Guaranty Corporation
established pursuant to Section 4002 of ERISA, or any successor thereto.
"Percentage" of any Bank at any time shall mean a fraction
(expressed as a percentage) the numerator of which is the Revolving Loan
Commitment of such Bank at such
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time and the denominator of which is the Total Revolving Loan Commitment at such
time; provided that if the Percentage of any Bank is to be determined after the
Total Revolving Loan Commitment has been terminated, then the Percentages of the
Banks shall be determined immediately prior (and without giving effect) to such
termination.
"Permitted Business" shall mean a line of business in which the
Borrower and its Subsidiaries is engaged on the Initial Borrowing Date and
reasonably related extensions thereof.
"Permitted Liens" shall have the meaning provided in Section 9.01.
"Person" shall mean any individual, partnership, limited liability
company, joint venture, firm, corporation, association, trust or other
enterprise or any government or political subdivision or any agency, department
or instrumentality thereof.
"Plan" shall mean any pension plan, as defined in Section 3(2) of
ERISA, which is maintained or contributed to by (or to which there is an
obligation to contribute of) the Borrower, a Subsidiary of the Borrower or an
ERISA Affiliate, and each such plan for the five year period immediately
following the latest date on which the Borrower, a Subsidiary of the Borrower or
an ERISA Affiliate maintained, contributed to or had an obligation to contribute
to such plan.
"Pledge Agreement" shall have the meaning provided in Section 5.07.
"Pledge Agreement Collateral" shall mean all "Collateral" as defined
in the Pledge Agreements.
"Pledged Equity" shall mean the capital stock of the Borrower that
is pledged pursuant to the Pledge Agreement.
"Pledged Securities" shall have the meaning assigned that term in
the Pledge Agreements.
"Pops" shall mean, as of any date, the population of the Service
Area (based on the most recent data released by the Census Bureau or any other
source reasonably satisfactory to the Administrative Agent).
"Preferred Stock" shall mean, each of, or both, as the context shall
require, the Series A Preferred Stock of Holdings, with par value per share of
$.001 and the Series B Preferred Stock of Holdings, with par value per share of
$.001.
"Preferred Stock Issuance" shall mean the issuance of Holdings'
Series B Preferred Stock, in accordance with the terms and conditions of the
Preferred Stock Purchase Agreement, in an aggregate amount of $25,000,000.
"Preferred Stock Purchase Agreement" shall mean that certain Stock
Purchase Agreement, dated as of February 22, 2000 between Holdings and DLJ.
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"Prime Lending Rate" shall mean the rate which The Chase Manhattan
Bank announces from time to time as its prime lending rate, the Prime Lending
Rate to change when and as such prime lending rate changes. The Prime Lending
Rate is a reference rate and does not necessarily represent the lowest or best
rate actually charged to any customer by Paribas or The Chase Manhattan Bank,
who may make commercial loans or other loans at rates of interest at, above or
below the Prime Lending Rate.
"Private Placement Documents" shall mean all documents executed or
delivered in connection with the Private Placement Financing (including, without
limitation, the Preferred Stock Purchase Agreement), as amended, modified or
supplemented from time to time in accordance with the terms thereof and hereof.
"Private Placement Equity" shall mean the aggregate total of
Holdings Series B Preferred Stock issued pursuant to the Private Placement
Financing.
"Private Placement Financing" shall have the meaning provided in
Section 8.20(a).
"Projections" shall have the meaning provided in Section 5.14(b).
"Public Offering" shall have the meaning provided in Section 8.20.
"Public Offering Equity" shall mean the aggregate total of Holdings
Common Shares issued pursuant to the Public Offering.
"Purchase Agreement" shall mean the Purchase Agreement, dated as of
December 28, 1999, among Holdings, the Borrower and BET Associates, L.P.
"Quarterly Payment Date" shall mean the last Business Day of each
December, March, June and September of each fiscal year.
"Quoted Rate" shall mean (a) the offered quotation to first-class
banks in the London interbank Eurodollar market by the Administrative Agent for
U.S. dollar deposits of amounts in immediately available funds comparable to the
outstanding principal amount of the Eurodollar Loan of the Administrative Agent
for which an interest rate is then being determined with maturities comparable
to the Interest Period applicable to such Eurodollar Loan determined as of 10:00
A.M. (New York time) on the date which is two Business Days prior to the
commencement of such Interest Period, divided (and rounded upward to the next
whole multiple of 1/16 of 1%) by (b) a percentage equal to 100% minus the then
stated maximum rate of all reserve requirements (including, without limitation,
any marginal, emergency, supplemental, special or other reserves) applicable to
any member bank of the Federal Reserve System in respect of Eurocurrency funding
or liabilities as defined in Regulation D (or any successor category of
liabilities under Regulation D).
"RCRA" shall mean the Resource Conservation and Recovery Act, as the
same may be amended from time to time, 42 U.S.C. ss. 6901 et seq.
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"Real Property" of any Person shall mean all the right, title and
interest of such Person in and to land, improvements and fixtures, including
Leaseholds.
"Recovery Event" shall mean the receipt by the Borrower, Holdings or
any Subsidiary of Holdings of any cash insurance proceeds payable by reason of
theft, physical destruction or damage or any other similar event with respect to
any properties or assets of the Borrower, Holdings or any Subsidiary of Holdings
(including, without limitation, business interruption insurance).
"Refinanced Indebtedness" shall have the meaning set forth in
Section 5.27(a).
"Register" shall have its meaning provided in Section 8.16.
"Regulation D" shall mean Regulation D of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof establishing reserve requirements.
"Regulation T" shall mean Regulation T of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Regulation U" shall mean Regulation U of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Regulation X" shall mean Regulation X of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Related Fund" shall mean, with respect to any Bank that is a fund
that invests in loans, any other fund that invests in loans and is managed by
the same investment advisor as such Bank or by an Affiliate of such investment
advisor.
"Release" shall mean disposing, discharging, injecting, spilling,
pumping, leaking, leaching, dumping, emitting, escaping, emptying, seeping,
placing, pouring and the like, into or upon any land or water or air, or
otherwise entering into the environment.
"Replaced Bank" shall have the meaning provided in Section 1.12.
"Replacement Bank" shall have the meaning provided in Section 1.12.
"Reportable Event" shall mean an event described in Section 4043(c)
of ERISA with respect to a Plan that is subject to Title IV of ERISA other than
those events as to which the 30-day notice period is waived under subsection
.22, .23, .25, .27 or .28 of PBGC Regulation Section 4043.
"Required A Term Facility Banks" shall mean Banks the sum of whose
outstanding A Term Loans represent an amount greater than 51% of all outstanding
A Term Loans made by all Banks.
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"Required A Term Loan Drawdown Amount" shall mean (i) on the
sixth-month anniversary of the Initial Borrowing Date, $30,000,000, (ii) on the
one-year anniversary of the Initial Borrowing Date, $60,000,000 and (iii) on the
eighteenth-month anniversary of the Initial Borrowing Date, $90,000,000.
"Required B Term Facility Banks" shall mean Banks the sum of whose
outstanding B Term Loans represent an amount greater than 51% of all outstanding
B Term Loans made by all Banks.
"Required Banks" shall mean Banks the sum of whose outstanding A
Term Loans (and, if applicable, any A Term Loan Commitments of such Banks), B
Term Loans and Revolving Loan Commitments (or after the termination thereof, the
sum of outstanding Revolving Loans, outstanding Swingline Loans and Letter of
Credit Outstandings), represent an amount equal to or greater than 51% of the
sum of all outstanding A Term Loans (and, if applicable, any A Term Loan
Commitments of such Banks), B Term Loans and the Total Revolving Loan Commitment
(or after the termination thereof, the sum of the then total outstanding
Revolving Loans, outstanding Swingline Loans and Letter of Credit Outstandings).
"Returns" shall have the meaning provided in Section 7.09.
"Revolving Loan Commitment" shall mean, for each Bank, the amount
set forth opposite such Bank's name on Schedule I hereto directly below the
column entitled "Revolving Loan Commitment," as same may be (x) reduced or
terminated from time to time pursuant to Section 3.02, 3.03, 4.02 and/or 10 or
(y) adjusted from time to time as a result of assignments to or from such Bank
pursuant to Section 1.12 or 13.04.
"Revolving Loan Facility" shall mean the revolving loan facility
evidenced by the Total Revolving Loan Commitment.
"Revolving Loan Maturity Date" shall mean the seven year and
six-month anniversary of the Initial Borrowing Date.
"Revolving Loans" shall have the meaning provided in Section
1.01(c).
"Revolving Notes" shall have the meaning provided in Section
1.05(a)(iii).
"Scheduled A Term Loan Repayment" shall have the meaning provided in
Section 4.02(A)(b).
"Scheduled B Term Loan Repayment" shall have the meaning provided in
Section 4.02(A)(c).
"Scheduled Repayments" shall mean each Scheduled A Term Loan
Repayment and each Scheduled B Term Loan Repayment.
"SEC" shall have the meaning provided in Section 8.01(h).
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"Section 4.04(b)(ii) Certificate" shall have the meaning provided in
Section 4.04(b)(ii).
"Section 8.20 Events" shall mean each of the events, conditions and
circumstances described in clauses (a) through (i) of Section 8.20 hereof.
"Secured Creditors" shall mean (x) the Banks, the Administrative
Agent, the Collateral Agent and (y) any Bank which on the date hereof is, or
subsequently becomes, party to any Interest Rate Protection or Other Hedging
Agreement.
"Securities Act" shall mean the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder.
"Securities Exchange Act" shall mean the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated thereunder.
"Security Agreement" shall have the meaning provided in Section
5.08.
"Security Agreement Collateral" shall mean all "Collateral" as
defined in the Security Agreement.
"Security Documents" shall mean the Pledge Agreement, the Security
Agreement, the Cash Collateral Agreement, the Escrow Agreement, the
Concentration Account Consent Letter, the Guaranty, each Additional Security
Document and the Consent and Agreement.
"Senior Subordinated Bridge Notes" shall mean the senior
subordinated bridge notes issued pursuant to the Bridge Financing.
"Senior Subordinated Discount Notes" shall mean the Borrower's
senior subordinated notes, due 2010, issued pursuant to the Senior Subordinated
Discount Notes Documents.
"Senior Subordinated Discount Notes Documents" shall mean all
documents executed or delivered in connection with the issuance by the Borrower
of the Senior Subordinated Discount Notes, as amended, modified or supplemented
from time to time in accordance with the terms thereof and hereof.
"Senior Subordinated Discount Notes Financing" shall have the
meaning set forth in Section 5.25(a).
"Series A Certificate of Designations" shall mean that certain
Certificate of the Designations of the Series A Preferred Stock, as amended,
modified or supplemented from time to time in accordance with the terms hereof
and thereof.
"Series A Preferred Stock" shall mean Holdings' Convertible Series A
Preferred Stock, with a par value per share of $0.001.
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"Series A Preferred Stock Issuance" shall mean the issuance of
Holdings' Series A Preferred Stock, in accordance with the terms and conditions
of the Series A Preferred Stock Purchase Agreement, in an aggregate amount of
$17,000,000.
"Series A Preferred Stock Purchase Agreement" shall mean that
certain preferred stock purchase agreement, dated as of November 23, 1999, among
Holdings and the stockholders named therein, as amended, modified or
supplemented from time to time in accordance with the terms thereof and hereof.
"Series B Nonvoting Certificate of Designations" shall mean that
certain Certificate of Designations, Preferences and Relative Participating,
Optional and other rights of Holdings Nonvoting Preferred Stock, as amended,
modified or supplemented from time to time in accordance with the terms thereof
and hereof.
"Series B Preferred Stock" shall mean Holdings' Non-Voting Preferred
Stock and Voting Preferred Stock.
"Series B Voting Certificate of Designations" shall mean that
certain Certificate of Designations, Preferences and Relative Participating,
Optional and other rights of Holdings Voting Preferred Stock as amended,
modified or supplemented from time to time in accordance with the terms thereof
and hereof.
"Service Area" means the geographic area described on the Service
Area Exhibit to the Sprint Management Agreement (including, without limitation,
areas located in portions of California, Nevada, Washington, Montana, Wyoming,
Idaho, Utah, Indiana, Ohio, Kentucky and Tennessee), except that the term does
not include any of certain new areas that the Borrower chooses not to build out
pursuant to Section 2.5 of the Sprint Management Agreement.
"Service Area Network" means the network and business activities
managed by the Borrower under the Sprint Management Agreement in the Service
Area under the License.
"Shareholders' Agreements" shall have the meaning provided in
Section 5.05.
"Spectrasite" shall mean Spectrasite Communications, Inc., a
Delaware corporation.
"Sprint Agreements" shall mean the Sprint Management Agreement,
Sprint Services Agreement, the Sprint License Agreements and all other
contracts, agreements or understandings entered into between the Borrower or any
of its Subsidiaries on the one hand and Sprint Corporation or any of its
Affiliates, on the other hand.
"Sprint Communications Company, L.P." shall mean Sprint
Communications Company, L.P., a Delaware limited partnership.
"Sprint License Agreements" shall mean collectively the (i) Sprint
Trademark and Service Mark License Agreement, dated September __, 1998, among
Sprint Communications
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Company, L.P. and the Borrower, and (ii) Sprint Spectrum Trademark and Service
Mark Agreement, dated September __, 1998, among Sprint Spectrum, L.P. and the
Borrower.
"Sprint Management Agreement" shall mean the Sprint PCS Management
Agreement, made September __, 1998, among Sprint Spectrum L.P., WirelessCo, L.P.
and Ubiquitel L.L.C., a Washington corporation, as amended, modified or
supplemented from time to time in accordance with the provisions hereof and as
assigned to the Borrower.
"Sprint PCS" shall mean any or all of the following affiliates who
are License holders and signatories to the Management Agreement: Sprint Spectrum
L.P., a Delaware limited partnership, SprintCom, Inc., a Kansas corporation,
PhillieCo Partners I, L.P., a Delaware limited partnership, Cox Communications
PCS, L.P., a Delaware limited partnership, Cox PCS License, L.L.C., a Delaware
limited liability company and American PCS Communications, LLC, a Delaware
limited liability company. Each entity listed above is an affiliate to each of
the other listed entities.
"Sprint PCS Network" shall mean the national wireless network and
business activities to be developed by Sprint PCS, the Borrower and Other
Managers in the United States and certain of its territories and possessions,
which network includes the Service Area Network.
"Sprint PCS Products and Services" means all types and categories of
wireless communications services and associated products that are designated by
Sprint PCS (whether now existing or developed and implemented in the future) as
products and services to be offered by Sprint PCS, the Borrower and other
Sprint-related parties as the products and services of the Sprint PCS Network
for fixed and mobile voice, short message and other data services under the
FCC's rules for broadband personal communications services, including all local
area service plans. Sprint PCS Products and Services do not include wireline
products services, including local exchange service, wireline long distance
service, and wireline-based Internet access.
"Sprint Services Agreement" shall mean that certain Sprint PCS
Services Agreement executed by the Borrower and Sprint Spectrum L.P. and any
documents incorporated by reference in said agreement.
"Sprint Spectrum L.P." shall mean Sprint Spectrum L.P., a Delaware
limited partnership.
"SprintCom, Inc." shall mean SprintCom, Inc., a Kansas corporation.
"Start Date" shall have the meaning provided in the definition of
Leveraged Reduction Discount.
"Stated Amount" of each Letter of Credit shall, at any time, mean
the maximum amount available to be drawn thereunder at such time (in each case
determined without regard to whether any conditions to drawing could then be
met).
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"Subscriber Acquisition Costs" shall mean for any period all sales
and marketing expenses, including without limitation, all direct and indirect
sales person compensation and benefits, commissions, customer activation
expenses, advertising and promotion expenses and net equipment expenses (i.e.,
calculated as the sum of the cost and related handling fees of handsets sold and
less revenue received from handsets sold in connection with acquiring new
Subscribers), but exclusive of fees paid to Sprint Spectrum L.P. and its
Affiliates.
"Subscribers" shall mean the total number of subscribers to the
services of the Borrower and its Subsidiaries; provided, however, for purposes
of Section 9.15, Subscribers shall not include any subscriber as of such date
which has any amounts owing to the Borrower or any of its Subsidiaries which are
past due for more than 60 days or past due for more than such shorter period of
time as the Borrower may have established for accounting or credit policy
purposes for treating a subscriber as not being in good standing.
"Subscribers Report" shall mean a report prepared by the Borrower
detailing, among other things, the current level of Subscribers, the amount of
Subscribers disconnected during the period covered thereby and the amount of
Subscribers added during such period of time.
"Subsidiary" shall mean, as to any Person, (i) any corporation more
than 50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such Person and/or one or
more Subsidiaries of such Person and (ii) any partnership, association, joint
venture or other entity in which such Person and/or one or more Subsidiaries of
such Person has more than a 50% equity interest at the time.
"Swingline Bank" shall mean Paribas, in its capacity as the maker of
Swingline Loans.
"Swingline Expiry Date" shall mean the date which is two Business
Days prior to the Revolving Loan Maturity Date.
"Swingline Loans" shall have the meaning provided in Section
1.01(d).
"Swingline Note" shall have the meaning provided in Section
1.05(a)(iv).
"Syndication Termination Date" shall mean the earlier of (x) 120
days after the Initial Borrowing Date or (y) the date on which the
Administrative Agent, in its sole discretion, determines (and notifies the
Borrower) that the primary syndication (and the resultant addition of
institutions as Banks pursuant to Section 13.04) has been completed.
"Tax Sharing Agreements" shall have the meaning provided in Section
5.05.
"Taxes" shall have the meaning provided in Section 4.04(a).
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"Term Loan" shall mean each A Term Loan and each B Term Loan.
"Term Loan Commitment" shall mean, with respect to each Bank, the
sum of the A Term Loan Commitment and the B Term Loan Commitment of such Bank at
such time.
"Term Loan Facilities" shall mean the A Term Loan Facility and the B
Term Loan Facility.
"Term Note" shall mean each A Term Note and each B Term Note.
"Total A Term Loan Commitments" shall mean, at any time, the sum of
the A Term Loan Commitments of each of the Banks.
"Total B Term Loan Commitments" shall mean, at any time, the sum of
the B Term Loan Commitments of each of the Banks.
"Total Aggregate Unutilized Commitments" shall mean, at any time,
the sum of the Aggregate Unutilized Commitments of each of the Banks.
"Total Capital" shall mean the sum of (i) Consolidated Indebtedness
and (ii) the Public Offering Equity or Private Placement Equity, as applicable.
"Total Commitment" shall mean, at any time, the sum of the
Commitments of each of the Banks.
"Total Revolving Loan Commitment" shall mean, at any time, the sum
of the Revolving Loan Commitments of each of the Banks.
"Total Term Loan Commitment" shall mean, at any time, the sum of the
Term Loan Commitments of each of the Banks.
"Total Unutilized Revolving Loan Commitment" shall mean, at any
time, an amount equal to the remainder of (x) the then Total Revolving Loan
Commitment, less (y) the sum of (A) the aggregate principal amount of Revolving
Loans and Swingline Loans then outstanding plus (B) the then aggregate amount of
Letter of Credit Outstandings.
"Tower Site Leases" shall mean each of, or all of, as the context
shall require, the Borrower's leases delivered and entered into in connection
with the leasing of each Tower Site.
"Tower Sites" shall mean each and every site upon which the
Borrower's network equipment is located, affixed or otherwise annexed to a tower
or rooftop or other similar location, as in effect from time to time.
"Tranche" shall mean the respective facility and commitments
utilized in making Loans hereunder, with there being four separate Tranches,
i.e., whether A Term Loans, B Term Loans, Revolving Loans or Swingline Loans.
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"Tranche A Reference Amount" shall have the meaning provided in
Section 4.02(A)(b).
"Transaction" shall mean collectively, (i) the incurrence of Loans
hereunder on the Initial Borrowing Date, (ii) the refinancing of the Refinanced
Indebtedness, (iii) the consummation of the Equity Financing, (iv) the
consummation of the Notes Financing, (v) the consummation of the Acquisition and
(vi) the payment of the Transaction Fees and Expenses in connection therewith.
"Transaction Fees and Expenses" shall mean (a) all fees and expenses
incurred in connection with and arising out of the Transaction and the
transactions contemplated thereby and hereby; provided, however, that the
aggregate amount of such fees and expenses shall not exceed $28,000,000
(including, without limitation, all bonus or percentage based underwriter fees
and expenses associated with the Equity Financing and the Notes Financing) and
(b) the payment of cash Dividends, on or after the date of consummation of the
Public Offering, with respect to accrued dividends on the Series A Preferred
Stock and the Series B Preferred Stock, due and payable on such date, in an
amount of approximately $850,000.
"Type" shall mean the type of Loan determined with regard to the
interest option applicable thereto, i.e., whether a Base Rate Loan or a
Eurodollar Loan.
"UCC" shall mean the Uniform Commercial Code as from time to time in
effect in the relevant jurisdiction.
"Unfunded Current Liability" of any Plan shall mean the amount, if
any, by which the actuarial present value of the accumulated plan benefits under
the Plan determined on a plan termination basis in accordance with actuarial
assumptions at such time consistent with those prescribed by the PBGC for
purposes of Section 4044 of ERISA, exceeds the fair market value of all plan
assets allocable to such liabilities under Title IV of ERISA (excluding any
accrued but unpaid contributions).
"United States" and "U.S." shall each mean the United States of
America.
"Unpaid Drawing" shall have the meaning provided for in Section
2.05(a).
"Unutilized Revolving Loan Commitment" for any Bank, at any time,
shall mean the Revolving Loan Commitment of such Bank at such time less the sum
of (i) the aggregate principal amount of Revolving Loans made by such Bank and
then outstanding and (ii) such Bank's Percentage of the Letter of Credit
Outstandings.
"Voting Preferred Stock" shall mean Holdings' 7% Senior Pay-in-Kind
Convertible Preferred Stock, with par value per share of $.001.
"Wholly-Owned Subsidiary" shall mean, as to any Person, (i) any
corporation 100% of whose capital stock is at the time owned by such Person
and/or one or more Wholly-Owned Subsidiaries of such Person and (ii) any
partnership, association, joint venture or other
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entity in which such Person and/or one or more Wholly-Owned Subsidiaries of such
Person has a 100% equity interest at such time.
"Wireless Co., L.P." shall mean Wireless Co., L.P., a Delaware
limited partnership.
Section 12. The Administrative Agent.
12.01 Appointment. The Banks hereby designate Paribas as
Administrative Agent (for purposes of this Section 12, the term "Administrative
Agent" shall include Paribas in its capacity as Collateral Agent pursuant to the
Security Documents) to act as specified herein and in the other Credit
Documents. Each Bank hereby irrevocably authorizes, and each holder of any Note
by the acceptance of such Note shall be deemed irrevocably to authorize, the
Administrative Agent to take such action on its behalf under the provisions of
this Agreement, the other Credit Documents and any other instruments and
agreements referred to herein or therein and to exercise such powers and to
perform such duties hereunder and thereunder as are specifically delegated to or
required of the Administrative Agent by the terms hereof and thereof and such
other powers as are reasonably incidental thereto. The Administrative Agent may
perform any of its duties hereunder by or through its officers, directors,
agents or employees.
12.02 Nature of Duties. The Administrative Agent shall have no
duties or responsibilities except those expressly set forth in this Agreement
and the Security Documents. Neither the Administrative Agent nor any of its
officers, directors, agents or employees shall be liable for any action taken or
omitted by it or them hereunder or under any other Credit Document or in
connection herewith or therewith, unless caused by its or their gross negligence
or willful misconduct. The duties of the Administrative Agent shall be
mechanical and administrative in nature; the Administrative Agent shall not have
by reason of this Agreement or any other Credit Document a fiduciary
relationship in respect of any Bank or the holder of any Note; and nothing in
this Agreement or any other Credit Document, expressed or implied, is intended
to or shall be so construed as to impose upon the Administrative Agent any
obligations in respect of this Agreement or any other Credit Document except as
expressly set forth herein.
12.03 Lack of Reliance on the Administrative Agent. Independently
and without reliance upon the Administrative Agent, each Bank and the holder of
each Note, to the extent it deems appropriate, has made and shall continue to
make (i) its own independent investigation of the financial condition and
affairs of the Borrower and its Subsidiaries in connection with the making and
the continuance of the Loans and the participation in Letters of Credit and the
taking or not taking of any action in connection herewith and (ii) its own
appraisal of the creditworthiness of the Borrower and its Subsidiaries and,
except as expressly provided in this Agreement, the Administrative Agent shall
have no duty or responsibility, either initially or on a continuing basis, to
provide any Bank or the holder of any Note with any credit or other information
with respect thereto, whether coming into its possession before the making of
the Loans, the participation in the Letters of Credit or at any time or times
thereafter. The Administrative Agent shall not be responsible to any Bank or the
holder of any Note for any recitals, statements, information, representations or
warranties herein or in any document,
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certificate or other writing delivered in connection herewith or for the
execution, effectiveness, genuineness, validity, enforceability, perfection,
priority or sufficiency of this Agreement or any other Credit Document or the
financial condition of the Borrower or its Subsidiaries or be required to make
any inquiry concerning either the performance or observance of any of the terms,
provisions or conditions of this Agreement or any other Credit Document, or the
financial condition of the Borrower or its Subsidiaries or the existence or
possible existence of any Default or Event of Default. In no event shall the
Administrative Agent be required to take any action in contravention of
applicable law or if such action would cause it, in its sole determination, to
incur any risk or liability for which it is not adequately indemnified for to
its satisfaction.
12.04 Certain Rights of the Administrative Agent. If the
Administrative Agent shall request instructions from the Required Banks with
respect to any act or action (including failure to act) in connection with this
Agreement or any other Credit Document, the Administrative Agent shall be
entitled to refrain from such act or taking such action unless and until the
Administrative Agent shall have received instructions from the Required Banks or
all Banks, as required; and the Administrative Agent shall not incur liability
to any Person by reason of so refraining. Without limiting the foregoing, no
Bank or the holder of any Note shall have any right of action whatsoever against
the Administrative Agent as a result of the Administrative Agent acting or
refraining from acting hereunder or under any other Credit Document in
accordance with the instructions of the Required Banks or all Banks, as the case
may be.
12.05 Reliance. The Administrative Agent shall be entitled to rely,
and shall be fully protected in relying, upon any note, writing, resolution,
notice, statement, certificate, telex, teletype or facsimile message, cablegram,
radiogram, legal opinion, order or other document or telephone message signed,
sent or made by any Person that the Administrative Agent believed to be the
proper Person, and, with respect to all legal matters pertaining to this
Agreement and any other Credit Document and its duties hereunder and thereunder,
upon advice of counsel selected by it.
12.06 Indemnification. (a) To the extent the Administrative Agent is
not reimbursed and indemnified by the Borrower, the Banks will reimburse and
indemnify the Administrative Agent, in proportion to their respective
"percentages" as used in determining the Required Banks, for and against any and
all liabilities, obligations, losses, damages, penalties, claims, actions,
judgments, suits, costs, expenses or disbursements of whatsoever kind or nature
which may be imposed on, asserted against or incurred by the Administrative
Agent in performing its duties hereunder or under any other Credit Document, in
any way relating to or arising out of this Agreement or any other Credit
Document; provided that no Bank shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the Administrative Agent's gross
negligence or willful misconduct.
(b) The Administrative Agent shall be fully justified in failing or
refusing to take any action hereunder and under any other Credit Document
(except actions expressly required to be taken by it hereunder or under the
Credit Documents) unless it shall first be
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indemnified to its satisfaction by the Banks pro rata against any and all
liability, cost and expense that it may incur by reason of taking or continuing
to take any such action.
12.07 The Administrative Agent in Its Individual Capacity. With
respect to its obligation to make Loans under this Agreement, the Administrative
Agent shall have the rights and powers specified herein for a "Bank" and may
exercise the same rights and powers as though it were not performing the duties
specified herein; and the term "Banks," "Required Banks," "holders of Notes" or
any similar terms shall, unless the context clearly otherwise indicates, include
the Administrative Agent in its individual capacity. The Administrative Agent
may accept deposits from, lend money to, and generally engage in any kind of
banking, trust or other business with any Credit Party or any Affiliate of any
Credit Party as if it were not performing the duties specified herein, and may
accept fees and other consideration from the Borrower or any other Credit Party
for services in connection with this Agreement and otherwise without having to
account for the same to the Banks.
12.08 Holders. The Administrative Agent may deem and treat the payee
of any Note as the owner thereof for all purposes hereof unless and until a
written notice of the assignment, transfer or endorsement thereof, as the case
may be, shall have been filed with the Administrative Agent. Any request,
authority or consent of any Person who, at the time of making such request or
giving such authority or consent, is the holder of any Note shall be conclusive
and binding on any subsequent holder, transferee, assignee or endorsee, as the
case may be, of such Note or of any Note or Notes issued in exchange therefor.
12.09 Resignation by the Administrative Agent. (a) The
Administrative Agent may resign from the performance of all its functions and
duties hereunder and/or under the other Credit Documents at any time by giving
15 Business Days' prior written notice to the Borrower and the Banks. Such
resignation shall take effect upon the appointment of a successor Administrative
Agent and acceptance of such appointment by such successor pursuant to clauses
(b) and (c) below or as otherwise provided below. The Administrative Agent
agrees to cooperate, using best efforts, with the Banks and any successor agent,
in taking all actions required in connection with the Banks' Liens upon and
security interests in the Collateral.
(b) Upon any such notice of resignation, the Required Banks shall
appoint a successor Administrative Agent hereunder or thereunder who shall be a
commercial bank or trust company reasonably acceptable to the Borrower (it being
understood and agreed that any Bank is deemed to be acceptable to the Borrower).
(c) If a successor Administrative Agent shall not have been so
appointed and accepted such appointment within such 15 Business Day period, the
Administrative Agent, with the consent of the Borrower, shall then appoint a
successor Administrative Agent who, upon acceptance, shall serve as
Administrative Agent hereunder or thereunder until such time, if any, as the
Banks appoint a successor Administrative Agent as provided above.
(d) If no successor Administrative Agent has been appointed pursuant
to clause (b) or (c) above by the 45th Business Day after the date such notice
of resignation was given by the Administrative Agent, the Administrative Agent's
resignation shall become
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effective and the Banks shall thereafter perform all the duties of the
Administrative Agent hereunder and/or under any other Credit Document until such
time, if any, as the Banks appoint a successor Administrative Agent as provided
above.
12.10 Special Provisions Regarding the Lead Arranger. The Lead
Arranger shall not have any obligations, responsibilities or duties under this
Agreement or any other Credit Document in its capacity as such.
Section 13. Miscellaneous.
13.01 Payment of Expenses, etc. The Borrower agrees to: (i) whether
or not the transactions herein contemplated are consummated, pay all reasonable
out-of-pocket costs and expenses of the Administrative Agent and the Lead
Arranger (including, without limitation, the reasonable fees and disbursements
of White & Case LLP and local counsel) in connection with the preparation,
execution and delivery of this Agreement and the other Credit Documents and the
documents and instruments referred to herein and therein (including, without
limitation, all reasonable expenses attributable to the Administrative Agent's
due diligence undertakings) and any amendment, waiver or consent relating hereto
or thereto, of the Administrative Agent and the Lead Arranger in connection with
its syndication efforts with respect to this Agreement (including, without
limitation, the reasonable fees and disbursements of White & Case LLP), of the
Administrative Agent and the Lead Arranger in connection with any other services
necessary in order to implement and service the transactions contemplated under
this Agreement, and of the Administrative Agent and each of the Banks in
connection with the enforcement of this Agreement and the other Credit Documents
and the documents and instruments referred to herein and therein (including,
without limitation, the reasonable fees and disbursements of counsel for the
Administrative Agent and for each of the Banks); (ii) pay and hold each of the
Banks harmless from and against any and all present and future stamp, excise and
other similar taxes with respect to the foregoing matters and save each of the
Banks harmless from and against any and all liabilities with respect to or
resulting from any delay or omission (other than to the extent attributable to
such Bank) to pay such taxes; and (iii) defend, protect, indemnify and hold
harmless the Administrative Agent, the Lead Arranger and each Bank, and each of
their respective officers, directors, employees, representatives, attorneys and
agents (collectively called the "Indemnitees") from and against any and all
liabilities, obligations (including removal or remedial actions), losses,
damages (including foreseeable and unforeseeable consequential damages and
punitive damages), penalties, claims, actions, judgments, suits, costs, expenses
and disbursements (including reasonable attorneys' and consultants fees and
disbursements) of any kind or nature whatsoever that may at any time be incurred
by, imposed on or assessed against the Indemnitees directly or indirectly based
on, or arising or resulting from, or in any way related to, or by reason of (a)
any investigation, litigation or other proceeding (whether or not the
Administrative Agent, the Lead Arranger, the Collateral Agent or any Bank is a
party thereto and whether or not any such investigation, litigation or other
proceeding is between or among the Administrative Agent, the Lead Arranger, the
Collateral Agent, any Bank, the Borrower or any third person or otherwise)
related to the entering into and/or performance of this Agreement or any other
Credit Document or the use of any Letter of Credit or the proceeds of any Loans
hereunder or the consummation of any transactions contemplated herein
(including, without
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limitation, the Transaction) or in any other Credit Document or the exercise of
any of their rights or remedies provided herein or in the other Credit
Documents; or, (b) the actual or alleged generation, presence or Release of
Hazardous Materials on or from, or the transportation of Hazardous Materials to
or from, any Real Property owned or operated at any time by the Borrower or any
of its Subsidiaries or; (c) any Environmental Claim relating to the Borrower or
any of its Subsidiaries or any Real Property owned or at any time operated by
the Borrower, Holdings or any of their respective Subsidiaries or; (d) the
exercise of the rights of the Administrative Agent and of any Bank under any of
the provisions of this Agreement or any other Credit Document or any Letter of
Credit or any Loans hereunder; or (e) the consummation of any transaction
contemplated herein (including, without limitation, the Transaction) or in any
other Credit Document (the "Indemnified Matters") regardless of when such
Indemnified Matter arises; but excluding any such Indemnified Matter to the
extent based on the gross negligence or willful misconduct of any Indemnitee.
13.02 Right of Setoff. In addition to any rights now or hereafter
granted under applicable law or otherwise, and not by way of limitation of any
such rights, upon the occurrence and during the continuance of an Event of
Default, each Bank is hereby authorized at any time or from time to time,
without presentment, demand, protest or other notice of any kind to any Credit
Party or to any other Person, any such notice being hereby expressly waived, to
set off and to appropriate and apply any and all deposits (general or special)
and any other Indebtedness at any time held or owing by such Bank (including,
without limitation, by branches and agencies of such Bank wherever located) to
or for the credit or the account of each Credit Party against and on account of
the Obligations and liabilities of such Credit Party to such Bank under this
Agreement or under any of the other Credit Documents, including, without
limitation, all interests in Obligations purchased by such Bank pursuant to
Section 13.06(b), and all other claims of any nature or description arising out
of or connected with this Agreement or any other Credit Document, irrespective
of whether or not such Bank shall have made any demand hereunder and although
said Obligations, liabilities or claims, or any of them, shall be contingent or
unmatured.
13.03 Notices. Except as otherwise expressly provided herein, all
notices and other communications provided for hereunder shall be in writing
(including telegraphic, telex, facsimile or cable communication) and mailed,
telegraphed, telexed, telecopied, cabled or delivered: if to the Borrower, at
its address specified opposite its signature below; if to any Bank, at its
address specified opposite its name below; and if to the Administrative Agent,
at its Notice Office; or, as to any Credit Party or the Administrative Agent, at
such other address as shall be designated by such party in a written notice to
the other parties hereto and, as to each Bank, at such other address as shall be
designated by such Bank in a written notice to each Borrower and the
Administrative Agent. All such notices and communications shall be effective
when received.
13.04 Benefit of Agreement. (a) This Agreement shall be binding upon
and inure to the benefit of and be enforceable by the respective successors and
assigns of the parties hereto; provided, however, no Credit Party may assign or
transfer any of its rights, obligations or interests hereunder or under any
other Credit Document without the prior written consent of the
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Banks; and provided further, that although any Bank may transfer, assign or
grant participations in its rights hereunder, such Bank shall remain a "Bank"
for all purposes hereunder (and may not transfer or assign all or any portion of
its Commitments or Loans hereunder except as provided in Section 13.04(b)) and
the transferee, assignee or participant, as the case may be, shall not
constitute a "Bank" hereunder; and provided further, that no Bank shall transfer
or grant any participation under which the participant shall have rights to
approve any amendment to or waiver of this Agreement or any other Credit
Document except to the extent such amendment or waiver would (i) extend the
final scheduled maturity of any Loan, Note or Letter of Credit (unless such
Letter of Credit is not extended beyond the Revolving Loan Maturity Date) in
which such participant is participating, or reduce the rate or extend the time
of payment of interest or Fees thereon (except (x) in connection with a waiver
of applicability of any post-default increase in interest rates and (y) any
amendment or modification to the financial definitions (but not to the levels)
in this Agreement or to Section 13.07(a) shall not constitute a reduction in the
rate of interest or fees for purposes of this clause, notwithstanding the fact
that such amendment or modification would otherwise actually result in such a
reduction, so long as the primary purpose (as determined in good faith by the
Borrower and the Administrative Agent) of the respective amendment or
modification was not to decrease the pricing pursuant to this Agreement) or
reduce the principal amount thereof, or increase the Commitments in which such
participant is participating over the amount thereof then in effect (it being
understood that a waiver of any Default or Event of Default or mandatory
repayment shall not constitute a change in the terms of any Commitment, and that
an increase in any Commitment shall be permitted without the consent of any
participant if the participant's participation is not increased as a result
thereof), (ii) consent to the assignment or transfer by any Credit Party of any
of its rights and obligations under this Agreement or (iii) release all or
substantially all of the Collateral under all of the Security Documents (except
as expressly provided in the Credit Documents) supporting the Loans hereunder in
which such participant is participating. In the case of any such participation,
the participant shall not have any rights under this Agreement or any of the
other Credit Documents (the participant's rights against such Bank in respect of
such participation to be those set forth in the agreement executed by such Bank
in favor of the participant relating thereto) and all amounts payable by the
Borrower hereunder shall be determined as if such Bank had not sold such
participation.
(b) Notwithstanding the foregoing, any Bank (or any Bank together
with one or more other Banks) may (x) (A) pledge its Loans and/or Notes
hereunder to a Federal Reserve Bank in support of borrowings made by such Bank
from such Federal Reserve Bank or (B) assign all or a portion of its Loans or
Commitments and related outstanding Obligations hereunder to its parent company,
principal office and/or any Affiliate of such Bank which is at least 50% owned
by such Bank or its parent company or to one or more other Banks or to a Related
Fund or (y) assign all or a portion equal to at least $5,000,000, of such Loans
or Commitments and related outstanding Obligations hereunder to one or more
Eligible Transferees each of which transferees shall become a party to this
Agreement as a Bank by execution of an assignment and assumption agreement
substantially in the form of Exhibit J (appropriately completed); provided that:
(i) at such time Schedule I shall be deemed modified to reflect the Commitments
of such new Bank and of the existing Banks; (ii) new Notes will be issued to
such new Bank and to the assigning Bank upon the request of such new Bank or
assigning Bank, such
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new Notes to be in conformity with the requirements of Section 1.05 to the
extent needed to reflect the revised Commitments; (iii) the consent of the
Administrative Agent, which consent shall not be unreasonably withheld, shall be
required in connection with any assignment (provided, however, that no such
consent by the Administrative Agent shall be required in the case of any
assignment to the Federal Reserve Bank, another Bank, any Bank's Parent or
Affiliate or Related Fund); and (iv) the Administrative Agent shall receive at
the time of each such assignment, from the assigning Bank, the payment of a
non-refundable assignment fee of $3,000; provided, however, that prior to the
Syndication Termination Date, any assigning Bank that was a party to this
Agreement on the Initial Borrowing Date shall not be required to pay such
assignment fee. To the extent of any assignment pursuant to this Section
13.04(b), the assigning Bank shall be relieved of its obligations hereunder with
respect to its assigned Commitments. No transfer or assignment under this
Section 13.04(b) will be effective until recorded by the Administrative Agent on
the Register pursuant to Section 8.16. At the time of each assignment pursuant
to this Section 13.04(b) to a Person which is not already a Bank hereunder and
which is not a United States person (as such term is defined in Section
7701(a)(30) of the Code) for Federal income tax purposes, the respective
assignee Bank shall provide to the Borrower, as the case may be, and the
Administrative Agent the appropriate Internal Revenue Service Forms (and, if
applicable, a Section 4.04(b)(ii) Certificate) required by Section 4.04(b).
13.05 No Waiver; Remedies Cumulative. No failure or delay on the
part of the Administrative Agent or any Bank or any holder of any Note in
exercising any right, power or privilege hereunder or under any other Credit
Document and no course of dealing between the Borrower or any other Credit Party
and the Administrative Agent or any Bank or the holder of any Note shall operate
as a waiver thereof; nor shall any single or partial exercise of any right,
power or privilege hereunder or under any other Credit Document preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege hereunder or thereunder. The rights, powers and remedies herein or in
any other Credit Document expressly provided are cumulative and not exclusive of
any rights, powers or remedies which the Administrative Agent or any Bank or the
holder of any Note would otherwise have. No notice to or demand on any Credit
Party in any case shall entitle any Credit Party to any other or further notice
or demand in similar or other circumstances or constitute a waiver of the rights
of the Administrative Agent or any Bank or the holder of any Note to any other
or further action in any circumstances without notice or demand.
13.06 Payments Pro Rata. (a) The Administrative Agent agrees that
promptly after its receipt of each payment from or on behalf of the Borrower in
respect of any Obligations hereunder, it shall distribute such payment to the
Banks pro rata based upon their respective shares, if any, of the Obligations
with respect to which such payment was received.
(b) Each of the Banks agrees that, if it should receive any amount
hereunder (whether by voluntary payment, by realization upon security, by the
exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Credit Documents, or
otherwise), which is applicable to the payment of the principal of, or interest
on, the Loans, Unpaid Drawings, the B Commitment Commission, AR Commitment
Commission or Fees, of a sum which with respect to the related sum or sums
received by other
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Banks is in a greater proportion than the total of such Obligation then owed and
due to such Bank bears to the total of such Obligation then owed and due to all
of the Banks immediately prior to such receipt, then such Bank receiving such
excess payment shall purchase for cash without recourse or warranty from the
other Banks an interest in the Obligations of the respective Credit Party to
such Banks in such amount as shall result in a proportional participation by all
the Banks in such amount; provided that if all or any portion of such excess
amount is thereafter recovered from such Bank, such purchase shall be rescinded
and the purchase price restored to the extent of such recovery, but without
interest.
13.07 Calculations; Computations. (a) The financial statements to be
furnished to the Banks pursuant hereto shall be made and prepared in accordance
with generally accepted accounting principles in the United States consistently
applied throughout the periods involved (except as set forth in the notes
thereto or as otherwise disclosed in writing by the Borrower to the Banks);
provided that, except as otherwise specifically provided herein, all
computations of Excess Cash Flow and all computations determining compliance
with Sections 9.04 and 9.08 through 9.15, inclusive, including the definitions
used therein, shall utilize accounting principles and policies in conformity
with those used to prepare the financial statements delivered to the Banks on or
prior to the Initial Borrowing Date and set forth on Schedule III hereto unless
the Required Banks within 60 days of delivery thereof disagree with such
principles or policies, in which case the principles and policies shall be those
determined by the Required Banks.
(b) All computations of interest and Fees hereunder shall be made on
the basis of a year of 360 days for the actual number of days (including the
first day but excluding the last day) occurring in the period for which such
interest or Fees are payable.
13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF
JURY TRIAL. (a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE CONSTRUED IN
ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK. ANY LEGAL
ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT
MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES
FOR THE SOUTHERN DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS
AGREEMENT, EACH OF THE BORROWER AND HOLDINGS HEREBY IRREVOCABLY ACCEPTS FOR
ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE
EXCLUSIVE JURISDICTION OF THE AFORESAID COURTS. EACH OF THE BORROWER AND
HOLDINGS IRREVOCABLY CONSENT TO THE SERVICE OF PROCESS OUT OF ANY OF THE
AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES
THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO EACH OF THE
BORROWER AND HOLDINGS AT ITS ADDRESS SET FORTH OPPOSITE ITS SIGNATURES BELOW,
SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS AFTER SUCH MAILING. NOTHING HEREIN
SHALL AFFECT THE RIGHT OF THE ADMINISTRATIVE AGENT UNDER THIS AGREEMENT, ANY
BANK OR THE HOLDER OF ANY NOTE TO SERVE PROCESS IN ANY OTHER
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MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED
AGAINST ANY CREDIT PARTY IN ANY OTHER JURISDICTION.
(b) EACH OF THE BORROWER AND HOLDINGS HEREBY IRREVOCABLY WAIVES ANY
OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF
THE AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS
AGREEMENT OR ANY OTHER CREDIT DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN
CLAUSE (a) ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD
OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY
SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
(c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING
OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
13.09 Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. A set of counterparts
executed by all the parties hereto shall be lodged with the Borrower and the
Administrative Agent.
13.10 Effectiveness. This Agreement shall become effective on the
date (the "Effective Date") on which (a) Holdings, the Borrower and each of the
Banks shall have signed a copy hereof (whether the same or different copies) and
shall have delivered the same to the Administrative Agent at its Notice Office
or, in the case of the Banks, shall have given to the Administrative Agent
telephonic (confirmed in writing), written or facsimile transmission notice
(actually received) in accordance with Section 13.03 at such office that the
same has been signed and mailed to it and (b) all fees and expenses owing to the
Administrative Agent pursuant to any agreements between the Borrower and the
Administrative Agent have been paid in full (including, without limitation, all
upfront fees).
13.11 Headings Descriptive. The headings of the several sections and
subsections of this Agreement are inserted for convenience only and shall not in
any way affect the meaning or construction of any provision of this Agreement.
13.12 Amendment or Waiver. (a) Neither this Agreement nor any other
Credit Document nor any terms hereof or thereof may be changed, waived,
discharged or terminated unless such change, waiver, discharge or termination is
in writing signed by the respective Credit Parties party thereto and the
Required Banks; provided that no such change, waiver, discharge or termination
shall, without the consent of each Bank (with Obligations of the respective
types being directly affected thereby): (i) extend or reduce the scheduled
maturity of any Loan or Note
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or extend any required amortization under Section 4.02(A)(b) or (c) or extend or
reduce any revolving loan commitment reduction date under Section 3.03(d) or
extend or reduce any required repayment date under Section 4.02(A)(a) or extend
or reduce the stated maturity of any Letter of Credit or Unpaid Drawing beyond
the Revolving Loan Maturity Date, or reduce the rate or extend the time of
payment of interest or Fees thereon (except (x) in connection with a waiver of
applicability of any post-default increase in interest rates and (y) that any
amendment or modification to the financial definitions (but not to the levels)
in this Agreement or to Section 13.07(a) shall not constitute a reduction in the
rate of interest or fees for purposes of this clause, notwithstanding the fact
that such amendment or modification would otherwise actually result in such a
reduction, so long as the primary purpose (as determined in good faith by the
Borrower and the Administrative Agent) of the respective amendment or
modification was not to decrease the pricing pursuant to this Agreement), or
reduce the principal amount thereof, or increase the Commitments of any Bank
over the amount thereof then in effect (it being understood that a waiver of any
Default or Event of Default or a mandatory repayment shall not constitute an
increase of the Commitment of any Bank, and that an increase in the available
portion of any Commitment of any Bank shall not constitute an increase in the
Commitment of such Bank); (ii) release any substantial portion of the Collateral
(except as expressly provided in the relevant Credit Documents); (iii) amend,
modify or waive any provision of this Section 13.12, 1.07 or any other provision
providing for pro rata application of payments, prepayments or reductions in
Commitments; (iv) reduce the percentage specified in, or otherwise modify, the
definition of Required Banks (it being understood that, with the consent of the
Required Banks, additional extensions of credit pursuant to this Agreement may
be included in the determination of the Required Banks on substantially the same
basis as the extensions of Term Loans and Revolving Loan Commitments are
included on the Effective Date); or (v) consent to the assignment or transfer by
the Borrower of any of its rights and obligations under this Agreement; provided
further, that no such change, waiver, discharge or termination shall: (i)
without the consent of the Swingline Bank, to amend, modify or waive any
provision relating to Swingline Loans or the rights or obligations of the
Swingline Bank; or (ii) without the consent of the Required A Term Facility
Banks amend, modify or waive (I) Sections 4.01(a)(v), 4.01(a)(vi), 4.02(B)(a)(i)
or the definitions of A TL Percentage or B TL Percentage to the extent that, in
any such case, such amendment, modification or waiver would alter the
application of prepayments or repayments as between A Term Loans and B Term
Loans in a manner adverse to the A Term Loans or (II) the definition of Required
A Term Facility Banks; or (iii) without the consent of each Bank with
outstanding A Term Loans, amend, modify, waive or defer any Scheduled A Term
Loan Repayment; or (iv) without the consent of the Required B Term Facility
Banks amend, modify or waive (I) Sections 4.01(a)(v), 4.01(a)(vi), 4.02(B)(a)(i)
or the definitions of A TL Percentage or B TL Percentage to the extent that, in
any such case, such amendment, modification or waiver would alter the
application of prepayments or repayments as between A Term Loans and B Term
Loans in a manner adverse to the B Term Loans or (II) the definition of Required
B Term Facility Banks; or (v) without the consent of each Bank with outstanding
B Term Loans, amend, modify, waive or defer any Scheduled B Term Loan Repayment
or (vi) without the consent of the Issuing Bank, amend, modify or waive any
provision of Section 2 or alter its rights or obligations with respect to
Letters of Credit; or (vii) without the consent of the Administrative Agent,
amend, modify or waive any provision of Section 12 or any other provision
relating to the rights or obligations of the Administrative Agent; or (viii)
without the consent of the Collateral
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Agent, amend, modify or waive any provision of Section 12 or any other provision
relating to the rights or obligations of the Collateral Agent.
(b) If, in connection with any proposed change, waiver, discharge or
termination to any of the provisions of this Agreement as contemplated by clause
(a)(i) through (v), inclusive, of the first proviso to Section 13.12(a), the
consent of the Required Banks is obtained but the consent of one or more of such
other Banks whose consent is required is not obtained, then the Borrower shall
have the right to replace each such non-consenting Bank or Banks (so long as all
non-consenting Banks are so replaced) with one or more Replacement Banks
pursuant to Section 1.12 so long as at the time of such replacement, each such
Replacement Bank consents to the proposed change, waiver, discharge or
termination, provided that the Borrower shall not have the right to replace a
Bank solely as a result of the exercise of such Bank's rights (and the
withholding of any required consent by such Bank) pursuant to clauses (i)-(viii)
of the second proviso to Section 13.12(a).
(c) The obligations or rights of the Swingline Bank with respect to
Swingline Loans, including, without limitation, the terms of any such Swingline
Loans and the obligations of the other Banks to fund Mandatory Borrowings shall
not be amended or modified without the consent of the Swingline Bank.
(d) Notwithstanding anything to the contrary contained above in this
Section 13.12, the Collateral Agent may (i) enter into amendments to the
Security Documents for the purpose of adding additional Subsidiaries of the
Borrower (or other Credit Parties) as parties thereto and (ii) enter into
security documents to satisfy the requirements of Section 8.17 and Section 9.20,
in each case without the consent of the Required Banks.
13.13 Survival. All indemnities set forth herein including, without
limitation, in Sections 1.10, 1.11, 2.06, 4.04, 12.06 and 13.01 shall survive
the execution and delivery of this Agreement and the Notes and the making and
repayment of the Loans.
13.14 Domicile of Loans. Each Bank may transfer and carry its Loans
at, to or for the account of any office, Subsidiary or Affiliate of such Bank.
13.15 Post-Closing Obligations. (a) The Borrower hereby acknowledges
that in connection with certain assignments hereof, the Administrative Agent or
any of the Banks may be required to obtain a rating of the Obligations and
Commitments hereunder of the Borrower and the Borrower hereby consents to such
Administrative Agent or Bank providing to the respective rating agency such
information regarding the Obligations and creditworthiness of the Borrower as is
customary practice of such rating agency.
(b) Notwithstanding anything to contrary contained in this
Agreement, it is agreed that all Schedules and Exhibits to this Agreement will
be completed, be satisfactory to the Administrative Agent and the Required Banks
and become part of this Agreement on or prior to the Initial Borrowing Date.
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13.16 Sprint Spectrum L.P.'s Purchase Rights. The Banks acknowledge
and agree that Sprint Spectrum L.P. has the right in accordance with the Consent
and Agreement to purchase all Obligations, the Operating Assets or the Pledged
Equity under the terms and conditions set forth in the Consent and Agreement.
The Banks hereby consent to, and authorize the Administrative Agent to take, all
actions required to be taken in accordance with the Consent and Agreement.
13.17 Existing Paribas Credit Agreement. On the Effective Date, the
Existing Paribas Credit Agreement shall automatically terminate (except with
respect to provisions which survive the termination of such agreement by the
express terms thereof) and all security interests and pledged collateral with
respect thereto shall automatically be canceled, terminated and released, as
applicable.
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IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Agreement as of the date first
above written.
Address:
- --------
1 Bala Plaza, Suite 402 UBIQUITEL INC.
Bala Cynwyd, PA 19004
Attention: Donald A. Harris
Telephone: 610-660-9512 By:______________________________
Facsimile: 610-660-9558 Name:
Title:
1 Bala Plaza, Suite 402 UBIQUITEL OPERATING COMPANY
Bala Cynwyd, PA 19004
Attention: Donald A. Harris
Telephone: 610-660-9512 By:______________________________
Facsimile: 610-660-9558 Name:
Title:
787 Seventh Avenue PARIBAS,
New York, NY 10019 Individually and as
Attention: Salo Aizenberg Administrative Agent
Telephone: 212-841-2119
Facsimile: 212-841-2369 By:______________________________
Name:
Title:
By:______________________________
Name:
Title:
3 Stamford Plaza MEESPIERSON CAPITAL CORP.
301 Tresser Boulevard, 9th Floor
Stamford, CT 06901
Attention: Scott Webster By:______________________________
Name:
Title:
Telephone: 203-705-5752 By:______________________________
Name:
Title:
<PAGE>
Facsimile: 203-705-5890
Communications Banking Division PNC BANK, NATIONAL ASSOCIATION
21st Floor, Mail Stop F2-F070-21-1
1600 Market Street
Philadelphia, PA 19103
Attention: Steven J. McGehrin
By:______________________________
Telephone: 215-585-6269 Name:
Facsimile: 215-585-6680 Title:
By:______________________________
Name:
Title:
1211 Avenue of the Americas WESTDEUTSCHE LANDESBANK
New York, New York 10036 GIROZENTRALE, NEW YORK BRANCH
Attention: Michael Wynne
Telephone: 212-852-6393 By:______________________________
Facsimile: 212-852-7647 Name:
Title:
By:______________________________
Name:
Title:
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<PAGE>
SCHEDULE I
COMMITMENTS
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
A Term Loan B Term Loan Revolving Loan
Bank Commitment Commitment Commitment Total
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Paribas $17,142,857.13 $75,000,000 $ 7,857,142.86 $100,000,000
- -------------------------------------------------------------------------------------------------------------------
MeesPierson $34,285,714.29 -- $15,714,285.71 $ 50,000,000
Capital Corp.
- -------------------------------------------------------------------------------------------------------------------
PNC Bank, National $34,285,714.29 -- $15,714,285.71 $ 50,000,000
Association
- -------------------------------------------------------------------------------------------------------------------
Westdeutsche $34,285,714.29 -- $15,714,285.71 $ 50,000,000
Landesbank
Girozentrale, New
York Branch
- -------------------------------------------------------------------------------------------------------------------
Total $120,000,000 $75,000,000 $55,000,000 $250,000,000
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
SCHEDULE II
INSURANCE
<PAGE>
SCHEDULE III
FINANCIAL STATEMENTS
<PAGE>
SCHEDULE IV
PROJECTIONS
<PAGE>
SCHEDULE V
REAL PROPERTY
<PAGE>
SCHEDULE VI
ERISA
<PAGE>
SCHEDULE VII
CAPITALIZATION
<PAGE>
SCHEDULE VIII
MATERIAL CONTRACTS
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SCHEDULE IX
EXISTING LIENS
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SCHEDULE X
AFFILIATE TRANSACTIONS
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Exhibit 10.19
UBIQUITEL OPERATING COMPANY
UBIQUITEL INC.
$300,000,000
300,000 Units Consisting of
14% Senior Subordinated Discount Notes due 2010 and
Warrants to Purchase 1,789,500 Shares of Common Stock
Purchase Agreement
April 4, 2000
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
PARIBAS CORPORATION
PNC CAPITAL MARKETS, INC.
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April 4, 2000
Donaldson, Lufkin & Jenrette
Securities Corporation
Paribas Corporation
PNC Capital Markets, Inc.
c/o Donaldson, Lufkin & Jenrette
Securities Corporation
277 Park Avenue
New York, New York 10172
Dear Sirs:
UbiquiTel Inc., a Delaware corporation ("UbiquiTel Parent"), and
UbiquiTel Operating Company, a Delaware corporation and wholly-owned subsidiary
of UbiquiTel Parent (the "Company"), propose to (i) issue and sell to Donaldson,
Lufkin & Jenrette Securities Corporation ("DLJ"), Paribas Corporation and PNC
Capital Markets, Inc. (each, an "Initial Purchaser" and, collectively, the
"Initial Purchasers") 300,000 units (the "Units"), each consisting of $1,000 in
aggregate principal amount at maturity of the Company's 14% Senior Subordinated
Discount Notes due 2010 (the "Initial Notes"), and one warrant (each a "Unit
Warrant," and all such Unit Warrants being hereinafter referred to collectively
as the "Unit Warrants") to purchase 5.965 shares of common stock, par value
$0.001 per share ("Common Stock") of UbiquiTel Parent and (ii) issue and sell to
DLJ 54,971 warrants (the "Additional Warrants" and, collectively with the Unit
Warrants, the "Warrants"), each to purchase 5.965 shares of Common Stock of
UbiquiTel Parent, in each case subject to the terms and conditions set forth
herein. The Initial Notes are to be issued pursuant to the provisions of an
indenture (the "Indenture"), to be dated as of the Closing Date (as defined
below), among the Company, the Guarantors (as defined below) and American Stock
Transfer & Trust Company, as trustee (the "Trustee"). The Initial Notes and the
Exchange Notes (as defined below) issuable in exchange therefor are collectively
referred to herein as the "Notes." The Notes will be guaranteed (the
"Guarantees") by UbiquiTel Parent and by future subsidiaries of the Company that
become "Restricted Subsidiaries" under the Indenture (each, a "Guarantor" and
collectively the "Guarantors"). The Warrants will be issued pursuant to a
Warrant Agreement (the "Warrant Agreement," to be dated as of the Closing Date
between UbiquiTel Parent and American Stock Transfer & Trust Company, as warrant
agent (the "Warrant Agent"). The shares of Common Stock issuable upon exercise
of the Warrants are referred to herein, collectively, as the "Warrant Shares."
The Units, the Notes, and the Warrants are referred to herein, collectively, as
the "Securities." Capitalized terms used but not defined herein shall have the
meanings given to such terms in the Indenture and Warrant Agreement, as
applicable.
UbiquiTel Parent has filed a registration statement with the
Securities and Exchange Commission for an initial public offering of its Common
Stock (the "Common Stock Offering"). In addition, UbiquiTel Parent and the
Company have entered into a credit agreement, dated as of March 31, 2000 (the
"Credit Agreement"), with the several lending
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institutions that from time to time will be parties thereto (the "Lenders") and
Paribas, as administrative agent.
1. Offering Memorandum. The Units will be offered and sold to the
Initial Purchasers and the Additional Warrants will be offered and sold to DLJ
pursuant to one or more exemptions from the registration requirements under the
Securities Act of 1933, as amended (the "Act"). The Company and UbiquiTel Parent
have prepared a final offering memorandum, dated April 4, 2000 (the "Offering
Memorandum"), relating to the Units.
Upon original issuance thereof, and until such time as the same is
no longer required pursuant to the Indenture and the Warrant Agreement, the
Initial Notes, the Warrants (and all securities issued in exchange therefor, in
substitution thereof or upon conversion thereof) shall bear a legend in
substantially the following form, together with such other legends as may be set
forth in the Indenture or Warrant Agreement as applicable:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR
THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE NEXT
SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN,
THE HOLDER:
(1) REPRESENTS THAT (i) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE ACT)(A "QIB"), (ii) IT HAS ACQUIRED
THIS NOTE IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S
UNDER THE ACT OR (iii) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR"
(AS DEFINED IN RULE 501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER
THE ACT (AN "IAI"),
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS
SECURITY EXCEPT (i) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES, (ii)
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, (iii) IN AN OFFSHORE
TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR 904 OF THE ACT,
(iv) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE
ACT, (v) TO AN IAI THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE
TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING TO THE TRANSFER OF THIS SECURITY (THE FORM OF
WHICH CAN BE OBTAINED
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FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN
AGGREGATE PRINCIPAL AMOUNT OF NOTES LESS THAN $250,000 OR ANY
WARRANTS OR WARRANT SHARES, AN OPINION OF COUNSEL ACCEPTABLE TO THE
COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE ACT, (vi) IN
ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THE ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE
COMPANY) OR (vii) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
AND, IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS
OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE
JURISDICTION AND
(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY
OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND.
AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" AND "UNITED STATES" HAVE
THE MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE ACT. THE
INDENTURE AND WARRANT AGREEMENT CONTAIN A PROVISION REQUIRING THE TRUSTEE
TO REFUSE TO REGISTER ANY TRANSFER OF THESE SECURITIES IN VIOLATION OF THE
FOREGOING."
2. Agreements to Sell and Purchase. On the basis of the
representations, warranties and covenants contained in this Agreement, and
subject to the terms and conditions contained herein, UbiquiTel Parent and the
Company agree to issue and sell to the Initial Purchasers, and each Initial
Purchaser agrees to purchase from UbiquiTel Parent and the Company, the number
of Units set forth opposite the name of such Initial Purchaser in Schedule A
hereto at a purchase price equal to $489.82435 per Unit (the "Purchase Price").
On the basis of the representations, warranties and covenants
contained in this Agreement, and subject to the terms and conditions contained
herein, UbiquiTel Parent and the Company agree to issue and sell to DLJ, and DLJ
agrees to purchase from UbiquiTel Parent and the Company, the Additional
Warrants, for $10.00 and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged.
3. Terms of Offering. The Initial Purchasers have advised the
Company and UbiquiTel Parent that the Initial Purchasers will make offers (the
"Exempt Resales") of the Units purchased hereunder 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) persons permitted to
purchase the Units in offshore transactions in reliance upon Regulation S under
the Act (each, a "Regulation S Purchaser") (such persons specified in clauses
(i) and (ii) being
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referred to herein as the "Eligible Purchasers"). The Initial Purchasers will
offer the Units to Eligible Purchasers initially at a price equal to $507.59 per
Unit. Such price may be changed at any time without notice.
Holders (including subsequent transferees) of the Units will have
the registration rights set forth in the registration rights agreement (the
"Notes Registration Rights Agreement"), to be dated the Closing Date, in
substantially the form of Exhibit A hereto, and the registration rights
agreement (the "Warrant Registration Rights Agreement") to be dated as of the
Closing Date, substantially in the form of Exhibit B hereto, for so long as such
Notes, Warrants or Warrant Shares constitute "Transfer Restricted Securities"
(as defined in the Notes Registration Rights Agreement and Warrant Registration
Rights Agreement, as applicable). Pursuant to the Notes Registration Rights
Agreement and the Warrant Registration Rights Agreement, (i)(x) the Company and
the Guarantors will agree to file with the Securities and Exchange Commission
(the "Commission") under the circumstances set forth therein, a registration
statement under the Act (the "Exchange Offer Registration Statement") relating
to the Company's 14% Senior Subordinated Discount Notes (the "Exchange Notes")
to be offered in exchange for the Initial Notes (such offer to exchange being
referred to as the "Exchange Offer") and the Guarantees thereof and (y) a shelf
registration statement pursuant to Rule 415 under the Act (the "Notes Shelf
Registration Statement" and, together with the Exchange Offer Registration
Statement, the "Notes Registration Statements") relating to the resale by
certain holders of the Initial Notes and (ii) UbiquiTel Parent will agree to
file with the Commission under the circumstances set forth therein a
registration statement pursuant to Rule 415 under the Act (the "Warrants Shelf
Registration Statement" and, collectively with the Notes Registration
Statements, the "Registration Statements") relating to the resale of the
Warrants, the issuance of shares of Common Stock upon exercise of the Warrants
and the resale of the Warrant Shares and, in each case, to use its respective
best efforts to cause such Registration Statements to be declared and remain
effective and usable for the periods specified in the Notes Registration Rights
Agreement and the Warrant Registration Rights Agreement, as applicable, and to
consummate the Exchange Offer. This Agreement, the Indenture, the Warrant
Agreement, the Notes, the Warrants, the Guarantees, the Registration Rights
Agreement and the Warrant Registration Rights Agreement are hereinafter
sometimes referred to collectively as the "Operative Documents."
4. Delivery and Payment.
(a) Delivery of, and payment of the Purchase Price for, the Units
shall be made at the offices of Weil, Gotshal & Manges LLP, 100 Crescent Court,
Suite 1300, Dallas, Texas 75201, 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 April 11, 2000 or at such other time on the same date or such other
date as shall be agreed upon by the Initial Purchasers and the Company in
writing. The time and date of such delivery and the payment for the Units are
herein called the "Closing Date."
(b) The Initial Notes and the Unit Warrants comprising the Units
shall be represented by definitive global certificates, registered in the name
of Cede & Co., as nominee of the Depository Trust Company ("DTC"), shall be
delivered by the Company to the Initial Purchasers (or as the Initial Purchasers
direct) in each case with any transfer taxes thereon duly
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paid by the Company against payment by the Initial Purchasers of the Purchase
Price thereof by wire transfer in same day funds to the order of the Company.
The Additional Warrants shall be represented by definitive certificates,
registered in the name of DLJ, shall be delivered by the Company to DLJ with any
transfer taxes thereon duly paid by the Company against payment therefor by DLJ.
The certificates representing the Notes and Warrants shall be made available to
the Initial Purchasers for inspection not later than 9:30 a.m., New York City
time, on the business day immediately preceding the Closing Date.
5. Agreements of the Company and UbiquiTel Parent. Each of the
Company and UbiquiTel Parent hereby 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 Units for offering or sale in any
jurisdiction designated by the Initial Purchasers pursuant to Section 5(e)
hereof, or the initiation of any proceeding by any state securities commission
or any other federal or state regulatory authority for such purpose and (ii) of
the happening of any event during the period referred to in Section 5(c) below
that makes any statement of a material fact made in the Offering Memorandum
untrue or that requires any additions to or changes in the Offering Memorandum
in order to make the statements therein not misleading. The Company and
UbiquiTel Parent shall use their best efforts to prevent the issuance of any
stop order or order suspending the qualification or exemption of any Units under
any state securities or Blue Sky laws and, if at any time any state securities
commission or other federal or state regulatory authority shall issue an order
suspending the qualification or exemption of any Units under any state
securities or Blue Sky laws, the Company and UbiquiTel Parent 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 Company as many copies of the Offering
Memorandum, and any amendments or supplements thereto, as the Initial Purchasers
may reasonably request for the time period specified in Section 5(c). Subject to
the Initial Purchasers' compliance with its representations and warranties and
agreements set forth in Section 7 hereof, the Company and UbiquiTel Parent
consents to the use of the Offering Memorandum, and any amendments and
supplements thereto required pursuant hereto, by the Initial Purchases in
connection with Exempt Resales.
(c) During such period as in the opinion of counsel for the Initial
Purchasers an Offering Memorandum is required by law to be delivered in
connection with Exempt Resales by the Initial Purchasers and in connection with
market-making activities of the Initial Purchasers for so long as any Initial
Notes or Warrants are outstanding, (i) not to make any amendment or supplement
to the Offering Memorandum of which the Initial Purchasers shall not previously
have been advised or to which the Initial Purchasers shall reasonably object
after being so advised and (ii) to prepare promptly upon the Initial Purchasers'
reasonable request, any amendment or supplement to the Offering Memorandum which
may be necessary or advisable in connection with such Exempt Resales or such
market-making activities.
(d) If, during the period referred to in Section 5(c) above, any
event shall occur or condition shall exist as a result of which, in the opinion
of counsel to the Company and
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UbiquiTel Parent or the Initial Purchasers, it becomes necessary to amend or
supplement the Offering Memorandum in order to make the statements therein, in
the light of the circumstances when such Offering Memorandum is delivered to an
Eligible Purchaser, not misleading, or if, in the opinion of counsel to the
Company and UbiquiTel Parent or the Initial Purchasers, it is necessary to amend
or supplement the Offering Memorandum to comply with any applicable law,
forthwith to prepare an appropriate amendment or supplement to such Offering
Memorandum 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 such Offering Memorandum will comply with applicable law, and to
furnish to the Initial Purchasers and such other persons as the Initial
Purchasers may designate such number of copies thereof as the Initial Purchasers
may reasonably request.
(e) Prior to the sale of all Units pursuant to Exempt Resales as
contemplated hereby, to cooperate with the Initial Purchasers and counsel to the
Initial Purchasers in connection with the registration or qualification of the
Units for offer and sale to the Initial Purchasers and pursuant to Exempt
Resales under the securities or Blue Sky laws of such jurisdictions as the
Initial Purchasers may request and to continue such registration or
qualification in effect so long as required for Exempt Resales and to file such
consents to service of process or other documents as may be necessary in order
to effect such registration or qualification; provided, however, that neither
the Company, UbiquiTel Parent nor any Guarantor shall be required in connection
therewith to qualify as a foreign corporation in any jurisdiction in which it is
not now so qualified or to take any action that would subject it to general
consent to service of process or taxation other than as to matters and
transactions relating to the Offering Memorandum or Exempt Resales in any
jurisdiction in which it is not now so subject.
(f) So long as any Securities are outstanding and the Indenture or
the Warrant Agreement so requires, (i) to mail and make generally available as
soon as practicable after the end of each fiscal year to the record holders of
the Securities a financial report of UbiquiTel Parent and its subsidiaries
(including the Company) on a consolidated basis (and a similar financial report
of all unconsolidated subsidiaries, if any), all such financial reports to
include a consolidated balance sheet, a consolidated statement of operations, a
consolidated statement of cash flows and a consolidated statement of
shareholders' equity as of the end of and for such fiscal year, together with
comparable information as of the end of and for the preceding year, certified by
UbiquiTel Parent's independent public accountants and (ii) to mail and make
generally available as soon as practicable after the end of each quarterly
period (except for the last quarterly period of each fiscal year) to such
holders, a consolidated balance sheet, a consolidated statement of operations
and a consolidated statement of cash flows (and similar financial reports of all
unconsolidated subsidiaries, if any) as of the end of and for such period, and
for the period from the beginning of such year to the close of such quarterly
period, together with comparable information for the corresponding periods of
the preceding year.
(g) So long as any Securities are outstanding, to furnish to the
Initial Purchasers as soon as available copies of all reports or other
communications furnished by the Company, UbiquiTel Parent or any of the
Guarantors to its security holders or furnished to or filed with the Commission
or any national securities exchange on which any class of securities of the
Company, UbiquiTel Parent or any of the Guarantors is listed and such other
publicly available
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information concerning UbiquiTel Parent, the Company and/or its subsidiaries as
the Initial Purchasers may reasonably request.
(h) So long as any of the Securities remain outstanding and during
any period in which the Company, UbiquiTel Parent 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 of such Securities
in connection with any sale thereof and any prospective purchaser of such
Securities from such holder, the information ("Rule 144A Information") required
by Rule 144A(d)(4) under the Act.
(i) Whether or not the transactions contemplated in this Agreement
are consummated or this Agreement is terminated, to pay or cause to be paid all
expenses incident to the performance of the obligations of the Company,
UbiquiTel Parent and the Guarantors under this Agreement, including: (i) the
fees, disbursements and expenses of counsel to the Company, UbiquiTel Parent and
the Guarantors and accountants of the Company, UbiquiTel Parent and the
Guarantors in connection with the sale and delivery of the Units to the Initial
Purchasers and pursuant to Exempt Resales, and all other fees and expenses in
connection with the preparation, printing, filing and distribution of the
Offering Memorandum and all amendments and supplements to any of the foregoing
(including financial statements), including the mailing and delivering of copies
thereof to the Initial Purchasers and persons designated by them in the
quantities specified herein, (ii) all costs and expenses related to the transfer
and delivery of the Units to the Initial Purchasers and pursuant to Exempt
Resales, including any transfer or other taxes payable thereon, (iii) all costs
of printing or producing this Agreement, the other Operative Documents and any
other agreements or documents in connection with the offering, purchase, sale or
delivery of the Units, (iv) all expenses in connection with the registration or
qualification of the Securities for offer and sale under the securities or Blue
Sky laws of the several states and all costs of printing or producing any
preliminary and supplemental Blue Sky memoranda in connection therewith
(including the filing fees and reasonable fees and disbursements of counsel for
the Initial Purchasers in connection with such registration or qualification and
memoranda relating thereto), (v) the cost of printing certificates representing
the Securities, (vi) all expenses and listing fees in connection with the
application for quotation of the Units, Initial Notes and the Warrants in the
National Association of Securities Dealers, Inc. ("NASD") Automated Quotation
System - PORTAL ("PORTAL"), (vii) the fees and reasonable expenses of the
Trustee and the Trustee's counsel in connection with the Indenture, the Notes
and the Guarantees, (viii) the reasonable costs and charges of any transfer
agent, registrar and/or depositary (including DTC), (ix) any fees charged by
rating agencies for the rating of the Units or Initial Notes, (x) all costs and
expenses of the Exchange Offer and any Registration Statement, as set forth in
the Registration Rights Agreement, (xi) the fees and reasonable expenses of the
Warrant Agent and the Warrant Agent's counsel in connection with the Warrant
Agreement and the Warrants, and (xii) and all other costs and reasonable
expenses incident to the performance of the obligations of the Company,
UbiquiTel Parent and the Guarantors hereunder for which provision is not
otherwise made in this Section.
(j) In accordance with the Warrant Agreement, to cause any Warrant
Shares, upon issuance, to be listed on the principal securities exchanges,
automated quotation systems or other markets within the United States of
America, if any, on which other shares of Common
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Stock are then listed and to maintain any such listings of Warrant Shares for so
long as such Warrant Shares are outstanding.
(k) To use its best efforts to effect the inclusion of the Units,
Initial Notes and the Warrants in PORTAL and to maintain the listing of the
Units, Initial Notes and the Warrants on PORTAL for so long as the Initial Notes
and the Warrants are outstanding.
(l) To obtain the approval of DTC for "book-entry" transfer of the
Notes and the Warrants as Units and as separate securities, and to comply with
all of its agreements set forth in the representation letters of the Company,
UbiquiTel Parent and the Guarantors to DTC relating to the approval of the Notes
and the Warrants as Units and as separate securities by DTC for "book-entry"
transfer.
(m) During the period beginning on the date hereof and continuing to
and including the Closing Date, not to offer, sell, contract to sell or
otherwise transfer or dispose of any securities of the Company, UbiquiTel Parent
or any Guarantor or any warrants, rights or options to purchase or otherwise
acquire securities of the Company, UbiquiTel Parent or any Guarantor
substantially similar to the Units, Notes, the Warrants and the Guarantees
(other than (i) the Units, (ii) the Notes, (iii) the Warrants, (iv) securities
issued in connection with the Credit Agreements and (v) commercial paper issued
in the ordinary course of business and as otherwise contemplated by the Offering
Memorandum), without the prior written consent of the Initial Purchasers.
(n) 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 Units to the Initial Purchasers or
pursuant to Exempt Resales in a manner that would require the registration of
any such sale of Securities under the Act.
(o) Not to voluntarily claim, and to actively resist any attempts to
claim, the benefit of any usury laws against the holders of the Securities.
(p) To cause the Exchange Offer to be made in the appropriate form
to permit Exchange Notes and guarantees thereof by the Guarantors registered
pursuant to the Act to be offered in exchange for the Initial Notes and the
Guarantees and to comply with all applicable federal and state securities laws
in connection with the Exchange Offer.
(q) In accordance with the Warrant Registration Rights Agreement, to
file and cause to become effective a shelf registration statement pursuant to
Rule 415 under the Act relating to the issuance of the Warrant Shares and to use
its reasonable best efforts to maintain the effectiveness of the Warrants Shelf
Registration Statement for the period specified in the Warrant Registration
Rights Agreement.
(r) To comply with all of its agreements set forth in the Warrant
Agreement.
(s) To comply with all of its agreements set forth in the Notes
Registration Rights Agreement.
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(t) To comply with all of its agreement set forth in the Warrant
Registration Rights Agreement.
(u) To use its best efforts to do and perform all things required or
necessary to be done and performed under this Agreement by it prior to the
Closing Date and to satisfy all conditions precedent to the delivery of the
Units.
6. Representations, Warranties and Agreements of the Company and
UbiquiTel Parent. As of the date hereof, each of the Company and UbiquiTel
Parent, jointly and severally, represent and warrant to, and agree with, the
Initial Purchasers that:
(a) The Offering Memorandum does not, and any supplement or
amendment to it will not, contain any untrue statement of a material fact or
omit to state any 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, except that the representations and warranties
contained in this paragraph (a) shall not apply to statements in or omissions
from the Offering Memorandum (or any supplement or amendment thereto) based upon
information relating to the Initial Purchasers furnished to the Company in
writing by or on behalf of the Initial Purchasers through their representatives
expressly for use therein. No stop order preventing the use of 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.
(b) Each of UbiquiTel Parent, the Company and its subsidiaries has
been duly incorporated, is validly existing as a corporation in good standing
under the laws of its jurisdiction of incorporation and has the corporate power
and authority to carry on its business as described in the Offering Memorandum
and to own, lease and operate its properties, and each is duly qualified and is
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 would not have a material adverse effect on the business, prospects,
financial condition or results of operations of UbiquiTel Parent, the Company
and its subsidiaries, taken as a whole (a "Material Adverse Effect").
(c) All outstanding shares of capital stock of each of UbiquiTel
Parent and the Company have been duly authorized and validly issued and are
fully paid, non-assessable and, other than agreements described in the Offering
Memorandum, which do not apply in connection with the Offering or have been
waived in connection therewith, are not subject to any preemptive or similar
rights. All outstanding shares of capital stock of the Company are owned,
beneficially and of record, by UbiquiTel Parent free and clear of any security
interest, claim, lien, encumbrance or adverse interest of any nature (each, a
"Lien"), except as provided under the Credit Agreement.
(d) This Agreement has been duly authorized, executed and delivered
by the Company and UbiquiTel Parent.
(e) The entities listed on Schedule B hereto are the only
subsidiaries, direct or indirect, of the Company. All of the outstanding shares
of capital stock of each of the Company's
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subsidiaries have been duly authorized and validly issued and are fully paid and
non-assessable, and are owned by the Company, directly or indirectly through one
or more subsidiaries, free and clear of any Lien, except as provided under the
Credit Agreement.
(f) The Warrant Agreement has been duly authorized, executed and
delivered by UbiquiTel Parent and is a valid and binding agreement of UbiquiTel
Parent, enforceable in accordance with its terms except as to (i) the
enforceability thereof may be limited by bankruptcy, insolvency or similar laws
affecting creditors' rights generally and (ii) rights of acceleration and the
availability of equitable remedies may be limited by equitable principles of
general applicability.
(g) The Warrants have been duly authorized by UbiquiTel Parent and,
on the Closing Date, will have been validly executed and delivered by UbiquiTel
Parent. When the Unit Warrants have been executed and countersigned in
accordance with the provisions of the Warrant Agreement and delivered to and
paid for by the Initial Purchasers as part of a Unit, and when the Additional
Warrants have been executed and countersigned in accordance with the provisions
of the Warrant Agreement and delivered and paid for by DLJ, the Warrants will be
entitled to the benefits of the Warrant Agreement, and the Warrants will be
valid and binding obligations of UbiquiTel Parent, enforceable in accordance
with their terms except as to (i) the enforceability thereof may be limited by
bankruptcy, insolvency or similar laws affecting creditors' rights generally and
(ii) rights of acceleration and the availability of equitable remedies may be
limited by equitable principles of general applicability.
(h) The Warrant Shares have been duly and validly authorized for
issuance by UbiquiTel Parent and, when issued pursuant to the terms of the
Warrants and the Warrant Agreement, will be fully paid, non-assessable and,
other than agreements described in the Offering Memorandum, which do not apply
in connection with the Offering or have been waived in connection therewith, are
not subject to any preemptive or similar rights.
(i) The Indenture has been duly authorized by the Company and each
of the Guarantors and, on the Closing Date, will have been validly executed and
delivered by the Company and each of the Guarantors. When the Indenture has been
duly executed and delivered by the Company and each of the Guarantors and
assuming due authorization, execution and delivery thereof by the Trustee, the
Indenture will be a valid and binding agreement of the Company and each
Guarantor, enforceable against the Company and each Guarantor in accordance with
its terms except as (i) the enforceability of the rights to indemnity and/or
contribution thereunder may be limited by federal or state securities laws or
principles of public policy, (ii) the enforceability thereof may be limited by
bankruptcy, insolvency or similar laws affecting creditors' rights generally and
(iii) rights of acceleration and the availability of equitable remedies may be
limited by equitable principles of general applicability. 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 "TIA" or "Trust Indenture Act"),
and the rules and regulations of the Commission applicable to an indenture which
is qualified thereunder.
(j) The Initial Notes have been duly authorized and, on the Closing
Date, will have been validly executed and delivered by the Company. When the
Initial Notes have been issued, executed and authenticated in accordance with
the provisions of the Indenture and
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delivered to and paid for by the Initial Purchasers in accordance with the terms
of this Agreement, the Initial Notes will be entitled to the benefits of the
Indenture and will be valid and binding obligations of the Company, enforceable
in accordance with their terms except as (i) the enforceability of the rights to
indemnity and/or contribution thereunder may be limited by federal or state
securities laws or principles of public policy, (ii) the enforceability thereof
may be limited by bankruptcy, insolvency or similar laws affecting creditors'
rights generally and (iii) rights of acceleration and the availability of
equitable remedies may be limited by equitable principles of general
applicability.
(k) On the Closing Date, the Exchange Notes will have been duly
authorized by the Company. When the Exchange Notes are issued, executed and
authenticated in accordance with the terms of the Exchange Offer and the
Indenture, the Exchange Notes will be entitled to the benefits of the Indenture
and will be the valid and binding obligations of the Company, enforceable
against the Company in accordance with their terms, except as (i) the
enforceability of the rights to indemnity and/or contribution thereunder may be
limited by federal or state securities laws or principles of public policy, (ii)
the enforceability thereof may be limited by bankruptcy, insolvency or similar
laws affecting creditors' rights generally and (iii) rights of acceleration and
the availability of equitable remedies may be limited by equitable principles of
general applicability.
(l) The Guarantee to be endorsed on the Initial Notes by each
Guarantor has been duly authorized by such Guarantor and, on the Closing Date,
will have been duly executed and delivered by each such Guarantor. When the
Initial Notes have been issued, executed and authenticated in accordance with
the Indenture and delivered to and paid for by the Initial Purchasers in
accordance with the terms of this Agreement, the Guarantee of each Guarantor
endorsed thereon will be entitled to the benefits of the Indenture and will be
the valid and binding obligation of such Guarantor, enforceable against such
Guarantor in accordance with its terms, except as (i) the enforceability of the
rights to indemnity and/or contribution thereunder may be limited by federal or
state securities laws or principles of public policy, (ii) the enforceability
thereof may be limited by bankruptcy, insolvency or similar laws affecting
creditors' rights generally and (iii) rights of acceleration and the
availability of equitable remedies may be limited by equitable principles of
general applicability.
(m) The Guarantee to be endorsed on the Exchange Notes by each
Guarantor has been duly authorized by such Guarantor and, when issued, will have
been duly executed and delivered by each such Guarantor. When the Exchange Notes
have been issued, executed and authenticated in accordance with the terms of the
Exchange Offer and the Indenture, the Guarantee of each Guarantor endorsed
thereon will be entitled to the benefits of the Indenture and will be the valid
and binding obligation of such Guarantor, enforceable against such Guarantor in
accordance with its terms, except as (i) the enforceability of the rights to
indemnity and/or contribution thereunder may be limited by federal or state
securities laws or principles of public policy, (ii) the enforceability thereof
may be limited by bankruptcy, insolvency or similar laws affecting creditors'
rights generally and (iii) rights of acceleration and the availability of
equitable remedies may be limited by equitable principles of general
applicability.
(n) Each of UbiquiTel Parent and the Company have duly and validly
authorized the issuance of the Initial Notes and the Unit Warrants as Units and
the Additional Warrants.
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(o) The Securities and the Operative Documents conform as to legal
matters in all material respects to the description thereof contained in the
Offering Memorandum.
(p) The Notes Registration Rights Agreement has been duly authorized
by the Company and UbiquiTel Parent and, on the Closing Date, will have been
duly executed and delivered by the Company and UbiquiTel Parent. When the Notes
Registration Rights Agreement has been duly executed and delivered, the Notes
Registration Rights Agreement will be a valid and binding agreement of the
Company and each of the Guarantors, enforceable against the Company and each
Guarantor in accordance with its terms except as (i) the enforceability of the
rights to indemnity and/or contribution thereunder may be limited by federal or
state securities laws or principles of public policy, (ii) the enforceability
thereof may be limited by bankruptcy, insolvency or similar laws affecting
creditors' rights generally and (iii) rights of acceleration and the
availability of equitable remedies may be limited by equitable principles of
general applicability. On the Closing Date, the Notes Registration Rights
Agreement will conform as to legal matters in all material respects to the
description thereof in the Offering Memorandum.
(q) The Warrant Registration Rights Agreement has been duly
authorized by UbiquiTel Parent and, on the Closing Date, will have been duly
executed and delivered by UbiquiTel Parent. When the Warrant Registration Rights
Agreement has been duly executed and delivered, the Warrant Registration Rights
Agreement will be a valid and binding agreement of UbiquiTel Parent, enforceable
against UbiquiTel Parent in accordance with its terms except as (i) the
enforceability of the rights to indemnity and/or contribution thereunder may be
limited by federal or state securities laws or principles of public policy, (ii)
the enforceability thereof may be limited by bankruptcy, insolvency or similar
laws affecting creditors' rights generally and (iii) rights of acceleration and
the availability of equitable remedies may be limited by equitable principles of
general applicability. On the Closing Date, the Warrant Registration Rights
Agreement will conform as to legal matters in all material respects to the
description thereof in the Offering Memorandum.
(r) Neither UbiquiTel Parent, the Company nor any of their
respective subsidiaries is in violation of its respective charter or bylaws or
in default in the performance of any obligation, agreement, covenant or
condition contained in any indenture, loan agreement, mortgage, lease or other
agreement or instrument to which UbiquiTel Parent, the Company or any of its
subsidiaries is a party or by which UbiquiTel Parent, the Company or any of its
subsidiaries or their respective property is bound, in each case which default
has not had or is not likely to have, singly or in the aggregate, a Material
Adverse Effect.
(s) The execution, delivery and performance of this Agreement and
the other Operative Documents by the Company and UbiquiTel Parent, compliance by
the Company and UbiquiTel Parent with all provisions hereof and thereof and the
consummation of the transactions contemplated hereby and thereby will not (i)
require any consent, approval, authorization or other order of, or qualification
by UbiquiTel Parent and/or the Company with, any court or governmental body or
agency (except such as may be obtained on or prior to the Closing Date and/or
may be required under the securities or Blue Sky laws of the various states or
future filings that may be required under federal or state antitrust laws
relating to the exercise of any Warrants) by UbiquiTel Parent and/or the
Company, (ii) conflict with or constitute a
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breach of any of the terms or provisions of, or a default under, the charter or
bylaws of UbiquiTel Parent, the Company or any of its subsidiaries or any
indenture, loan agreement, mortgage, lease or other agreement or instrument to
which UbiquiTel Parent, the Company or any of its subsidiaries is a party or by
which UbiquiTel Parent, the Company or any of its subsidiaries or their
respective property is bound, which would, singly or in the aggregate, have a
Material Adverse Effect, (iii) violate or conflict with any applicable law or
any rule, regulation, judgment, order or decree of any court or any governmental
body or agency having jurisdiction over UbiquiTel Parent, the Company, any of
its subsidiaries or their respective property which would, singly or in the
aggregate, have a Material Adverse Effect, (iv) result in the imposition or
creation of (or the obligation to create or impose) a Lien under, any agreement
or instrument to which UbiquiTel Parent, the Company or any of its subsidiaries
is a party or by which UbiquiTel Parent, the Company or any of its subsidiaries
or their respective property is bound, which would, singly or in the aggregate,
have a Material Adverse Effect, or (v) result in the termination, suspension or
revocation of any Authorization (as defined below) of UbiquiTel Parent, the
Company or any of its subsidiaries which would, singly or in the aggregate, have
a Material Adverse Effect or result in any other impairment of the rights of the
holder of any such Authorization.
(t) Except as described in the Offering Memorandum, there are no
legal or governmental proceedings pending or, to the knowledge of the Company,
threatened to which the Company or any of its subsidiaries is or could be a
party or to which any of their respective property is or could be subject, which
might result, singly or in the aggregate, in a Material Adverse Effect.
(u) Neither UbiquiTel Parent, the Company nor any of its
subsidiaries has violated 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
("Environmental Laws"), any provisions of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), or any provisions of the Foreign
Corrupt Practices Act or the rules and regulations promulgated thereunder,
except for such violations which, singly or in the aggregate, would not have a
Material Adverse Effect.
(v) There are no costs or liabilities associated with Environmental
Laws (including, without limitation, any capital or operating expenditures
required for clean-up, closure of properties or compliance with Environmental
Laws or any Authorization, any related constraints on operating activities and
any potential liabilities to third parties) which would, singly or in the
aggregate, have a Material Adverse Effect.
(w) Each of UbiquiTel Parent, the Company and its subsidiaries has
such permits, licenses, consents, exemptions, franchises, authorizations and
other approvals (each, an "Authorization") of, and has made all filings with and
notices to, all governmental or regulatory authorities and self-regulatory
organizations and all courts and other tribunals, including without limitation,
under any applicable Environmental Laws, as are necessary to own, lease, license
and operate its respective properties and to conduct its business, except where
the failure to have any such Authorization or to make any such filing or notice
would not, singly or in the aggregate, have a Material Adverse Effect. Each such
Authorization is valid and in full force and effect and each of UbiquiTel
Parent, the Company and its subsidiaries is in compliance with all the terms
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and conditions thereof and with the rules and regulations of the authorities and
governing bodies having jurisdiction with respect thereto; and no event has
occurred (including, without limitation, the receipt of any notice from any
authority or governing body) which allows or, after notice or lapse of time or
both, would allow, revocation, suspension or termination of any such
Authorization or results or, after notice or lapse of time or both, would result
in any other impairment of the rights of the holder of any such Authorization;
except where such failure to be valid and in full force and effect or to be in
compliance, the occurrence of any such event or the presence of any such
restriction would not, singly or in the aggregate, have a Material Adverse
Effect.
(x) The accountants that have certified the audited financial
statements and supporting schedules included in the Offering Memorandum are
independent public accountants with respect to UbiquiTel Parent and the Company
as required by the Act and the Exchange Act. The historical audited financial
statements, together with related schedules and notes, set forth 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 other than
financial statements, together with related schedules and notes with regard to
the Company's pending acquisition of the Spokane PCS assets as described in the
Offering Memorandum, as to which UbiquiTel Parent has received written
communication from the staff of the Commission that the Commission will not
object to UbiquiTel Parent's presentation of such financial statements in a
registration statement on Form S-1.
(y) The historical audited financial statements, together with
related schedules and notes forming part of the Offering Memorandum (and any
amendment or supplement thereto), present fairly the consolidated financial
position, results of operations and changes in financial position of UbiquiTel
Parent and its subsidiaries on the basis stated in the Offering Memorandum at
the respective dates or for the respective periods to which they apply; such
statements and related schedules and notes have been prepared in accordance with
generally accepted accounting principles consistently applied throughout the
periods involved, except as disclosed therein; and the other financial and
statistical information and data set forth in the Offering Memorandum (and any
amendment or supplement thereto) are, in all material respects, accurately
presented and prepared on a basis consistent with such financial statements and
the books and records of UbiquiTel Parent, except as disclosed therein.
(z) The pro forma financial statements included in the Offering
Memorandum have been prepared on a basis consistent with the historical
financial statements of the Company and its subsidiaries and give effect to
assumptions used in the preparation thereof on a reasonable basis and in good
faith and present fairly the historical and proposed transactions contemplated
by the Offering Memorandum; 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 disclosed therein. The other pro forma financial and statistical
information and data included in the Offering Memorandum are, in all material
respects, accurately presented and prepared on a basis consistent with the pro
forma financial statements, except as disclosed therein..
(aa) Each of UbiquiTel Parent and the Company is not and, after
giving effect to the offering and sale of the Units and the application of the
net proceeds thereof as described
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in the Offering Memorandum, will not be, an "investment company," as such term
is defined in the Investment Company Act of 1940, as amended.
(bb) Except as contemplated by this Agreement, or agreements
described in the Offering Memorandum, there are no contracts, agreements or
understandings between the Company or UbiquiTel Parent and any person granting
such person the right to require the Company or UbiquiTel Parent to file a
registration statement under the Act with respect to any securities of the
Company or UbiquiTel Parent or to require the Company or UbiquiTel Parent to
include such securities with the Securities registered pursuant to any
Registration Statement.
(cc) Neither UbiquiTel Parent, the Company nor any of its
subsidiaries nor any agent (other than the Initial Purchasers, as to whom the
Company and UbiquiTel Parent make no representation) thereof acting on the
behalf of them has taken, and none of them will take, any action that might
cause this Agreement or the issuance or sale of the Units to violate Regulation
G (12 C.F.R. Part 207), Regulation T (12 C.F.R. Part 220), Regulation U (12
C.F.R. Part 221) or Regulation X (12 C.F.R. Part 224) of the Board of Governors
of the Federal Reserve System.
(dd) Neither UbiquiTel Parent nor the Company has received notice
from a "nationally recognized statistical rating organization" as such term is
defined for purposes of Rule 436(g)(2) under the Act, that such organization (i)
has imposed (or has informed the Company or UbiquiTel Parent that it is
considering imposing) any condition (financial or otherwise) on the Company's or
UbiquiTel Parent's retaining any rating assigned to the Company or UbiquiTel
Parent, any securities of the Company or UbiquiTel Parent or (ii) has indicated
to the Company or UbiquiTel Parent that it is considering (a) the downgrading,
suspension, or withdrawal of, or any review for a possible change that does not
indicate the direction of the possible change in, any rating so assigned or (b)
any change in the outlook for any rating of the Company, UbiquiTel Parent or any
securities of the Company or UbiquiTel Parent.
(ee) Since the respective dates as of which information is given in
the Offering Memorandum other than as set forth in the Offering Memorandum
(exclusive of any amendments or supplements thereto subsequent to the date of
this Agreement), (i) there has not occurred any material adverse change or any
development involving a prospective material adverse change in the condition,
financial or otherwise, or the earnings, business, management or operations of
UbiquiTel Parent, the Company and its subsidiaries, taken as a whole, (ii) there
has not been any material adverse change or any development involving a
prospective material adverse change in the capital stock or in the long-term
debt of UbiquiTel Parent, the Company or any of its subsidiaries and (iii)
neither UbiquiTel Parent, the Company nor any of its subsidiaries has incurred
any material liability or obligation, direct or contingent.
(ff) The Offering Memorandum, as of its date, contains all the
information specified in, and meeting the requirements of, Rule 144A(d)(4) under
the Act.
(gg) When the Securities are issued and delivered pursuant to this
Agreement, the Securities will not be of the same class (within the meaning of
Rule 144A under the Act) as any security of the Company or UbiquiTel Parent that
is listed on a national securities exchange
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registered under Section 6 of the Exchange Act or that is quoted in a United
States automated inter-dealer quotation system.
(hh) No form of general solicitation or general advertising (as
defined in Regulation D under the Act) was used by the Company, UbiquiTel Parent
or any of their respective representatives (other than the Initial Purchasers,
as to whom the Company and UbiquiTel Parent make no representation) in
connection with the offer and sale of the Units contemplated hereby, 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. Except as described in (or contemplated by
the agreements referenced in) the Offering Memorandum, no securities of the same
class as the Units have been issued and sold by the Company or UbiquiTel Parent
within the six-month period immediately prior to the date hereof.
(ii) Prior to the effectiveness of any Registration Statement, the
Indenture is not required to be qualified under the TIA.
(jj) None of the Company, UbiquiTel Parent nor any of their
respective affiliates or any person acting on its or their behalf (other than
the Initial Purchasers, as to whom the Company and UbiquiTel Parent make no
representation) has engaged or will engage in any directed selling efforts
within the meaning of Regulation S under the Act ("Regulation S") with respect
to the Securities.
(kk) No registration under the Act of the Securities is required for
the sale of the Securities and the Guarantees to the Initial Purchasers as
contemplated hereby or for the Exempt Resales assuming the accuracy of the
Initial Purchasers' representations and warranties and agreements set forth in
Section 7 hereof.
(ll) The Company has provided or made available to the Initial
Purchasers and counsel for DLJ a true and correct copy of the Consent and
Agreement between Sprint Spectrum L.P., Sprint Communications Company, L.P., Cox
Communications PCS, L.P., Cox PCS License, L.L.C., Paribas and the Company,
including any amendments thereto and restatements thereof, as in effect on the
date hereof (the "Consent and Agreement"); all proposed amendments and
restatements of such Consent and Agreement in existence as of the date hereof;
and such other documents as may be necessary to interpret such Consent and
Agreement, documents and correspondence and to assess the impact thereof on the
business and financial condition of UbiquiTel Parent and the Company.
(mm) The Company has provided or made available to the Initial
Purchasers and counsel for the Initial Purchasers true and correct copies of
each and every agreement between and among the Company and any Related Party (as
such term is defined below), on the one hand, and Sprint PCS and any Related
Party on the other, including in each case any amendments and addenda thereto
and restatements thereof, as in effect on the date hereof (collectively,
including the Consent and Agreement, the "Sprint Agreements"); and such other
documents as may be necessary to interpret such agreements, documents and
correspondence and to assess the impact thereof on the business and financial
condition of UbiquiTel Parent and the Company. For
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purposes of this subparagraph and the immediately following subparagraph,
"Related Party" shall have the meaning given to such term in the Schedule of
Definitions incorporated by reference in that certain Sprint PCS Management
Agreement executed by the Company and Sprint PCS as of September 1998 (as
amended and supplemented through the date hereof, the "Sprint PCS Management
Agreement").
(nn) Each of the Sprint Agreements (A) has been duly authorized,
executed and delivered by, (B) constitutes the valid and binding obligation of
and (C) is enforceable in accordance with its terms against, the Company and any
Related Party, to the extent each is a party thereto (subject, as to the
enforcement of remedies, to applicable bankruptcy, reorganization, insolvency,
moratorium or other laws affecting creditors' rights generally from time to time
in effect and to general principles of equity, and subject, as to enforcement or
rights of indemnity and contribution, to applicable principles of public
policy). No Event of Termination (as defined in the Sprint Agreements) has
occurred or is continuing that has not been waived or cured in accordance with
the terms of any Sprint Agreement.
(oo) The Company has provided the Initial Purchasers and counsel for
the Initial Purchasers true and correct copies of the Credit Agreement,
including any amendments thereto and restatements thereof, as in effect on the
date hereof; and such other documents as may be necessary to interpret such
agreements and to assess the impact thereof on the business and financial
condition of the Company.
(pp) The Credit Agreement (A) has been duly authorized, executed and
delivered by, (B) constitutes the valid and binding obligation of and (C) is
enforceable in accordance with its terms against, the Company and its
affiliates, to the extent each is a party thereto(subject, as to the enforcement
of remedies, to applicable bankruptcy, reorganization, insolvency, moratorium or
other laws affecting creditors' rights generally from time to time in effect and
to general principles of equity, and subject, as to enforcement or rights of
indemnity and contribution, to applicable principles of public policy).
(qq) On the Closing Date $75 million of loans under the Credit
Agreement will be placed in an escrow account for the benefit of and use by the
Company pending the satisfaction of certain conditions specified in the Credit
Agreement. The Credit Agreement, subject to the escrow arrangement set forth
therein, constitutes all of the documentation and agreements necessary for the
Company to receive further disbursements under the Credit Agreement in
accordance with the terms of the Credit Agreement.
(rr) The execution, delivery and performance of the Sprint
Agreements and the Credit Agreement by the Company and any of its affiliates
that are a party thereto, the compliance by the Company and such affiliates with
all the provisions thereof and the consummation of the transactions contemplated
thereby do not (A) require any consent, approval, authorization or other order
of, or qualification with, any court or governmental body or agency (except such
as have already been obtained or that may be required to be obtained hereafter
from time to time in accordance with such agreements or that would not,
individually or in the aggregate, have a Material Adverse Effect), (B) conflict
with or constitute a breach of any of the terms or provisions of, or a default
under (or an event which with notice or lapse of time, or both, would constitute
a breach of or a default under), the certificate of incorporation or
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bylaws of UbiquiTel Parent, the Company or any of its subsidiaries or any
indenture, loan agreement, mortgage, lease or other agreement or instrument to
which UbiquiTel Parent, the Company or any of its subsidiaries is a party or by
which UbiquiTel Parent, the Company or any of its subsidiaries or their
respective property is bound, other than conflicts, breaches or defaults that,
individually or in the aggregate, would not have a Material Adverse Effect, (C)
violate or conflict with any applicable law or any rule, regulation, judgment,
order or decree of any court or any governmental body or agency having
jurisdiction over UbiquiTel Parent, the Company, any of its subsidiaries or
their respective property other than violations or conflicts that, individually
or in the aggregate, would not have a Material Adverse Effect, or (D) result in
the suspension, termination or revocation of any Authorization of UbiquiTel
Parent, the Company or any of its subsidiaries or any other impairment of the
rights of the holder of any such Authorization other than suspensions,
terminations or revocations that, individually or in the aggregate, would not
have a Material Adverse Effect.
(ss) Each of the Sprint Agreements (including, without limitation,
the Sprint PCS Management Agreement) and the Consent and Agreement
(collectively, the "PCS Agreements"), is, and the PCS Agreements viewed as a
whole are, consistent with the terms and conditions of the License (as such term
is defined in the Sprint PCS Management Agreement) as the Federal Communications
Commission (the "FCC") has construed the terms of such License, or similar
licenses, to date and, to the best of the Company's knowledge, is not otherwise
contrary to FCC policies, rules and regulations or other applicable law, rules
or regulations.
(tt) Each certificate signed by any officer of the Company or
UbiquiTel Parent and delivered to the Initial Purchasers or counsel for the
Initial Purchasers shall be deemed to be a representation and warranty by the
Company or UbiquiTel Parent to the Initial Purchasers as to the matters covered
thereby.
The Company acknowledges that the Initial Purchasers and, for
purposes of the opinions to be delivered to the Initial Purchasers pursuant to
Section 9 hereof, counsel to the Company and UbiquiTel Parent and counsel to the
Initial Purchasers will rely upon the accuracy and truth of the foregoing
representations and hereby consents to such reliance.
7. Initial Purchasers' Representations and Warranties. Each of the
Initial Purchasers, severally and not jointly, represents and warrants to, and
agrees with, the Company and UbiquiTel Parent:
(a) Such Initial Purchaser is either a QIB or an Accredited
Institution, in either case, with such knowledge and experience in financial and
business matters as is necessary in order to evaluate the merits and risks of an
investment in the Units.
(b) Such Initial Purchaser (A) is not acquiring the Units with a
view to any distribution thereof or with any present intention of offering or
selling any of the Units in a transaction 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 Units only to (x) QIBs
in reliance on the exemption from the registration requirements of the Act
provided by Rule 144A and (y) in offshore transactions in reliance upon
Regulation S under the Act.
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(c) Such Initial Purchaser agrees that 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 the Units pursuant
hereto, 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.
(d) Such Initial Purchaser agrees that, in connection with Exempt
Resales, such Initial Purchaser will solicit offers to buy the Units only from,
and will offer to sell the Units only to, Eligible Purchasers. Each Initial
Purchaser further agrees that it will offer to sell the Units only to, and will
solicit offers to buy the Units only from (A) Eligible Purchasers that the
Initial Purchaser reasonably believes are QIBs and (B) Regulation S Purchasers,
in each case, that agree that (x) the Units purchased by them may be resold,
pledged or otherwise transferred within the time period referred to under Rule
144(k) (taking into account the provisions of Rule 144(d) under the Act, if
applicable) under the Act, as in effect on the date of the transfer of such
Units, only (i) to the Company or any of its subsidiaries, (ii) 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, (iii) in an offshore transaction (as defined in Rule 902 under
the Act) meeting the requirements of Rule 904 of the Act, (iv) in a transaction
meeting the requirements of Rule 144 under the Act, (v) to an Accredited
Institution that, prior to such transfer, furnishes the Trustee a signed letter
containing certain representations and agreements relating to the registration
of transfer of such Unit and, if such transfer is in respect of an aggregate
principal amount of Notes less than $250,000 or any Units or Warrants, an
opinion of counsel acceptable to the Company that such transfer is in compliance
with the Act, (vi) in accordance with another exemption from the registration
requirements of the Act (and based upon an opinion of counsel acceptable to the
Company) or (vii) pursuant to an effective registration statement and, in each
case, in accordance with the applicable securities laws of any state of the
United States or any other applicable jurisdiction and (y) they will deliver to
each person to whom such Units or an interest therein is transferred a notice
substantially to the effect of the foregoing.
(e) 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 Units.
(f) The Units 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.
(g) The sale of the Units 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.
Such Initial Purchaser acknowledges that the Company and UbiquiTel
Parent and, for purposes of the opinions to be delivered to each Initial
Purchaser pursuant to Section 9 hereof, counsel to the Company and UbiquiTel
Parent and counsel to the Initial Purchasers will
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rely upon the accuracy and truth of the foregoing representations and such
Initial Purchaser hereby consents to such reliance.
DLJ hereby also makes the foregoing representations and warranties
with respect to the Additional Warrants in connection with its purchase of the
Additional Warrants.
8. Indemnification.
(a) The Company and UbiquiTel Parent agree, jointly and severally,
to indemnify and hold harmless each Initial Purchaser, its directors, its
officers and each person, if any, who controls such Initial Purchaser within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, from and
against any and all losses, claims, damages, liabilities and judgments
(including, without limitation, any reasonable legal or other reasonable
expenses incurred in connection with investigating or defending any matter,
including any action, that could give rise to any such losses, claims, damages,
liabilities or judgments) caused by any untrue statement or alleged untrue
statement of a material fact contained in the Offering Memorandum (or any
amendment or supplement thereto) or any Rule 144A Information provided by the
Company or UbiquiTel Parent to any holder or prospective purchaser of Units
pursuant to Section 5(h) or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages, liabilities or judgments are caused by any such untrue statement or
omission or alleged untrue statement or omission based upon information relating
to the Initial Purchaser furnished in writing to the Company by or on behalf of
such Initial Purchaser (and not with respect to the information provided by any
other Initial Purchaser).
(b) Each Initial Purchaser, severally and not jointly, agrees to
indemnify and hold harmless the Company and UbiquiTel Parent, and their
respective directors and officers and each person, if any, who controls (within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act) the
Company or UbiquiTel Parent, to the same extent as the foregoing indemnity from
the Company and UbiquiTel Parent to the Initial Purchasers but only with
reference to information relating to the Initial Purchaser furnished in writing
to the Company by or on behalf of the Initial Purchaser (and not with respect to
the information provided by or on behalf of any other Initial Purchaser)
expressly for use in the Offering Memorandum.
(c) In case any action shall be commenced involving any person in
respect of which indemnity may be sought pursuant to Section 8(a) or 8(b) (the
"indemnified party"), the indemnified party shall promptly notify the person
against whom such indemnity may be sought (the "indemnifying party") in writing
and the indemnifying party shall assume the defense of such action, including
the employment of counsel reasonably satisfactory to the indemnified party and
the payment of all fees and expenses of such counsel, as incurred (except that
in the case of any action in respect of which indemnity may be sought pursuant
to both Sections 8(a) and 8(b), the Initial Purchasers shall not be required to
assume the defense of such action pursuant to this Section 8(c), but may employ
separate counsel and participate in the defense thereof, but the fees and
expenses of such counsel, except as provided below, shall be at the expense of
the Initial Purchasers). Any indemnified party shall have the right to employ
separate counsel in any such action and participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of the indemnified
party unless (i) the employment of such
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counsel shall have been specifically authorized in writing by the indemnifying
party, (ii) the indemnifying party shall have failed to assume the defense of
such action or employ counsel reasonably satisfactory to the indemnified party
or (iii) the named parties to any such action (including any impleaded parties)
include both the indemnified party and the indemnifying party, and the
indemnified party shall have been advised by such counsel that there may be one
or more legal defenses available to it which are different from or additional to
those available to the indemnifying party (in which case the indemnifying party
shall not have the right to assume the defense of such action on behalf of the
indemnified party). In any such case, the indemnifying party shall not, in
connection with any one action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more than one separate
firm of attorneys (in addition to any local counsel) for all indemnified parties
and all such fees and expenses shall be reimbursed as they are paid. Such firm
shall be designated in writing by DLJ, in the case of the parties indemnified
pursuant to Section 8(a), and by the Company, in the case of parties indemnified
pursuant to Section 8(b). The indemnifying party shall indemnify and hold
harmless the indemnified party from and against any and all losses, claims,
damages, liabilities and judgments by reason of any settlement of any action (i)
effected with its written consent or (ii) effected without its written consent
if the settlement is entered into more than twenty business days after the
indemnifying party shall have received a request from the indemnified party for
reimbursement for the fees and expenses of counsel (in any case where such fees
and expenses are at the expense of the indemnifying party) and, prior to the
date of such settlement, the indemnifying party shall have failed to comply with
such reimbursement request. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement or compromise
of, or consent to the entry of judgment with respect to, any pending or
threatened action in respect of which the indemnified party is or could have
been a party and indemnity or contribution may be or could have been sought
hereunder by the indemnified party, unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from all
liability on claims that are or could have been the subject matter of such
action and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of the indemnified party.
(d) To the extent the indemnification provided for in this Section 8
is unavailable to an indemnified party or insufficient in respect of any losses,
claims, damages, liabilities or judgments referred to therein, then each
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities and judgments (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company and UbiquiTel Parent, on the one hand, and the Initial Purchasers on the
other hand from the offering of the Units or (ii) if the allocation provided by
clause 8(d)(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
8(d)(i) above but also the relative fault of the Company and UbiquiTel Parent,
on the one hand, and the Initial Purchasers, on the other hand, in connection
with the statements or omissions which resulted in such losses, claims, damages,
liabilities or judgments, as well as any other relevant equitable
considerations. The relative benefits received by the Company and UbiquiTel
Parent, on the one hand and the Initial Purchasers, on the other hand, shall be
deemed to be in the same proportion as the total net proceeds from the offering
of the Units (after underwriting discounts and commissions, but before deducting
expenses) received by the Company, and the total discounts
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and commissions received by the Initial Purchasers bear to the total price to
investors of the Units. The relative fault of the Company and UbiquiTel Parent,
on the one hand, and 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 Company or UbiquiTel
Parent, on the one hand, or the Initial Purchasers, on the other hand, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
The Company and UbiquiTel Parent, and the Initial Purchasers agree
that it would not be just and equitable if contribution pursuant to this Section
8(d) were determined by pro rata allocation or by any other method of allocation
which does not take account of the equitable considerations referred to in the
immediately preceding paragraph. The amount paid or payable by an indemnified
party as a result of the losses, claims, damages, liabilities or judgments
referred to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any reasonable legal or other
expenses incurred by such indemnified party in connection with investigating or
defending any matter, including any action, that could have given rise to such
losses, claims, damages, liabilities or judgments. Notwithstanding the
provisions of this Section 8, the Initial Purchasers shall not be required to
contribute any amount in excess of the amount by which the total discounts and
commissions received by such Initial Purchaser 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 Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Initial Purchasers' obligations
to contribute pursuant to this Section 8(d) are several in proportion to the
respective principal amount of Units purchased by each of the Initial Purchasers
hereunder and not joint.
(e) The remedies provided for in this Section 8 are not exclusive
and shall not limit any rights or remedies which may otherwise be available to
any indemnified party at law or in equity.
9. Conditions of Initial Purchasers' Obligations. The obligations of
each Initial Purchasers to purchase the Units and the obligation of DLJ to
purchase the Additional Warrants under this Agreement are subject to the
satisfaction of each of the following conditions:
(a) All the representations and warranties of the Company and
UbiquiTel Parent contained in this Agreement that are qualified as to Material
Adverse Effect shall be true and correct, and all of the representations and
warranties of the Company and UbiquiTel Parent that are not so qualified shall
be true and correct in all material respects on the Closing Date with the same
force and effect as if made on and as of the Closing Date (except to the extent
in either case that such representations and warranties speak as of another
date).
(b) 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 UbiquiTel Parent or any securities of the Company or UbiquiTel
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Parent (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 change, nor shall any notice have
been given of any potential or intended change, in the outlook for any rating of
the Company or UbiquiTel Parent or any securities of the Company or UbiquiTel
Parent 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 Units than that on which the Units were marketed.
(c) Since the respective dates as of which information is given in
the Offering Memorandum other than as set forth in the Offering Memorandum
(exclusive of any amendments or supplements thereto subsequent to the date of
this Agreement), (i) there shall not have occurred any change or any development
involving a prospective change in the condition, financial or otherwise, or the
earnings, business, management or operations of UbiquiTel Parent, the Company
and its subsidiaries, taken as a whole, (ii) there shall not have been any
change or any development involving a prospective change in the capital stock or
in the long-term debt of UbiquiTel Parent, the Company or any of its
subsidiaries and (iii) neither UbiquiTel Parent, the Company nor any of its
subsidiaries shall have incurred any liability or obligation, direct or
contingent, the effect of which, in any such case described in clause 9(c)(i),
9(c)(ii) or 9(c)(iii), in your judgment, is material and adverse and, in your
judgment, makes it impracticable to market the Units on the terms and in the
manner contemplated in the Offering Memorandum.
(d) You shall have received on the Closing Date a certificate dated
the Closing Date, signed by the President and the Chief Financial Officer of
each of UbiquiTel Parent and the Company, confirming the matters set forth in
Sections 6(y), 9(a) and 9(b) and stating that each of the Company and UbiquiTel
Parent has complied with all the agreements and satisfied all of the conditions
herein contained and required to be complied with or satisfied on or prior to
the Closing Date.
(e) You shall have received on the Closing Date an opinion
(satisfactory to you and counsel for DLJ), dated the Closing Date, of Greenberg
Traurig, LLP, counsel for the Company and UbiquiTel Parent, to the effect that:
(i) each of UbiquiTel Parent, the Company and its subsidiaries has
been duly incorporated, is validly existing as a corporation in good
standing under the laws of its jurisdiction of incorporation and has the
corporate power and authority to carry on its business as described in the
Offering Memorandum and to own, lease and operate its properties;
(ii) each of UbiquiTel Parent, the Company and its subsidiaries is
duly qualified and is 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 would not have a Material Adverse
Effect;
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(iii) all the outstanding shares of capital stock of UbiquiTel
Parent and the Company have been duly authorized and validly issued and
are fully paid, non-assessable and not subject to any preemptive rights
pursuant to law or UbiquiTel Parent's or the Company's certificate of
incorporation or, to our knowledge, in violation of any other preemptive
rights;
(iv) the Warrant Agreement has been duly authorized, executed and
delivered by UbiquiTel Parent and are valid and binding agreements of
UbiquiTel Parent, enforceable in accordance with its terms except as (x)
the enforceability thereof may be limited by bankruptcy, insolvency or
similar laws affecting creditors' rights generally and (y) rights of
acceleration and the availability of equitable remedies may be limited by
equitable principles of general applicability;
(v) the Warrants have been duly authorized and, when executed by
UbiquiTel Parent in accordance with the provisions of the Warrant
Agreement and delivered to and paid for by the Initial Purchasers or DLJ,
as applicable, in accordance with the terms of this Agreement, will be
valid and binding obligations of UbiquiTel Parent, enforceable in
accordance with its terms except as (x) the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws affecting creditors'
rights generally and (y) rights of acceleration and the availability of
equitable remedies may be limited by equitable principles of general
applicability;
(vi) the Warrant Shares have been duly and validly authorized for
issuance by UbiquiTel Parent and, when issued pursuant to the terms of the
Warrants and the Warrant Agreement, will be fully paid, non-assessable and
not subject to any preemptive rights pursuant to law or UbiquiTel Parent's
or the Company's certificate of incorporation or, to our knowledge, any
other preemptive rights;
(vii) the Initial Notes have been duly authorized and, when executed
and authenticated in accordance with the provisions of the Indenture and
delivered to and paid for by the Initial Purchasers in accordance with the
terms of this Agreement and will be valid and binding obligations of the
Company, enforceable in accordance with their terms except as (x) the
enforceability of the rights of indemnity and/or contribution thereunder
may be limited by federal or state securities laws or principles of public
policy, (y) the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally and (z)
rights of acceleration and the availability of equitable remedies may be
limited by equitable principles of general applicability;
(viii) the Guarantees have been duly authorized and, when the
Initial Notes are executed and authenticated in accordance with the
provisions of the Indenture and delivered to and paid for by the Initial
Purchasers in accordance with the terms of this Agreement, the Guarantees
endorsed thereon and will be valid and binding obligations of the
Guarantors, enforceable in accordance with their terms except as (x) the
enforceability of the rights of indemnity and/or contribution thereunder
may be limited by federal or state securities laws or principles of public
policy, (y) the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights
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<PAGE>
generally and (z) rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general applicability;
(ix) each of UbiquiTel Parent and the Company has duly and validly
authorized the issuance of the Notes and the Warrants as Units and
UbiquiTel Parent has duly and validly authorized the issuance of the
Additional Warrants;
(x) the Indenture has been duly authorized, executed and delivered
by the Company and UbiquiTel Parent and is a valid and binding agreement
of the Company and UbiquiTel Parent, enforceable against the Company and
UbiquiTel Parent in accordance with its terms except as (x) the
enforceability of the rights of indemnity and/or contribution thereunder
may be limited by federal or state securities laws or principles of public
policy, (y) the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally and (z)
rights of acceleration and the availability of equitable remedies may be
limited by equitable principles of general applicability;
(xi) this Agreement has been duly authorized, executed and delivered
by the Company and UbiquiTel Parent;
(xii) the Notes Registration Rights Agreement has been duly
authorized, executed and delivered by the Company and the Guarantor and is
a valid and binding agreement of the Company and the Guarantor,
enforceable against the Company and the Guarantor in accordance with its
terms, except as (x) the enforceability of the rights of indemnity and/or
contribution thereunder may be limited by federal or state securities laws
or principles of public policy, (y) the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws affecting creditors'
rights generally and (z) rights of acceleration and the availability of
equitable remedies may be limited by equitable principles of general
applicability;
(xiii) the Warrant Registration Rights Agreement has been duly
authorized, executed and delivered by UbiquiTel Parent and is a valid and
binding agreement of UbiquiTel Parent, enforceable against UbiquiTel
Parent in accordance with its terms, except as (x) the enforceability of
the rights of indemnity and/or contribution thereunder may be limited by
federal or state securities laws or principles of public policy, (y) the
enforceability thereof may be limited by bankruptcy, insolvency or similar
laws affecting creditors' rights generally and (z) rights of acceleration
and the availability of equitable remedies may be limited by equitable
principles of general applicability;
(xiv) the Exchange Notes have been duly authorized;
(xv) the statements under the captions "The Sprint PCS Agreements,"
"Description of Certain Indebtedness," "Principal Stockholders," "Certain
Transactions," "Description of Units," "Description of Notes,"
"Description of Warrants," "Description of Capital Stock," and "U.S.
Federal Tax Considerations" in the Offering Memorandum, insofar as such
statements constitute a summary of the legal
26
<PAGE>
matters, documents or proceedings referred to therein, fairly present in
all material respects such legal matters, documents and proceedings;
(xvi) neither UbiquiTel Parent, the Company nor any of its
subsidiaries is in violation of its respective charter or by-laws and, to
such counsel's knowledge, neither UbiquiTel Parent, the Company nor any of
its subsidiaries is in default in the performance of any obligation,
agreement, covenant or condition contained in any material agreements (the
"Material Agreements") listed or required to be listed as exhibits to the
Company's registration statement on Form S-1 filed with the Securities and
Exchange Commission on March 10, 2000, indenture, loan agreement,
mortgage, lease or other agreement or instrument that is material to
UbiquiTel Parent, the Company and their subsidiaries, taken as a whole, to
which UbiquiTel Parent, the Company or any of their subsidiaries is a
party or by which UbiquiTel Parent, the Company or any of its subsidiaries
or their respective property is bound, in each case which default has not
or is not likely to have, singly or in the aggregate, a Material Adverse
Effect;
(xvii) the execution, delivery and performance of this Agreement and
the other Operative Documents by the Company and UbiquiTel Parent, the
compliance by the Company and UbiquiTel Parent with all provisions hereof
and thereof and the consummation of the transactions contemplated hereby
and thereby will not (i) require Ubiquitel Parent and/or the Company to
obtain any consent, approval, authorization or other order of, or
qualification with, any court or governmental body or agency (except such
as may be obtained on or prior to the Closing Date and/or may be required
under the securities or Blue Sky laws of the various states or filing
under federal or state antitrust laws or which would not, singly or in the
aggregate, have a Material Adverse Effect), (ii) conflict with or
constitute a breach of any of the terms or provisions of, or a default
under, the charter or by-laws of UbiquiTel Parent or the Company or any
Material Agreement, which would, singly or in the aggregate, have a
Material Adverse Effect, (iii) violate or conflict with any applicable law
or any rule, regulation, judgment, order or decree of any court or any
governmental body or agency having jurisdiction over UbiquiTel Parent or
the Company, any of its subsidiaries or their respective property, which
would, singly or in the aggregate, have a Material Adverse Effect, (iv)
result in the imposition or creation of (or the obligation to create or
impose) a Lien under, any Material Agreement which would, singly or in the
aggregate, have a Material Adverse Effect, or (v) result in the
termination, suspension or revocation of any Authorization of UbiquiTel
Parent, the Company or any of its subsidiaries or result in any other
impairment of the rights of the holder of any such Authorization which
would, singly or in the aggregate, have a Material Adverse Effect.
(xviii) except as described in the Offering Memorandum, to such
counsel's knowledge, there are no legal or governmental proceedings
pending or threatened to which UbiquiTel Parent, the Company or any of its
subsidiaries is a party or to which any of their respective property is
subject, which might result, singly or in the aggregate, in a Material
Adverse Effect.
(xix) to such counsel's knowledge, none of UbiquiTel Parent, the
Company or any of its subsidiaries has violated any Environmental Law or
any provisions of ERISA,
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<PAGE>
any provisions of the Foreign Corrupt Practices Act or the rules and
regulations promulgated thereunder, except for such violations which,
singly or in the aggregate, would not have a Material Adverse Effect;
(xx) neither UbiquiTel Parent nor the Company is not, after giving
effect to the offering and sale of the Units and the application of the
net proceeds thereof as described in the Offering Memorandum, will not be,
an "investment company" as such term is defined in the Investment Company
Act of 1940, as amended;
(xxi) except as contemplated by this Agreement or agreements
referenced in the Offering Memorandum, to the best of such counsel's
knowledge, there are no contracts, agreements or understandings between
UbiquiTel Parent or the Company and any person granting such person the
right to require UbiquiTel Parent or the Company to file a registration
statement under the Act with respect to any securities of UbiquiTel Parent
or the Company or to require UbiquiTel Parent or the Company to include
such securities with the Units and Guarantees registered pursuant to any
Registration Statement;
(xxii) the Indenture complies as to form in all material respects
with the requirements of the TIA, and the rules and regulations of the
Commission applicable to an indenture which is qualified thereunder. It is
not necessary in connection with the offer, sale and delivery of the Units
to the Initial Purchasers in the manner contemplated by this Agreement or
in connection with the Exempt Resales to qualify the Indenture under the
TIA.
(xxiii) no registration under the Act of the Units is required for
the sale of the Units to the Initial Purchasers as contemplated by this
Agreement or for the Exempt Resales assuming that (i) each Initial
Purchaser is a QIB or a Regulation S Purchaser, (ii) the accuracy of, and
compliance with, the Initial Purchasers' representations and agreements
contained in Section 7 of this Agreement, and (iii) the accuracy of the
representations of UbiquiTel Parent and the Company set forth in Sections
6(ff), (gg), (hh) and (jj) of this Agreement.
(xxiv) such counsel has no reason to believe that, as of the date of
the Offering Memorandum or as of the Closing Date, the Offering
Memorandum, as amended or supplemented, if applicable (except for the
financial statements and other financial data and statistical data
included therein, as to which such counsel need not express any belief)
contains any untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
The opinion of Greenberg Traurig LLP described in Section 9(e) above
shall be rendered to you at the request of the Company and UbiquiTel Parent and
shall so state therein. In giving such opinion with respect to the matters
covered by Section 9(e)(xxv), Greenberg Traurig LLP may state that their opinion
and belief are based upon their participation in the preparation of the Offering
Memorandum and any amendments or supplements thereto and review and discussion
of the contents thereof, but are without independent check or verification
except as specified.
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(f) The Initial Purchasers shall have received on the Closing Date
an opinion, dated the Closing Date, of Weil, Gotshal &Manges LLP, counsel for
DLJ, in form and substance reasonably satisfactory to DLJ.
(g) The Initial Purchasers shall have received, at the time this
Agreement is executed and at the Closing Date, letters dated the date hereof or
the Closing Date, as the case may be, in form and substance satisfactory to the
Initial Purchasers from Arthur Andersen LLP and Ernst & Young LLP, independent
public accountants, containing the information and statements of the type
ordinarily included in accountants' "comfort letters" to the Initial Purchasers
with respect to the financial statements and certain financial information
contained in the Offering Memorandum.
(h) The Initial Notes and Warrants as Units and the Additional
Warrants shall have been approved by the NASD for trading and duly listed in
PORTAL.
(i) The Initial Purchasers shall have received a counterpart,
conformed as executed, of the Indenture which shall have been entered into by
the Company, UbiquiTel Parent and the Trustee.
(j) The Company and UbiquiTel Parent shall have executed the Initial
Notes Registration Rights Agreement and the Warrant Registration Rights
Agreement and the Initial Purchasers shall have received an original copy
thereof, duly executed by the Company and UbiquiTel Parent.
(k) Neither the Company nor UbiquiTel Parent shall have failed at or
prior to the Closing Date to perform or comply with any of the agreements herein
contained and required to be performed or complied with by the Company or
UbiquiTel Parent, as the case may be, at or prior to the Closing Date.
10. Effectiveness of Agreement and Termination. This Agreement shall
become effective upon the execution and delivery of this Agreement by the
parties hereto.
This Agreement may be terminated at any time on or prior to the
Closing Date by the Initial Purchasers by written notice to the Company if any
of the following has occurred: (i) any outbreak or escalation of hostilities or
other national or international calamity or crisis or change in economic
conditions or in the financial markets of the United States or elsewhere that,
in the Initial Purchasers' judgment, is material and adverse and, in the Initial
Purchasers' judgment, makes it impracticable to market the Units on the terms
and in the manner contemplated in the Offering Memorandum, (ii) the suspension
or material limitation of trading in securities or other instruments 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 National Market or limitation on prices for securities or other
instruments on any such exchange or the Nasdaq National Market, (iii) the
suspension of trading of any securities of the Company or UbiquiTel Parent on
any exchange or in the over-the-counter market, (iv) the enactment, publication,
decree or other promulgation of any federal or state statute, regulation, rule
or order of any court or other governmental authority which in your opinion
materially and adversely affects, or will materially and adversely affect, the
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business, prospects, financial condition or results of operations of UbiquiTel
Parent, the Company and its subsidiaries, taken as a whole, (v) the declaration
of a banking moratorium by either federal or New York State authorities or (vi)
the taking of any action by any federal, state or local government or agency in
respect of its monetary or fiscal affairs which in your opinion has a material
adverse effect on the financial markets in the United States.
If on the Closing Date any one or more of the Initial Purchasers
shall fail or refuse to purchase the Units which it or they have agreed to
purchase hereunder on such date and the aggregate principal amount of the Units
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 Units 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 Units set forth
opposite its name in Schedule A bears to the aggregate principal amount of the
Units which all the non-defaulting Initial Purchasers, as the case may be, have
agreed to purchase, or in such other proportion as you may specify, to purchase
the Units 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 Units which any
Initial Purchaser has agreed to purchase pursuant to Section 2 hereof be
increased pursuant to this Section 10 by an amount in excess of one-ninth of
such principal amount of the Units 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 Units and the aggregate principal amount of
the Units with respect to which such default occurs is more than one-tenth of
the aggregate principal amount of the Units to be purchased by all Initial
Purchasers and arrangements satisfactory to the Initial Purchasers and the
Company for purchase of such the Units are not made within 48 hours after such
default, this Agreement will terminate without liability on the part of any
non-defaulting Initial Purchaser and the Company. In any such case which does
not result in termination of this Agreement, either you or the Company shall
have the right to postpone the Closing Date, but in no event for longer than
seven days, in order that the required changes, if any, in the Offering
Memorandum or 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.
11. Miscellaneous. Notices given pursuant to any provision of this
Agreement shall be addressed as follows: (i) if to the Company or UbiquiTel
Parent, to 1 Bala Plaza, Suite 402, Bala Cynwyd, Pennsylvania 19004, Attention:
Donald A. Harris, with a copy to Greenberg Traurig, 1221 Brickell Avenue, Miami,
Florida 33131, Attention: Rebecca Orand and (ii) if to the Initial Purchasers,
c/o Donaldson, Lufkin & Jenrette Securities Corporation, 277 Park Avenue, New
York, New York 10172, Attention: Syndicate Department, with a copy to Weil,
Gotshal & Manges LLP, 100 Crescent Court, Suite 1300, Dallas, Texas 75201,
Attention: Michael Saslaw, or in any case to such other address as the person to
be notified may have requested in writing.
The respective indemnities, contribution agreements,
representations, warranties and other statements of the Company, UbiquiTel
Parent and the Initial Purchasers set forth in or made pursuant to this
Agreement shall remain operative and in full force and effect, and will survive
delivery of and payment for the Units, regardless of (i) any investigation, or
statement as to the results thereof, made by or on behalf of the Initial
Purchasers, the officers or directors of
30
<PAGE>
the Initial Purchasers, any person controlling the Initial Purchasers, the
Company, UbiquiTel Parent, the officers or directors of UbiquiTel Parent or the
Company, or any person controlling the Company or UbiquiTel Parent, (ii)
acceptance of the Units and payment for them hereunder and (iii) termination of
this Agreement.
If for any reason the Units are not delivered by or on behalf of the
Company as provided herein (other than as a result of any termination of this
Agreement pursuant to Section 10), the Company and UbiquiTel Parent, jointly and
severally, agree to reimburse the Initial Purchasers for all reasonable
out-of-pocket expenses (including the reasonable fees and disbursements of
counsel) incurred by them. Notwithstanding any termination of this Agreement,
the Company shall be liable for all expenses which it has agreed to pay pursuant
to Section 5(i) hereof. The Company and UbiquiTel Parent also agree, jointly and
severally, to reimburse the Initial Purchasers and its officers, directors and
each person, if any, who controls such Initial Purchaser within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act for any and all fees and
expenses (including without limitation the fees and expenses of counsel)
incurred by them in connection with enforcing their rights under this Agreement
(including without limitation its rights under Section 8).
Except as otherwise provided, this Agreement has been and is made
solely for the benefit of and shall be binding upon the Company, UbiquiTel
Parent, the Initial Purchasers, the Initial Purchasers' directors and officers,
any controlling persons referred to herein, the directors of the Company and
UbiquiTel Parent and their respective successors and assigns, all as and to the
extent provided in this Agreement, and no other person shall acquire or have any
right under or by virtue of this Agreement. The term "successors and assigns"
shall not include a purchaser of any of the Units from the Initial Purchaser
merely because of such purchase.
This Agreement shall be governed and construed in accordance with
the laws of the State of New York.
This Agreement may be signed in various counterparts which together
shall constitute one and the same instrument.
[The remainder of this page is intentionally left blank.]
31
<PAGE>
Please confirm that the foregoing correctly sets forth the agreement
among the Company, UbiquiTel Parent and the Initial Purchasers.
Very truly yours,
UBIQUITEL OPERATING COMPANY
By:_____________________________________
Peter Lucas
Interim Chief Financial Officer
UBIQUITEL INC.
By:_____________________________________
Peter Lucas
Interim Chief Financial Officer
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
By:________________________________
William G. Payne
Senior Vice President
PARIBAS CORPORATION
By:________________________________
Name:
Title:
PNC CAPITAL MARKETS, INC.
By:________________________________
Name:
Title:
<PAGE>
SCHEDULE A
Number
Initial Purchaser of Units
----------------- --------
Donaldson, Lufkin & Jenrette
Securities Corporation.......................... 255,000,000
Paribas Corporation................................. 22,500,000
PNC Capital Markets, Inc............................ 22,500,000
-----------
Total......................................... 300,000,000
<PAGE>
SCHEDULE B
Subsidiaries
UbiquiTel Leasing Company
<PAGE>
EXHIBIT A
Form of Notes Registration Rights Agreement
<PAGE>
EXHIBIT B
Form of Warrant Registration Rights Agreement
<PAGE>
Exhibit 10.20
Execution Copy
================================================================================
14% SENIOR SUBORDINATED DISCOUNT NOTES DUE 2010
INDENTURE
Dated as of April 11, 2000
By and Among
UBIQUITEL OPERATING COMPANY
As Issuer,
UBIQUITEL INC.
As Guarantor
And
AMERICAN STOCK TRANSFER & TRUST COMPANY,
As Trustee
================================================================================
<PAGE>
CROSS-REFERENCE TABLE*
Trust Indenture Act
Section Indenture
- ------- ---------
310(a)(1)............................................................7.10
(a)(2) ...........................................................7.10
(a)(3)............................................................N.A.
(a)(4)............................................................N.A.
(a)(5)............................................................7.10
(b)...............................................................7.10
(c)...............................................................N.A.
311(a)...............................................................7.11
(b)...............................................................7.11
(c)...............................................................N.A.
312(a)...............................................................2.05
(b)...............................................................10.03
(c)...............................................................10.03
313(a)...............................................................7.06
(b)(2)............................................................7.06; 7.07
(c)...............................................................7.06; 10.02
314(a)...............................................................4.03; 10.02
(c)(1)............................................................10.04
(c)(2)............................................................10.04
(c)(3)............................................................N.A.
(e)...............................................................10.05
(f)...............................................................NA
315(a)...............................................................7.01
(b)...............................................................7.05, 10.02
(c)...............................................................7.01
(d)...............................................................7.01
(e)...............................................................6.11
316(a)(last sentence)................................................2.09
(a)(1)(A).........................................................6.05
(a)(1)(B).........................................................6.04
(a)(2)............................................................N.A.
(b)...............................................................6.07
(c)...............................................................2.12
317(a)(1)............................................................6.08
(a)(2)............................................................6.09
(b)...............................................................2.04
318(a)...............................................................10.01
(b)...............................................................N.A.
(c)...............................................................10.01
N.A. means not applicable.
*This Cross-Reference Table is not part of the Indenture.
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE........................1
Section 1.01. Definitions.................................................1
Section 1.02. Other Definitions..........................................17
Section 1.03. Incorporation by Reference of Trust Indenture Act..........18
Section 1.04. Rules of Construction......................................18
ARTICLE 2. THE NOTES........................................................19
Section 2.01. Form and Dating............................................19
Section 2.02. Execution and Authentication...............................19
Section 2.03. Registrar and Paying Agent.................................20
Section 2.04. Paying Agent to Hold Money in Trust........................20
Section 2.05. Holder Lists...............................................20
Section 2.06. Transfer and Exchange......................................21
Section 2.07. Replacement Notes..........................................32
Section 2.08. Outstanding Notes..........................................32
Section 2.09. Treasury Notes.............................................33
Section 2.10. Temporary Notes............................................33
Section 2.11. Cancellation...............................................33
Section 2.12. Defaulted Interest.........................................33
Section 2.13. CUSIP Numbers..............................................34
ARTICLE 3. REDEMPTION AND PREPAYMENT........................................34
Section 3.01. Notices to Trustee.........................................34
Section 3.02. Selection of Notes to Be Redeemed..........................34
Section 3.03. Notice of Redemption.......................................34
Section 3.04. Effect of Notice of Redemption.............................35
Section 3.05. Deposit of Redemption Price................................35
Section 3.06. Notes Redeemed in Part.....................................36
Section 3.07. Optional Redemption........................................36
Section 3.08. Mandatory Redemption.......................................36
Section 3.09. Offer to Purchase..........................................36
ARTICLE 4. COVENANTS........................................................38
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Section 4.01. Payment of Notes...........................................38
Section 4.02. Maintenance of Office or Agency............................38
Section 4.03. Reports....................................................39
Section 4.04. Compliance Certificate.....................................39
Section 4.05. Taxes......................................................40
Section 4.06. Stay, Extension and Usury Laws.............................40
Section 4.07. Limitation on Restricted Payments..........................40
Section 4.08. Dividend and Other Payment Restrictions Affecting
Subsidiaries...............................................43
Section 4.09. Incurrence of Indebtedness and Issuance of
Preferred Stock............................................45
Section 4.10. Asset Sales................................................47
Section 4.11. Transactions with Affiliates...............................48
Section 4.12. Liens......................................................49
Section 4.13. Corporate Existence........................................49
Section 4.14. Offer to Repurchase Upon Change of Control.................49
Section 4.15. Payments for Consent.......................................50
Section 4.16. Sale and Leaseback Transactions............................50
Section 4.17 No Senior Subordinated Debt................................51
Section 4.18 Limitation On Issuances and Sales of Equity Interests
in Wholly-Owned Restricted Subsidiaries....................51
Section 4.19. Business Activities........................................51
Section 4.20. Designation of Restricted and Unrestricted Subsidiaries....51
ARTICLE 5. SUCCESSORS.......................................................52
Section 5.01. Merger, Consolidation, or Sale of Assets...................52
Section 5.02. Successor Corporation Substituted..........................53
ARTICLE 6. DEFAULTS AND REMEDIES............................................53
Section 6.01. Events of Default..........................................53
Section 6.02. Acceleration...............................................55
Section 6.03. Other Remedies.............................................55
Section 6.04. Waiver of Past Defaults....................................56
Section 6.05. Control by Majority........................................56
Section 6.06. Limitation on Suits........................................56
Section 6.07. Rights of Holders of Notes to Receive Payment..............56
Section 6.08. Collection Suit by Trustee.................................57
Section 6.09. Trustee May File Proofs of Claim...........................57
Section 6.10. Priorities.................................................57
Section 6.11. Undertaking for Costs......................................58
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<PAGE>
Section 6.11. Willful Defaults by the Company............................58
ARTICLE 7. TRUSTEE..........................................................58
Section 7.01. Duties of Trustee..........................................58
Section 7.02. Rights of Trustee..........................................59
Section 7.03. Individual Rights of Trustee...............................60
Section 7.04. Trustee's Disclaimer.......................................60
Section 7.05. Notice of Defaults.........................................60
Section 7.06. Reports by Trustee to Holders of the Notes.................60
Section 7.07. Compensation and Indemnity.................................61
Section 7.08. Replacement of Trustee.....................................61
Section 7.09. Successor Trustee by Merger, etc...........................62
Section 7.10. Eligibility; Disqualification..............................62
Section 7.11. Preferential Collection of Claims Against Company..........63
ARTICLE 8. LEGAL DEFEASANCE AND COVENANT DEFEASANCE.........................63
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance...63
Section 8.02. Legal Defeasance and Discharge.............................63
Section 8.03. Covenant Defeasance........................................63
Section 8.04. Conditions to Legal or Covenant Defeasance.................64
Section 8.05. Deposited Money and Government Securities to be Held
in Trust; Other Miscellaneous Provisions...................65
Section 8.06. Repayment to Company.......................................65
Section 8.07. Reinstatement..............................................66
ARTICLE 9. AMENDMENT, SUPPLEMENT AND WAIVER.................................66
Section 9.01. Without Consent of Holders of Notes........................66
Section 9.02. With Consent of Holders of Notes...........................67
Section 9.03. Compliance with Trust Indenture Act........................68
Section 9.04. Revocation and Effect of Consents..........................68
Section 9.05. Notation on or Exchange of Notes...........................68
Section 9.06. Trustee to Sign Amendments, etc............................68
ARTICLE 10. MISCELLANEOUS...................................................69
Section 10.01. Trust Indenture Act Controls..............................69
Section 10.02. Notices...................................................69
Section 10.03. Communication by Holders of Notes with Other
Holders of Notes..........................................70
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<PAGE>
Section 10.04. Certificate and Opinion as to Conditions Precedent........70
Section 10.05. Statements Required in Certificate or Opinion.............70
Section 10.06. Rules by Trustee and Agents...............................71
Section 10.07. No Personal Liability of Directors, Officers,
Employees and Stockholders................................71
Section 10.08. Governing Law.............................................71
Section 10.09. No Adverse Interpretation of Other Agreements.............71
Section 10.10. Successors................................................71
Section 10.11. Severability..............................................71
Section 10.12. Counterpart Originals.....................................72
Section 10.13. Table of Contents, Headings, etc..........................72
ARTICLE 11. SUBORDINATION...................................................72
Section 11.01. Agreement To Subordinate..................................72
Section 11.02. Liquidation; Dissolution; Bankruptcy......................72
Section 11.03. Default On Designated Senior Indebtedness.................72
Section 11.04. acceleration of notes.....................................73
Section 11.05. When distribution must be paid over.......................73
Section 11.06. Notice By The Company.....................................74
Section 11.07. Subrogation...............................................74
Section 11.08. Relative Rights...........................................74
Section 11.09. Subordination May Not Be Impaired By The Company..........75
Section 11.10. Distribution Or Notice To Representative..................75
Section 11.11. Rights Of Trustee And Paying Agent........................75
Section 11.12. Authorization To Effect Subordination.....................76
Section 11.13. Payment...................................................76
ARTICLE 12 NOTE GUARANTEES..................................................76
Section 12.01. Guarantee.................................................76
Section 12.02. Additional Note Guarantees................................78
Section 12.03. Limitation on Guarantor Liability.........................78
Section 12.04. Execution and Delivery of Note Guarantee..................78
Section 12.05. Guarantors May Consolidate, etc., on Certain Terms........79
Section 12.06. Releases of Note Guarantees...............................79
EXHIBITS
EXHIBIT A FORM OF NOTE
EXHIBIT B FORM OF CERTIFICATE OF TRANSFER
iv
<PAGE>
EXHIBIT C FORM OF CERTIFICATE OF EXCHANGE
EXHIBIT D FORM OF NOTATION ON NOTE RELATING TO SUBSIDIARY GUARANTEE
EXHIBIT E FORM OF SUPPLEMENTAL INDENTURE TO BE DELIVERED BY GUARANTORS
EXHIBIT F FORM OF CERTIFICATE FROM ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
v
<PAGE>
INDENTURE dated as of April 11, 2000 between UbiquiTel Operating
Company, a Delaware corporation (the "Company"), as issuer, UbiquiTel Inc., a
Delaware corporation ("UbiquiTel Parent" or a "Guarantor"), as guarantor, and
American Stock Transfer & Trust Company, a New York corporation, as trustee (the
"Trustee").
The Company and the Trustee agree as follows for the benefit of each
other and for the equal and ratable benefit of the Holders of the 14% Senior
Subordinated Discount Notes due 2010 (the "Initial Notes") and the 14% Senior
Subordinated Discount Notes due 2010 to be used in exchange for such Initial
Notes in the Exchange Offer (the "Exchange Notes" and, together with the Initial
Notes, the "Notes"):
ARTICLE 1.
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. DEFINITIONS.
"144A Global Note" means a global note in substantially the form of
Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend
and deposited with or on behalf of, and registered in the name of, the
Depositary or its nominee that shall be issued in a denomination equal to the
outstanding principal amount of the Notes sold in reliance on Rule 144A.
"Accreted Value" of any outstanding Note as of or to any date of
determination means an amount equal to the sum of (1) the issue price of such
Note as determined in accordance with Section 1273 of the Code, plus (2) the
aggregate of the portions of the original issue discount, i.e., the excess of
the amounts considered as part of the "stated redemption price at maturity" of
such Note within the meaning of Section 1273(a)(2) of the Code or any successor
provisions, whether denominated as principal or interest, over the issue price
of such Note, that shall theretofore have accrued pursuant to Section 1272 of
the Code, without regard to Section 1272(a)(7) of the Code, from the date of
issue of such Note (a) for each six-month or shorter period ending or prior to
the date of determination and (b) for the shorter period, if any, from the end
of the immediately preceding six-month or shorter period, as the case may be, to
the date of determination, plus (3) accrued and unpaid interest to the date such
Accreted Value is paid (without duplication of any amount set forth in (2)
above), minus all amounts theretofore paid in respect of such Note, which
amounts are considered as part of the "stated redemption price at maturity" of
such Note within the meaning of Section 1273(a)(2) of the Code or any successor
provisions whether such amounts paid were denominated principal or interest.
"Acquired Debt" means, with respect to any specified Person, (1)
Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a subsidiary of such specified Person, whether or
not such Indebtedness is incurred in connection with, or in contemplation of,
such other Person merging with or into, or becoming a subsidiary of, such
specified Person; and (2) Indebtedness secured by a Lien encumbering any asset
acquired by such specified Person.
"Affiliate" of any specified Person means any other Person directly
or indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control,"
as used with respect to any Person, shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise. For purposes of this definition, the terms
"controlling," "controlled by" and "under common control with" shall have
correlative meanings.
<PAGE>
"Agent" means any Registrar, Paying Agent or co-registrar.
"Annualized Operating Cash Flow" means Operating Cash Flow, for the
latest two full fiscal quarters for which consolidated financial statements of
the Company are available multiplied by two.
"Applicable Procedures" means, with respect to any transfer or
exchange of or for beneficial interests in any Global Note, the rules and
procedures of the Depositary that apply to such transfer or exchange.
"Asset Sale" means (a) the sale, lease, conveyance or other
disposition of any assets or rights including, without limitation, by way of a
sale and leaseback, provided that the sale, lease, conveyance or other
disposition of all or substantially all of the assets of the Company and its
Restricted Subsidiaries taken as a whole shall be governed by Section 4.14
and/or Section 5.01 hereof and not by Section 4.10 hereof, and (b) the issue or
sale by the Company or any of its Subsidiaries of Equity Interests of any of the
Subsidiaries. Notwithstanding the foregoing, none of the following shall be
deemed an Asset Sale: (A) the sale or lease of equipment, inventory, accounts
receivable or other assets in the ordinary course of business, (B) dispositions
of cash or Cash Equivalents, (C) a transaction or series of related transactions
involving assets that have a fair market value of less than $1.0 million, (D) a
transfer of assets by the Company to a Wholly-Owned Restricted Subsidiary or by
a Wholly-Owned Restricted Subsidiary to the Company or to another Wholly-Owned
Restricted Subsidiary, (E) an issuance of Equity Interests by a Wholly-Owned
Restricted Subsidiary to the Company or to another Wholly-Owned Restricted
Subsidiary and (F) a Restricted Payment that is permitted under Section 4.07.
"Attributable Debt" in respect of a sale and leaseback transaction
means, at the time of determination, the present value of the obligation of the
lessee for net rental payments during the remaining term of the lease included
in such sale and leaseback transaction including any period for which such lease
has been extended or may, at the option of the lessor, be extended. Such present
value shall be calculated using a discount rate equal to the rate of interest
implicit in such transaction, determined in accordance with GAAP.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or
state law for the relief of debtors.
"Beneficial Owner" has the meaning assigned to such term in Rule
13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the
beneficial ownership of any particular "person," as such term is used in Section
13(d)(3) of the Exchange Act, such "person" shall be deemed to have beneficial
ownership of all securities that such "person" has the right to acquire, whether
such right is currently exercisable or is exercisable only upon the occurrence
of a subsequent condition.
"Board of Directors" means (1) in respect of a limited liability
company, the board of advisors of the Company; (2) in respect of a corporation,
the board of directors of the corporation, or any authorized committee thereof;
and (3) in respect of any other Person, the board or committee of that Person
serving a similar function.
"Board Resolution" means, with respect to any Person, a duly adopted
resolution of the Board of Directors of such Person.
"Broker-Dealer" has the meaning set forth in the Registration Rights
Agreement.
2
<PAGE>
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a capital lease
that would at that time be required to be capitalized on a balance sheet in
accordance with GAAP.
"Capital Stock" means (1) in the case of a corporation, corporate
stock; (2) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents, however designated, of
corporate stock; (3) in the case of a partnership or limited liability company,
partnership or membership interests, whether general or limited; and (4) any
other interest or participation that confers on a Person the right to receive a
share of the profits and losses of, or distributions of assets of, the issuing
Person.
"Cash Equivalents" means (1) United States dollars; (2) securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality thereof, provided that the full
faith and credit of the United States is pledged in support thereof, having
maturities of less than one year from the date of acquisition; (3) certificates
of deposit and eurodollar time deposits with maturities of less than one year
from the date of acquisition, bankers' acceptances with maturities not exceeding
six months and overnight bank deposits, in each case, with any domestic
commercial bank having capital and surplus in excess of $500 million and a
Thompson Bank Watch Rating of "B" or better; (4) repurchase obligations with a
term of not more than seven days for underlying securities of the types
described in clauses (2) and (3) above entered into with any financial
institution meeting the qualifications specified in clause (3) above; (5)
commercial paper having the highest rating obtainable from Moody's Investors
Service, Inc. or Standard & Poor's Corporation and in each case maturing prior
to one year after the date of acquisition; and (6) money market funds at least
95% of the assets of which constitute Cash Equivalents of the kinds described in
clauses (1) through (5) of this definition.
"Cedel" means Cedel Bank, S.A.
"Change of Control" means the occurrence of any of the following:
(a) the sale, lease, transfer, conveyance or other disposition (other than by
way of merger or consolidation), in one or a series of related transactions, of
all or substantially all of the assets of the Company and its Subsidiaries taken
as a whole to any "person" or "group" (as such terms are used in Section
13(d)(3) of the Exchange Act) (whether or not otherwise in compliance with this
Indenture) other than to any Principals; (b) the adoption of a plan relating to
the liquidation or dissolution of the Company; (c) the consummation of any
transaction (including, without limitation, any merger or consolidation) the
result of which is that any "person" or "group" (as such terms are used in
Section 13(d)(3) of the Exchange Act), other than any Principals or any
underwriters in connection with an underwritten public offering, becomes the
"beneficial owner" (as such term is defined in Rule 13d-3 and Rule 13d-5 under
the Exchange Act), except that a person or group shall be deemed to have
"beneficial ownership" of all securities that the person or group has the right
to acquire, whether the right is currently exercisable or is exercisable only
upon the occurrence of a subsequent condition, directly or indirectly, of more
than 50% of the Voting Equity Interests of the Company (measured by voting power
rather than the number of shares); or (d) the first day on which more than a
majority of the members of the Board of Directors of the Company are not
Continuing Directors, disregarding for such calculation any members of the Board
of Directors that have been elected by the holders of any Preferred Stock of the
Company issued after the Closing Date pursuant to the terms thereof set forth in
the Company's Certificate of Incorporation or any Certificate of Designations
related to such Preferred Stock.
"Closing Date" means April 11, 2000.
3
<PAGE>
"Code" means the United States Internal Revenue Code of 1986, as
amended, together with the rules and regulations promulgated thereunder.
"Company" means UbiquiTel Operating Company, a Delaware corporation,
and any and all successors thereto.
"Consolidated Debt" means the aggregate amount of Indebtedness of
the Company and its Restricted Subsidiaries on a consolidated basis outstanding
at the date of determination.
"Consolidated Debt to Annualized Operating Cash Flow Ratio" means,
as at any date of determination, the ratio of (i) Consolidated Debt to (ii) the
Annualized Operating Cash Flow of the Company as of its most recently completed
fiscal quarter for which financial statements are available.
"Consolidated Interest Expense" of any Person means, for any period,
(1) the aggregate interest expense and fees and other financing costs in respect
of Indebtedness (including amortization of original issue discount and non-cash
interest payments and accruals), (2) the interest component in respect of
Capital Lease Obligations and any deferred payment obligations of such Person
and its Restricted Subsidiaries determined on a consolidated basis in accordance
with GAAP, (3) all commissions, discounts, other fees and charges owed with
respect to letters of credit and bankers' acceptance financing and net costs
(including amortization of discounts) associated with interest rate swap and
similar agreements and with foreign currency hedge, exchange and similar
agreements and (4) the product of (a) all dividend payments, whether or not in
cash, on any series of Preferred Stock of such Person or any of its Restricted
Subsidiaries, other than dividend payments on Capital Stock payable solely in
Capital Stock of such Person (other than Disqualified Stock) or to such Person
or its Restricted Subsidiaries, times (b) a fraction, the numerator of which is
one and the denominator of which is one minus the then current combined federal,
state and local statutory tax rate of such Person, expressed as a decimal, in
each case, on a consolidated basis in accordance with GAAP.
"Consolidated Net Income" means, with respect to any specified
Person for any period, the aggregate of the Net Income of such Person and its
Restricted Subsidiaries for such period, on a consolidated basis, determined in
accordance with GAAP; provided that (1) the Net Income, but not loss, of any
Person that is not a Restricted Subsidiary or that is accounted for by the
equity method of accounting shall be included only to the extent of the amount
of dividends or distributions paid in cash to the specified Person or a
Wholly-Owned Restricted Subsidiary thereof; (2) the Net Income of any Restricted
Subsidiary shall be excluded to the extent that the declaration or payment of
dividends or similar distributions by that Restricted Subsidiary of that Net
Income is not at the date of determination permitted without any prior
governmental approval that has not been obtained or, directly or indirectly, by
operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Restricted Subsidiary or its stockholders; (3) the Net Income of any Person
acquired in a pooling of interests transaction for any period prior to the date
of such acquisition shall be excluded; and (4) the cumulative effect of change
in accounting principles shall be excluded.
"Consolidated Net Worth" means, with respect to any Person as of any
date, the sum of (1) the consolidated equity of the common stockholders of such
Person and its consolidated subsidiaries as of such date; plus (2) the
respective amounts reported on such Person's balance sheet as of such date with
respect to any series of Preferred Stock, other than Disqualified Stock, that by
its terms is not entitled to the payment of dividends unless such dividends may
be declared and paid only out of net earnings in respect of the year of such
declaration and payment, but only to the extent of any cash received by such
Person upon issuance of such Preferred Stock.
4
<PAGE>
"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors who (a) was a member of the Board of Directors
on the date of this Indenture or (b) was nominated for election to the Board of
Directors with the approval of a majority of the Continuing Directors who were
members of the Board of Directors at the time of such nomination or election.
"Corporate Trust Office of the Trustee" shall be at the address of
the Trustee specified in Section 10.02 hereof or such other address as to which
the Trustee may give notice to the Company.
"Credit Facilities" means the Credit Agreement, dated as of March
31, 2000, among UbiquiTel Inc., UbiquiTel Operating Company, various banks and
Paribas as agent, together with the related documents (including without
limitation, any guarantee agreements and security documents), as such agreements
may be amended, restated, modified, renewed, refunded, replaced or refinanced in
whole or in part from time to time, including any agreement extending the
maturity of, refinancing, replacing or otherwise restructuring (including
increasing the amount of available borrowings thereunder or adding the Company's
Subsidiaries as additional borrowers or guarantors thereunder) all or any
portion of the Indebtedness under such agreement or any successor or replacement
agreement and whether by the same or any other agent, lender or group of
lenders.
"Custodian" means the Trustee, as custodian with respect to the
Notes in global form, or any successor entity thereto.
"Default" means any event that is, or with the passage of time or
the giving of notice or both would be, an Event of Default.
"Definitive Note" means a certificated Note registered in the name
of the Holder thereof and issued in accordance with Section 2.06 hereof, in
substantially the form of Exhibit A hereto except that such Note shall not bear
the Global Note Legend and shall not have the "Schedule of Exchanges of
Interests in the Global Note" attached thereto.
"Depositary" means, with respect to the Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.03 hereof as
the Depositary with respect to the Notes, and any and all successors thereto
appointed as depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.
"Designated Senior Indebtedness" means (a) Indebtedness under the
Credit Facilities, whether outstanding on the date of issuance of a Blockage
Notice or thereafter incurred, and (b) after payment of all obligations under
the Credit Facilities, any other Senior Indebtedness permitted to be incurred
under this Indenture which, at the time of determination, has an aggregate
principal amount of at least $25.0 million and that has been designated by the
Company in writing to the Trustee as "Designated Senior Indebtedness."
"Disqualified Stock" means any Capital Stock that, by its terms, or
by the terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder thereof, or upon the
happening of any event, matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, or redeemable at the option of the holder
thereof, in whole or in part, on or prior to the date that is 91 days after the
date on which the Notes mature. Notwithstanding the preceding sentence, any
Capital Stock that would constitute Disqualified Stock solely because the
holders thereof have the right to require the Company to repurchase such Capital
Stock upon the occurrence of a change of control or an asset sale shall not
constitute Disqualified Stock if the terms of such Capital Stock
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provide that the Company may not repurchase or redeem any such Capital Stock
pursuant to such provisions unless such repurchase or redemption complies with
Section 4.07.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock, but excludes any debt security that is
convertible into, or exchangeable for, Capital Stock.
"Euroclear" means Morgan Guaranty Trust Company of New York,
Brussels office, as operator of the Euroclear systems.
"Event of Termination" means any of the events described in (1)
Section 11.3 of the Management Agreement; (2) Section 13.2 of the Trademark
Agreement or (3) Section 13.2 of the Spectrum Trademark Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Notes" means the Notes to be issued in the Exchange Offer
pursuant to Section 2.06(e) hereof.
"Exchange Offer" has the meaning set forth in the Registration
Rights Agreement.
"Exchange Offer Registration Statement" has the meaning set forth in
the Registration Rights Agreement.
"Existing Indebtedness" means the aggregate principal amount of
Indebtedness of the Company and its Restricted Subsidiaries in existence on the
date of this Indenture, until that Indebtedness is repaid.
"GAAP" means generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as have been approved by a significant segment
of the accounting profession, which are in effect from time to time.
"Global Note Legend" means the legend set forth in Section
2.06(g)(ii), which is required to be placed on all Global Notes issued under
this Indenture.
"Global Notes" means, individually and collectively, each of the
Restricted Global Notes and the Unrestricted Global Notes in the form of Exhibit
A hereto issued in accordance with Section 2.01, 2.06(b)(iv), 2.06(d)(ii) or
2.06(f) hereof.
"Government Securities" means (1) any security which is (a) a direct
obligation of the United States of America for the payment of which the full
faith and credit of the United States of America is pledged or (b) an obligation
of a Person controlled or supervised by and acting as an agency or
instrumentality of the United States of America the payment of which is
unconditionally guaranteed as a full faith and credit obligation of the United
States of America, which, in either case, is not callable or redeemable at the
option of the issuer thereof, and (2) any depository receipt issued by a bank,
as defined in the Securities Act, as custodian with respect to any Government
Securities and held by such bank for the account of the holder of such
depository receipt, or with respect to any specific payment of principal of or
interest on any Government Securities which is so specified and held, provided
that, except as required by law, such custodian is not authorized to make any
deduction from the amount payable to the
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holder of such depository receipt from any amount received by the custodian in
respect of the Government Securities or the specific payment of principal or
interest evidenced by such depository receipt.
"Guarantee" means a guarantee (other than by endorsement of
negotiable instruments for collection in the ordinary course of business),
direct or indirect, in any manner (including by way of a pledge of assets or
through letters of credit or reimbursement agreements in respect thereof), of
all or any part of any Indebtedness.
"Guarantors" means UbiquiTel Parent initially and each Restricted
Subsidiary formed or organized under the laws of any state of the United States
or District of Columbia that executes a Note Guarantee pursuant to Article 12 of
this Indenture.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (1) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements; and (2) other
agreements or arrangements designed to protect such Person against fluctuations
in interest rates.
"Holder" means a Person in whose name a Note is registered.
"IAI Global Note" means a global note in substantially the form of
Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend
and deposited with or on behalf of, and registered in the name of, the
Depositary or its nominee that shall be initially issued in a denomination equal
to $0, but shall thereafter be revised to represent the outstanding principal
amount of the Notes transferred to Institutional Accredited Investors.
"incur" means create, incur, issue, assume, guarantee or otherwise
become liable, directly or indirectly, contingently or otherwise, for any
Indebtedness. The term "incurrence" when used as a noun shall have a correlative
meaning. The accretion of principal of a non-interest bearing or other discount
security shall not be deemed the incurrence of Indebtedness.
"Indebtedness" means, with respect to any specified Person, any
indebtedness of such Person, whether or not contingent, in respect of (1)
borrowed money; (2) evidenced by bonds, notes, debentures or similar instruments
or letters of credit, or reimbursement agreements in respect thereof; (3)
banker's acceptances; (4) representing Capital Lease Obligations; (5) the
balance deferred and unpaid of the purchase price of any property, except any
such balance that constitutes an accrued expense or trade payable; or (6)
representing any Hedging Obligations; if and to the extent any of the preceding,
other than letters of credit and Hedging Obligations, would appear as a
liability upon a balance sheet of the specified Person prepared in accordance
with GAAP. In addition, the term "Indebtedness" includes all Indebtedness of
others secured by a Lien on any asset of the specified Person, whether or not
such Indebtedness is assumed by the specified Person, and, to the extent not
otherwise included, the guarantee by such Person of any indebtedness of any
other Person. The amount of any Indebtedness outstanding as of any date shall
be(1) the Accreted Value thereof, in the case of any Indebtedness issued with
original issue discount; and (2) the principal amount thereof, in the case of
any other Indebtedness.
"Indenture" means this Indenture, as amended or supplemented from
time to time in accordance with Article 9 hereof.
"Indirect Participant" means a Person who holds a beneficial
interest in a Global Note through a Participant.
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"Initial Notes" means $300 million in aggregate principal amount of
Notes issued under this Indenture on the date hereof.
"Initial Purchasers" means Donaldson, Lufkin & Jenrette Securities
Corporation, Paribas Corporation and PNC Capital Markets, Inc.
"Institutional Accredited Investor" means an "accredited investor"
within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act.
"Investments" means, with respect to any Person, all investments by
such Person in other Persons, including Affiliates, in the forms of direct or
indirect loans, including guarantees of Indebtedness or other obligations,
advances or capital contributions, excluding commission, travel and similar
advances to officers and employees made in the ordinary course of business,
purchases or other acquisitions for consideration of Indebtedness, Equity
Interests or other securities, together with all items that are or would be
classified as investments on a balance sheet prepared in accordance with GAAP.
If the Company or any Restricted Subsidiary sells or otherwise disposes of any
Equity Interests of any direct or indirect Restricted Subsidiary of the Company
such that, after giving effect to any such sale or disposition, such Person is
no longer a Restricted Subsidiary of the Company, the Company shall be deemed to
have made an Investment on the date of any such sale or disposition equal to the
fair market value of the Equity Interests of such Restricted Subsidiary not sold
or disposed of in an amount determined as provided in the penultimate paragraph
of Section 4.07. The acquisition by the Company or any Restricted Subsidiary of
a Person that holds an Investment in a third Person shall be deemed to be an
Investment by the Company or such Restricted Subsidiary in such third Person in
an amount equal to the fair market value of the Investment held by the acquired
Person in such third Person in an amount determined as provided in the final
paragraph of Section 4.07.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue on
such payment for the intervening period.
"Letter of Transmittal" means the letter of transmittal to be
prepared by the Company and sent to all Holders of the Notes for use by such
Holders in connection with the Exchange Offer.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law,
including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (other than precautionary filings made with respect
to operating leases and sales of receivables), or equivalent statutes, of any
jurisdiction, other than any lease properly classified as an operating lease
under GAAP or intellectual property licensing agreements.
"Liquidated Damages" means all liquidated damages then owing
pursuant to Section 5 of the Registration Rights Agreement.
"Net Income" means, with respect to any Person, the net income
(loss) of such Person and its Restricted Subsidiaries, determined in accordance
with GAAP and before any reduction in respect of Preferred Stock dividends,
excluding, however (1) any gain, but not loss, together with any related
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provision for taxes on such gain, but not loss, realized in connection with (a)
any asset sale; or (b) the disposition of any securities by such Person or any
of its Restricted Subsidiaries or the extinguishment of any Indebtedness of such
Person or any of its Restricted Subsidiaries; and (2) any extraordinary gain,
but not loss, together with any related provision for taxes on such
extraordinary gain, but not loss.
"Net Proceeds" means the aggregate cash proceeds received by the
Company or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale), net of
(i) the direct costs relating to such Asset Sale (including legal, accounting
and investment banking fees, and sales commissions and all title and recording
taxes) and any relocation expenses incurred as a result thereof, taxes paid or
payable as a result thereof, in each case after taking into account any
available tax credits or deductions and any tax sharing arrangements, and (ii)
amounts required to be applied to the repayment of Indebtedness other than
Senior Indebtedness, Indebtedness secured by a Lien on the asset or assets that
were the subject of such Asset Sale, provided, however, if the instrument or
agreement governing such Asset Sale requires the transferor to maintain a
portion of the purchase price in escrow (whether as a reserve for adjustment of
the purchase price or otherwise) or to indemnify the transferee for specified
liabilities in a maximum specified amount, the portion of the cash or Cash
Equivalents that is actually placed in escrow or segregated and set aside by the
transferor for such indemnification obligation shall not be deemed to be Net
Proceeds until the escrow terminates or the transferor ceases to segregate and
set aside such funds, in whole or in part, and then only to the extent of the
proceeds released from escrow to the transferor or that are no longer segregated
and set aside by the transferor.
"Non-Recourse Debt" means Indebtedness (1) as to which neither the
Company nor any of its Restricted Subsidiaries (a) provides credit support of
any kind, including any undertaking, agreement or instrument that would
constitute Indebtedness, (b) is directly or indirectly liable as a guarantor or
otherwise, or (c) constitutes the lender; (2) no default with respect to which,
including any rights that the holders thereof may have to take enforcement
action against an Unrestricted Subsidiary, would permit upon notice, lapse of
time or both any holder of any other Indebtedness, other than the Notes, of the
Company or any of its Restricted Subsidiaries to declare a default on such other
Indebtedness or cause the payment thereof to be accelerated or payable prior to
its stated maturity; and (3) as to which the lenders have been notified in
writing that they will not have any recourse to the stock or assets of the
Company or any of its Restricted Subsidiaries.
"Non-U.S. Person" means a Person who is not a U.S. Person.
"Note Guarantee" means the Guarantee by each Guarantor of the
Company's payment obligations under this Indenture and on the Notes, executed
pursuant to the provisions of Article 12 of this Indenture.
"Notes" has the meaning assigned to it in the preamble to this
Indenture.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Offering" means the offering of the Notes by the Company pursuant
to the Offering Memorandum.
"Offering Memorandum" means the offering memorandum of the Company,
dated April 4, 2000, relating to the Initial Notes.
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"Officer" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating Officer,
the Chief Financial Officer (including any Interim Chief Financial Officer
acting in such capacity upon the authorization of the Board of Directors), the
Treasurer, any Assistant Treasurer, the Controller, the Secretary, any Assistant
Secretary or any Vice-President of such Person.
"Officers' Certificate" means a certificate signed on behalf of the
Company by at least one Officer of the Company, who must be the principal
executive officer, the principal financial officer, the treasurer or the
principal accounting officer of the Company, that meets the requirements of
Sections 10.04 and 10.05 hereof.
"Operating Cash Flow" means, with respect to any Person for any
fiscal quarter, (a) Consolidated Net Income, plus (i) depreciation, (ii)
amortization, (iii) other non-cash charges, other than any such non-cash items
to the extent that it represents an accrual of or reserve for cash expenditures
in any future period or constituting an extraordinary or non-recurring item,
(iv) Consolidated Interest Expense, and (v) all income taxes of such Person paid
or accrued in accordance with GAAP for such Person, other than income taxes
attributable to extraordinary or non-recurring gains or losses, minus (b) all
non-cash items increasing Consolidated Net Income for such period, other than
any such non-cash item to the extent that it will result in the receipt of cash
payments in any future period, all as determined on a consolidated basis in
accordance with generally accepted accounting principles. For purposes of
calculating Operating Cash Flow for the fiscal quarter most recently completed
for which financial statements are available prior to any date on which an
action is taken that requires a calculation of the Consolidated Debt to
Annualized Operating Cash Flow Ratio, (1) any Person that is a Restricted
Subsidiary on such date (or would become a Restricted Subsidiary in connection
with the transaction that requires the determination of such ratio) will be
deemed to have been a Restricted Subsidiary at all times during such fiscal
quarter, (2) any Person that is not a Restricted Subsidiary on such date (or
would cease to be a Restricted Subsidiary in connection with the transaction
that requires the determination of such ratio) will be deemed not to have been a
Restricted Subsidiary at any time during such fiscal quarter and (3) if such
Person or any Restricted Subsidiary of such Person shall have in any manner
acquired (including through commencement of activities constituting such
operating business) or disposed of (including through termination or
discontinuance of activities constituting such operating business) any operating
business during or subsequent to the most recently completed fiscal quarter,
such calculation will be made on a pro forma basis on the assumption that such
acquisition or disposition had been completed on the first day of such completed
fiscal quarter.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Sections
10.04 and 10.05 hereof. The counsel may be an employee of or counsel to the
Company, any Subsidiary of the Company or the Trustee.
"Participant" means, with respect to the Depositary, Euroclear or
Cedel, a Person who has an account with the Depositary, Euroclear or Cedel,
respectively, and, with respect to the Depository Trust Company, shall include
Euroclear and Cedel.
"Permitted Business" means the business primarily involved in the
ownership, design, construction, development, acquisition, installation,
integration, management and/or provision of Telecommunications Assets or any
business or activity reasonably related or ancillary thereto.
"Permitted Investments" means (1) any Investment in the Company or
in a Wholly-Owned Restricted Subsidiary of the Company that is a Guarantor; (2)
any Investment in Cash Equivalents; (3) any Investment by the Company or any
Restricted Subsidiary of the Company in a
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Person, if as a result of such Investment (a) such Person becomes a Wholly-Owned
Restricted Subsidiary of the Company; or (b) such Person is merged, consolidated
or amalgamated with or into, or transfers or conveys substantially all of its
assets to, or is liquidated into, the Company or a Wholly-Owned Restricted
Subsidiary of the Company; (4) any Investment made as a result of the receipt of
non-cash consideration from an Asset Sale that was made pursuant to and in
compliance with Section 4.10; (5) any acquisition of assets solely in exchange
for the issuance of Equity Interests of the Company, other than Disqualified
Stock; (6) other Investments in any Person having an aggregate fair market
value, measured on the date each such Investment was made and without giving
effect to subsequent changes in value, when taken together with all other
Investments made pursuant to this clause (6) since the date of the Indenture,
not to exceed $5.0 million; (7) Guarantees of Indebtedness of a Wholly-Owned
Restricted Subsidiary given by the Company or another Wholly-Owned Restricted
Subsidiary and Guarantees of Indebtedness of the Company given by any Restricted
Subsidiary, in each case, not otherwise in violation of the terms of this
Indenture; (8) accounts receivable created or acquired in the ordinary course of
the Company's business or any Subsidiary and Investments arising from
transactions by the Company or any Subsidiary with trade creditors or customers
in the ordinary course of business, including any such Investment received
pursuant to any plan or reorganization or similar arrangement pursuant to
bankruptcy or insolvency of such trade creditors or customers or otherwise in
settlement of a claim; (9) investments in prepaid expenses, negotiable
instruments held for collection, and lease, utility and workers' compensation,
performance and other similar deposits; and (10) exchange of Preferred Stock of
the Company into Capital Stock of the Company or non-voting Capital Stock of the
Company into voting Capital Stock of the Company, all in accordance with the
terms of the Company's Certificate of Incorporation as in effect on the date of
this Indenture.
"Permitted Liens" means (1) Liens on the assets of the Company and
any Guarantor securing Indebtedness and other Obligations under the Credit
Facilities that were permitted by the terms of this Indenture to be incurred;
(2) Liens in favor of the Company or the Guarantors; (3) Liens on property of a
Person existing at the time such Person is merged with or into or consolidated
with the Company or any Restricted Subsidiary; provided that such Liens were in
existence prior to the contemplation of such merger or consolidation and do not
extend to any assets other than those of the Person merged into or consolidated
with the Company or the Restricted Subsidiary; (4) Liens on property existing at
the time of acquisition thereof by the Company or any Restricted Subsidiary of
the Company, provided that such Liens were in existence prior to the
contemplation of such acquisition; (5) Liens and deposits made to secure the
performance of statutory obligations, surety or appeal bonds, performance bonds
or other obligations of a like nature incurred in the ordinary course of
business; (6) Liens to secure Indebtedness, including Capital Lease Obligations,
permitted by Section 4.09(b)(iv) covering only the assets acquired with such
Indebtedness; (7) Liens existing on the date of this Indenture; (8) Liens for
taxes, assessments or governmental charges or claims that are not yet delinquent
or that are being contested in good faith by appropriate proceedings promptly
instituted and diligently concluded, provided that any reserve or other
appropriate provision as shall be required in conformity with GAAP shall have
been made therefor; (9) Liens for security for payment of workers' compensation
or other insurance or arising under workers' compensation laws or similar
legislation; (10) Liens relating to zoning restrictions, easements, licenses,
reservations, title defects, rights of others for rights of way, utilities,
sewers, electric lines, telephone or telegraph lines, and other similar
purposes, provisions, covenants, conditions, waivers, restrictions on the use of
property or irregularities of title and, with respect to leasehold interests,
mortgages, obligations, liens and other encumbrances incurred, created, assumed
or permitted to exist and arising by, through or under a landlord or owner of
the leased property, with or without consent of the lessee, none of which
materially impairs the use of any parcel of property material to the operation
of the Company's business or any Subsidiary or the value of such property for
the purpose of such business; (11) Liens arising by operation of law in favor of
landlords, carriers, warehousemen, bankers, mechanics, materialmen, laborers,
employees or suppliers, incurred in the ordinary course of business for sums
which are not yet
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delinquent or are being contested in good faith by negotiations or by
appropriate proceedings which suspend the collection thereof; (12) Liens arising
from leases, subleases, licenses or other similar rights granted to third
Persons not interfering with the ordinary course of the Company's business or
its Subsidiaries; (13) any Lien securing reimbursement obligations with respect
to letters of credit that encumber documents and other property relating to such
letters of credit; and (14) Liens incurred in the ordinary course of business of
the Company or any Restricted Subsidiary with respect to obligations that do not
exceed $5.0 million at any one time outstanding.
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Company or any of its Restricted Subsidiaries issued in exchange for, or the net
proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness of the Company or any of its Restricted Subsidiaries,
other than intercompany Indebtedness; provided that (1) the principal amount, or
Accreted Value, if applicable, of such Permitted Refinancing Indebtedness does
not exceed the principal amount of, or Accreted Value, if applicable, plus the
amount of any premium required to be paid in connection with such refinancing
pursuant to the terms of the Indebtedness refinanced or the amount of any
premium reasonably determined by the Company as necessary to accomplish such
refinancing, plus accrued interest on, the Indebtedness so extended, refinanced,
renewed, replaced, defeased or refunded, plus the amount of reasonable expenses
incurred in connection therewith; (2) such Permitted Refinancing Indebtedness
has a final maturity date later than the final maturity date of, and has a
Weighted Average Life to Maturity equal to or greater than the Weighted Average
Life to Maturity of, the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded; (3) if the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded is subordinated in right of
payment to the Notes, such Permitted Refinancing Indebtedness has a final
maturity date later than the final maturity date of, and is subordinated in
right of payment to, the Notes on terms at least as favorable to the Holders of
Notes as those contained in the documentation governing the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded; and (4) such
Indebtedness is incurred either by the Company or by its Restricted Subsidiary
who is the obligor on the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Preferred Stock," of any Person means any Capital Stock of such
Person that has preferential rights to any other Capital Stock of such Person
with respect to dividends or redemptions or upon liquidation.
"Principals" means Donaldson, Lufkin & Jenrette Securities
Corporation, BET Associates, L.P., The Walter Group, Inc., Donald A. Harris,
James Parsons, Paul F. Judge, US Bancorp, Brookwood UbiquiTel Investors, LLC,
CBT Wireless Investments, L.L.C., Spectrasite Communications and New Ventures,
L.L.C.
"Private Placement Legend" means the legend set forth in Section
2.06(g)(i) to be placed on all Notes issued under this Indenture except where
otherwise permitted by the provisions of this Indenture.
"QIB" means a "qualified institutional buyer" as defined in Rule
144A.
"Refinance" means, in respect of any Indebtedness, to refinance,
extend, renew, refund, repay, prepay, redeem, defease or retire, or to issue
other Indebtedness in exchange or replacement for, such Indebtedness.
"refinanced" or "refinancing" shall have correlative meanings.
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"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of April 11, 2000, by and among the Company and the Initial
Purchasers, as such agreement may be amended, modified or supplemented from time
to time.
"Regulation S" means Regulation S promulgated under the Securities
Act.
"Regulation S Global Note" means a Global Note in substantially the
form of Exhibit A hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of and registered in the name
of the Depositary or its nominee that shall be initially issued in a
denomination equal to $0, but shall thereafter be revised to represent the
outstanding principal amount of the Notes transferred or sold in reliance on
Rule 903 of Regulation S.
"Responsible Officer," when used with respect to the Trustee, means
any officer within the Corporate Trust Department of the Trustee (or any
successor group of the Trustee) or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his or her
knowledge of and familiarity with the particular subject.
"Restricted Definitive Note" means a Definitive Note bearing the
Private Placement Legend.
"Restricted Global Note" means a Global Note bearing the Private
Placement Legend.
"Restricted Investment" means any Investment that is not a Permitted
Investment.
"Restricted Period" means the 40-day restricted period as defined in
Regulation S.
"Restricted Subsidiary" of a Person means any Subsidiary of the
referent Person that is not an Unrestricted Subsidiary.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated the Securities Act.
"Sale and Leaseback Transaction" of any Person means an arrangement
with any lender or investor or to which such lender or investor is a party
providing for the leasing by such Person of any property or asset of such Person
which has been or is being sold or transferred by such Person more than 365 days
after the acquisition thereof or the completion of construction or commencement
of operation thereof to such lender or investor or to any Person to whom funds
have been or are to be advanced by such lender or investor on the security of
such property or asset. The stated maturity of such arrangement is the date of
the last payment of rent or any other amount due under such arrangement prior to
the first date on which such arrangement may be terminated by the lessee without
payment of a penalty.
"SEC" means the Securities and Exchange Commission.
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"Securities Act" means the Securities Act of 1933, as amended.
"Senior Indebtedness" means (1) all Indebtedness outstanding under
Credit Facilities and all Hedging Obligations with respect thereto, whether
incurred on the date of this Indenture or thereafter; (2) any other Indebtedness
incurred by the Company and the Guarantors, unless the instrument under which
such Indebtedness is incurred expressly provides that it is on a parity with or
subordinated in right of payment to the Notes or the Note Guarantees, as the
case may be; and (3) all obligations with respect to items listed in the
preceding clauses (1) and (2) (including any interest accruing subsequent to the
filing of a petition in bankruptcy at the rate provided for in the documentation
with respect thereto, whether or not such interest is an allowed claim under
applicable law). Notwithstanding anything to the contrary in the preceding,
Senior Indebtedness will not include (whether or not constituting Indebtedness)
(1) any liability for federal, state, local or other taxes owed or owing by the
Company; (2) any Indebtedness of the Company to any of its Subsidiaries or other
Affiliates (other than Indebtedness owing under the Credit Facilities); (3) any
trade payables; (4) Indebtedness represented by Disqualified Stock; (5)
Indebtedness which is, by its express terms, subordinated in right of payment to
any other Indebtedness of the Company; or (6) the portion of any Indebtedness
that is incurred in violation of this Indenture to the extent so incurred,
provided, however, that any portion of Indebtedness incurred by the Company
under the Credit Facilities in violation of Section 4.09(b) solely as the result
of a Default or Event of Default having occurred and continuing or caused by
such incurrence shall only be excluded from the definition of Senior
Indebtedness in the event that the Trustee or Holders of at least 25% of the
aggregate principal amount of the Notes then outstanding shall have delivered a
notice to the administrative agent for the leaders under the Credit Facilities
of such Default or Event of Default prior to such incurrence.
"Senior Subordinated Indebtedness" means the Notes and any other
Indebtedness of the Company that specifically provides that such Indebtedness is
to rank pari passu with the Notes in right of payment and is not subordinated by
its terms in right of payment to any Indebtedness or other obligation of the
Company which is not Senior Indebtedness.
"Separability Legend" has the meaning specified in Section 2.06(g).
"Separation Date" means the earliest of (i) October 8, 2000, (ii)
the commencement of the Exchange Offer, (iii) the effective date of a Shelf
Registration Statement, (iv) the commencement of a Change of Control Offer or
upon the delivery by the Company to the Trustee of a notice of redemption in
accordance with Section 3.01, (v) upon the occurrence of an Event of Default,
and (vi) such date as Donaldson, Lufkin & Jenrette Securities Corporation in its
sole discretion shall determine.
"Shelf Registration Statement" means the Shelf Registration
Statement as defined in the Registration Rights Agreement.
"Significant Subsidiary" means any Restricted Subsidiary that would
be a "significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation
S-X, promulgated pursuant to the Securities Act, as such Regulation is in effect
on the date of this Indenture.
"Sprint Agreements" means the (1) Sprint PCS Management Agreement
between Sprint Spectrum L.P., WirelessCo, L.P. and UbiquiTel Holdings, Inc.,
dated as of October 15, 1998 as amended on October 15, 1998 and in December
1999, and any exhibits, schedules or addendum thereto, as such may be further
amended, modified or supplemented from time to time (the "Management
Agreement"); (2) Sprint PCS Services Agreement between Sprint Spectrum L.P. and
UbiquiTel Holdings, Inc., dated as of October 15, 1998, and any exhibits,
schedules or addendum thereto, as such may be amended,
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modified or supplemented from time to time; (3) Sprint Trademark and Service
Mark License Agreement between Sprint Communications Company, L.P. and UbiquiTel
Holdings, Inc., dated as of October 15, 1998, and any exhibits, schedules or
addendum thereto, as such may be amended, modified or supplemented from time to
time (the "Trademark Agreement"); and (4) Sprint Spectrum Trademark and Service
mark License Agreement between Sprint Spectrum L.P. and UbiquiTel Holdings,
Inc., dated as of October 15, 1998, and any exhibits, schedules or addendum
thereto, as such may be amended, modified or supplemented from time to time (the
"Spectrum Trademark Agreement").
"Stated Maturity" means, with respect to any installment of interest
or principal on any series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and shall not include any contingent obligations to
repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.
"Subordinated Indebtedness" means any Indebtedness of the Company
(whether outstanding on the date of this Indenture or thereafter incurred) which
is subordinate or junior in right or payment to the Notes pursuant to a written
agreement.
"Subsidiary" means, with respect to a Person, (a) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of that Person (or a combination
thereof) and (b) any partnership (i) the sole general partner or the managing
general partner of which is such Person or a Subsidiary of such Person or (ii)
the only general partners of which are such Person or of one or more
Subsidiaries of such Person (or any combination thereof).
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ss.ss.
77aaa-77bbbb) as in effect on the date on which this Indenture is qualified
under the TIA.
"Telecommunications Assets" means, with respect to any Person, any
asset that is utilized by such Person, directly or indirectly, for the design,
development, construction, installation, integration, operation, management or
provision of PCS telecommunications equipment, inventory, technology, systems
and/or services. Telecommunications Assets shall include stock, joint venture or
partnership interests of an entity where substantially all of the assets of the
entity consist of Telecommunications Assets.
"Total Invested Capital" means at any time of determination, the sum
of, without duplication, (i) the total amount of equity contributed to the
Company as of the Closing Date (being $42.0 million), plus (ii) the aggregate
net cash proceeds received by the Company from capital contributions or any
other issuance or sale of Capital Stock (other than Disqualified Stock but
including Capital Stock issued upon the conversion of convertible Indebtedness
or from the exercise of options, warrants or rights to purchase Capital Stock
(other than Disqualified Stock)), subsequent to the Closing Date, other than to
a Restricted Subsidiary, plus (iii) the aggregate net repayment of any
Investment made after the Closing Date and constituting a Restricted Payment in
an amount equal to the lesser of (a) the return of capital with respect to such
Investment and (b) the initial amount of such Investment, in either case, less
the cost of the disposition of such Investment, plus (iv) an amount equal to the
net Investment (as of the date of determination) the Company and/or any of its
Restricted Subsidiaries has made in any subsidiary that has been designated as
an Unrestricted Subsidiary after the Closing Date upon its redesignation as a
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Restricted Subsidiary in accordance with Section 4.20," plus (v) Consolidated
Debt, minus (vi) the aggregate amount of all Restricted Payments declared or
made on or after the Closing Date.
"Trustee" means the party named as such above until a successor
replaces it in accordance with the applicable provisions of this Indenture and
thereafter means the successor serving hereunder.
"UbiquiTel Parent" means UbiquiTel Inc., a Delaware corporation, and
any and all successors thereto.
"Unit Warrants" means warrants to purchase 1,789,500 shares of the
UbiquiTel Parent's common stock, par value $0.001 per share, issued pursuant to
the Warrant Agreement.
"Unrestricted Global Note" means a permanent Global Note in
substantially the form of Exhibit A attached hereto that bears the Global Note
Legend and that has the "Schedule of Exchanges of Interests in the Global Note"
attached thereto, and that is deposited with or on behalf of and registered in
the name of the Depositary, representing a series of Notes that do not bear the
Private Placement Legend.
"Unrestricted Definitive Note" means one or more Definitive Notes
that do not bear and are not required to bear the Private Placement Legend.
"Unrestricted Subsidiary" means any Subsidiary of the Company that
is designated by the Board of Directors of the Company as an Unrestricted
Subsidiary pursuant to a Board Resolution, but only to the extent that such
Subsidiary (1) has no Indebtedness other than Non-Recourse Debt; (2) is not
party to any agreement, contract, arrangement or understanding with the Company
or any Restricted Subsidiary of the Company unless the terms of any such
agreement, contract, arrangement or understanding are no less favorable to the
Company or such Restricted Subsidiary than those that might be obtained at the
time from Persons who are not Affiliates of the Company; (3) is a Person with
respect to which neither the Company nor any of its Restricted Subsidiaries has
any direct or indirect obligation (a) to subscribe for additional Equity
Interests or (b) to maintain or preserve such Person's financial condition or to
cause such Person to achieve any specified levels of operating results; (4) has
not guaranteed or otherwise directly or indirectly provided credit support for
any Indebtedness of the Company or any of its Restricted Subsidiaries; and (5)
has at least one director on its Board of Directors that is not a director or
executive officer of the Company or any of its Restricted Subsidiaries and has
at least one executive officer that is not a director or executive officer of
the Company or any of its Restricted Subsidiaries. Any designation of a
Subsidiary of the Company as an Unrestricted Subsidiary shall be evidenced to
the Trustee by filing with the Trustee a certified copy of the Board Resolution
giving effect to such designation and an Officers' Certificate certifying that
such designation complied with the preceding conditions and was permitted by
Section 4.07. If, at any time, any Unrestricted Subsidiary would fail to meet
the preceding requirements as an Unrestricted Subsidiary, it shall thereafter
cease to be an Unrestricted Subsidiary for purposes of this Indenture and any
Indebtedness of such Subsidiary shall be deemed to be incurred by a Restricted
Subsidiary of the Company as of such date and, if such Indebtedness is not
permitted to be incurred as of such date under Section 4.09, the Company shall
be in Default of such covenant. The Company's Board of Directors may at any time
designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided
that such designation shall be deemed to be an incurrence of Indebtedness by a
Restricted Subsidiary of the Company of any outstanding Indebtedness of such
Unrestricted Subsidiary and such designation shall only be permitted if (1) such
Indebtedness is permitted under Section 4.09 calculated on a pro forma basis as
if such designation had occurred at the beginning of the two-quarter reference
period; and (2) no Default or Event of Default would be in existence following
such designation.
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"U.S. Person" means a U.S. person as defined in Rule 902(o) under
the Securities Act.
"Voting Equity Interest" of any Person as of any date means the
Equity Interests of such Person that is at the time entitled to vote in the
election of the Board of Directors or other governing body of such Person.
"Warrant Agreement" means the Warrant Agreement, dated as of April
11, 2000, by and between UbiquiTel Parent and American Stock Transfer & Trust
Company, in its capacity as warrant agent, relating to the Unit Warrants.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (1) the sum
of the products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years, calculated to the nearest one-twelfth, that will elapse between
such date and the making of such payment; by (2)the then outstanding principal
amount of such Indebtedness.
"Wholly-Owned Restricted Subsidiary" of any Person means a
Restricted Subsidiary of such Person all of the outstanding Capital Stock or
other ownership interests of which, other than directors' qualifying shares,
shall at the time be owned by such Person or by one or more Wholly-Owned
Restricted Subsidiaries of such Person and one or more Wholly-Owned Restricted
Subsidiaries of such Person.
SECTION 1.02. OTHER DEFINITIONS.
Defined in
Term Section
---- -------
"Affiliate Transaction"..............................4.11
"Asset Sale Offer"...................................4.10
"Authentication Order"...............................2.02
"Benefited Party"....................................12.01
"Blockage Notice"....................................11.03
"Change of Control Offer"............................4.14
"Change of Control Payment"..........................4.14
"Change of Control Payment Date" ....................4.14
"Covenant Defeasance"................................8.03
"DTC"................................................2.03
"Event of Default"...................................6.01
"Excess Proceeds"....................................4.10
"Legal Defeasance" ..................................8.02
"Offer Amount".......................................3.09
"Offer Period".......................................3.09
"Paying Agent".......................................2.03
"Payment Blockage Period"............................11.03
"Payment Default"....................................6.01
"pay the Notes"......................................11.03
"Permitted Indebtedness".............................4.09
"Purchase Date"......................................3.09
"Registrar"..........................................2.03
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"Regulation S Global Note Legend"....................2.06
"Representative".....................................11.03
"Repurchase Offer"...................................3.09
"Restricted Payments"................................4.07
"Surviving Entity"...................................5.01
SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT
(a) Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
(b) The following TIA terms used in this Indenture have the
following meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the
Trustee; and
"obligor" on the Notes means the Company and any successor
obligor upon the Notes.
(c) All other terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule under
the TIA have the meanings so assigned to them.
SECTION 1.04 RULES OF CONSTRUCTION.
(a) Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the
plural include the singular;
(5) "including" means "including without limitation";
(6) provisions apply to successive events and transactions;
and
(7) references to sections of or rules under the Securities
Act shall be deemed to include substitute, replacement or successor
sections or rules adopted by the SEC from time to time.
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ARTICLE 2.
THE NOTES
SECTION 2.01. FORM AND DATING.
(a) General. The Notes and the Trustee's certificate of
authentication shall be substantially in the form of Exhibit A hereto. The Notes
may have notations, legends or endorsements required by law, stock exchange rule
or usage. Each Note shall be dated the date of its authentication. The Notes
shall be in denominations of $1,000 and integral multiples thereof. The terms
and provisions contained in the Notes shall constitute, and are hereby expressly
made, a part of this Indenture and the Company and the Trustee, by their
execution and delivery of this Indenture, expressly agree to such terms and
provisions and to be bound thereby. However, to the extent any provision of any
Note conflicts with the express provisions of this Indenture, the provisions of
this Indenture shall govern and be controlling.
(b) Form of Notes. Notes issued in global form shall be
substantially in the form of Exhibits A attached hereto (including the Global
Note Legend thereon and the "Schedule of Exchanges of Interests in the Global
Note" attached thereto). Notes issued in definitive form shall be substantially
in the form of Exhibit A attached hereto (but without the Global Note Legend
thereon and without the "Schedule of Exchanges of Interests in the Global Note"
attached thereto). Each Global Note shall represent such portion of the
outstanding Notes as shall be specified therein and each shall provide that it
shall represent the aggregate principal amount of outstanding Notes from time to
time endorsed thereon and that the aggregate principal amount of outstanding
Notes represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions. Any endorsement of a Global
Note to reflect the amount of any increase or decrease in the aggregate
principal amount of outstanding Notes represented thereby shall be made by the
Trustee or the Custodian, at the direction of the Trustee, in accordance with
instructions given by the Holder thereof as required by Section 2.06 hereof.
(c) Euroclear and Cedel Procedures Applicable. The provisions of the
"Operating Procedures of the Euroclear System" and "Terms and Conditions
Governing Use of Euroclear" and the "General Terms and Conditions of Cedel Bank"
and "Customer Handbook" of Cedel Bank shall be applicable to transfers of
beneficial interests in Global Notes that are held by Participants through
Euroclear or Cedel Bank.
SECTION 2.02 EXECUTION AND AUTHENTICATION.
(a) One Officer shall sign the Notes for the Company by manual or
facsimile signature. The Company's seal may be reproduced on the Notes and may
be in facsimile form.
(b) If an Officer whose signature is on a Note no longer holds that
office at the time a Note is authenticated, the Note shall nevertheless be
valid.
(c) A Note shall not be valid until authenticated by the manual
signature of the Trustee. The signature shall be conclusive evidence that the
Note has been authenticated under this Indenture.
(d) The Trustee shall, upon a written order of the Company signed by
at least one Officer (an "Authentication Order"), authenticate Notes for
original issue up to the aggregate principal amount stated in paragraph 4 of the
Notes. The aggregate principal amount of Notes outstanding at any time may not
exceed such amount except as provided in Section 2.07 hereof.
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(e) The Trustee may appoint an authenticating agent acceptable to
the Company to authenticate Notes. An authenticating agent may authenticate
Notes whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or an
Affiliate of the Company.
SECTION 2.03. REGISTRAR AND PAYING AGENT.
(a) The Company shall maintain an office or agency where Notes may
be presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent"). The
Registrar shall keep a register of the Notes and of their transfer and exchange.
The Company may appoint one or more co-registrars and one or more additional
paying agents. The term "Registrar" includes any co-registrar and the term
"Paying Agent" includes any additional paying agent. The Company may change any
Paying Agent or Registrar without notice to any Holder. The Company shall notify
the Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Company fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Company or any of
its Subsidiaries may act as Paying Agent or Registrar.
(b) The Company initially appoints The Depository Trust Company
("DTC") to act as Depositary with respect to the Global Notes.
(c) The Company initially appoints the Trustee to act as the
Registrar and Paying Agent and to act as Note Custodian with respect to the
Global Notes.
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.
The Company shall require each Paying Agent other than the Trustee
to agree in writing that the Paying Agent shall hold in trust for the benefit of
Holders or the Trustee all money held by the Paying Agent for the payment of
principal, premium or Liquidated Damages, if any, or interest on the Notes, and
shall notify the Trustee of any default by the Company in making any such
payment. While any such default continues, the Trustee may require a Paying
Agent to pay all money held by it to the Trustee. The Company at any time may
require a Paying Agent to pay all money held by it to the Trustee. Upon payment
over to the Trustee, the Paying Agent (if other than the Company or a
Subsidiary) shall have no further liability for the money. If the Company or a
Subsidiary acts as Paying Agent, it shall segregate and hold in a separate trust
fund for the benefit of the Holders all money held by it as Paying Agent. Upon
any bankruptcy or reorganization proceedings relating to the Company, the
Trustee shall serve as Paying Agent for the Notes.
SECTION 2.05. HOLDER LISTS.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA ss. 312(a). If the Trustee is
not the Registrar, the Company shall furnish to the Trustee at least seven
Business Days before each interest payment date and at such other times as the
Trustee may request in writing, a list in such form and as of such date or such
shorter time as the Trustee may allow, as the Trustee may reasonably require of
the names and addresses of the Holders of Notes and the Company shall otherwise
comply with TIA ss. 312(a).
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SECTION 2.06. TRANSFER AND EXCHANGE.
(a) Transfer and Exchange of Global Notes. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary, or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary. All Global Notes shall be exchanged
by the Company for Definitive Notes if (i) the Company delivers to the Trustee
notice from the Depositary that it is unwilling or unable to continue to act as
Depositary or that it is no longer a clearing agency registered under the
Exchange Act and, in either case, a successor Depositary is not appointed by the
Company within 120 days after the date of such notice from the Depositary or
(ii) the Company in its sole discretion determines that the Global Notes (in
whole but not in part) should be exchanged for Definitive Notes and delivers a
written notice to such effect to the Trustee. Upon the occurrence of either of
the preceding events in (i) or (ii) above, Definitive Notes shall be issued in
such names as the Depositary shall instruct the Trustee. Global Notes also may
be exchanged or replaced, in whole or in part, as provided in Sections 2.07 and
2.10 hereof. Every Note authenticated and delivered in exchange for, or in lieu
of, a Global Note or any portion thereof, pursuant to this Section 2.06 or
Section 2.07 or 2.10 hereof, shall be authenticated and delivered in the form
of, and shall be, a Global Note. A Global Note may not be exchanged for another
Note other than as provided in this Section 2.06(a), although beneficial
interests in a Global Note may be transferred and exchanged as provided in
Section 2.06(b), (c) or (d) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global
Notes. The transfer and exchange of beneficial interests in the Global Notes
shall be effected through the Depositary, in accordance with the provisions of
this Indenture and the Applicable Procedures. Beneficial interests in the
Restricted Global Notes shall be subject to restrictions on transfer comparable
to those set forth herein to the extent required by the Securities Act.
Transfers of beneficial interests in the Global Notes also shall require
compliance with either subparagraph (i) or (ii) below, as applicable, as well as
one or more of the other following subparagraphs, as applicable:
(i) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest in
the same Restricted Global Note in accordance with the transfer
restrictions set forth in the Private Placement Legend; provided, however,
that prior to the expiration of the Restricted Period, transfers of
beneficial interests in the Regulation S Global Note may not be made to a
U.S. Person or for the account or benefit of a U.S. Person (other than the
Initial Purchasers). Beneficial interests in any Unrestricted Global Note
may be transferred to Persons who take delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note. No written orders or
instructions shall be required to be delivered to the Registrar to effect
the transfers described in this Section 2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial Interests in
Global Notes. In connection with all transfers and exchanges of beneficial
interests that are not subject to Section 2.06(b)(i) above, the transferor
of such beneficial interest must deliver to the Registrar either (A) (1) a
written order from a Participant or an Indirect Participant given to the
Depositary in accordance with the Applicable Procedures directing the
Depositary to credit or cause to be credited a beneficial interest in
another Global Note in an amount equal to the beneficial interest to be
transferred or exchanged and (2) instructions given in accordance with the
Applicable Procedures containing information regarding the Participant
account to be credited with such increase or (B) (1) a written order from
a Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to
cause to be issued a Definitive Note in an amount equal to the beneficial
interest to be transferred or exchanged and (2) instructions given by the
Depositary to the Registrar
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containing information regarding the Person in whose name such Definitive
Note shall be registered to effect the transfer or exchange referred to in
(1) above. Upon consummation of an Exchange Offer by the Company in
accordance with Section 2.06(f) hereof, the requirements of this Section
2.06(b)(ii) shall be deemed to have been satisfied upon receipt by the
Registrar of the instructions contained in the Letter of Transmittal
delivered by the Holder of such beneficial interests in the Restricted
Global Notes. Upon satisfaction of all of the requirements for transfer or
exchange of beneficial interests in Global Notes contained in this
Indenture and the Notes or otherwise applicable under the Securities Act,
the Trustee shall adjust the principal amount of the relevant Global
Note(s) pursuant to Section 2.06(h) hereof.
(iii) Transfer of Beneficial Interests to Another Restricted Global
Note. A beneficial interest in any Restricted Global Note may be
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of Section 2.06(b)(ii) above and the
Registrar receives the following:
(A) if the transferee shall take delivery in the form of a
beneficial interest in the 144A Global Note, then the transferor
must deliver a certificate in the form of Exhibit B hereto,
including the certifications in item (1) thereof; and
(B) if the transferee shall take delivery in the form of a
beneficial interest in the Regulation S Global Note, then the
transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (2) thereof; and
(C) if the transferee shall take delivery in the form of a
beneficial interest in the IAI Global Note, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the
certifications in item (3) thereof.
(iv) Transfer and Exchange of Beneficial Interests in a Restricted
Global Note for Beneficial Interests in the Unrestricted Global Note. A
beneficial interest in any Restricted Global Note may be exchanged by any
holder thereof for a beneficial interest in an Unrestricted Global Note or
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note if the exchange or
transfer complies with the requirements of Section 2.06(b)(ii) above and:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the holder of the beneficial interest to be transferred, in the
case of an exchange, or the transferee, in the case of a transfer,
certifies in the applicable Letter of Transmittal that it is not (1)
a broker-dealer, (2) a Person participating in the distribution of
the Exchange Notes or (3) a Person who is an affiliate (as defined
in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) such transfer is effected by a Participating Broker-Dealer
pursuant to the Exchange Offer Registration Statement in accordance
with the Registration Rights Agreement; or
(D) the Registrar receives the following:
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(1) if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a beneficial
interest in an Unrestricted Global Note, a certificate from such holder in
the form of Exhibit C hereto, including the certifications in item (1)(a)
thereof; or
(2) if the holder of such beneficial interest in a Restricted
Global Note proposes to transfer such beneficial interest to a Person who
shall take delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note, a certificate from such holder in the form of
Exhibit B hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar or the Company so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable to the
Registrar or the Company, if applicable to the effect that such exchange
or transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private Placement
Legend are no longer required in order to maintain compliance with the
Securities Act.
If any such transfer is effected pursuant to subparagraph (B) or (D)
above at a time when an Unrestricted Global Note has not yet been issued, the
Company shall issue and, upon receipt of an Authentication Order in accordance
with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
aggregate principal amount of beneficial interests transferred pursuant to
subparagraph (B) or (D) above.
Beneficial interests in an Unrestricted Global Note cannot be
exchanged for, or transferred to Persons who take delivery thereof in the form
of, a beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for Definitive Notes.
(i) Beneficial Interests in Restricted Global Notes to
Restricted Definitive Notes. Restricted Global Notes and beneficial
interests therein shall be exchangeable for Definitive Notes if (i) the
Depositary (x) notifies the Company that it is unwilling or unable to
continue as depositary for the Restricted Global Notes and the Company
thereupon fails to appoint a successor depositary or (y) has ceased to be
a clearing agency registered under the Exchange Act and the Company fails
to appoint a successor, (ii) the Company, at its option, notifies the
Trustee in writing that it elects to cause the issuance of the Definitive
Notes or (iii) there shall have occurred and be continuing a Default with
respect to the Notes. In all cases, Definitive Notes delivered in exchange
for any Restricted Global Note or beneficial interests therein shall be
registered in the names, and issued in any approved denominations,
requested by or on behalf of the Depositary (in accordance with the
Applicable Procedures).
In such event, the Trustee shall cause the Restricted Global Notes
to be canceled accordingly pursuant to Section 2.11 hereof, and the
Company shall execute and upon receipt of an Authentication Order the
Trustee shall authenticate and deliver to the Person designated in the
instructions a Definitive Note in the appropriate principal amount. Any
Definitive Note issued in exchange for a beneficial interest in a
Restricted Global Note pursuant to this Section 2.06(c) shall be
registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant. The Trustee shall deliver such Definitive Notes to
the Persons in whose names such Notes are so registered. Any Definitive
Note issued in exchange for a beneficial
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interest in a Restricted Global Note pursuant to this Section 2.06(c)(i)
shall bear the Private Placement Legend and shall be subject to all
restrictions on transfer contained therein.
(ii) Beneficial Interests in Restricted Global Notes to Unrestricted
Definitive Notes. A holder of a beneficial interest in a Restricted Global
Note may exchange such beneficial interest for an Unrestricted Definitive
Note or may transfer such beneficial interest to a Person who takes
delivery thereof in the form of an Unrestricted Definitive Note only if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the holder of such beneficial interest, in the case of an
exchange, or the transferee, in the case of a transfer, certifies in
the Letter of Transmittal that it is not (1) a broker-dealer, (2) a
Person participating in the distribution of the Exchange Notes or
(3) a Person who is an affiliate (as defined in Rule 144) of the
Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) such transfer is effected by a Broker-Dealer pursuant to
the Exchange Offer Registration Statement in accordance with the
Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a Definitive
Note that does not bear the Private Placement Legend, a certificate from
such holder in the form of Exhibit C hereto, including the certifications
in item (1)(b) thereof; or
(2) if the holder of such beneficial interest in a Restricted
Global Note proposes to transfer such beneficial interest to a Person who
shall take delivery thereof in the form of a Definitive Note that does not
bear the Private Placement Legend, a certificate from such holder in the
form of Exhibit B hereto, including the certifications in item (4)
thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar or the Company so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable to the
Registrar or the Company, if applicable to the effect that such exchange
or transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private Placement
Legend are no longer required in order to maintain compliance with the
Securities Act.
(iii) Beneficial Interests in Unrestricted Global Notes to
Unrestricted Definitive Notes. Unrestricted Global Notes and beneficial
interests therein shall be exchangeable for Definitive Notes if (i) the
Depositary (x) notifies the Company that it is unwilling or unable to
continue as depositary for the Unrestricted Global Notes and the Company
thereupon fails to appoint a successor depositary or (y) has ceased to be
a clearing agency registered under the Exchange Act and the Company fails
to appoint a successor, (ii) the Company, at its option, notifies the
Trustee in writing that it elects to cause the issuance of the Definitive
Notes or (iii) there shall have occurred and be continuing a Default with
respect to the Notes. In all cases, Definitive Notes delivered in exchange
for any
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Unrestricted Global Note or beneficial interests therein shall be
registered in the names, and issued in any approved denominations,
requested by or on behalf of the depositary (in accordance with the
Applicable Procedures). In such event, the Trustee shall cause the
Unrestricted Global Notes to be canceled accordingly pursuant to Section
2.11 hereof, and the Company shall execute and the Trustee shall
authenticate and deliver to the Person designated in the instructions a
Definitive Note in the appropriate principal amount. Any Definitive Note
issued in exchange for a beneficial interest pursuant to this Section
2.06(c)(iii) shall be registered in such name or names and in such
authorized denomination or denominations as the holder of such beneficial
interest shall instruct the Registrar through instructions from the
Depositary and the Participant or Indirect Participant. The Trustee shall
deliver such Definitive Notes to the Persons in whose names such Notes are
so registered. Any Definitive Note issued in exchange for a beneficial
interest pursuant to this Section 2.06(c)(iii) shall not bear the Private
Placement Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial Interests.
(i) Restricted Definitive Notes to Beneficial Interests in
Restricted Global Notes. If any Holder of a Restricted Definitive Note
proposes to exchange such Note for a beneficial interest in a Restricted
Global Note or to transfer such Restricted Definitive Notes to a Person
who takes delivery thereof in the form of a beneficial interest in a
Restricted Global Note, then, upon receipt by the Registrar of the
following documentation:
(A) if the Holder of such Restricted Definitive Note proposes
to exchange such Note for a beneficial interest in a Restricted
Global Note, a certificate from such Holder in the form of Exhibit C
hereto, including the certifications in item (2)(b) thereof;
(B) if such Restricted Definitive Note is being transferred to
a QIB in accordance with Rule 144A under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including
the certifications in item (1) thereof;
(C) if such Restricted Definitive Note is being transferred to
a Non-U.S. Person in an offshore transaction in accordance with Rule
903 or Rule 904 under the Securities Act, a certificate to the
effect set forth in Exhibit B hereto, including the certifications
in item (2) thereof;
(D) if such Restricted Definitive Note is being transferred
pursuant to an exemption from the registration requirements of the
Securities Act in accordance with Rule 144 under the Securities Act,
a certificate to the effect set forth in Exhibit B hereto, including
the certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Note is being transferred to
an Institutional Accredited Investor in reliance on an exemption
from the registration requirements of the Securities Act other than
those listed in subparagraphs (B) through (D) above, a certificate
to the effect set forth in Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel required by item
(3) thereof, if applicable;
(F) if such Restricted Definitive Note is being transferred to
the Company or any of its Subsidiaries, a certificate to the effect
set forth in Exhibit B hereto, including the certifications in item
(3)(b) thereof; or
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(G) if such Restricted Definitive Note is being transferred
pursuant to an effective registration statement under the Securities
Act, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(c) thereof,
the Trustee shall cancel the Restricted Definitive Note, increase or cause to be
increased the aggregate principal amount of, in the case of clause (A) above,
the appropriate Restricted Global Note, in the case of clause (B) above, the
144A Global Note, in the case of clause (C) above, the Regulation S Global Note,
and in all other cases, the IAI Global Note.
(ii) Restricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of a Restricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global
Note or transfer such Restricted Definitive Note to a Person who takes
delivery thereof in the form of a beneficial interest in an Unrestricted
Global Note only if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the Holder, in the case of an exchange, or the transferee, in
the case of a transfer, certifies in the applicable Letter of
Transmittal that it is not (1) a broker-dealer, (2) a Person
participating in the distribution of the Exchange Notes or (3) a
Person who is an affiliate (as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration in accordance with the Registration Rights Agreement;
(C) such transfer is effected by a Broker-Dealer pursuant to
the Exchange Offer Registration Statement in accordance with the
Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Definitive Notes proposes to
exchange such Notes for a beneficial interest in the Unrestricted Global
Note, a certificate from such Holder in the form of Exhibit C hereto,
including the certifications in item (1)(c) thereof; or
(2) if the Holder of such Definitive Notes proposes to
transfer such Notes to a Person who shall take delivery thereof in the
form of a beneficial interest in the Unrestricted Global Note, a
certificate from such Holder in the form of Exhibit B hereto, including
the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the Registrar so
requests or if the Applicable Procedures so require, an Opinion of Counsel in
form reasonably acceptable to the Registrar to the effect that such exchange or
transfer is in compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are no longer
required in order to maintain compliance with the Securities Act.
Upon satisfaction of the conditions of any of the subparagraphs in
this Section 2.06(d)(ii), the Trustee shall cancel the Definitive Notes and
increase or cause to be increased the aggregate principal amount of the
Unrestricted Global Note.
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(iii) Unrestricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global
Note or transfer such Definitive Notes to a Person who takes delivery
thereof in the form of a beneficial interest in an Unrestricted Global
Note at any time. Upon receipt of a request for such an exchange or
transfer, the Trustee shall cancel the applicable Unrestricted Definitive
Note and increase or cause to be increased the aggregate principal amount
of one of the Unrestricted Global Notes.
If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (ii)(B), (ii)(D) or
(iii) above at a time when an Unrestricted Global Note has not yet been issued,
the Company shall issue and, upon receipt of an Authentication Order in
accordance with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
principal amount of Definitive Notes so transferred.
(e) Transfer and Exchange of Definitive Notes for Definitive Notes.
Upon request by a Holder of Definitive Notes and such Holder's compliance with
the provisions of this Section 2.06(e), the Registrar shall register the
transfer or exchange of Definitive Notes. Prior to such registration of transfer
or exchange, the requesting Holder shall present or surrender to the Registrar
the Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by his attorney, duly authorized in writing. In addition, the requesting Holder
shall provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section
2.06(e).
(i) Restricted Definitive Notes to Restricted Definitive Notes. Any
Restricted Definitive Note may be transferred to and registered in the
name of Persons who take delivery thereof in the form of a Restricted
Definitive Note if the Registrar receives the following:
(A) if the transfer shall be made pursuant to Rule 144A under
the Securities Act, then the transferor must deliver a certificate
in the form of Exhibit B hereto, including the certifications in
item (1) thereof; and
(B) if the transfer shall be made pursuant to Rule 903 or Rule
904, then the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications in item (2) thereof;
and
(C) if the transfer shall be made pursuant to any other
exemption from the registration requirements of the Securities Act,
then the transferor must deliver a certificate in 9 the form of
Exhibit B hereto, including the certifications, certificates and
Opinion of Counsel required by item (3) thereof, if applicable.
(ii) Restricted Definitive Notes to Unrestricted Definitive Notes.
Any Restricted Definitive Note may be exchanged by the Holder thereof for
an Unrestricted Definitive Note or transferred to a Person or Persons who
take delivery thereof in the form of an Unrestricted Definitive Note if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the Holder, in the case of an exchange, or the transferee, in
the case of a transfer, certifies in the applicable Letter of
Transmittal that it is not (1) a broker-dealer, (2) a Person
participating in the distribution of the Exchange Notes or (3) a
Person who is an affiliate (as defined in Rule 144) of the Company;
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(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) any such transfer is effected by a Participating
Broker-Dealer pursuant to the Exchange Offer Registration Statement
in accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Restricted Definitive Notes proposes
to exchange such Notes for an Unrestricted Definitive Note, a certificate
from such Holder in the form of Exhibit C hereto, including the
certifications in item (1)(d) thereof; or
(2) if the Holder of such Restricted Definitive Notes proposes
to transfer such Notes to a Person who shall take delivery thereof in the
form of an Unrestricted Definitive Note, a certificate from such Holder in
the form of Exhibit B hereto, including the certifications in item (4)
thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar or the Company so requests, an Opinion of Counsel in form
reasonably acceptable to the Registrar and the Company, if applicable, to
the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein and
in the Private Placement Legend are no longer required in order to
maintain compliance with the Securities Act.
(iii) Unrestricted Definitive Notes to Unrestricted Definitive
Notes. A Holder of Unrestricted Definitive Notes may transfer such Notes
to a Person who takes delivery thereof in the form of an Unrestricted
Definitive Note. Upon receipt of a request to register such a transfer,
the Registrar shall register the Unrestricted Definitive Notes pursuant to
the instructions from the Holder thereof.
(f) Exchange Offer. Upon the occurrence of the Exchange Offer in
accordance with the Registration Rights Agreement, the Company shall issue and,
upon receipt of an Authentication Order in accordance with Section 2.02, the
Trustee shall authenticate (i) one or more Unrestricted Global Notes in an
aggregate principal amount equal to the principal amount of the beneficial
interests in the Restricted Global Notes tendered for acceptance by Persons that
certify in the applicable Letters of Transmittal that (x) they are not
broker-dealers, (y) they are not participating in a distribution of the Exchange
Notes and (z) they are not affiliates (as defined in Rule 144) of the Company,
and accepted for exchange in the Exchange Offer and (ii) Definitive Notes in an
aggregate principal amount equal to the principal amount of the Restricted
Definitive Notes accepted for exchange in the Exchange Offer. Concurrently with
the issuance of such Notes, the Trustee shall cause the aggregate principal
amount of the applicable Restricted Global Notes to be reduced accordingly, and
the Company shall execute and the Trustee shall authenticate and deliver to the
Persons designated by the Holders of Definitive Notes so accepted Definitive
Notes in the appropriate principal amount.
(g) Legends. The following legends shall appear on the face of all
Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this
Indenture.
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(i) Private Placement Legend.
(A) Except as permitted by subparagraph (B) below, each Global
Note and each Definitive Note (and all Notes issued in exchange
therefor or substitution thereof) shall bear the legend in
substantially the following form
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT
OF 1933, AS AMENDED (THE "ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED,
SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR
FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE
NEXT SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST
HEREIN, THE HOLDER:
(1) REPRESENTS THAT (i) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE ACT)(A "QIB"), (ii) IT HAS ACQUIRED
THIS SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH
REGULATION S UNDER THE ACT OR (iii) IT IS AN INSTITUTIONAL
"ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(A)(1), (2), (3) OR (7)
OF REGULATION D UNDER THE ACT (AN "IAI"),
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS
SECURITY EXCEPT (i) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES, (ii)
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, (iii) IN AN OFFSHORE
TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR 904 OF THE ACT,
(iv) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE
ACT, (v) TO AN IAI THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE
TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING TO THE TRANSFER OF THIS SECURITY (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 COMPANY THAT SUCH
TRANSFER IS IN COMPLIANCE WITH THE ACT, (vi) IN ACCORDANCE WITH
ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE ACT (AND
BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY) OR (vii)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE,
IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND
(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY
OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND.
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AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" AND "UNITED STATES"
HAVE THE MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE ACT.
THE INDENTURE AND WARRANT AGREEMENT CONTAIN A PROVISION REQUIRING THE
TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THESE SECURITIES IN
VIOLATION OF THE FOREGOING."
(B) Notwithstanding the foregoing, any Global Note or
Definitive Note issued pursuant to subparagraphs (b)(iv), (c)(ii),
(c)(iii), (d)(ii), (d)(iii), (e)(ii) or (f) to this Section 2.06
(and all Notes issued in exchange therefor or substitution thereof)
shall not bear the Private Placement Legend.
(ii) Global Note Legend. Each Global Note shall bear a legend in
substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON
AS MAY BE REQUIRED PURSUANT TO SECTION 2.07 OF THE INDENTURE, (II) THIS
GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION
2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE
TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND
(IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH
THE PRIOR WRITTEN CONSENT OF THE COMPANY."
(iii) Separability Legend. Until the Separation Date, each Global
Note shall bear a legend in substantially the following form (the
"Separability Legend"):
"UNTIL THE SEPARATION DATE (AS DEFINED), THIS NOTE HAS BEEN ISSUED AS, AND
MUST BE TRANSFERRED AS, A UNIT TOGETHER WITH THE ASSOCIATED WARRANTS TO
PURCHASE COMMON STOCK OF UBIQUITEL INC. EACH UNIT CONSISTS OF $1,000
PRINCIPAL AMOUNT OF NOTES AND A WARRANT TO PURCHASE 5.965 SHARES OF COMMON
STOCK OF UBIQUITEL INC., SUBJECT TO ADJUSTMENT UNDER CERTAIN
CIRCUMSTANCES. A COPY OF THE WARRANT AGREEMENT PURSUANT TO WHICH THE
WARRANTS HAVE BEEN ISSUED IS AVAILABLE FROM THE COMPANY UPON REQUEST."
(iv) Original Issue Discount Legend. Each Global Note shall bear a
legend in substantially the following form:
"FOR PURPOSES OF SECTION 1273 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE"), THIS SECURITY HAS ORIGINAL ISSUE DISCOUNT. FOR
PURPOSES OF SECTION 1273 OF THE CODE, THE ISSUE PRICE IS $394.97 AND THE
AMOUNT OF ORIGINAL ISSUE DISCOUNT IS $605.03, IN EACH CASE PER $1,000
PRINCIPAL AMOUNT OF THIS SECURITY. FOR PURPOSES OF SECTION 1275 OF THE
CODE, THE YIELD TO MATURITY COMPOUNDED SEMIANNUALLY IS 17.81%."
(h) Cancellation or Adjustment of Global Notes. At such time as all
beneficial interests in a particular Global Note
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have been exchanged for Definitive Notes or a particular Global Note has been
redeemed, repurchased or cancelled in whole and not in part, each such Global
Note shall be returned to or retained and cancelled by the Trustee in accordance
with Section 2.11 hereof. At any time prior to such cancellation, if any
beneficial interest in a Global Note is exchanged for or transferred to a Person
who shall take delivery thereof in the form of a beneficial interest in another
Global Note or for Definitive Notes, the principal amount of Notes represented
by such Global Note shall be reduced accordingly and an endorsement shall be
made on such Global Note by the Trustee or by the Depositary at the direction of
the Trustee to reflect such reduction; and if the beneficial interest is being
exchanged for or transferred to a Person who shall take delivery thereof in the
form of a beneficial interest in another Global Note, such other Global Note
shall be increased accordingly and an endorsement shall be made on such Global
Note by the Trustee or by the Depositary at the direction of the Trustee to
reflect such increase.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the Company
shall execute and the Trustee shall authenticate Global Notes and
Definitive Notes upon the Company's order or at the Registrar's request.
(ii) No service charge shall be made to a holder of a beneficial
interest in a Global Note or to a Holder of a Definitive Note for any
registration of transfer or exchange, but the Company may require payment
of a sum sufficient to cover any transfer tax or similar governmental
charge payable in connection therewith (other than any such transfer taxes
or similar governmental charge payable upon exchange or transfer pursuant
to Sections 2.10, 3.06, 3.09, 4.10, 4.14 and 9.05 hereof).
(iii) The Registrar shall not be required to register the transfer
of or exchange any Note selected for redemption in whole or in part,
except the unredeemed portion of any Note being redeemed in part.
(iv) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive Notes
shall be the valid obligations of the Company, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Global
Notes or Definitive Notes surrendered upon such registration of transfer
or exchange.
(v) The Company shall not be required (A) to issue, to register the
transfer of or to exchange any Notes during a period beginning at the
opening of business 15 days before the day of any selection of Notes for
redemption under Section 3.02 hereof and ending at the close of business
on the day of selection, (B) to register the transfer of or to exchange
any Note so selected for redemption in whole or in part, except the
unredeemed portion of any Note being redeemed in part or (c) to register
the transfer of or to exchange a Note between a record date and the next
succeeding Interest Payment Date.
(vi) Prior to due presentment for the registration of a transfer of
any Note, the Trustee, any Agent and the Company may deem and treat the
Person in whose name any Note is registered as the absolute owner of such
Note for the purpose of receiving payment of principal of and interest on
such Notes and for all other purposes, and none of the Trustee, any Agent
or the Company shall be affected by notice to the contrary.
(vii) The Trustee shall authenticate Global Notes and Definitive
Notes in accordance with the provisions of Section 2.02 hereof.
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(viii) All certifications, certificates and Opinions of Counsel
required to be submitted to the Registrar pursuant to this Section 2.06 to
effect a registration of transfer or exchange may be submitted by
facsimile.
(j) Separation of Notes and Unit Warrants
(i) Prior to the Separation Date, no Notes may be sold, assigned or
otherwise transferred to any Person unless, simultaneously with such
transfer, the Trustee receives confirmation from the Warrant Agent for the
Unit Warrants that the Holder of the Notes has requested a transfer of the
related Unit Warrants to the same transferee.
(ii) On or after the Separation Date, the Holder of a Note
containing a Separability Legend may surrender such Note accompanied by a
written application to the Trustee, duly executed by the Holder, for a new
Note or Notes not containing a Separability Legend. Whether or not the
Holder obtains a new Note, from and after the Separation Date, the
Separability Legend shall have no further force and effect.
SECTION 2.07. REPLACEMENT NOTES
(a) If any mutilated Note is surrendered to the Trustee or the
Company and the Trustee receives evidence to its satisfaction of the
destruction, loss or theft of any Note, the Company shall issue and the Trustee,
upon receipt of an Authentication Order, shall authenticate a replacement Note
if the Trustee's requirements are met. If required by the Trustee or the
Company, an indemnity bond must be supplied by the Holder that is sufficient in
the judgment of the Trustee and the Company to protect the Company, the Trustee,
any Agent and any authenticating agent from any loss that any of them may suffer
if a Note is replaced. The Company may charge for its expenses in replacing a
Note.
(b) Every replacement Note is an additional obligation of the
Company and shall be entitled to all of the benefits of this Indenture equally
and proportionately with all other Notes duly issued hereunder.
SECTION 2.08. OUTSTANDING NOTES.
(a) The Notes outstanding at any time are all the Notes
authenticated by the Trustee except for those cancelled by it, those delivered
to it for cancellation, those reductions in the interest in a Global Note
effected by the Trustee in accordance with the provisions hereof, and those
described in this Section 2.08 as not outstanding. Except as set forth in
Section 2.09 hereof, a Note does not cease to be outstanding because the Company
or an Affiliate of the Company holds the Note; however, Notes held by the
Company or a Subsidiary of the Company shall not be deemed to be outstanding for
purposes of Section 3.07(b) hereof.
(b) If a Note is replaced pursuant to Section 2.07 hereof, it ceases
to be outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.
(c) If the principal amount of any Note is considered paid under
Section 4.01 hereof, it ceases to be outstanding and interest on it ceases to
accrue.
(d) If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date,
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then on and after that date such Notes shall be deemed to be no longer
outstanding and shall cease to accrue interest.
SECTION 2.09. TREASURY NOTES.
In determining whether the Holders of the required principal amount
of Notes have concurred in any direction, waiver or consent, Notes owned by the
Company, or by any Person directly or indirectly controlling or controlled by or
under direct or indirect common control with the Company, shall be considered as
though not outstanding, except that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, waiver or consent,
only Notes that the Trustee knows are so owned shall be so disregarded.
SECTION 2.10. TEMPORARY NOTES
Until certificates representing Notes are ready for delivery, the
Company may prepare and the Trustee, upon receipt of an Authentication Order,
shall authenticate temporary Notes. Notes shall be substantially in the form of
certificated Notes but may have variations that the Company considers
appropriate for temporary Notes and as shall be reasonably acceptable to the
Trustee. Without unreasonable delay, the Company shall prepare and the Trustee
shall authenticate definitive Notes in exchange for temporary Notes.
Holders of temporary Notes shall be entitled to all of the benefits
of this Indenture.
SECTION 2.11. CANCELLATION.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee upon direction by the Company and no one else shall cancel all Notes
surrendered for registration of transfer, exchange, payment, replacement or
cancellation and shall destroy cancelled Notes (subject to the record retention
requirements of the Exchange Act). Certification of the destruction of all
cancelled Notes shall be delivered to the Company. The Company may not issue new
Notes to replace Notes that it has paid or that have been delivered to the
Trustee for cancellation.
SECTION 2.12. DEFAULTED INTEREST.
If the Company defaults in a payment of interest on the Notes, it shall
pay the defaulted interest in any lawful manner plus, to the extent lawful,
interest payable on the defaulted interest, to the Persons who are Holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 4.01 hereof. The Company shall notify the Trustee in writing of
the amount of defaulted interest proposed to be paid on each Note and the date
of the proposed payment. The Company shall fix or cause to be fixed each such
special record date and payment date; provided, however, that no such special
record date shall be less than 5 days prior to the related payment date for such
defaulted interest. At least 10 days before the special record date, the Company
(or, upon the written request of the Company, the Trustee in the name and at the
expense of the Company) shall mail or cause to be mailed to Holders a notice
that states the special record date, the related payment date and the amount of
such interest to be paid.
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SECTION 2.13. CUSIP NUMBERS.
The Company in issuing the Notes may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Holders; provided, however, that any such
notice may state that no representation is made as to the correctness of such
numbers either as printed on the Notes or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Notes, and any such redemption shall not be affected by
any defect in or omission of such numbers. The Company will promptly notify the
Trustee of any change in the "CUSIP" numbers.
ARTICLE 3.
REDEMPTION AND PREPAYMENT
SECTION 3.01. NOTICES TO TRUSTEE.
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee,
at least 30 days but not more than 60 days before a redemption date, an
Officers' Certificate setting forth (i) the clause of this Indenture pursuant to
which the redemption shall occur, (ii) the redemption date, (iii) the principal
amount of Notes to be redeemed and (iv) the redemption price.
SECTION 3.02. SELECTION OF NOTES TO BE REDEEMED
If less than all of the Notes are to be redeemed or purchased in an
offer to purchase at any time, the Trustee shall select the Notes to be redeemed
or purchased among the Holders of the Notes in compliance with the requirements
of the principal national securities exchange, if any, on which the Notes are
listed or, if the Notes are not so listed, on a pro rata basis, by lot or in
accordance with any other method the Trustee considers fair and appropriate. In
the event of partial redemption by lot, the particular Notes to be redeemed
shall be selected, unless otherwise provided herein, not less than 30 nor more
than 60 days prior to the redemption date by the Trustee from the outstanding
Notes not previously called for redemption.
The Trustee shall promptly notify the Company in writing of the
Notes selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of $1,000 or whole multiples of $1,000;
except that if all of the Notes of a Holder are to be redeemed, the entire
outstanding amount of Notes held by such Holder, even if not a multiple of
$1,000, shall be redeemed. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
SECTION 3.03. NOTICE OF REDEMPTION
Subject to the provisions of Section 3.09 hereof, at least 30 days
but not more than 60 days before a redemption date, the Company shall mail or
cause to be mailed, by first class mail, a notice of redemption to each Holder
whose Notes are to be redeemed at its registered address.
The notice shall identify the Notes to be redeemed and shall state:
(a) the redemption date;
(b) the redemption price;
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(c) if any Note is being redeemed in part, the portion of the principal
amount of such Note to be redeemed and that, after the redemption date upon
surrender of such Note, a new Note or Notes in principal amount equal to the
unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the Paying
Agent to collect the redemption price;
(f) that, unless the Company defaults in making such redemption payment,
interest on Notes called for redemption ceases to accrue on and after the
redemption date;
(g) the paragraph of the Notes or Section of this Indenture pursuant to
which the Notes called for redemption are being redeemed; and
(h) that no representation is made as to the correctness or accuracy of
the CUSIP number, if any, listed in such notice or printed on the Notes.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; provided, however, that the
Company shall have delivered to the Trustee, at least 45 days, or such shorter
period allowed by the Trustee, prior to the redemption date, an Officers'
Certificate requesting that the Trustee give such notice and setting forth the
information to be stated in such notice as provided in the preceding paragraph.
SECTION 3.04. EFFECT OF NOTICE OF REDEMPTION
Once notice of redemption is mailed in accordance with Section 3.03
hereof, Notes called for redemption become irrevocably due and payable on the
redemption date at the redemption price. A notice of redemption may not be
conditional.
SECTION 3.05. DEPOSIT OF REDEMPTION PRICE
On or one Business Day prior to the redemption date, the Company
shall deposit with the Trustee or with the Paying Agent money sufficient to pay
the redemption price of and accrued interest on all Notes to be redeemed on that
date. The Trustee or the Paying Agent shall promptly return to the Company any
money deposited with the Trustee or the Paying Agent by the Company in excess of
the amounts necessary to pay the redemption price of, and accrued interest on,
all Notes to be redeemed.
If the Company complies with the provisions of the preceding
paragraph, on and after the redemption date, interest shall cease to accrue on
the Notes or the portions of Notes called for redemption. If a Note is redeemed
on or after an interest record date but on or prior to the related interest
payment date, then any accrued and unpaid interest shall be paid to the Person
in whose name such Note was registered at the close of business on such record
date. If any Note called for redemption shall not be so paid upon surrender for
redemption because of the failure of the Company to comply with the preceding
paragraph, interest shall be paid on the unpaid principal from the redemption
date until such principal is paid, and to the extent lawful on any interest not
paid on such unpaid principal, in each case at the rate provided in the Notes
and in Section 4.01 hereof.
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SECTION 3.06. NOTES REDEEMED IN PART.
Upon surrender of a Note that is redeemed in part, the Company shall
issue and, upon the Company's written request, the Trustee shall authenticate
for the Holder at the expense of the Company a new Note equal in principal
amount to the unredeemed portion of the Note surrendered.
SECTION 3.07. OPTIONAL REDEMPTION.
(a) On or after April 15, 2005, the Company may redeem the Notes at any
time, in whole or in part, upon not less than 30 nor more than 60 days' notice,
at the redemption prices (expressed as percentages of principal amount) set
forth below, plus accrued and unpaid interest and Liquidated Damages, if any,
thereon to the date fixed for redemption, if redeemed during the twelve-month
period beginning on April 15 of the year indicated below:
Year Percentage
---- -----------
2005 107.000%
2006 104.667%
2007 102.333%
2008 and thereafter 100.000%
(b) Notwithstanding the provisions of clause (a) of this Section 3.07,
prior to April 15, 2003, the Company shall be permitted to redeem up to 35% of
the aggregate principal amount of the Notes originally issued at a redemption
price of 114.000% of the Accreted Value thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon to the date fixed for
redemption, with the net cash proceeds of one or more underwritten public
offerings of Capital Stock of the Company (or the underwritten public offering
of UbiquiTel Parent's Capital Stock, to the extent of proceeds contributed to
the Company as a capital contribution, but excluding the net proceeds of an
underwritten initial public offering of UbiquiTel Parent's common stock
occurring on or before July 31, 2000), other than Disqualified Stock; provided,
however, that (1) at least 65% of the aggregate principal amount of the Notes
originally issued remains outstanding immediately after the occurrence of the
redemption, excluding Notes held by the Company or any of its Subsidiaries; and
(2) each redemption occurs within 45 days after the date of the closing of such
an offering.
(b) Any redemption pursuant to this Section 3.07 shall be made pursuant
to the provisions of Section 3.01 through 3.06 hereof.
SECTION 3.08. MANDATORY REDEMPTION.
The Company shall not be required to make mandatory redemption or
sinking fund payments with respect to the Notes.
SECTION 3.09. OFFER TO PURCHASE.
In the event that, pursuant to Section 4.10 or 4.14 hereof, the
Company shall be required to commence an offer to all Holders to purchase Notes
(a "Repurchase Offer"), it shall follow the procedures specified below.
The Repurchase Offer shall remain open for a period of 20 Business
Days following its commencement and no longer, except to the extent that a
longer period is required by applicable law (the "Offer Period"). No later than
five Business Days after the termination of the Offer Period (the
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"Purchase Date"), the Company shall purchase the principal amount of Notes
required to be purchased pursuant to Section 4.10 or 4.14 hereof (the "Offer
Amount") or, if less than the Offer Amount has been tendered, all Notes tendered
in response to the Asset Sale Offer or Change of Control Offer, as applicable.
Payment for any Notes so purchased shall be made in the same manner as interest
payments are made.
If the Purchase Date is on or after an interest record date and on
or before the related interest payment date, any accrued and unpaid interest
shall be paid to the Person in whose name a Note is registered at the close of
business on such record date, and no additional interest shall be payable to
Holders who tender Notes pursuant to the Repurchase Offer.
Upon the commencement of an Repurchase Offer, the Company shall
send, by first class mail, a notice to the Trustee and each of the Holders, with
a copy to the Trustee. The notice shall contain all instructions and materials
necessary to enable such Holders to tender Notes pursuant to the Repurchase
Offer. The Repurchase Offer shall be made to all Holders. The notice, which
shall govern the terms of the Repurchase Offer, shall state:
(a) that the Repurchase Offer is being made pursuant to this Section 3.09
and Section 4.10 or 4.14 hereof and the length of time the Repurchase Offer
shall remain open;
(b) the Offer Amount, the purchase price and the Purchase Date;
(c) that any Note not tendered or accepted for payment shall continue to
accrue interest and Liquidated Damages, if any;
(d) that, unless the Company defaults in making such payment, any Note
accepted for payment pursuant to the Repurchase Offer shall cease to accrue
interest and Liquidated Damages, if any, after the Purchase Date;
(e) that Holders electing to have a Note purchased pursuant to an
Repurchase Offer may elect to have Notes purchased in integral multiples of
$1,000 only;
(f) that Holders electing to have a Note purchased pursuant to any
Repurchase Sale Offer shall be required to surrender the Note, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Note
completed, or transfer by book-entry transfer, to the Company, a depositary, if
appointed by the Company, or a Paying Agent at the address specified in the
notice at least three days before the Purchase Date;
(g) that Holders shall be entitled to withdraw their election if the
Company, the Depositary or the Paying Agent, as the case may be, receives, not
later than the expiration of the Offer Period, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Note the Holder delivered for purchase and a statement that such
Holder is withdrawing his election to have such Note purchased;
(h) that, if the aggregate principal amount of Notes surrendered by
Holders exceeds the Offer Amount, the Company shall select the Notes to be
purchased on a pro rata basis (with such adjustments as may be deemed
appropriate by the Company so that only Notes in denominations of $1,000, or
integral multiples thereof, shall be purchased); and
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(i) that Holders whose Notes were purchased only in part shall be issued
new Notes equal in principal amount to the unpurchased portion of the Notes
surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Company shall, to the extent
lawful, accept for payment, on a pro rata basis to the extent necessary, the
Offer Amount of Notes or portions thereof tendered pursuant to the Asset Sale
Offer or Change of Control Offer, as applicable, or if less than the Offer
Amount has been tendered, all Notes tendered, and shall deliver to the Trustee
an Officers' Certificate stating that such Notes or portions thereof were
accepted for payment by the Company in accordance with the terms of this Section
3.09. The Company, the Depositary or the Paying Agent, as the case may be, shall
promptly (but in any case not later than five days after the Purchase Date) mail
or deliver to each tendering Holder an amount equal to the purchase price of the
Notes tendered by such Holder and accepted by the Company for purchase, and the
Company shall promptly issue a new Note, and the Trustee, upon written request
from the Company shall authenticate and mail or deliver such new Note to such
Holder, in a principal amount equal to any unpurchased portion of the Note
surrendered. Any Note not so accepted shall be promptly mailed or delivered by
the Company to the Holder thereof. The Company shall publicly announce the
results of the Asset Sale Offer on the Purchase Date.
Other than as specifically provided in this Section 3.09, any purchase
pursuant to this Section 3.09 shall be made pursuant to the provisions of
Sections 3.01 through 3.06 hereof.
ARTICLE 4.
COVENANTS
SECTION 4.01. PAYMENT OF NOTES.
(a) The Company shall pay or cause to be paid the principal of,
premium, if any, and interest on the Notes on the dates and in the manner
provided in the Notes. Principal, premium, if any, and interest shall be
considered paid on the date due if the Paying Agent, if other than the Company
or a Subsidiary thereof, holds as of 10:00 a.m. Eastern Time on the due date
money deposited by the Company in immediately available funds and designated for
and sufficient to pay all principal, premium, if any, and interest then due. The
Company shall pay all Liquidated Damages, if any, in the same manner on the
dates and in the amounts set forth in the Registration Rights Agreement.
(b) The Company shall pay interest (including post-petition interest
in any proceeding under any Bankruptcy Law) on overdue principal at the rate
equal to 1% per annum in excess of the then applicable interest rate on the
Notes to the extent lawful; it shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue installments of
interest and Liquidated Damages (without regard to any applicable grace period)
at the same rate to the extent lawful.
SECTION 4.02. MAINTENANCE OF OFFICE OR AGENCY.
(a) The Company shall maintain in the Borough of Manhattan, the City
of New York, an office or agency (which may be an office of the Trustee or an
affiliate of the Trustee, Registrar or co-registrar) where Notes may be
surrendered for registration of transfer or for exchange and where notices and
demands to or upon the Company in respect of the Notes and this Indenture may be
served. The Company shall give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee.
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(b) The Company may also from time to time designate one or more
other offices or agencies where the Notes may be presented or surrendered for
any or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, the City of New York for such purposes. The Company shall
give prompt written notice to the Trustee of any such designation or rescission
and of any change in the location of any such other office or agency.
(c) The Company hereby designates the Corporate Trust Office of the
Trustee as one such office or agency of the Company in accordance with Section
2.03.
SECTION 4.03. REPORTS.
(a) Whether or not the Company is required to do so by the rules and
regulations of the SEC, so long as any Notes are outstanding, the Company shall
furnish to the Holders of the Notes, within 15 days of the time periods
specified in the SEC's rules and regulations (a) all quarterly and annual
financial and other information with respect to the Company and its consolidated
Subsidiaries that would be required to be contained in a filing with the SEC on
Forms 10-Q and 10-K if the Company were required to file such forms, including a
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" that describes the financial condition and results of operations of
the Company and its consolidated Subsidiaries, showing in reasonable detail,
either on the face of the financial statements or in the footnotes thereto and
in Management's Discussion and Analysis of Financial Condition and Results of
Operations, the financial condition and results of operations of the Company and
its Restricted Subsidiaries separate from the financial information and results
of operations of the Unrestricted Subsidiaries of the Company and, with respect
to the annual information only, a report thereon by the Company's certified
independent accountants, and (b) all current reports that would be required to
be filed with the SEC on Form 8-K if the Company were required to file such
reports; provided, that the obligation of the Company to file reports arising
under this paragraph shall not be in effect until the earlier of (i) the date
that UbiquiTel Parent becomes subject to the reporting requirements of Section
13 or 15(d) under the Exchange Act (and then, with respect to the Company's
first requirement to provide the information required by Form 10-Q, in
accordance with the time periods specified in the SEC's rules and regulations
applicable to UbiquiTel Parent) and (ii) August 14, 2000.
(b) After the Exchange Offer or the effectiveness of the Shelf
Registration Statement, whether or not required by the rules and regulations of
the SEC, the Company shall file a copy of all of the information and reports
required to be delivered pursuant to clause (a) of this Section 4.03 with the
SEC for public availability, unless the SEC shall not accept such a filing, and
from and after the date hereof shall make this information available to
securities analysts and prospective investors upon request. In addition, for so
long as any Notes remain outstanding, the Company shall file with the Trustee
and the SEC (unless the SEC shall not accept such filing) the information
required to be delivered pursuant to clause (a) of this Section 4.03 within the
time periods specified in the SEC's rules and regulations and furnish that
information to Holders of the Notes, securities analysts and prospective
investors upon their request.
SECTION 4.04. COMPLIANCE CERTIFICATE.
(a) The Company shall deliver to the Trustee, within 90 days after the
end of each fiscal year, an Officers' Certificate stating that a review of the
activities of the Company and its Subsidiaries during the preceding fiscal year
has been made under the supervision of the signing
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Officers with a view to determining whether the Company has kept, observed,
performed and fulfilled its obligations under this Indenture, and further
stating, as to each such Officer signing such certificate, that to the best of
his or her knowledge the Company has kept, observed, performed and fulfilled
each and every covenant contained in this Indenture and is not in default in the
performance or observance of any of the terms, provisions and conditions of this
Indenture (or, if a Default or Event of Default shall have occurred, describing
all such Defaults or Events of Default of which he or she may have knowledge and
what action the Company is taking or proposes to take with respect thereto) and
that to the best of his or her knowledge no event has occurred and remains in
existence by reason of which payments on account of the principal of or
interest, if any, on the Notes is prohibited or if such event has occurred, a
description of the event and what action the Company is taking or proposes to
take with respect thereto.
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.03(a) above shall be accompanied by a
written statement of the Company's independent public accountants (who shall be
a firm of established national reputation) that in making the examination
necessary for certification of such financial statements, nothing has come to
their attention that would lead them to believe that the Company has violated
any provisions of Article 4 or Article 5 hereof or, if any such violation has
occurred, specifying the nature and period of existence thereof, it being
understood that such accountants shall not be liable directly or indirectly to
any Person for any failure to obtain knowledge of any such violation.
(c) The Company shall, so long as any of the Notes are outstanding,
deliver to the Trustee, forthwith upon any Officer (excluding for purposes
hereof any Assistant Treasurer, Secretary or Assistant Secretary) becoming aware
of any Default or Event of Default, an Officers' Certificate specifying such
Default or Event of Default and what action the Company is taking or proposes to
take with respect thereto.
SECTION 4.05. TAXES.
The Company shall pay, and shall cause each of its Subsidiaries to
pay, prior to delinquency, all material taxes, assessments, and governmental
levies except such as are contested in good faith and by appropriate proceedings
or where the failure to effect such payment is not adverse in any material
respect to the Holders of the Notes.
SECTION 4.06. STAY, EXTENSION AND USURY LAWS.
The Company covenants (to the extent that it may lawfully do so)
that it shall not at any time insist upon, plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay, extension or usury law
wherever enacted, now or at any time hereafter in force, that may affect the
covenants or the performance of this Indenture; and the Company (to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage of
any such law, and covenants that it shall not, by resort to any such law,
hinder, delay or impede the execution of any power herein granted to the
Trustee, but shall suffer and permit the execution of every such power as though
no such law has been enacted.
SECTION 4.07. LIMITATION ON RESTRICTED PAYMENTS.
(a) Prior to and including April 15, 2003, the Company shall not,
directly or indirectly, and shall not permit any of its Restricted Subsidiaries
to,
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(i) declare or pay any dividend on, or make any distribution to, the
holders of, any shares of the Company's or any of its Restricted
Subsidiaries' Equity Interests (including, without limitation, any payment
in connection with any merger or consolidation involving the Company or
any of its Restricted Subsidiaries), or to the direct or indirect holders
of the Company's or any of its Restricted Subsidiaries' Equity Interests,
other than dividends or distributions payable solely in the Company's
Equity Interests, other than Disqualified Stock;
(ii) purchase, redeem or otherwise acquire or retire for value, or
permit any Restricted Subsidiary to, directly or indirectly, purchase,
redeem or otherwise acquire or retire for value (including without
limitation, in each case, in connection with any merger or consolidation
involving the Company or any Restricted Subsidiary), any of the Company's
or its direct or indirect parent's Equity Interests;
(iii) redeem, repurchase, defease or otherwise acquire or retire for
value, or permit any Restricted Subsidiary to, directly or indirectly,
redeem, repurchase, defease or otherwise acquire or retire for value,
prior to any scheduled maturity, scheduled repayment or scheduled sinking
fund payment, any Indebtedness that is subordinate, whether pursuant to
its terms or by operation of law, in right of payment to the Notes; or
(iv) make, or permit any Restricted Subsidiary, directly or
indirectly, to make, any Restricted Investment (each of the foregoing
actions set forth in clauses (i) through (iv) being referred to as a
"Restricted Payment").
(b) After April 15, 2003, the Company shall not, directly or
indirectly, make any Restricted Payment, and will not permit any Restricted
Subsidiary to make any Restricted Payment, unless, at the time thereof, and
after giving effect thereto,
(i) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof;
(ii) the Company would, at the time of such Restricted Payment and
after giving pro forma effect thereto as if such Restricted Payment had
been made at the beginning of the applicable period, have been permitted
to incur at least $1.00 of additional Indebtedness, other than Permitted
Indebtedness, pursuant to Section 4.09(a)(i) or (ii); and
(iii) after giving effect to such Restricted Payment on a pro forma
basis, the aggregate amount of all Restricted Payments made on or after
the Closing Date shall not exceed (A) the amount of (x) 100% of the
Company's Operating Cash Flow after April 15, 2003 through the end of the
latest full fiscal quarter for which consolidated financial statements of
the Company are available preceding the date of such Restricted Payment,
treated as a single accounting period, less (y) 150% of the cumulative
Consolidated Interest Expense of the Company after April 15, 2003 through
the end of the latest full fiscal quarter for which consolidated financial
statements of the Company are available preceding the date of such
Restricted Payment, treated as a single accounting period, plus (B) 100%
of the aggregate net cash proceeds received by the Company after the
Closing Date as a contribution to the Company's common equity capital or
from the issuance or sale of the Company's Equity Interests, other than
Disqualified Stock, or from the issuance or sale of convertible or
exchangeable Disqualified Stock or convertible or exchangeable debt
securities of the Company that have been converted into or exchanged for
such Equity Interests, other than Equity Interests, Disqualified Stock or
debt securities sold to a Subsidiary of the Company; provided, however,
that for purposes of this clause (b)(iii), (x) the aggregate net proceeds
received by the Company from the initial public
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offering of the common stock of UbiquiTel Parent or (y) in the event that
the initial public offering of the common stock of UbiquiTel Parent has
not been consummated by July 31, 2000, $100.0 million, as the case may be,
will be excluded from the calculation, plus (C) the aggregate net cash
proceeds received by the Company or any Restricted Subsidiary from the
sale, disposition or repayment, other than to the Company or a Restricted
Subsidiary, of any Restricted Investment made after the Closing Date in an
amount equal to the lesser of (x) the return of capital with respect to
such Investment and (y) the initial amount of such Investment, in either
case, less the cost of disposition of such Investment.
(c) So long as no Default or Event of Default shall have occurred
and be continuing or would be caused thereby, the foregoing limitations shall
not prevent the Company from:
(i) paying a dividend on the Company's Equity Interests within 60
days after the declaration thereof if, on the date when the dividend was
declared, the Company could have paid such dividend in accordance with the
provisions of this Indenture;
(ii) repurchasing the Company's Equity Interests from the Company's
former employees, consultants or directors or any of its Subsidiaries for
consideration not to exceed $1.0 million in the aggregate in any fiscal
year and any unused portion in any twelve month period may be carried
forward to one or more future periods; provided that the aggregate amount
of all such repurchases made pursuant to this clause (ii) does not exceed
$5.0 million in the aggregate;
(iii) the redemption, repurchase, defeasance or other acquisition or
retirement for value of Indebtedness that is subordinated in right of
payment to the Notes in exchange for, or with the net cash proceeds of a
substantially concurrent sale of (other than to one of the Company's
Subsidiaries):
(A) our Equity Interests, other than Disqualified Stock, or
(B) Indebtedness that is at least as subordinated in right of
payment to the Notes as the Indebtedness being purchased;
(iv) the repurchase, redemption or other acquisition of the
Company's Equity Interests, or out of the proceeds of a capital
contribution or a substantially concurrent offering of, the Company's
Equity Interests, other than Disqualified Stock;
(v) the payment of any dividend or distribution by one of the
Company's Wholly-Owned Restricted Subsidiaries to the holders of its
common Equity Interests on a pro rata basis;
(vi) so long as UbiquiTel Parent holds all of the Company's
outstanding Capital Stock, the payment of dividends or the making of loans
or advances to UbiquiTel Parent not to exceed $500,000 in any fiscal year,
for the purposes of paying franchise taxes or other expenses of UbiquiTel
Parent; and
(vii) make Investments in any Person, provided that the fair market
value thereof, measured on the date each such Investment was made or
returned, as applicable, when taken together with all other Investments
made pursuant to this clause (vii), does not exceed the sum of $25.0
million, plus the aggregate amount of the net reduction in Investments in
any Person made pursuant to this clause (vii) on and after the Issue Date
resulting from dividends, repayments of loans or other transfers of
property, in each case to the Company or any Wholly-Owned Restricted
Subsidiary from such Person, except to the extent that any such net
reduction amount is included in the amount calculated
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pursuant to clause (b)(iii) of this Section 4.07 or any other clause of
this Section 4.07; provided, however, that at the time of such Investment,
no Default or Event of Default shall have occurred and be continuing (or
result therefrom); provided further, however, that such Investment shall
be included in the calculation of the amount of Restricted Payments made
after the Closing Date pursuant to clause (b)(iii) of this Section 4.07.
In addition, if any Person in which an Investment is made, which
Investment constitutes a Restricted Payment when made, thereafter becomes a
Restricted Subsidiary, all such Investments previously made in such Person shall
no longer be counted as Restricted Payments for purposes of calculating the
aggregate amount of Restricted Payments pursuant to clause (b)(iii) of this
Section 4.07 to the extent such Investments would otherwise be so counted.
For purposes of clause (iii) above, the net proceeds received by the
Company from the issuance or sale of the Company's Equity Interests either upon
the conversion of, or exchange for, Indebtedness of the Company or any
Restricted Subsidiary shall be deemed to be an amount equal to (A) the sum of
(1) the principal amount or Accreted Value, whichever is less, of such
Indebtedness on the date of such conversion or exchange and (2) the additional
cash consideration, if any, received by the Company upon such conversion or
exchange, less any payment on account of fractional shares, minus (B) all
expenses incurred in connection with such issuance or sale. In addition, for
purposes of clause (iii) and (iv) above, the net proceeds received by the
Company from the issuance or sale of its Capital Stock upon the exercise of any
options or warrants of the Company or any Restricted Subsidiary shall be deemed
to be an amount equal to (A) the additional cash consideration, if any, received
by the Company upon such exercise, minus (B) all expenses incurred in connection
with such issuance or sale.
For purposes of this Section 4.07, if a particular Restricted
Payment involves a non-cash payment, including a distribution of assets, then
such Restricted Payment shall be deemed to be an amount equal to the cash
portion of such Restricted Payment, if any, plus an amount equal to the fair
market value of the non-cash portion of such Restricted Payment, as determined
by the Company's Board of Directors, whose good-faith determination shall be
conclusive and evidenced by a Board Resolution and, in the case of fair market
value of such non-cash portion in excess of $5.0 million, accompanied by an
opinion of an accounting, appraisal or investment banking firm of national
standing. Not later than the date of making any Restricted Payment, the Company
shall deliver to the Trustee an Officers' Certificate stating that such
Restricted Payment is permitted and setting forth the basis upon which the
calculations required by this "Limitation on Restricted Payments" covenant were
computed, together with a copy of any Board Resolution, fairness opinion or
appraisal required by this Indenture.
The amount of any Investment outstanding at any time shall be deemed
to be equal to the amount of such Investment on the date made, less the return
of capital, repayment of loans and return on capital, including interest and
dividends, in each case, received by the Company or one of its Restricted
Subsidiaries in cash, up to the amount of such Investment on the date made.
SECTION 4.08. DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING SUBSIDIARIES.
(a) The Company will not, and will not permit any of its Restricted
Subsidiaries, directly or indirectly, to create or permit to exist or become
effective any encumbrance or restriction on the ability of any Restricted
Subsidiary to (1) pay dividends or make any other distributions on its Capital
Stock to the Company or any of its Restricted Subsidiaries, or with respect to
any other interest or participation in, or measured by, its profits, or pay any
Indebtedness owed to the Company or any of its Restricted Subsidiaries; (2) make
loans or advances to the Company or any of its Restricted Subsidiaries; or (3)
transfer any of its properties or assets to the Company or any of its Restricted
Subsidiaries.
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(b) The provisions of clause (a) above shall not apply to
encumbrances or restrictions existing under or by reason of:
(i) Existing Indebtedness or the Credit Facilities as in effect on
the date of this Indenture and any amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacements
or refinancings thereof, provided that such amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacement or
refinancings are no more restrictive, taken as a whole, with respect to
such dividend and other payment restrictions than those contained in such
Existing Indebtedness, as in effect on the date of this Indenture;
(ii) this Indenture, the Notes and the Note Guarantees;
(iii) applicable law;
(iv) any instrument governing Indebtedness or Capital Stock of a
Person acquired by the Company or any of its Restricted Subsidiaries as in
effect at the time of such acquisition, except to the extent such
Indebtedness was incurred in connection with or in contemplation of such
acquisition, which encumbrance or restriction is not applicable to any
Person, or the properties or assets of any Person, other than the Person,
or the property or assets of the Person, so acquired, provided that, in
the case of Indebtedness, such Indebtedness was permitted by the terms of
this Indenture to be incurred;
(v) customary non-assignment provisions in leases entered into in
the ordinary course of business;
(vi) purchase money obligations for property acquired in the
ordinary course of business that impose restrictions on the property so
acquired of the nature described in clause (iii) of paragraph(a) of this
Section 4.08;
(vii) any agreement for the sale or other disposition of a
Restricted Subsidiary that restricts distributions by such Restricted
Subsidiary pending its sale or other disposition;
(viii) Permitted Refinancing Indebtedness, provided that the
restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are no more restrictive in any material respect,
taken as a whole, than those contained in the agreements governing the
Indebtedness being refinanced;
(ix) Liens securing Indebtedness otherwise permitted to be incurred
pursuant to the provisions of Section 4.12 that limit the right of the
Company or any of its Restricted Subsidiaries to dispose of the assets
subject to such Lien;
(x) provisions with respect to the disposition or distribution of
assets or property in joint venture agreements, asset or stock purchase
agreements and other similar agreements entered into in the ordinary
course of business; and
(xi) restrictions on cash or other deposits or net worth imposed by
customers under contracts entered into in the ordinary course of business.
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SECTION 4.09. INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF PREFERRED STOCK.
(a) The Company shall not, and shall not permit any Restricted
Subsidiary to, incur any Indebtedness, including Acquired Debt, and the Company
shall not issue any Disqualified Stock and shall not permit any of its
Restricted Subsidiaries to issue any shares of Preferred Stock, unless
immediately after giving effect to the incurrence of such Indebtedness,
including Acquired Debt, or the issuance of such Disqualified Stock or Preferred
Stock and the receipt and application of the net proceeds therefrom, including,
without limitation, the application or use of the net proceeds therefrom to
repay Indebtedness or make any Restricted Payment, (i) the Consolidated Debt to
Annualized Operating Cash Flow Ratio would be (A) less than 7.0 to 1.0, if prior
to April 15, 2005 and (B) less than 6.0 to 1.0, if on or after April 15, 2005 or
(ii) in the case of any incurrence of Indebtedness prior to April 15, 2005 only,
Consolidated Debt would be equal to or less than 70% of Total Invested Capital.
(b) So long as no Default or Event of Default shall have occurred
and be continuing or would be caused thereby, paragraph (a) of this Section 4.09
will not prohibit the incurrence of any of the following items of Indebtedness
(collectively, "Permitted Indebtedness"):
(i) the incurrence by the Company and its subsidiaries of Existing
Indebtedness;
(ii) the incurrence by the Company and the Guarantors of
Indebtedness represented by the Notes and the Note Guarantees;
(iii) the incurrence by the Company and any Guarantor of
Indebtedness under Credit Facilities; provided that the aggregate
principal amount of all Indebtedness of the Company and the Guarantors
outstanding under the Credit Facilities at any time outstanding, after
giving effect to such incurrence, does not exceed an amount equal to
$250.0 million less the aggregate amount of all Net Proceeds of Asset
Sales applied by the Company or any of its Subsidiaries since the date of
this Indenture to permanently repay Indebtedness under the Credit
Facilities pursuant to Section 4.10.
(iv) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness represented by Capital Lease Obligations,
mortgage financings or purchase money obligations, in each case, incurred
for the purpose of leasing or financing all or any part of the purchase
price or cost of construction or improvement of inventory, property, plant
or equipment used in its business in an aggregate principal amount not to
exceed $5.0 million at any time outstanding;
(v) the incurrence by the Company or any of its Restricted
Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the
net proceeds of which are used to refund, refinance or replace,
Indebtedness, other than intercompany Indebtedness, that was permitted to
be incurred paragraph (a) of this Section 4.09 or clauses (i), (ii) or
(xi) of this paragraph;
(vi) the incurrence by the Company or any of its Restricted
Subsidiaries of intercompany Indebtedness between or among the Company and
any of its Wholly-Owned Restricted Subsidiaries that are Guarantors;
provided, however, that:
(A) if the Company or any Guarantor is the obligor on such
Indebtedness, such Indebtedness must be expressly subordinated to
the prior payment in full in cash of all Obligations with respect to
the Notes, in the case of the Company, or the Note Guarantee of such
Guarantor, in the case of a Guarantor; and
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(B) (1) any subsequent issuance or transfer of Equity
Interests that results in any such Indebtedness being held by a
Person other than the Company or one of its Wholly-Owned Restricted
Subsidiaries and (2) any sale or other transfer of any such
Indebtedness to a Person that is not either the Company or one of
its Wholly-Owned Restricted Subsidiaries, shall be deemed, in each
case, to constitute an incurrence of such Indebtedness by the
Company or such Restricted Subsidiary, as the case may be, that was
not permitted by this clause (vi);
(vii) the incurrence by the Company or any of its Restricted
Subsidiaries of Hedging Obligations that are incurred for the purpose of
fixing or hedging interest rate risk with respect to any floating rate
Indebtedness that is permitted by the terms of this Indenture to be
outstanding, provided that the notional amount of any such Hedging
Obligation does not exceed the amount of Indebtedness to which such
Hedging Obligation relates;
(viii) the Guarantee by the Company or any of the Guarantors of
Indebtedness of the Company or a Restricted Subsidiary that was permitted
to be incurred by another provision of this Section 4.09;
(ix) the accrual of interest, accretion or amortization of original
issue discount, the payment of interest on any Indebtedness in the form of
additional Indebtedness with the same terms, and the payment of dividends
on Disqualified Stock in the form of additional shares of the same class
of Disqualified Stock;
(x) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness (A) in respect of bid, performance or advance
payment bonds, standby letters of credit and appeal or surety bonds
entered into in the ordinary course of business and not in connection with
the borrowing of money, or (B) arising from agreements providing for
indemnification, adjustment of purchase price or similar obligations
incurred in connection with the disposition of any business, assets or
Restricted Subsidiary in compliance with the terms of this Indenture;
(xi) the incurrence by the Company or any of its Restricted
Subsidiaries of additional Indebtedness (which may, but need not be,
incurred in whole or in part under the Credit Facilities) in an aggregate
principal amount, or Accreted Value, as applicable, at any time
outstanding, including all Permitted Refinancing Indebtedness incurred to
refund, refinance or replace any Indebtedness incurred pursuant to this
clause (xi), not to exceed $50.0 million; and
(xii) the incurrence by the Company of any Indebtedness under any
unsecured deferred promissory note payable to Sprint PCS pursuant to the
deferral of collected revenues provisions of the Consent and Agreement
between Sprint PCS and the lenders under the Credit Facilities.
(c) For purposes of determining compliance with this Section 4.09,
in the event that an item of proposed Indebtedness meets the criteria of more
than one of the categories of Permitted Indebtedness described in clauses (i)
through (xii) of paragraph (b) of this Section 4.09, or is entitled to be
incurred pursuant to the paragraph (a) of this Section 4.09, the Company will be
permitted to classify such item of Indebtedness on the date of its incurrence,
or later reclassify all or a portion of such item of Indebtedness, in any manner
that complies with this Section 4.09; provided, that Indebtedness outstanding
under the Credit Facilities on the date of this Indenture will be deemed to have
been incurred on such date in reliance on the exception provided in clause (iii)
of paragraph (b) of this Section 4.09.
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SECTION 4.10. ASSET SALES
(a) Neither the Company nor any of its Restricted Subsidiaries shall
consummate an Asset Sale unless:
(i) the Company or its Restricted Subsidiary receives consideration
at the time of the asset sale at least equal to the fair market value of
the assets or Equity Interests issued or sold, as determined by the Board
of Directors of the Company and certified to the Trustee by an Officers'
Certificate, and
(ii) at least 75% of the consideration is cash or Cash Equivalents.
For purposes of clause (ii) of this paragraph (a), the following are
considered to be cash: any liabilities of the Company or any Restricted
Subsidiary that are assumed by the transferee by an agreement that releases the
Company or the Restricted Subsidiary from further liability other than
contingent liabilities and liabilities that are subordinate to the Notes, and
cash that the Company or its Restricted Subsidiary receives from converting into
cash any securities, notes or other obligations that the Company or its
Restricted Subsidiary receives from the asset sale within 30 days after receipt.
(b) Within 360 days after the Company receives Net Proceeds from an
Asset Sale, the Company shall be permitted to apply the Net Proceeds, at its
option,
(i) to repay Senior Indebtedness and, if the Senior Indebtedness
repaid is revolving credit Indebtedness, to correspondingly reduce the
amount the lenders have committed to lend the Company thereunder;
(ii) to acquire all or substantially all of the assets of, or a
majority of the Voting Equity Interests of, a Permitted Business,
provided, that in the event of the acquisition of at least a majority of
the Voting Equity Interests of a Permitted Business, such Permitted
Business becomes a Restricted Subsidiary of the Company;
(iii) to make a capital expenditure that is useful or to be used in
a Permitted Business; or
(iv) to acquire other long-term assets to be used in a Permitted
Business.
Pending the Company's use of Net Proceeds for these purposes, the Company may
temporarily reduce revolving credit borrowings or otherwise invest them in any
manner that is not prohibited by this Indenture.
(c) Any net proceeds from asset sales that the Company does not
apply or invest as provided in paragraph (b) of this Section 4.10 will be deemed
to constitute "Excess Proceeds." When the amount of Excess Proceeds is greater
than $10.0 million, the Company shall be required to make an offer to all
holders of Notes and all holders of Senior Subordinated Indebtedness containing
provisions similar to those set forth in this Indenture with respect to offers
to purchase or redeem the Indebtedness with the proceeds of sales of assets (an
"Asset Sale Offer") to purchase the maximum principal amount of Notes and such
other Senior Subordinated Indebtedness that may be purchased out of the Excess
Proceeds. The offer price in any Asset Sale Offer shall be the Accreted Value of
the Notes, if the repurchase occurs before April 15, 2005, or the principal
amount of the Notes, plus any accrued interest thereon to the date fixed for
purchase, if the repurchase occurs on or after April 15, 2005, and shall be
payable in cash. If the aggregate principal amount of Notes and other Senior
Subordinated Indebtedness surrendered by holders
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thereof exceeds the amount of Excess Proceeds, the Trustee shall select the
Notes to be purchased pursuant to Section 3.09. Upon completion of an Asset Sale
Offer, the amount of Excess Proceeds shall be reset at zero.
(d) The Company will comply with the requirements of Rule 14e-1
under the Exchange Act and any other securities laws and regulations thereunder
to the extent such laws and regulations are applicable in connection with their
purchase of Notes pursuant to an Asset Sale Offer. To the extent the provisions
of any such rule conflict with the provisions of this Indenture relating to an
Asset Sale Offer, the Company shall comply with the provisions of such rule and
be deemed not to have breached its obligations relating to such Asset Sale
Offer.
SECTION 4.11. TRANSACTIONS WITH AFFILIATES.
(a) The Company will not, and will not permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate (each, an "Affiliate Transaction"), unless:
(i) such Affiliate Transaction is on terms that are no less favorable to
the Company or the relevant Restricted Subsidiary than those that
would have been obtained in a comparable transaction by the Company
or such Restricted Subsidiary with an unrelated Person; and
(ii) The Company delivers to the trustee:
(A) with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in
excess of $1.0 million, a Board Resolution set forth in an
Officers' Certificate certifying that such Affiliate
Transaction complies with this Section 4.11 and that such
Affiliate Transaction has been approved by a majority of the
disinterested members of the Board of Directors of the
Company; and
(B) with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in
excess of $5.0 million, an opinion as to the fairness to the
Holders of Notes of such Affiliate Transaction from a
financial point of view issued by an accounting, appraisal or
investment banking firm of national standing.
(b) The following items shall not be deemed to be Affiliate
Transactions and, therefore, will not be subject to the provisions of the
paragraph (a) of this Section 4.11:
(i) any employment, severance, stock option and other employee benefit
agreement entered into by the Company or any of its Restricted
Subsidiaries in the ordinary course of business;
(ii) transactions between or among the Company and/or its Restricted
Subsidiaries;
(iii) agreements in effect on the Closing Date, provided that each
amendment to any such agreement shall be subject to the limitations
of this Section 4.11;
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(iv) payment of reasonable directors fees, expenses and indemnification
to Persons who are not otherwise Affiliates of the Company; and
(v) Restricted Payments that are permitted by the provisions of Section
4.07.
SECTION 4.12. LIENS.
The Company shall not, and shall not permit any Restricted
Subsidiary to, create, incur, assume or otherwise cause or suffer to exist or
become effective any Lien of any kind securing Indebtedness that is equal in
right of payment with the Notes or the applicable Note Guarantee, as the case
may be, or is subordinated Indebtedness, upon any of its respective property or
assets, now owned or hereafter acquired, unless all payments due under this
Indenture and the Notes are secured equally and ratably with, or prior to, in
the case of subordinated Indebtedness, the obligations so secured until such
time as such Obligations are no longer secured by such Lien; provided that this
restriction will not apply to Permitted Liens.
SECTION 4.13. CORPORATE EXISTENCE.
Subject to Article 5 hereof, the Company shall do or cause to be
done all things necessary to preserve and keep in full force and effect (i) its
corporate existence, and the corporate, limited liability company, partnership
or other existence of each of its Restricted Subsidiaries, in accordance with
the respective organizational documents (as the same may be amended from time to
time) of the Company or any such Restricted Subsidiary and (ii) the rights
(charter and statutory), licenses and franchises of the Company and its
Restricted Subsidiaries; provided, however, that the Company shall not be
required to preserve any such right, license or franchise, or the corporate,
limited liability company, partnership or other existence of any of its
Restricted Subsidiaries, if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company and its Restricted Subsidiaries, taken as a whole, and that the loss
thereof is not adverse in any material respect to the Holders of the Notes.
SECTION 4.14. OFFER TO REPURCHASE UPON CHANGE OF CONTROL.
(a) If a Change of Control occurs, the Company shall make an offer
(a "Change of Control Offer") to each Holder to repurchase all or any part,
equal to $1,000 or an integral multiple of $1,000, of the Holder's Notes at an
offer price in cash equal to (i) 101% of the Accreted Value of the Notes, plus
Liquidated Damages, if any, thereon to the date fixed for repurchase, if the
repurchase occurs prior to April 15, 2005 or (ii) 101% of the aggregate
principal amount of the Notes, plus accrued and unpaid interest and Liquidated
Damages, if any, thereon to the date fixed for repurchase, if the repurchase
occurs on or after April 15, 2005 (the "Change of Control Payment").
(b) Within 30 business days following a Change of Control, the
Company shall mail a notice to each Holder describing the transaction or
transactions that constitute the Change of Control and offering to repurchase
the Notes on the date specified in the notice, which date shall be no earlier
than 30 days and no later than 60 days from the date the notice is mailed (the
"Change of Control Payment Date") pursuant to the procedures set forth in
Section 3.09 and described in the notice.
(c) The Company will comply with the requirements of Rule 14e-1
under the Exchange Act and any other securities laws and regulations thereunder
to the extent such laws and regulations are applicable in connection with their
purchase of Notes pursuant to a Change of Control Offer. To the extent the
provisions of any such rule conflict with the provisions of this Indenture
relating
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to an Change of Control Offer, the Company shall comply with the provisions of
such rule and be deemed not to have breached its obligations relating to such
Change of Control Offer.
(d) On the Change of Control Payment Date, the Company shall, to the
extent lawful, (1) accept for payment all Notes or portions of Notes properly
tendered under the Change of Control Offer; (2) deposit with the Paying Agent an
amount equal to the Change of Control Payment in respect of all Notes or
portions of the Notes so tendered; and (3) deliver or cause to be delivered to
the Trustee the Notes so accepted together with an Officers' Certificate stating
the aggregate Accreted Value or principal amount , as applicable, of Notes or
portions of the Notes being purchased by the Company.
(e) The Paying Agent shall mail promptly to each holder of Notes so
tendered the Change of Control Payment for the Notes, and the Trustee shall
promptly authenticate and mail, or cause to be transferred by book entry, to
each holder a new Note equal in principal amount to any unpurchased portion of
the Notes surrendered, provided, however, that each new Note shall be in a
principal amount of $1,000 or an integral multiple of $1,000.
(f) Prior to a Change of Control Payment Date, the Company shall
either repay all outstanding Senior Indebtedness or obtain the requisite
consents, if any, under all agreements governing outstanding Senior Indebtedness
to permit the repurchase of Notes required by this Section 4.14. The Company
shall publicly announce the results of the Change of Control Offer on or as soon
as practicable after the Change of Control Payment Date.
(g) The Change of Control provisions described in this Section 4.14
shall be applicable notwithstanding any other provisions of this Indenture.
(h) The Company shall not be required to make a Change of Control
Offer following a Change of Control if a third party makes the Change of Control
Offer in the manner, at the times and otherwise in compliance with the
requirements set forth in this Section 4.14 and purchases all Notes validly
tendered and not withdrawn under the Change of Control Offer.
SECTION 4.15. PAYMENTS FOR CONSENT.
Neither the Company nor any of its Subsidiaries shall, directly or
indirectly, pay or cause to be paid any consideration to or for the benefit of
any Holder of Notes for or as an inducement to any consent, waiver or amendment
of any of the terms or provisions of this Indenture or the Notes unless such
consideration is offered to be paid or is paid to all Holders of Notes that
consent, waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or agreement.
SECTION 4.16. SALE AND LEASEBACK TRANSACTIONS
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, enter into any Sale and Leaseback Transaction; provided that
the Company or any Restricted Subsidiary that is a Guarantor may enter into a
Sale and Leaseback transaction if:
(i) the Company or that Guarantor, as applicable, could have (A)
incurred Indebtedness in an amount equal to the Attributable Debt
relating to such Sale and Leaseback Transaction under the tests in
paragraphs (a) and (b) of Section 4.09(a), if applicable, and (b)
incurred a Lien to secure such Indebtedness pursuant to Section
4.12;
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(ii) the gross cash proceeds of that Sale and Leaseback Transaction are
at least equal to the fair market value, as determined in good faith
by the Board of Directors and set forth in an Officers' Certificate
delivered to the Trustee, of the property that is the subject of
such Sale and Leaseback Transaction; and
(3) the transfer of assets in that Sale and Leaseback Transaction is
permitted by, and the Company applies the Net Proceeds of such
transaction in compliance with, Section 4.10.
SECTION 4.17. NO SENIOR SUBORDINATED DEBT.
The Company and the Guarantors shall not incur any Indebtedness
that, pursuant to its terms, is subordinate or junior in right of payment to any
Senior Indebtedness or any Permitted Indebtedness described in Section
4.09(b)(iv) and senior in any respect in right of payment to the Notes or the
Note Guarantees; provided that the foregoing limitation shall not apply to
distinctions between categories of Senior Indebtedness of the Company or a
Guarantor that exist by reason of any Liens or Guarantees arising or created in
respect of some but not all such Senior Indebtedness.
SECTION 4.18. LIMITATION ON ISSUANCES AND SALES OF EQUITY INTERESTS IN
WHOLLY-OWNED RESTRICTED SUBSIDIARIES.
(a) The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, transfer, convey, sell, lease or otherwise dispose
of any Equity Interests in any Wholly-Owned Restricted Subsidiary of the Company
to any Person, other than the Company or a Wholly-Owned Restricted Subsidiary of
the Company, unless:
(i) such transfer, conveyance, sale, lease or other disposition is
of all the Equity Interests in such Wholly-Owned Restricted Subsidiary;
and
(ii) the Net Proceeds from such transfer, conveyance, sale, lease or
other disposition are applied in accordance with Section 4.10.
(b) In addition, the Company will not permit any Wholly-Owned
Restricted Subsidiary of the Company to issue any of its Equity Interests, other
than, if necessary, shares of its Capital Stock constituting directors'
qualifying shares, to any Person other than to the Company or a Wholly-Owned
Restricted Subsidiary of the Company.
SECTION 4.19. BUSINESS ACTIVITIES.
The Company shall not, and shall not permit any Restricted
Subsidiary to, engage in any business other than Permitted Businesses, except to
the extent that would not be material to the Company and its Subsidiaries, taken
as a whole.
SECTION 4.20. DESIGNATION OF RESTRICTED AND UNRESTRICTED SUBSIDIARIES.
The Board of Directors may designate any Restricted Subsidiary as an
Unrestricted Subsidiary if that designation would not cause a Default. If a
Restricted Subsidiary is designated as an Unrestricted Subsidiary, all
outstanding Investments owned by the Company and its Restricted Subsidiaries in
the Subsidiary so designated will be deemed to be an Investment made as of the
time of such designation and will reduce the amount available for Restricted
Payments under Section 4.07(b)(iii) or Permitted Investments, as applicable. All
such outstanding Investments will be valued at their fair
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market value at the time of such designation. That designation will only be
permitted if such Restricted Payment would be permitted at that time and if such
Restricted Subsidiary otherwise meets the definition of an Unrestricted
Subsidiary. The Board of Directors may redesignate any Unrestricted Subsidiary
to be a Restricted Subsidiary if the redesignation would not cause a Default.
ARTICLE 5.
SUCCESSORS
SECTION 5.01. MERGER, CONSOLIDATION, OR SALE OF ASSETS.
(a) The Company shall not, in any transaction or series of related
transactions, merge or consolidate with or into, or sell, assign, convey,
transfer or otherwise dispose of its properties and assets substantially as an
entirety to, any Person, and shall not permit any of its Restricted Subsidiaries
to enter into any such transaction or series of transactions if such transaction
or series of transactions, in the aggregate, would result in a sale, assignment,
conveyance, transfer or other disposition of the properties and assets of the
Company and its Restricted Subsidiaries, taken as a whole, substantially as an
entirety to any Person, unless, at the time and after giving effect thereto:
(i) either: (A) if the transaction or series of transactions is a
consolidation of the Company with or a merger of the Company with or into
any other Person, the Company shall be the surviving Person of such merger
or consolidation, or (B) the Person formed by any consolidation with or
merger with or into the Company, or to which the Company's properties and
assets or the properties and assets of the Company and its Restricted
Subsidiaries, taken as a whole, as the case may be, substantially as an
entirety are sold, assigned, conveyed or otherwise transferred (any such
surviving Person or transferee Person referred to in this clause (B) being
the "Surviving Entity"), shall be a corporation, partnership, limited
liability company or trust organized and existing under the laws of the
United States of America, any state thereof or the District of Columbia
and shall expressly assume by a supplemental Indenture executed and
delivered to the Trustee, in form satisfactory to the Trustee, all the
Company's obligations under the Notes and this Indenture and, in each
case, this Indenture, as so supplemented, shall remain in full force and
effect;
(ii) immediately before and immediately after giving effect to such
transaction or series of transactions on a pro forma basis including any
Indebtedness incurred or anticipated to be incurred in connection with or
in respect of such transaction or series of transactions, no Default or
Event of Default shall have occurred and be continuing; and
(iii) the Company or the Surviving Entity will, at the time of such
transaction and after giving pro forma effect thereto as if such
transaction had occurred at the beginning of the applicable period, (A)
have Consolidated Net Worth immediately after the transaction equal to or
greater than the Consolidated Net Worth of the Company immediately
preceding the transaction and (B) be permitted to incur at least $1.00 of
additional Indebtedness pursuant to Section 4.09(a); provided, however,
that the foregoing requirements shall not apply to any transaction or
series of transactions involving the sale, assignment, conveyance,
transfer or other disposition of the properties and assets by any
Wholly-Owned Restricted Subsidiary to any other Wholly-Owned Restricted
Subsidiary, or the merger or consolidation of any Wholly-Owned Restricted
Subsidiary with or into any other Wholly-Owned Restricted Subsidiary.
(b) For purposes of the foregoing, the transfer (by lease,
assignment, sale or otherwise, in a single transaction or series of related
transactions) of all or substantially all of the properties or assets of one or
more Subsidiaries, the Capital Stock of which constitutes all or substantially
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all of the properties and assets of the Company, shall be deemed to be the
transfer of all or substantially all of the properties and assets of the
Company.
(c) In connection with any consolidation, merger, sale, assignment,
conveyance, transfer or other disposition contemplated by the foregoing
provisions of this Section 5.01, the Company shall deliver, or cause to be
delivered, to the Trustee, in form and substance reasonably satisfactory to the
Trustee, an Officers' Certificate stating that such consolidation, merger, sale,
assignment, conveyance, transfer, or other disposition and the supplemental
Indenture in respect thereof, required under clause (a)(i)(B) of this Section
5.01, comply with the requirements of the Indenture and an Opinion of Counsel.
Each such Officers' Certificate shall set forth the manner of determination of
the Company's compliance with clause (a)(iii) of this Section 5.01.
(d) For all purposes under this Indenture and the Notes, including
the provisions described in this Section 5.01 and Sections 4.09 and 4.18 and
4.20, any Surviving Entity will, upon such transaction or series of
transactions, become Restricted Subsidiaries or Unrestricted Subsidiaries as
provided pursuant to Section 4.20 and all Indebtedness of the Surviving Entity
and its Subsidiaries that was not Indebtedness of the Company and its
Subsidiaries immediately prior to such transaction or series of transactions
shall be deemed to have been incurred upon such transaction or series of
transactions.
SECTION 5.02. SUCCESSOR CORPORATION SUBSTITUTED.
Upon any consolidation or merger, or any sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of the assets
of the Company in accordance with Section 5.01 hereof, the successor corporation
formed by such consolidation or into or with which the Company is merged or to
which such sale, assignment, transfer, lease, conveyance or other disposition is
made shall succeed to, and be substituted for (so that from and after the date
of such consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this Indenture referring to the "Company" shall refer instead to
the successor corporation and not to the Company), and may exercise every right
and power of the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein; provided, however, that
the predecessor Company shall not be relieved from the obligation to pay the
principal of and interest on the Notes except in the case of a sale of all of
the Company's assets that meets the requirements of Section 5.01 hereof.
ARTICLE 6.
DEFAULTS AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT.
An "Event of Default" occurs if:
(a) the Company defaults in the payment when due of interest on, or
Liquidated Damages with respect to, the Notes, whether or not prohibited by
Article 11, and such default continues for a period of 30 days;
(b) the Company defaults in the payment when due of principal of or
premium, if any, on the Notes, whether or not prohibited by Article 11;
(c) the Company or any of its Restricted Subsidiaries fails to comply with
any of the provisions of Section 4.10 or 4.14 or Article 5 hereof;
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(d) the Company or any of its Restricted Subsidiaries, for 60 days after
written notice to the Company by the Trustee or the Holders of at least 25% in
aggregate principal amount of the then outstanding Notes, fails to comply with
any of its other agreements in this Indenture or the Notes;
(e) the default under any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by the Company or any of its Restricted
Subsidiaries, or the payment of which is guaranteed by the Company or any of its
Restricted Subsidiaries, whether such Indebtedness or Guarantee now exists, or
is created after the date of this Indenture, if that default (i) is caused by a
failure to pay principal at final stated maturity of such Indebtedness (a
"Payment Default") or (ii) results in the acceleration of such Indebtedness
prior to its stated maturity and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such Indebtedness
under which there has been a Payment Default or the maturity of which has been
so accelerated, aggregates $7.5 million or more;
(f) failure by the Company or any of its Significant Subsidiaries to pay
final judgments aggregating in excess of $7.5 million, which judgments are not
paid, discharged or stayed for a period of 60 consecutive days;
(g) except as permitted by this Indenture, any Note Guarantee of UbiquiTel
Parent or any Significant Subsidiary is held in any judicial proceeding to be
unenforceable or invalid or ceases for any reason to be in full force and effect
or UbiquiTel Parent or any Guarantor that is a Significant Subsidiary, or any
Person acting on behalf of any Guarantor, denies or disaffirms its obligations
under its Note Guarantee;
(h) the Company or any of its Significant Subsidiaries or any group of
Restricted Subsidiaries that, taken as a whole, would constitute a Significant
Subsidiary, pursuant to or within the meaning of Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it in an
involuntary case,
(iii) consents to the appointment of a Custodian of it or for all or
substantially all of its property,
(iv) makes a general assignment for the benefit of its creditors,
or
(v) generally is not paying its debts as they become due;
(i) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(i) is for relief against the Company or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary in an
involuntary case; or
(ii) appoints a Custodian of the Company or any of its Significant
Subsidiaries or any group of Restricted Subsidiaries that,
taken as a whole, would constitute a Significant Subsidiary or
for all or substantially all of the property of the
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Company or any of its Significant Subsidiaries or any group of
Restricted Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary; or
(iii) orders the liquidation of the Company or any of its
Significant Subsidiaries or any group of Restricted
Subsidiaries that, taken as a whole, would constitute a
Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60 consecutive
days;
(j) (i) if any Credit Facility is not in existence, any event occurs that
causes, subject to any applicable grace period or waiver, an Event of
Termination under any of the Sprint Agreements or (i) if any Credit Facility is
in existence, Sprint shall have commenced to exercise any remedy under the
Sprint Agreements (other than Section 11.6.3 of the Management Agreement) by
reason of the occurrence of an Event of Termination; and
(k) if on or prior to July 31, 2000, UbiquiTel Parent has not received at
least $100 million of gross proceeds from either (a) the completion of its
proposed initial public offering of its common stock or (b) the issuance of
equity in a private placement, and in each case, has contributed all net
proceeds therefrom, except up to $1.25 million, to the Company.
SECTION 6.02. ACCELERATION.
If any Event of Default (other than an Event of Default specified in
clause (h) or (i) of Section 6.01 hereof with respect to the Company), occurs
and is continuing, the Trustee or the Holders of at least 25% in principal
amount of the then outstanding Notes may declare to be immediately due and
payable (i) if prior to April 15, 2005, the Accreted Value or (ii) if on or
after April 15, 2005, the principal amount, in each case, of all Notes then
outstanding, plus accrued and unpaid interest to the date of acceleration.
Notwithstanding the foregoing, if an Event of Default specified in clause (h) or
(i) of Section 6.01 hereof occurs with respect to the Company, all outstanding
Notes shall be due and payable immediately without further action or notice. In
order to effect such acceleration, the Trustee or Holders of at least 25% in
principal amount of the then outstanding Notes shall deliver notice in writing
to the Company and the Trustee specifying the respective Event of Default and
that such notice is a "notice of acceleration" (the "Acceleration Notice"), and
the same (A) shall become immediately due and payable or (B) if there are any
amounts outstanding under the Credit Facilities, shall become immediately due
and payable upon the first to occur of an acceleration under the Credit
Facilities or five Business Days after receipt by the Company and the agent
under the Credit Facilities of such Acceleration Notice, but only if such Event
of Default is then continuing.
SECTION 6.03. OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy to collect the payment of principal, premium, if
any, and interest on the Notes or to enforce the performance of any provision of
the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess
any of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder of a Note in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
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SECTION 6.04. WAIVER OF PAST DEFAULTS.
Holders of not less than a majority in aggregate principal amount of
the Notes then outstanding by notice to the Trustee may, on behalf of the
Holders of all of the Notes, waive an existing Default or Event of Default and
its consequences hereunder, except a continuing Default or Event of Default in
the payment of the principal of, premium and Liquidated Damages, if any, or
interest on, the Notes (including in connection with an offer to purchase)
(provided, however, that the Holders of a majority in aggregate principal amount
of the then outstanding Notes may rescind an acceleration and its consequences,
including any related payment default that resulted from such acceleration).
Upon any such waiver, such Default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
Default or impair any right consequent thereon.
SECTION 6.05. CONTROL BY MAJORITY.
Holders of a majority in principal amount of the then outstanding
Notes may direct the time, method and place of conducting any proceeding for
exercising any remedy available to the Trustee or exercising any trust or power
conferred on it. However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture that the Trustee determines may be unduly
prejudicial to the rights of other Holders of Notes or that may involve the
Trustee in personal liability.
SECTION 6.06. LIMITATION ON SUITS.
A Holder of a Note may pursue a remedy with respect to this
Indenture or the Notes only if:
(a) the Holder of a Note gives to the Trustee written notice of a
continuing Event of Default;
(b) the Holders of at least 25% in principal amount of the then
outstanding Notes make a written request to the Trustee to pursue the remedy;
(c) such Holder of a Note or Holders of Notes offer and, if
requested, provide to the Trustee indemnity satisfactory to the Trustee against
any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer and, if requested, the provision of
indemnity; and
(e) during such 60-day period the Holders of a majority in principal
amount of the then outstanding Notes do not give the Trustee a direction
inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the
rights of another Holder of a Note or to obtain a preference or priority over
another Holder of a Note.
SECTION 6.07. RIGHTS OF HOLDERS OF NOTES TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Note to receive payment of principal, premium and Liquidated
Damages, if any, and interest on the Note, on or after the respective due dates
expressed in the Note (including in connection with an offer to purchase), or
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to bring suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such
Holder.
SECTION 6.08. COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.01(a) or (b) occurs
and is continuing, the Trustee is authorized to recover judgment in its own name
and as trustee of an express trust against the Company for the whole amount of
principal of, premium and Liquidated Damages, if any, and interest remaining
unpaid on the Notes and interest on overdue principal and, to the extent lawful,
interest and such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee is authorized to file such proofs of claim and other
papers or documents as may be necessary or advisable in order to have the claims
of the Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the Company
(or any other obligor upon the Notes), its creditors or its property and shall
be entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian in any such
judicial proceeding is hereby authorized by each Holder to make such payments to
the Trustee, and in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay to the Trustee any amount due to
it for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07 hereof. To the extent that the payment of any such compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, and
any other amounts due the Trustee under Section 7.07 hereof out of the estate in
any such proceeding, shall be denied for any reason, payment of the same shall
be secured by a Lien on, and shall be paid out of, any and all distributions,
dividends, money, securities and other properties that the Holders may be
entitled to receive in such proceeding whether in liquidation or under any plan
of reorganization or arrangement or otherwise. Nothing herein contained shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
SECTION 6.10. PRIORITIES.
If the Trustee collects any money pursuant to this Article, it shall
pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due
under Section 7.07 hereof, including payment of all compensation, expense and
liabilities incurred, and all advances made, by the Trustee and the costs and
expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the Notes
for principal, premium and Liquidated Damages, if any, and interest, ratably,
without preference or priority of any kind, according to the amounts due and
payable on the Notes for principal, premium and Liquidated Damages, if any and
interest, respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
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The Trustee may fix a record date and payment date for any payment
to Holders of Notes pursuant to this Section 6.10.
SECTION 6.11. UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section does not apply to a suit by the Trustee, a suit by a Holder of a
Note pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in
principal amount of the then outstanding Notes.
SECTION 6.11. WILLFUL DEFAULTS BY THE COMPANY.
In the case of any Event of Default occurring by reason of any
willful action or inaction taken or not taken by or on behalf of the Company
with the intention of avoiding payment of the premium that the Company would
have had to pay if it then had elected to redeem the Notes pursuant to Section
3.07, an equivalent premium shall also become and be immediately due and payable
to the extent permitted by law upon the acceleration of the Notes. If an Event
of Default occurs prior to April 15, 2005, by reason of any willful action or
inaction taken or not taken by or on behalf of the Company with the intention of
avoiding the prohibition on redemption of the Notes prior to April 15, 2005,
then the premium specified in Section 3.07 shall also become immediately due and
payable to the extent permitted by law upon the acceleration of the Notes.
ARTICLE 7.
TRUSTEE
SECTION 7.01. DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in its exercise, as a prudent man would
exercise or use under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by the
express provisions of this Indenture and the Trustee need perform only
those duties that are specifically set forth in this Indenture and no
others, and no implied covenants or obligations shall be read into this
Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions furnished
to the Trustee and conforming to the requirements of this Indenture.
However, the Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this
Indenture.
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(c) The Trustee may not be relieved from liabilities for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:
(i) this paragraph does not limit the effect of paragraph (b) of
this Section;
(ii) the Trustee shall not be liable for any error of judgment made
in good faith by a Responsible Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05 hereof.
(d) Whether or not therein expressly so provided, every provision of this
Indenture that in any way relates to the Trustee is subject to paragraphs (a),
(b), (c), (e) and (f) of this Section and Section 7.02.
(e) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any Holders, unless such Holder shall have offered to the Trustee
security and indemnity satisfactory to it against any loss, liability or
expense.
(f) The Trustee shall not be liable for interest on any money received by
it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
SECTION 7.02. RIGHTS OF TRUSTEE.
(a) The Trustee may conclusively rely upon any document believed by it to
be genuine and to have been signed or presented by the proper Person. The
Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel and the written advice of such counsel or any Opinion of Counsel shall
be full and complete authorization and protection from liability in respect of
any action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall not be
responsible for the misconduct or negligence of any agent appointed with due
care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any demand,
request, direction or notice from the Company shall be sufficient if signed by
an Officer of the Company.
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(f) The Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders unless such Holders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities that might be
incurred by it in compliance with such request or direction.
SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest it must eliminate such conflict within 90 days, apply to the SEC for
permission to continue as trustee or resign. Any Agent may do the same with like
rights and duties. The Trustee is also subject to Sections 7.10 and 7.11 hereof.
SECTION 7.04. TRUSTEE'S DISCLAIMER.
The Trustee shall not be responsible for and makes no representation
as to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of this
Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
SECTION 7.05. NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing and if it
is known to the Trustee, the Trustee shall mail to Holders of Notes a notice of
the Default or Event of Default within 90 days after it occurs. Except in the
case of a Default or Event of Default in payment of principal of, premium, if
any, or interest on any Note, the Trustee may withhold the notice if and so long
as a committee of its Responsible Officers in good faith determines that
withholding the notice is in the interests of the Holders of the Notes.
SECTION 7.06. REPORTS BY TRUSTEE TO HOLDERS OF THE NOTES.
Within 60 days after each May 1 beginning with May 1, 2000, and for
so long as Notes remain outstanding, the Trustee shall mail to the Holders of
the Notes a brief report dated as of such reporting date that complies with TIA
ss. 313(a) (but if no event described in TIA ss. 313(a) has occurred within the
twelve months preceding the reporting date, no report need be transmitted). The
Trustee also shall comply with TIA ss. 313(b)(2). The Trustee shall also
transmit by mail all reports as required by TIA ss. 313(c).
A copy of each report at the time of its mailing to the Holders of
Notes shall be mailed to the Company and filed with the SEC and each stock
exchange on which the Notes are listed in accordance with TIA ss. 313(d). The
Company shall promptly notify the Trustee when the Notes are listed on any stock
exchange.
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SECTION 7.07. COMPENSATION AND INDEMNITY.
The Company shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee promptly
upon request for all reasonable disbursements, advances and expenses incurred or
made by it in addition to the compensation for its services. Such expenses shall
include the reasonable compensation, disbursements and expenses of the Trustee's
agents and counsel.
The Company shall indemnify the Trustee against any and all losses,
liabilities or expenses incurred by it arising out of or in connection with the
acceptance or administration of its duties under this Indenture, including the
costs and expenses of enforcing this Indenture against the Company (including
this Section 7.07) and defending itself against any claim (whether asserted by
the Company or any Holder or any other person) or liability in connection with
the exercise or performance of any of its powers or duties hereunder, except to
the extent any such loss, liability or expense or a portion thereof may be
attributable to its negligence or bad faith. The Trustee shall notify the
Company promptly of any claim for which it may seek indemnity. Failure by the
Trustee to so notify the Company shall not relieve the Company of its
obligations hereunder. The Company shall defend the claim and the Trustee shall
cooperate in the defense. The Trustee may have separate counsel and the Company
shall pay the reasonable fees and expenses of such counsel. The Company need not
pay for any settlement made without its consent, which consent shall not be
unreasonably withheld. The Company need not reimburse any expense or indemnify
against any loss liability or expense incurred by the Trustee through the
Trustee's own willful misconduct, negligence or bad faith.
The obligations of the Company under this Section 7.07 shall survive
the satisfaction and discharge of this Indenture.
To secure the Company's payment obligations in this Section, the
Trustee shall have a Lien prior to the Notes on all money or property held or
collected by the Trustee, except that held in trust to pay principal and
interest on particular Notes. Such Lien shall survive the satisfaction and
discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event
of Default specified in Section 6.01(h) or (i) hereof occurs, the expenses and
the compensation for the services (including the fees and expenses of its agents
and counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.
The Trustee shall comply with the provisions of TIA ss. 313(b)(2) to
the extent applicable.
SECTION 7.08. REPLACEMENT OF TRUSTEE.
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.
The Trustee may resign in writing at any time and be discharged from
the trust hereby created by so notifying the Company. The Holders of Notes of a
majority in principal amount of the then outstanding Notes may remove the
Trustee by so notifying the Trustee and the Company in writing. The Company may
remove the Trustee if:
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(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a Custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, or
the Holders of Notes of at least 10% in principal amount of the then outstanding
Notes may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee, after written request by any Holder of a Note who
has been a Holder of a Note for at least six months, fails to comply with
Section 7.10, such Holder of a Note may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders of the Notes. Subject to the Lien provided for in Section
7.07 hereof, the retiring Trustee shall promptly transfer all property held by
it as Trustee to the successor Trustee; provided, however, that all sums owing
to the Trustee hereunder shall have been paid. Notwithstanding replacement of
the Trustee pursuant to this Section 7.08, the Company's obligations under
Section 7.07 hereof shall continue for the benefit of the retiring Trustee.
SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates, merges or converts into, or transfers
all or substantially all of its corporate trust business to, another
corporation, the successor corporation without any further act shall be the
successor Trustee.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.
There shall at all times be a Trustee hereunder that is a
corporation organized and doing business under the laws of the United States of
America or of any state thereof that is authorized under such laws to exercise
corporate trustee power, that is subject to supervision or examination by
federal or state authorities and that has a combined capital and surplus of at
least $10 million as set forth in its most recent published annual report of
condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA ss. 310(a)(1), (2) and (5). The Trustee is subject to TIA
ss. 310(b).
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SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee is subject to TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
SECTION 8.01. OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
The Company may, at the option of its Board of Directors evidenced
by a resolution set forth in an Officers' Certificate, at any time, elect to
have either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon
compliance with the conditions set forth below in this Article Eight.
SECTION 8.02. LEGAL DEFEASANCE AND DISCHARGE.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be deemed to have been
discharged from its obligations with respect to all outstanding Notes on the
date the conditions set forth below are satisfied (hereinafter, "Legal
Defeasance"). For this purpose, Legal Defeasance means that the Company shall be
deemed to have paid and discharged the entire Indebtedness represented by the
outstanding Notes, which shall thereafter be deemed to be "outstanding" only for
the purposes of Section 8.05 hereof and the other Sections of this Indenture
referred to in (a) and (b) below, and to have satisfied all its other
obligations under such Notes and this Indenture (and the Trustee, on demand of
and at the expense of the Company, shall execute proper instruments
acknowledging the same), except for the following provisions which shall survive
until otherwise terminated or discharged hereunder: (a) the rights of Holders of
outstanding Notes to receive solely from the trust fund described in Section
8.04 hereof, and as more fully set forth in such Section, payments in respect of
the principal of, premium, if any, and interest and Liquidated Damages, if any,
on such Notes when such payments are due, (b) the Company's obligations with
respect to such Notes under Article 2 and Section 4.02 hereof, (c) the rights,
powers, trusts, duties and immunities of the Trustee hereunder and the Company's
obligations in connection therewith and (d) this Article Eight. Subject to
compliance with this Article Eight, the Company may exercise its option under
this Section 8.02 notwithstanding the prior exercise of its option under Section
8.03 hereof.
SECTION 8.03. COVENANT DEFEASANCE.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be released from its
obligations under the covenants contained in Sections 4.03, 4.07, 4.08, 4.09,
4.10, 4.11, 4.12, 4.13, 4.14, 4.15, 4.16, 4.17, 4.18, 4.19 and 4.20, hereof, and
the operation of Section 5.01 hereof, with respect to the outstanding Notes on
and after the date the conditions set forth in Section 8.04 are satisfied
(hereinafter, "Covenant Defeasance"), and the Notes shall thereafter be deemed
not "outstanding" for the purposes of any direction, waiver, consent or
declaration or act of Holders (and the consequences of any thereof) in
connection with such covenants, but shall continue to be deemed "outstanding"
for all other purposes hereunder (it being understood that such Notes shall not
be deemed outstanding for accounting purposes). For this purpose, Covenant
Defeasance means that, with respect to the outstanding Notes, the Company may
omit to comply with and shall have no liability in respect of any term,
condition or limitation set forth in any such covenant, whether directly or
indirectly, by reason of any reference elsewhere herein to any such covenant or
by reason of any reference in any such covenant
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to any other provision herein or in any other document and such omission to
comply shall not constitute a Default or an Event of Default under Section 6.01
hereof, but, except as specified above, the remainder of this Indenture and such
Notes shall be unaffected thereby. In addition, upon the Company's exercise
under Section 8.01 hereof of the option applicable to this Section 8.03 hereof,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
Sections 6.01(c) through 6.01(g) hereof shall not constitute Events of Default.
SECTION 8.04. CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of either
Section 8.02 or 8.03 hereof to the outstanding Notes. In order to exercise
either Legal Defeasance or Covenant Defeasance:
(a) the Company must irrevocably deposit with the Trustee, in trust, for
the benefit of the Holders, cash in United States dollars, non-callable
Government Securities, or a combination thereof, in such amounts as shall be
sufficient, in the opinion of a nationally recognized firm of independent public
accountants, to pay the principal of, premium, if any, and interest and
Liquidated Damages, if any, on the outstanding Notes on the stated date for
payment thereof or on the applicable redemption date, as the case may be, and
the Company must specify whether the Notes are being defeased to maturity or to
a particular redemption date;
(b) in the case of an election under Section 8.02 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that (A) the Company has
received from, or there has been published by, the Internal Revenue Service a
ruling or (B) since the date of this Indenture, there has been a change in the
applicable federal income tax law, in either case to the effect that, and based
thereon such Opinion of Counsel shall confirm that, the Holders of the
outstanding Notes shall not recognize income, gain or loss for federal income
tax purposes as a result of such Legal Defeasance and shall be subject to
federal income tax on the same amounts, in the same manner and at the same times
as would have been the case if such Legal Defeasance had not occurred;
(c) in the case of an election under Section 8.03 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that the Holders of the
outstanding Notes shall not recognize income, gain or loss for federal income
tax purposes as a result of such Covenant Defeasance and shall be subject to
federal income tax on the same amounts, in the same manner and at the same times
as would have been the case if such Covenant Defeasance had not occurred;
(d) no Default or Event of Default shall have occurred and be continuing
either: (I) on the date of such deposit other than a Default or Event of Default
resulting from the borrowing of funds to be applied to such deposit, or (ii)
under Sections 6.01(h) or 6.01(i) hereof at any time in the period ending on the
91st day after the date of deposit;
(e) such Legal Defeasance or Covenant Defeasance shall not result in a
breach or violation of, or constitute a default under, any material agreement or
instrument (other than this Indenture) to which the Company or any of its
Restricted Subsidiaries is a party or by which the Company or any of its
Restricted Subsidiaries is bound;
(f) the Company shall have delivered to the Trustee an Opinion of Counsel
(which may be subject to customary exceptions) to the effect that, assuming no
intervening bankruptcy of the Company between the date of deposit and the 91st
day following the deposit and assuming that no Holder is an
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"insider" of the Company under applicable Bankruptcy Law, after the 91st day
following the deposit, the trust funds shall not be subject to the effect of any
applicable bankruptcy, insolvency, reorganization or similar laws affecting
creditors' rights generally;
(g) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the intent
of preferring the Holders over any other creditors of the Company or with the
intent of defeating, hindering, delaying or defrauding any other creditors of
the Company; and
(h) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for or relating to the Legal Defeasance or the Covenant
Defeasance have been complied with.
SECTION 8.05. DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 8.06 hereof, all money and non-callable
Government Securities (including the proceeds thereof) deposited with the
Trustee (or other qualifying trustee, collectively for purposes of this Section
8.05, the "Trustee") pursuant to Section 8.04 hereof in respect of the
outstanding Notes shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Notes and this Indenture, to the payment,
either directly or through any Paying Agent (including the Company acting as
Paying Agent) as the Trustee may determine, to the Holders of such Notes of all
sums due and to become due thereon in respect of principal, premium, if any, and
interest, but such money need not be segregated from other funds except to the
extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the cash or non-callable
Government Securities deposited pursuant to Section 8.04 hereof or the principal
and interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Anything in this Article Eight to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon the request
of the Company any money or non-callable Government Securities held by it as
provided in Section 8.04 hereof which, in the opinion of a nationally recognized
firm of independent public accountants expressed in a written certification
thereof delivered to the Trustee (which may be the opinion delivered under
Section 8.04(a) hereof), are in excess of the amount thereof that would then be
required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.
SECTION 8.06. REPAYMENT TO COMPANY.
Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal of, premium, if
any, or interest or Liquidated Damages, if any, on any Note and remaining
unclaimed for two years after such principal, and premium, if any, or interest
or Liquidated Damages, if any, has become due and payable shall be paid to the
Company on its request or (if then held by the Company) shall be discharged from
such trust; and the Holder of such Note shall thereafter, as an unsecured
creditor, look only to the Company for payment thereof, and all liability of the
Trustee or such Paying Agent with respect to such trust money, and all liability
of the Company as trustee thereof, shall thereupon cease; provided, however,
that the Trustee or such Paying Agent, before being required to make any such
repayment, may at the expense of the Company cause to be published once, in The
New York Times and The Wall Street Journal (national edition), notice that such
money
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remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining shall be repaid to the Company.
SECTION 8.07. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any United States
dollars or non-callable Government Securities in accordance with Section 8.02 or
8.03 hereof, as the case may be, by reason of any order or judgment of any court
or governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company's obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 8.02 or 8.03 hereof until such time as the Trustee or Paying Agent is
permitted to apply all such money in accordance with Section 8.02 or 8.03
hereof, as the case may be; provided, however, that, if the Company makes any
payment of principal of, premium, if any, or interest or Liquidated Damages, if
any, on any Note following the reinstatement of its obligations, the Company
shall be subrogated to the rights of the Holders of such Notes to receive such
payment from the money held by the Trustee or Paying Agent.
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
SECTION 9.01. WITHOUT CONSENT OF HOLDERS OF NOTES.
Notwithstanding Section 9.02 of this Indenture, the Company and the
Trustee may amend or supplement this Indenture or the Notes without the consent
of any Holder of a Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in place of
certificated Notes or to alter the provisions of Article 2 hereof (including the
related definitions) in a manner that does not materially adversely affect any
Holder;
(c) to provide for the assumption of the Company's or any Guarantor's
obligations to the Holders of the Notes by a successor to the Company pursuant
to Article 5 hereof;
(d) to make any change that would provide any additional rights or
benefits to the Holders of the Notes or that does not adversely affect the legal
rights hereunder of any Holder of the Note;
(e) to comply with requirements of the SEC in order to effect or maintain
the qualification of this Indenture under the TIA;
(f) to add a Guarantor pursuant to Section 12.02; and
(g) to evidence and provide the acceptance of the appointment of a
successor Trustee pursuant to Section 7.08 and 7.09.
Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
Indenture, and upon receipt by the Trustee of the documents described in Section
7.02 hereof, the Trustee shall join with the Company in the execution of any
amended or supplemental Indenture authorized or permitted by the terms of this
Indenture and to make any further appropriate agreements and stipulations that
may be therein contained,
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but the Trustee shall not be obligated to enter into such amended or
supplemental Indenture that affects its own rights, duties or immunities under
this Indenture or otherwise.
SECTION 9.02. WITH CONSENT OF HOLDERS OF NOTES.
Except as provided below in this Section 9.02, the Company and the
Trustee may amend or supplement this Indenture (including Section 3.09, 4.10 and
4.14 hereof) and the Notes may be amended or supplemented with the consent of
the Holders of at least a majority in aggregate principal amount at maturity of
the Notes then outstanding voting as a single class (including without
limitation, consents obtained in connection with a purchase of, tender offer or
exchange offer for, the Notes), and, subject to Sections 6.04 and 6.07 hereof,
any existing Default or Event of Default (other than a Default or Event of
Default in the payment of the principal of, premium, if any, or interest or
Liquidated Damages, if any, on the Notes, except a payment default resulting
from an acceleration that has been rescinded) or compliance with any provision
of this Indenture or the Notes may be waived with the consent of the Holders of
a majority in aggregate principal amount at maturity of the then outstanding
Notes voting as a single class (including without limitation, consents obtained
in connection with a purchase of, tender offer or exchange offer for, the
Notes).
Upon the request of the Company accompanied by a Board Resolution
authorizing the execution of any such amended or supplemental Indenture, and
upon the filing with the Trustee of evidence satisfactory to the Trustee of the
consent of the Holders of Notes as aforesaid, and upon receipt by the Trustee of
the documents described in Section 7.02 hereof, the Trustee shall join with the
Company in the execution of such amended or supplemental Indenture unless such
amended or supplemental Indenture directly affects the Trustee's own rights,
duties or immunities under this Indenture or otherwise, in which case the
Trustee may in its discretion, but shall not be obligated to, enter into such
amended or supplemental Indenture.
It shall not be necessary for the consent of the Holders of Notes
under this Section 9.02 to approve the particular form of any proposed amendment
or waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders of Notes affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amended or supplemental
Indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the Holders of a
majority in aggregate principal amount at maturity of the Notes then outstanding
voting as a single class may waive compliance in a particular instance by the
Company with any provision of this Indenture or the Notes. However, without the
consent of each Holder affected, an amendment or waiver under this Section 9.02
may not (with respect to any Notes held by a non-consenting Holder):
(a) reduce the Accreted Value of the then outstanding Notes if prior to
April 15, 2005 or the aggregate principal amount of Notes if after April 15,
2005 whose Holders must consent to an amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of any Note or
alter any of the provisions with respect to the redemption of the Notes except
as provided above with respect to Sections 3.09, 4.10 and 4.14 hereof;
(c) reduce the rate of or change the time for payment of interest on any
Note;
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(d) waive a Default or Event of Default in the payment of principal of or
premium, if any, or interest or Liquidated Damages, if any, on the Notes (except
a rescission of acceleration of the Notes by the Holders of at least a majority
in aggregate principal amount of the then outstanding Notes and a waiver of the
payment default that resulted from such acceleration);
(e) make any Note payable in money other than that stated in the Notes;
(f) make any change in the provisions of this Indenture relating to
waivers of past Defaults or the rights of Holders of Notes to receive payments
of principal of or premium, if any, or interest or Liquidated Damages, if any,
on the Notes;
(g) waive a redemption payment with respect to any Note (other than a
payment required by Sections 3.09, 4.10 and 4.14 hereof); or
(i) make any change in Section 6.04 or 6.07 hereof or in the foregoing
amendment and waiver provisions.
SECTION 9.03. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture or the Notes shall
be set forth in a amended or supplemental Indenture that complies with the TIA
as then in effect.
SECTION 9.04. REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a
consent to it by a Holder of a Note is a continuing consent by the Holder of a
Note and every subsequent Holder of a Note or portion of a Note that evidences
the same debt as the consenting Holder's Note, even if notation of the consent
is not made on any Note. However, any such Holder of a Note or subsequent Holder
of a Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
SECTION 9.05. NOTATION ON OR EXCHANGE OF NOTES.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall
not affect the validity and effect of such amendment, supplement or waiver.
SECTION 9.06. TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall sign any amended or supplemental Indenture
authorized pursuant to this Article Nine if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
The Company may not sign an amendment or supplemental Indenture until the Board
of Directors approves it. In executing any amended or supplemental Indenture,
the Trustee shall be entitled to receive and (subject to Section 7.01 hereof)
shall be fully protected in relying upon, in addition to the documents required
by Section 10.04 hereof, an Officer's Certificate and an Opinion of
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Counsel stating that the execution of such amended or supplemental Indenture is
authorized or permitted by this Indenture.
ARTICLE 10.
MISCELLANEOUS
SECTION 10.01. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts
with the duties imposed by TIA ss. 318(c), the imposed duties shall control.
SECTION 10.02. NOTICES.
Any notice or communication by the Company or the Trustee to the others is
duly given if in writing and delivered in Person or mailed by first class mail
(registered or certified, return receipt requested), telex, telecopier or
overnight air courier guaranteeing next-day delivery, to the others' address:
If to the Company:
UbiquiTel Operating Company
1 Bala Plaza, Suite 402
Bala Cynwyd, Pennsylvania 19004
Attention: Donald A. Harris
Telecopy No.: (610) 660-9558
With copies to:
Greenberg Traurig, LLP
1750 Tysons Boulevard
Tysons Corner, Virginia 22102
Attention: Lee R. Marks, Esq.
Telecopy No.: (703) 749-1301
and
Greenberg Traurig, P.A.
1221 Brickell Avenue
21st Floor
Miami, Florida 33131
Telecopier No.: (305) 579-0717
Attention: Rebecca R. Orand, Esq.
If to the Trustee:
American Stock Transfer & Trust Company
40 Wall Street, 46th Floor
New York, New York 10005
Telecopier No.: (718) 331-1852
Attention: Corporate Trust Administration
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The Company or the Trustee, by notice to the others may designate
additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders)
shall be deemed to have been duly given: at the time delivered by hand, if
personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when receipt
acknowledged, if telecopied; and the next Business Day after timely delivery to
the courier, if sent by overnight air courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first
class mail, certified or registered, return receipt requested, or by overnight
air courier guaranteeing next day delivery to its address shown on the register
kept by the Registrar. Any notice or communication shall also be so mailed to
any Person described in TIA ss. 313(c), to the extent required by the TIA.
Failure to mail a notice or communication to a Holder or any defect in it shall
not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Holders, it shall
mail a copy to the Trustee and each Agent at the same time.
SECTION 10.03. COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES.
Holders may communicate pursuant to TIA ss. 312(b) with other
Holders with respect to their rights under this Indenture or the Notes. The
Company, the Trustee, the Registrar and anyone else shall have the protection of
TIA ss. 312(c).
SECTION 10.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee to
take any action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 10.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been satisfied; and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 10.05 hereof) stating that, in the opinion of such counsel, all such
conditions precedent and covenants have been satisfied.
SECTION 10.05. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA ss. 314(a)(4)) shall comply with the provisions of TIA
ss. 314(e) and shall include:
(a) a statement that the Person making such certificate or opinion
has read such covenant or condition;
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(b) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she has
made such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has been
satisfied; and
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been satisfied.
SECTION 10.06. RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a meeting
of Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
SECTION 10.07. NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND
STOCKHOLDERS.
No past, present or future director, officer, employee, incorporator
or stockholder of the Company or any Guarantor, as such, shall have any
liability for any obligations of the Company or any Guarantor under the Notes,
the Guarantees, this Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation. Each Holder by accepting a Note
waives and releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes and the Guarantees. Such waiver may not
be effective to waive liabilities under the federal securities laws and it is
the view of the SEC that such a waiver is against public policy.
SECTION 10.08. GOVERNING LAW.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED
TO CONSTRUE THIS INDENTURE AND THE NOTES WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
SECTION 10.09. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret any other indenture,
loan or debt agreement of the Company or its Subsidiaries or of any other
Person. Any such indenture, loan or debt agreement may not be used to interpret
this Indenture.
SECTION 10.10. SUCCESSORS.
All agreements of the Company in this Indenture and the Notes shall
bind its successors. All agreements of the Trustee in this Indenture shall bind
its successors.
SECTION 10.11. SEVERABILITY.
In case any provision in this Indenture or in the Notes shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
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SECTION 10.12. COUNTERPART ORIGINALS.
The parties may sign any number of copies of this Indenture. Each
signed copy shall be an original, but all of them together represent the same
agreement.
SECTION 10.13. TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part of this Indenture and shall in
no way modify or restrict any of the terms or provisions hereof.
ARTICLE 11.
SUBORDINATION
SECTION 11. 01. AGREEMENT TO SUBORDINATE.
The Company agrees, and each Holder by accepting a Note agrees, that the
Indebtedness evidenced by, and the payment of principal, premium, interest and
Liquidated Damages, if any, on, the Notes is subordinated in right of payment,
to the extent and in the manner provided in this Article 11, to the prior
payment in full of all Senior Indebtedness (whether outstanding on the date
hereof or hereafter created, incurred, assumed or guaranteed), and that the
subordination is for the benefit of the holders of Senior Indebtedness.
SECTION 11.02. LIQUIDATION; DISSOLUTION; BANKRUPTCY.
Upon any distribution to creditors of the Company in a liquidation or
dissolution of the Company or in a bankruptcy, reorganization, insolvency,
receivership or similar proceeding relating to the Company or its property, an
assignment for the benefit of creditors or any marshaling of the Company's
assets and liabilities, the holders of Senior Indebtedness shall be entitled to
receive payment in full of all Obligations due in respect of such Senior
Indebtedness (including interest after the commencement of any such proceeding
at the rate specified in the applicable Senior Indebtedness) before the Holders
of Notes shall be entitled to receive any payment with respect to the Notes, and
until all Obligations with respect to Senior Indebtedness are paid in full in
cash or Cash Equivalents, any distribution to which the Holders of Notes would
be entitled shall be made to the holders of Senior Indebtedness (except that
Holders of Notes may receive and retain Equity Interests of the Company or a
Guarantor or Indebtedness of the Company or any Guarantor that is subordinated
at least to the same extent as the Notes or Note Guarantee, as applicable, and
has a Weighted Average Life to Maturity at least equal to the remaining Weighted
Average Life to Maturity of the Notes and payments made from the trust described
under Article 8).
SECTION 11.03. DEFAULT ON DESIGNATED SENIOR INDEBTEDNESS.
The Company may not pay principal, premium, interest or Liquidated
Damages, if any, with respect to the Notes or make any deposit pursuant to the
provisions described under Article 8 and may not repurchase, redeem or otherwise
retire any Notes (collectively, "pay the Notes"), (except by delivery of Equity
Interests of the Company or any Guarantor or Indebtedness of the Company or any
Guarantor that is subordinated at least to the same extent as the Notes and the
Note Guarantee, as applicable, and has a Weighted Average Life to Maturity at
least equal to the remaining Weighted Average Life to Maturity of the Notes) if
(i) a default in the payment when due, whether at maturity, upon any redemption,
by acceleration or otherwise of any principal of, interest on, unpaid drawings
for letters of credit issued in respect of, or regularly accruing fees with
respect to, Senior Indebtedness or (ii) the Trustee has received a Blockage
Notice (as defined below). However, the Company may and shall pay the Notes
without
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regard to the foregoing if the Company and the Trustee receive written notice
approving such payment from the Representative (as defined below) of the
Designated Senior Indebtedness with respect to which either of the events set
forth in clause (i) or (ii) of the immediately preceding sentence has occurred
and is continuing. During the continuance of any default (other than a default
described in clause (i) of the second preceding sentence) with respect to any
Designated Senior Indebtedness pursuant to which the maturity thereof may be
accelerated immediately without further notice (except such notice as may be
required to effect such acceleration) or the expiration of any applicable grace
periods, the Company may not pay the Notes for a period (a "Payment Blockage
Period") commencing upon the receipt by the Trustee (with a copy to the Company)
of written notice (a "Blockage Notice") of such default from the Representative
of the holders of such Designated Senior Indebtedness specifying an election to
effect a Payment Blockage Period and ending 179 days thereafter (or earlier if
such Payment Blockage Period is terminated (i) by written notice to the Trustee
and the Company from the Person or Persons who gave such Blockage Notice, (ii)
because the default giving rise to such Blockage Notice is no longer continuing
or (iii) because such Designated Senior Indebtedness has been repaid in full).
Notwithstanding the provisions described in the immediately preceding
sentence (but subject to the provisions described in the first sentence of this
paragraph), unless a payment default described in clause (i) of the first
sentence of the preceding paragraph shall be continuing and the holders of such
Designated Senior Indebtedness or the representative of such holders (any such
representative, a "Representative") have accelerated the maturity of such
Designated Senior Indebtedness (and any such acceleration has not been
rescinded), the Company may resume payments on the Notes after the end of such
Payment Blockage Period. The Notes shall not be subject to more than one Payment
Blockage Period in any consecutive 360-day period, irrespective of the number of
defaults with respect to Designated Senior Indebtedness during such period. No
non-payment default that existed or was continuing on the date of delivery of
any Blockage Notice to the Trustee shall be, or be made, the basis for a
subsequent Blockage Notice unless such default shall have been waived or cured
for a period of not less than 90 days (it being acknowledged that any subsequent
action, or any breach of any financial covenants for a period commencing after
the date of such payment blockage period that, in either case, would give rise
to an event of default pursuant to any provisions under which an event of
default previously existed or was continuing shall constitute a new event of
default for this purpose). Following the expiration of any period during which
the Company is prohibited from making payments on the Notes pursuant to a
Blockage Notice, the Company shall be obligated to resume making any and all
required payments in respect of the Notes, including any missed payments, unless
the maturity of any Designated Senior Indebtedness has been accelerated, and
such acceleration remains in full force and effect.
The Company shall give prompt written notice to the Trustee of any default
in the payment of any Senior Indebtedness or any acceleration under any Senior
Indebtedness or under any agreement pursuant to which Senior Indebtedness may
have been issued. Failure to give such notice shall not affect the subordination
of the Notes to the Senior Indebtedness or the application of the other
provisions provided in this Article 11.
SECTION 11.04. ACCELERATION OF NOTES.
If payment of the Notes is accelerated because of a Default, the Company
shall promptly notify holders of Senior Indebtedness of the acceleration.
SECTION 11.05. WHEN DISTRIBUTION MUST BE PAID OVER.
In the event that the Trustee receives or is holding, or any Holder
receives, any payment of any principal, premium, interest and Liquidated
Damages, if any, with respect to the Notes at a time when the
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Trustee or such Holder, as applicable, has actual knowledge (in the case of the
Trustee as described in Section 11.11 hereof), that such payment is prohibited
by Section 11.02 or 11.03 hereof, such payment shall be held by the Trustee or
such Holder, in trust for the benefit of, and shall be paid forthwith over and
delivered to, the holders of Senior Indebtedness as their interests may appear
or their Representative under the Indenture or other agreement (if any) pursuant
to which Senior Indebtedness may have been issued, as their respective interests
may appear, for application to the payment of all Obligations with respect to
the Senior Indebtedness remaining unpaid to the extent necessary to pay such
Obligations in full in accordance with their terms, after giving effect to any
concurrent payment or distribution to or for the holders of Senior Indebtedness.
With respect to the holders of Senior Indebtedness, the Trustee undertakes
to perform only such obligations on the part of the Trustee as are specifically
set forth in this Article 11, and no implied covenants or obligations with
respect to the holders of Senior Indebtedness shall be read into this Indenture
against the Trustee. The Trustee shall not be deemed to owe any fiduciary duty
to the holders of Senior Indebtedness, and shall not be liable to any such
holders if the Trustee shall mistakenly pay over or distribute to or on behalf
of Holders or the Company or any other Person money or assets to which any
holders of Senior Indebtedness shall be entitled by virtue of this Article 11,
except if such payment is made as a result of the willful misconduct or gross
negligence of the Trustee.
SECTION 11.06. NOTICE BY THE COMPANY.
The Company shall promptly notify the Trustee and the Paying Agent of any
facts known to the Company that would cause a payment of any Obligations with
respect to the Notes to violate this Article 11, but failure to give such notice
shall not affect the subordination of the Notes to the Senior Indebtedness as
provided in this Article 11.
SECTION 11.07. SUBROGATION.
After all Senior Indebtedness is paid in full and until the Notes are paid
in full, Holders shall be subrogated (equally and ratably with all other
Indebtedness pari passu with the Notes) to the rights of holders of Senior
Indebtedness to receive distributions applicable to Senior Indebtedness to the
extent that distributions otherwise payable to the Holders have been applied to
the payment of Senior Indebtedness. A distribution made under this Article to
holders of Senior Indebtedness that otherwise would have been made to Holders is
not, as between the Company and Holders, a payment by the Company on the Notes.
If any payment or distribution to which the Holders would otherwise have
been entitled but for the provisions of this Article 11 shall have been applied,
pursuant to the provisions of this Article 11, to the payment of all amounts
payable under the Senior Indebtedness, then and in such case the Holders shall
be entitled to receive from the holders of such Senior Indebtedness at the time
outstanding any payments or distributions received by such holders of such
Senior Indebtedness in excess of the amount sufficient to pay all amounts
payable under or in respect of such Senior Indebtedness in full; provided,
however, that such payments or distributions shall be paid first pro rata to
Holders that previously paid amounts then pro rata to all Holders.
SECTION 11.08. RELATIVE RIGHTS.
This Article 11 defines the relative rights of Holders and holders of
Senior Indebtedness. Nothing in this Indenture shall:
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(1) impair, as between the Company and Holders, the obligation of
the Company, which is absolute and unconditional, to pay principal, premium,
interest and Liquidated Damages, if any, on the Notes in accordance with their
terms;
(2) affect the relative rights of Holders and creditors of the
Company other than their rights in relation to holders of Senior Indebtedness;
or
(3) prevent the Trustee or any Holder from exercising its available
remedies upon a Default, subject to the rights of holders and owners of Senior
Indebtedness to receive distributions and payments otherwise payable to Holders.
If the Company fails because of this Article 11 to pay principal,
premium, interest and Liquidated Damages, if any, on a Note on the due date, the
failure is still a Default.
SECTION 11.09. SUBORDINATION MAY NOT BE IMPAIRED BY THE COMPANY.
No right of any holder of Senior Indebtedness to enforce the subordination
of the Indebtedness evidenced by the Notes shall be impaired by any act or
failure to act by the Company or any Holder or by the failure of the Company or
any Holder to comply with this Indenture.
SECTION 11.10. DISTRIBUTION OR NOTICE TO REPRESENTATIVE.
Whenever a distribution is to be made or a notice given to holders of
Designated Senior Indebtedness, the distribution may be made and the notice
given to their Representative.
Upon any payment or distribution of assets of the Company referred to in
this Article 11, the Trustee and the Holders shall be entitled to rely upon any
order or decree made by any court of competent jurisdiction or upon any
certificate of such Representative or of the liquidating trustee or agent or
other person making any distribution to the Trustee or to the Holders for the
purpose of ascertaining the Persons entitled to participate in such
distribution, the holders of the Senior Indebtedness and other Indebtedness of
the Company, the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or to this Article
11.
SECTION 11.11. RIGHTS OF TRUSTEE AND PAYING AGENT.
Notwithstanding the provisions of this Article 11 or any other provision
of this Indenture, the Trustee shall not be charged with knowledge of the
existence of any facts that would prohibit the making of any payment or
distribution by the Trustee, and the Trustee and the Paying Agent may continue
to make payments on the Notes, unless an authorized Officer of the Trustee shall
have received at its office at least two Business Days prior to the due date of
such payment written notice of facts that would cause the payment of any
principal, premium, interest and Liquidated Damages, if any, with respect to the
Notes to violate this Article 11. Only the Company or a Representative may give
the notice. Nothing in this Article 11 shall impair the claims of, or payments
to, the Trustee under or pursuant to Section 7.07 hereof.
The Trustee in its individual or any other capacity may hold Senior
Indebtedness with the same rights it would have if it were not Trustee. Any
Agent may do the same with like rights.
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SECTION 11.12. AUTHORIZATION TO EFFECT SUBORDINATION.
Each Holder of a Note by the Holder's acceptance thereof authorizes and
directs the Trustee on the Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination as provided in this
Article 11, and appoints the Trustee to act as the Holder's attorney-in-fact for
any and all such purposes. If the Trustee does not file a proper proof of claim
or proof of debt in the form required in any proceeding referred to in Section
6.09 hereof at least 30 days before the expiration of the time to file such
claim, a Representative of Designated Senior Indebtedness is hereby authorized
to file an appropriate claim for and on behalf of the Holders of the Notes and
the Trustee shall have no liability therefor.
SECTION 11.13. PAYMENT.
A payment with respect to a Note or with respect to principal of or
interest on a Note shall include payment of principal, premium, interest and
Liquidated Damages, if any, on any Note, any payment on account of any mandatory
or optional repurchase or redemption of any Note (including payments pursuant to
Article 3 or Section 4.10 or Section 4.14 hereof) and any payment or recovery on
any claim (whether for rescission or damages and whether based on contract,
tort, duty imposed by law, or any other theory of liability) relating to or
arising out of the offer, sale or purchase of any Note provided that any such
payment, other payment or recovery (i) not prohibited pursuant to this Article
11 at the time actually made shall not be subject to any recovery by any holder
of Designated Senior Indebtedness or Representative therefor or other Person
pursuant to this Article 11 at any time thereafter (unless such payment is a
voluntary prepayment on the Notes made at the time a Default exists under this
Indenture) and (ii) made by or from any Person other than the Company shall not
be subject to any recovery by any holder of Designated Senior Indebtedness or
Representative therefor or other Person pursuant to this Article 11 at any time
thereafter except to the extent such Person recovers any such amount paid from
the Company, whether pursuant to rights of indemnity, rescission or otherwise.
ARTICLE 12
NOTE GUARANTEES
SECTION 12.01. GUARANTEE.
Subject to this Article 12, each of the Guarantors hereby, jointly and
severally, unconditionally guarantees to each Holder of a Note authenticated and
delivered by the Trustee and to the Trustee and its successors and assigns,
irrespective of the validity and enforceability of this Indenture, the Notes, or
the obligations of the Company hereunder or thereunder, that: (a) the principal
of premium and Liquidated Damages, if any, and interest on the Notes shall be
promptly paid in full when due, whether at maturity, by acceleration, redemption
or otherwise, and interest on the overdue principal of and interest on the
Notes, if any, if lawful, and all other obligations of the Company to the
Holders or the Trustee hereunder or thereunder shall be promptly paid in full or
performed, all in accordance with the terms hereof and thereof; and (b) in case
of any extension of time of payment or renewal of any Notes or any of such other
obligations, that same shall be promptly paid in full when due or performed in
accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration pursuant to Section 6.02 hereof or otherwise. Failing
payment when due of any amount so guaranteed or any performance so guaranteed
for whatever reason, the Guarantors shall be jointly and severally obligated to
pay the same immediately. Each Guarantor agrees that this is a guarantee of
payment and not a guarantee of collection. Notwithstanding anything herein to
the contrary, all obligations of the Guarantors hereunder shall be subordinated
to the prior payment of Senior Indebtedness to the same extent that the Notes
are subordinated pursuant to Article 11.
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Each Guarantor hereby agrees that its obligations with regard to this Note
Guarantee shall be joint and several, unconditional, irrespective of the
validity or enforceability of the Notes or the obligations of the Company under
this Indenture, the absence of any action to enforce the same, the recovery of
any judgment against the Company or any other obligor with respect to this
Indenture, the Notes or the Obligations of the Company under this Indenture or
the Notes, any action to enforce the same or any other circumstances (other than
complete performance) which might otherwise constitute a legal or equitable
discharge or defense of a Guarantor. Each Guarantor further, to the extent
permitted by law, waives and relinquishes all claims, rights and remedies
accorded by applicable law to guarantors and agrees not to assert or take
advantage of any such claims, rights or remedies, including but not limited to:
(a) any right to require any of the Trustee, the Holders or the Company (each a
"Benefited Party"), as a condition of payment or performance by such Guarantor,
to (1) proceed against the Company, any other guarantor (including any other
Guarantor) of the Obligations under the Note Guarantees or any other Person, (2)
proceed against or exhaust any security held from the Company, any such other
guarantor or any other Person, (3) proceed against or have resort to any balance
of any deposit account or credit on the books of any Benefited Party in favor of
the Company or any other Person, or (4) pursue any other remedy in the power of
any Benefited Party whatsoever; (b) any defense arising by reason of the
incapacity, lack of authority or any disability or other defense of the Company
including any defense based on or arising out of the lack of validity or the
unenforceability of the Obligations under the Note Guarantees or any agreement
or instrument relating thereto or by reason of the cessation of the liability of
the Company from any cause other than payment in full of the Obligations under
the Note Guarantees; (c) any defense based upon any statute or rule of law which
provides that the obligation of a surety must be neither larger in amount nor in
other respects more burdensome than that of the principal; (d) any defense based
upon any Benefited Party's errors or omissions in the administration of the
Obligations under the Note Guarantees, except behavior which amounts to bad
faith; (e)(1) any principles or provisions of law, statutory or otherwise, which
are or might be in conflict with the terms of the Note Guarantees and any legal
or equitable discharge of such Guarantor's obligations hereunder, (2) the
benefit of any statute of limitations affecting such Guarantor's liability
hereunder or the enforcement hereof, (3) any rights to set-offs, recoupments and
counterclaims and (4) promptness, diligence and any requirement that any
Benefited Party protect, secure, perfect or insure any security interest or lien
or any property subject thereto; (f) notices, demands, presentations, protests,
notices of protest, notices of dishonor and notices of any action or inaction,
including acceptance of the Note Guarantees, notices of default under the Notes
or any agreement or instrument related thereto, notices of any renewal,
extension or modification of the Obligations under the Note Guarantees or any
agreement related thereto, and notices of any extension of credit to the Company
and any right to consent to any thereof; (g) to the extent permitted under
applicable law, the benefits of any "One Action" rule and (h) any defenses or
benefits that may be derived from or afforded by law which limit the liability
of or exonerate guarantors or sureties, or which may conflict with the terms of
the Note Guarantees. Each Guarantor hereby covenants that its Note Guarantee
shall not be discharged except by complete performance of the obligations
contained in its Note Guarantee and this Indenture.
If any Holder or the Trustee is required by any court or otherwise to
return to the Company, the Guarantors or any custodian, trustee, liquidator or
other similar official acting in relation to either the Company or the
Guarantors, any amount paid by either to the Trustee or such Holder, this Note
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect.
Each Guarantor agrees that it shall not be entitled to any right of
subrogation in relation to the Holders in respect of any obligations guaranteed
hereby until payment in full of all obligations guaranteed hereby. Each
Guarantor further agrees that, as between the Guarantors, on the one hand, and
the Holders and the Trustee, on the other hand, (x) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Section 6.02
hereof for the purposes of this Note Guarantee, notwithstanding
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any stay, injunction or other prohibition preventing such acceleration in
respect of the obligations guaranteed hereby and (y) in the event of any
declaration of acceleration of such obligations as provided in Section 6.02
hereof, such obligations (whether or not due and payable) shall forthwith become
due and payable by the Guarantors for the purpose of this Note Guarantee. The
Guarantors shall have the right to seek contribution from any non-paying
Guarantor so long as the exercise of such right does not impair the rights of
the Holders under the Note Guarantee.
SECTION 12.02. ADDITIONAL NOTE GUARANTEES.
If (a) the Company or any of its Restricted Subsidiaries acquires or
creates another domestic Restricted Subsidiary after the date hereof, (b)
UbiquiTel Leasing Company, a wholly-owned special purposes Subsidiary of the
Company, or any successor amends its certificate of incorporation to change the
nature and purpose of the business that it is legally permitted to conduct or
Guarantees any Indebtedness under the Credit Facilities, or (c) any Unrestricted
Subsidiary ceases to be an Unrestricted Subsidiary, then, in each case, any such
Subsidiary shall execute and deliver to the Trustee (i) a supplemental
Indenture, in form and substance substantially in the form of Exhibit E attached
hereto, which subjects such Person to the provisions of this Indenture as a
Guarantor, and (ii) an Opinion of Counsel to the effect that such supplemental
Indenture has been duly authorized and executed by such Person and constitutes
the legal, valid, binding and enforceable obligation of such Person (subject to
such customary exceptions concerning fraudulent conveyance laws, creditors'
rights and equitable principles as may be reasonably acceptable to the Trustee).
SECTION 12.03. LIMITATION ON GUARANTOR LIABILITY.
Each Guarantor, and by its acceptance of Notes, each Holder, hereby
confirms that it is the intention of all such parties that the Note Guarantee of
such Guarantor not constitute a fraudulent transfer or conveyance for purposes
of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent
Transfer Act or any similar federal or state law to the extent applicable to any
Note Guarantee. To effectuate the foregoing intention, the Trustee, the Holders
and the Guarantors hereby irrevocably agree that the obligations of such
Guarantor under this Article 12 shall be limited to the maximum amount as shall,
after giving effect to such maximum amount and all other contingent and fixed
liabilities of such Guarantor that are relevant under such laws, and after
giving effect to any collections from, rights to receive contribution from or
payments made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under this Article 12, result in the
obligations of such Guarantor under its Note Guarantee not constituting a
fraudulent transfer or conveyance.
SECTION 12.04. EXECUTION AND DELIVERY OF NOTE GUARANTEE.
To evidence its Note Guarantee set forth in Section 12.01 hereof, each
Guarantor hereby agrees that a notation of such Note Guarantee in substantially
the form included in Exhibit D shall be endorsed by an Officer of such Guarantor
on each Note authenticated and delivered by the Trustee and that this Indenture
shall be executed on behalf of such Guarantor by an Officer of such Guarantor
thereunto authorized.
Each Guarantor hereby agrees that its Note Guarantee set forth in Section
12.01 hereof shall remain in full force and effect notwithstanding any failure
to endorse on each Note a notation of such Note Guarantee.
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If an Officer whose signature is on this Indenture or on the Note
Guarantee no longer holds that office at the time the Trustee authenticates the
Note on which a Note Guarantee is endorsed, the Note Guarantee shall be valid
nevertheless.
The delivery of any Note by the Trustee, after the authentication thereof
hereunder, shall constitute due delivery of the Note Guarantee set forth in this
Indenture on behalf of the Guarantors.
SECTION 12.05. GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.
A Guarantor (other than UbiquiTel Parent) may not sell or otherwise
dispose of all or substantially all of its assets, or consolidate with or merge
with or into another Person, other than the Company or another Guarantor,
unless:
(a) immediately after giving effect to the transaction, no Default exists
under this Indenture; and
(b) Either
(i) the Person formed by or surviving any such consolidation or
merger (if other than a Guarantor or the Company) unconditionally assumes
all the obligations of such Guarantor, pursuant to a supplemental
Indenture in form and substance reasonably satisfactory to the Trustee,
under the Notes, this Indenture, and the Note Guarantee on the terms set
forth herein or therein; or
(ii)the Net Proceeds of the transactions are applied in accordance
with Section 4.10.
In case of any such consolidation, merger, sale or conveyance and upon the
assumption by the successor Person, by supplemental Indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the Note
Guarantee endorsed upon the Notes and the due and punctual performance of all of
the covenants and conditions of this Indenture to be performed by the Guarantor,
such successor Person shall succeed to and be substituted for the Guarantor with
the same effect as if it had been named herein as a Guarantor. Such successor
Person thereupon may cause to be signed any or all of the Note Guarantees to be
endorsed upon all of the Notes issuable hereunder which theretofore shall not
have been signed by the Company and delivered to the Trustee. All the Note
Guarantees so issued shall in all respects have the same legal rank and benefit
under this Indenture as the Note Guarantees theretofore and thereafter issued in
accordance with the terms of this Indenture as though all of such Note
Guarantees had been issued at the date of the execution hereof.
Except as set forth in Articles 4 and 5 hereof, and notwithstanding clause
(a) and (b) of this Section 12.05, nothing contained in this Indenture or in any
of the Notes shall prevent any consolidation or merger of a Guarantor with or
into the Company or another Guarantor, or shall prevent any sale or conveyance
of the property of a Guarantor as an entirety or substantially as an entirety to
the Company or another Guarantor.
SECTION 12.06. RELEASES OF NOTE GUARANTEES.
A Note Guarantee, other than the Note Guarantee of UbiquiTel Parent,
will be released (a) in connection with any sale of all of the Capital Stock of
a Guarantor (including the Note Guarantee of any wholly-owned Subsidiary of such
Guarantor) to a Person (including by way of merger or consolidation) that is not
(either before or after giving effect to such transaction) a Subsidiary of the
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Company, if the Net Proceeds of that transaction are applied (or the Company
delivers an Officer's Certificate to the Trustee certifying that such Net
Proceeds will be applied within the time period specified in Section 4.10) in
accordance with Section 4.10 hereof or (b) if the Company properly designates
any Restricted Subsidiary that is a Guarantor as an Unrestricted Subsidiary in
accordance with Section 4.20 hereof.
Any Guarantor not released from its obligations under its Note
Guarantee shall remain liable for the full amount of principal of and interest
on the Notes and for the other obligations of any Guarantor under this Indenture
as provided in this Article 12.
[Signatures on following page]
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SIGNATURES
Dated as of April 11, 2000
UBIQUITEL OPERATING COMPANY
By: ______________________________________
Name: Peter Lucas
Title: Interim Chief Financial Officer
UBIQUITEL INC.
By: ______________________________________
Name: Peter Lucas
Title: Interim Chief Financial Officer
AMERICAN STOCK TRANSFER & TRUST COMPANY,
as Trustee
By: ______________________________________
Name: Herbert J. Lemmer
Title: Vice President
<PAGE>
EXHIBIT A
(Face of Note)
14% Senior Subordinated Discount Notes due 2010
CUSIP _____________
No. ___ $__________
UBIQUITEL OPERATING COMPANY
promises to pay to Cede & Co. or registered assigns, the principal sum of
_________________ Dollars ($______________) on April 15, 2010.
Interest Payment Dates: April 15 and October 15.
Record Dates: April 1 and October 1.
Dated: April 11, 2000
UBIQUITEL OPERATING COMPANY
By: ____________________________________
Name:
Title:
This is one of the Global
Notes referred to in the
within-mentioned Indenture:
AMERICAN STOCK TRANSFER & TRUST COMPANY,
as Trustee
By: ___________________________
Authorized Signatory
================================================================================
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(Back of Note)
14% Senior Subordinated Discount Notes due 2010
THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.07 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE,
(III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT
TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO
A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (55 WATER STREET, NEW YORK, NEW YORK) ("DTC"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE NEXT SENTENCE. BY ITS
ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER:
(1) REPRESENTS THAT (i) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE ACT)(A "QIB"), (ii) IT HAS ACQUIRED THIS
NOTE IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE
ACT OR (iii) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN
RULE 501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE ACT (AN "IAI"),
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS SECURITY
EXCEPT (i) TO THE COMPANY OR ANY OF ITS
A-1-2
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SUBSIDIARIES, (ii) 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, (iii) IN AN OFFSHORE
TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR 904 OF THE ACT, (iv)
IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE ACT, (v)
TO AN IAI THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED
LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
TRANSFER OF THIS SECURITY (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 COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE ACT, (vi) IN
ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY)
OR (vii) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH
CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND
(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY OR AN
INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND.
AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" AND "UNITED STATES" HAVE THE
MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE ACT. THE INDENTURE
AND WARRANT AGREEMENT CONTAIN A PROVISION REQUIRING THE TRUSTEE TO REFUSE TO
REGISTER ANY TRANSFER OF THESE SECURITIES IN VIOLATION OF THE FOREGOING.
UNTIL THE SEPARATION DATE (AS DEFINED), THIS NOTE HAS BEEN ISSUED AS, AND MUST
BE TRANSFERRED AS, A UNIT TOGETHER WITH THE ASSOCIATED WARRANTS TO PURCHASE
COMMON STOCK OF UBIQUITEL INC. EACH UNIT CONSISTS OF $1,000 PRINCIPAL AMOUNT OF
NOTES AND A WARRANT TO PURCHASE 5.965 SHARES OF COMMON STOCK OF UBIQUITEL INC.,
SUBJECT TO ADJUSTMENT UNDER CERTAIN CIRCUMSTANCES. A COPY OF THE WARRANT
AGREEMENT PURSUANT TO WHICH THE WARRANTS HAVE BEEN ISSUED IS AVAILABLE FROM THE
COMPANY UPON REQUEST.
FOR PURPOSES OF SECTION 1273 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED
(THE "CODE"), THIS SECURITY HAS ORIGINAL ISSUE DISCOUNT. FOR PURPOSES OF SECTION
1273 OF THE CODE, THE ISSUE PRICE IS $394.97 AND THE AMOUNT OF ORIGINAL ISSUE
DISCOUNT IS $605.03, IN EACH CASE PER $1,000 PRINCIPAL AMOUNT OF THIS SECURITY.
FOR PURPOSES OF SECTION 1275 OF THE CODE, THE YIELD TO MATURITY COMPOUNDED
SEMIANNUALLY IS 17.81%.
Capitalized terms used herein shall have the meanings assigned to
them in the Indenture referred to below unless otherwise indicated.
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1. INTEREST. UbiquiTel Operating Company, a Delaware corporation
(the "Company"), promises to pay interest on the principal amount of this Note
at 14% per annum until maturity, in the manner specified below, and shall pay
the Liquidated Damages, if any, payable pursuant to Section 5 of the
Registration Rights Agreement referred to below. Interest will not accrue prior
to April 15, 2005. Thereafter, the Company shall pay interest and Liquidated
Damages, if any, semi-annually on April 15 and October 15 of each year, or if
any such day is not a Business Day, on the next succeeding Business Day (each an
"Interest Payment Date"). Interest on the Notes shall accrue from the most
recent date to which interest has been paid or, if no interest has been paid,
from April 15, 2005; provided, however, that if there is no existing Default in
the payment of interest, and if this Note is authenticated between a record date
referred to on the face hereof and the next succeeding Interest Payment Date,
interest shall accrue from such next succeeding Interest Payment Date; provided,
further, that the first Interest Payment Date shall be October 15, 2005. The
Company shall pay interest (including post-petition interest in any proceeding
under any Bankruptcy Law) on overdue principal and premium, if any, from time to
time on demand at a rate that is 1% per annum in excess of the rate then in
effect; it shall pay interest (including post-petition interest in any,
proceeding under any Bankruptcy Law) on overdue installments of interest and
Liquidated Damages, if any (without regard to any applicable grace periods) from
time to time on demand at the same rate to the extent lawful. Interest shall be
computed on the basis of a 360-day year of twelve 30-day months.
2. METHOD OF PAYMENT. The Company shall pay interest on the Notes
(except defaulted interest) and Liquidated Damages, if any, to the Persons who
are registered Holders of Notes at the close of business on the April 1 or
October 1 next preceding the Interest Payment Date, even if such Notes are
cancelled after such record date and on or before such Interest Payment Date,
except as provided in Section 2.12 of the Indenture with respect to defaulted
interest. The Notes shall be payable as to principal, premium and Liquidated
Damages, if any, and interest at the office or agency of the Company maintained
for such purpose within or without the City and State of New York, or, at the
option of the Company, payment of interest and Liquidated Damages, if any, may
be made by check mailed to the Holders at their addresses set forth in the
register of Holders; provided, however, that payment by wire transfer of
immediately available funds shall be required with respect to principal of and
interest, premium and Liquidated Damages, if any, on, all Global Notes and all
other Notes the Holders of which shall have provided wire transfer instructions
to the Company or the Paying Agent. Such payment shall be in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts.
3. PAYING AGENT AND REGISTRAR. Initially, American Transfer & Trust
Company, the Trustee under the Indenture, shall act as Paying Agent and
Registrar. The Company may change any Paying Agent or Registrar without notice
to any Holder. The Company or any of its Subsidiaries may act in any such
capacity.
4. INDENTURE. The Company issued the Notes under an Indenture dated
as of April 11, 2000 ("Indenture") between the Company, UbiquiTel Inc., as
Guarantor, and the Trustee. The terms of the Notes include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (15 U.S. Code ss.ss. 77aaa-77bbbb). The Notes
are subject to all such terms, and Holders are referred to the Indenture and
such Act for a statement of such terms. To the extent any provision of this Note
conflicts with the express provisions of the Indenture, the provisions of the
Indenture shall govern and be controlling. The Notes are obligations of the
Company limited to $300,000,000 in aggregate principal amount.
5. OPTIONAL REDEMPTION.
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(a) On or after April 15, 2005, the Company may redeem the Notes at any
time, in whole or in part, upon not less than 30 nor more than 60 days' notice,
at the redemption prices (expressed as percentages of principal amount) set
forth below, plus accrued and unpaid interest and Liquidated Damages, if any,
thereon to the date fixed for redemption, if redeemed during the twelve-month
period beginning on April 15 of the years indicated below:
Year Percentage
---- ----------
2005 107.000%
2006 104.667%
2007 102.333%
2008 and thereafter 100.000%
(c) Notwithstanding the provisions of clause (a) of this Section 5, prior
to April 15, 2003, the Company shall be permitted to redeem up to 35% of the
aggregate principal amount of the Notes originally issued at a redemption price
of 114.000% of the Accreted Value thereof, plus accrued and unpaid interest and
Liquidated Damages, if any, thereon to the date fixed for redemption, with the
net cash proceeds of one or more underwritten public offerings of Capital Stock
of the Company (or the underwritten public offering of UbiquiTel Parent's
Capital Stock, to the extent of proceeds contributed to the Company as a capital
contribution, but excluding the net proceeds of an underwritten initial public
offering of UbiquiTel Parent's common stock occurring on or before July 31,
2000), other than Disqualified Stock; provided, however, that (1) at least 65%
of the aggregate principal amount of the Notes originally issued remains
outstanding immediately after the occurrence of the redemption, excluding Notes
held by the Company or any of its Subsidiaries; and (2) each redemption occurs
within 45 days after the date of the closing of such an offering.
6. MANDATORY REDEMPTION.
Except as set forth in paragraph 7 below, the Company shall not be
required to make mandatory redemption payments with respect to the Notes.
7. REPURCHASE AT OPTION OF HOLDER.
(a) If there is a Change of Control, the Company shall be required
to make an offer (a "Change of Control Offer") to repurchase all or any part
(equal to $1,000 or an integral multiple thereof) of each Holder's Notes at a
purchase price equal to (i) 101% of the Accreted Value thereof, plus Liquidated
Damages, if any, thereon to the date fixed for repurchase, if the repurchase
occurs prior to April 15, 2005, or (ii) 100% of the aggregate principal amount
thereof plus accrued and unpaid interest and Liquidated Damages, thereon, if
any, to the date of purchase, if the repurchase occurs on or after April 15,
2005 (the "Change of Control Payment"). Within 30 days following any Change of
Control, the Company shall mail a notice to each Holder setting forth the
procedures governing the Change of Control Offer as required by the Indenture.
(b) If the Company or a Restricted Subsidiary consummates any Asset
Sales, when the aggregate amount of Excess Proceeds exceeds $10.0 million, the
Company shall commence an offer to all Holders of Notes and all holders of other
Indebtedness containing provisions similar to those set forth in the Indenture
with respect to offers to purchase or redeem with the proceeds of sales of
assets (an "Asset Sale Offer") pursuant to Section 3.09 of the Indenture and
such other Indebtedness to purchase the maximum principal amount of Notes and
such other Indebtedness that may be purchased out of the Excess Proceeds at an
offer price in cash in an amount equal to 100% of the Accreted Value of the
Notes, if the repurchase occurs before April 15, 2005, or the principal amount
thereof plus accrued and unpaid
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<PAGE>
interest if the repurchase occurs before April 15, 2005, and in each case,
Liquidated Damages thereon, if any, to the date fixed for the closing of such
offer in accordance with the procedures set forth in Section 3.09 and such other
Indebtedness.
8. NOTICE OF REDEMPTION. Notice of redemption shall be mailed at
least 30 days but not more than 60 days before the redemption date to each
Holder whose Notes are to be redeemed at its registered address. Notes in
denominations larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000, unless all of the Notes held by a Holder are to be
redeemed. On and after the redemption date interest ceases to accrue on Notes or
portions thereof called for redemption.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. The transfer of Notes may be registered and Notes may be exchanged as
provided in the Indenture. The Registrar and the Trustee may require a Holder,
among other things, to furnish appropriate endorsements and transfer documents
and the Company may require a Holder to pay any taxes and fees required by law
or permitted by the Indenture. The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, the Company
need not exchange or register the transfer of any Notes for a period of 15 days
before a selection of Notes to be redeemed or during the period between a record
date and the corresponding interest payment date.
10. PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.
11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions,
the Indenture or the Notes may be amended or supplemented with the consent of
the Holders of at least a majority in aggregate principal amount at maturity of
the then outstanding Notes voting as a single class, including without
limitation, consents obtained in connection with a purchase of, or tender offer
or exchange offer for Notes, and any existing Default or compliance with any
provision of the Indenture or the Notes may be waived with the consent of the
Holders of a majority in aggregate principal amount at maturity of the then
outstanding Notes voting as a single class, including without limitation, in
consents obtained in connection with a purchase of, or tender offer or exchange
offer for Notes. Without the consent of any Holder of a Note, the Indenture or
the Notes may be amended or supplemented to cure any ambiguity, defect or
inconsistency, to provide for uncertificated Notes in addition to or in place of
certificated Notes or to alter the provisions of Article 2 hereof (including the
related definitions) in a manner that does not materially adversely affect any
Holder, to provide for the assumption of the Company's or any Guarantor's
obligations to the Holders of the Notes by a successor to the Company pursuant
to Article 5 of the Indenture, to make any change that would provide any
additional rights or benefits to the Holders of the Notes or that does not
adversely affect the legal rights hereunder of any Holder of the Note, to comply
with requirements of the SEC in order to effect or maintain the qualification of
this Indenture under the TIA, to add a Guarantor pursuant to Section 12.02 of
the Indenture, and to evidence and provide the acceptance of the appointment of
a successor Trustee pursuant to Section 7.08 and 7.09 of the Indenture.
12. DEFAULTS AND REMEDIES. Events of Default include (a) the Company
defaults in the payment when due of interest on, or Liquidated Damages with
respect to, the Notes, whether or not prohibited by Article 11 of the Indenture,
and such default continues for a period of 30 days, (b) the Company defaults in
the payment when due of principal of or premium, if any, on the Notes, whether
or not prohibited by Article 11 of the Indenture, (c) the Company or any of its
Restricted Subsidiaries fails to
A-1-6
<PAGE>
comply with any of the provisions of Section 4.10 or 4.14 or Article 5 of the
Indenture, (d) the Company or any of its Restricted Subsidiaries, for 60 days
after written notice to the Company by the Trustee or the Holders of at least
25% in aggregate principal amount of the then outstanding Notes, fails to comply
with any of its other agreements in the Indenture or the Notes, (e) the default
under any mortgage, indenture or instrument under which there may be issued or
by which there may be secured or evidenced any Indebtedness for money borrowed
by the Company or any of its Restricted Subsidiaries, or the payment of which is
guaranteed by the Company or any of its Restricted Subsidiaries, whether such
Indebtedness or Guarantee now exists, or is created after the date of the
Indenture, if that default (A) is caused by a failure to pay principal at final
stated maturity of such Indebtedness (a "Payment Default") or (B) results in the
acceleration of such Indebtedness prior to its stated maturity; and, in each
case, the principal amount of any such Indebtedness, together with the principal
amount of any other such Indebtedness under which there has been a Payment
Default or the maturity of which has been so accelerated, aggregates $7.5
million or more; (f) failure by the Company or any of its Significant
Subsidiaries to pay final judgments aggregating in excess of $7.5 million, which
judgments are not paid, discharged or stayed for a period of 60 consecutive
days, (g) certain events of bankruptcy or insolvency with respect to the Company
or any of its Significant Subsidiaries, (h) certain termination events under the
Sprint Agreements and (i) if on or prior to July 31, 2000, UbiquiTel Inc. has
not received at least $100 million of gross proceeds from either (A) the
completion of its proposed initial public offering of its common stock or (B)
the issuance of equity in a private placement, and in each case, has contributed
all net proceeds therefrom, except up to $1.25 million, to the Company. If any
Event of Default occurs and is continuing, the Trustee or the Holders of at
least 25% in principal amount of the then outstanding Notes may declare all the
Notes to be due and payable. Notwithstanding the foregoing, in the case of an
Event of Default arising from certain events of bankruptcy or insolvency, all
outstanding Notes shall become due and payable without further action or notice.
Holders may not enforce the Indenture or the Notes except as provided in the
Indenture. Subject to certain limitations, Holders of a majority in aggregate
principal amount of the then outstanding Notes may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Holders of the
Notes notice of any continuing Default or Event of Default (except a Default or
Event of Default relating to the payment of principal or interest) if it
determines that withholding notice is in their interest. The Holders of a
majority in aggregate principal amount of the Notes then outstanding by notice
to the Trustee may on behalf of the Holders of all of the Notes waive any
existing Default or Event of Default and its consequences under the Indenture
except a continuing Default or Event of Default in the payment of interest on,
or the principal of, the Notes. The Company is required to deliver to the
Trustee annually a statement regarding compliance with the Indenture, and the
Company is required upon becoming aware of any Default or Event of Default, to
deliver to the Trustee a statement specifying such Default or Event of Default.
13. TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Company or its Affiliates, and may otherwise deal with the
Company or its Affiliates, as if it were not the Trustee.
14. NO RECOURSE AGAINST OTHERS. No director, officer, employee,
incorporator or stockholder, of the Company, as such, shall have any liability
for any obligations of the Company under the Notes or the Indenture or for any
claim based on, in respect of, or by reason of, such obligations or their
creation. Each Holder by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for the issuance
of the Notes such waiver may not be effective to waive liabilities under the
federal securities laws and it is the view of the SEC that such a waiver is
against public policy.
15. AUTHENTICATION. This Note shall not be valid until authenticated
by the manual signature of the Trustee or an authenticating agent.
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<PAGE>
16. ABBREVIATIONS. Customary abbreviations may be used in the name
of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
17. ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND
RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes shall have all the rights set forth in the Registration Rights
Agreement dated as of April 11, 2000, between the Company and the parties named
on the signature pages thereof (the "Registration Rights Agreement").
18. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers
in notices of redemption as a convenience to Holders. No representation is made
as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
The Company shall furnish to any Holder upon written request and
without charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
UbiquiTel Operating Company
1 Bala Plaza, Suite 402
Bala Cynwyd, Pennsylvania 19004
Attention: Chief Executive Officer
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<PAGE>
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and transfer
this Note to
________________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint ________________________________________________________
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
________________________________________________________________________________
Date: ___________
Your Signature: ________________________
(Sign exactly as your name appears on
the face of this Note)
Signature Guarantee: ___________________
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<PAGE>
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.14 of the Indenture, check the box below:
|_| Section 4.10 |_| Section 4.14
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or Section 4.14 of the Indenture, state the
amount you elect to have purchased: $________
Date: ______ Your Signature:_________________________
(Sign exactly as your name appears on
the Note)
Signature Guarantee: ___________________
Tax Identification No: _________________
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<PAGE>
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE
The following exchanges of a part of this Global Note for an
interest in another Global Note or for a Definitive Note, or exchanges of a part
of another Global Note or Definitive Note for an interest in this Global Note,
have been made:
Amount of Amount of Principal Amount Signature of
decrease in increase in of this authorized
Principal Principal Global Note officer of
Amount Amount following such Trustee or
Date of of this of this decrease (or Note
Exchange Global Note Global Note increase) Custodian
- --------------------------------------------------------------------------------
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EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
UbiquiTel Operating Company
1 Bala Plaza, Suite 402
Bala Cynwyd, Pennsylvania 19004
American Stock Transfer & Trust Company
40 Wall Street, 46th Floor
New York, New York 10005
Re: 14% Senior Subordinated Discount Notes due 2010 of UbiquiTel
Operating Company
Reference is hereby made to the Indenture, dated as of April 11,
2000 (the "Indenture"), among UbiquiTel Operating Company, as issuer (the
"Company"), UbiquiTel Inc., as guarantor, and American Stock Transfer & Trust
Company, as trustee. Capitalized terms used but not defined herein shall have
the meanings given to them in the Indenture.
______________, (the "Transferor") owns and proposes to transfer the
Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount of $___________ in such Note[s] or interests (the "Transfer"),
to __________ (the "Transferee"), as further specified in Annex A hereto. In
connection with the Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. |_| Check if Transferee shall take delivery of a beneficial interest in the
144A Global Note or a Definitive Note Pursuant to Rule 144A. The Transfer is
being effected pursuant to and in accordance with Rule 144A under the United
States Securities Act of 1933 (the "Securities Act"), and, accordingly, the
Transferor hereby further certifies that the beneficial interest or Definitive
Note is being transferred to a Person that the Transferor reasonably believed
and believes is purchasing the beneficial interest or Definitive Note for its
own account, or for one or more accounts with respect to which such Person
exercises sole investment discretion, and such Person and each such account is a
"qualified institutional buyer" within the meaning of Rule 144A in a transaction
meeting the requirements of Rule 144A and such Transfer is in compliance with
any applicable blue sky securities laws of any state of the United States. Upon
consummation of the proposed Transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note shall be
subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the 144A Global Note or the Definitive Note and in the
Indenture and the Securities Act.
2. |_| Check if Transferee shall take delivery of a beneficial interest in the
Regulation S Global Note or a Definitive Note pursuant to Regulation S. The
Transfer is being effected pursuant to and in accordance with Rule 904 under the
Securities Act and, accordingly, the Transferor hereby further certifies that
(i) the Transfer is not being made to a person in the United States and (x) at
the time the buy order was originated, the Transferee was outside the United
States or such Transferor and any Person acting on its behalf reasonably
believed and believes that the Transferee was outside the United States or (y)
the transaction was executed in, on or through the facilities of a designated
offshore securities market and neither such Transferor nor any Person acting on
its behalf knows that the transaction was prearranged with a buyer in the United
States, (ii) no directed selling efforts have been made in
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<PAGE>
contravention of the requirements of Rule 904(b) of Regulation S under the
Securities Act, (iii) the transaction is not part of a plan or scheme to evade
the registration requirements of the Securities Act and (iv) if the proposed
transfer is being made prior to the expiration of the Restricted Period, the
transfer is not being made to a U.S. Person or for the account or benefit of a
U.S. Person (other than an Initial Purchaser). Upon consummation of the proposed
transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note shall be subject to the restrictions on
Transfer enumerated in the Private Placement Legend printed on the Regulation S
Global Note and/or the Definitive Note and in the Indenture and the Securities
Act.
3. |_| Check and complete if Transferee will take delivery of a
beneficial interest in the IAI Global Note or a Definitive Note pursuant to any
provision of the Securities Act other than Rule 144A or Regulation S. The
Transfer is being effected in compliance with the transfer restrictions
applicable to beneficial interests in Restricted Global Notes and Restricted
Definitive Notes and pursuant to and in accordance with the Securities Act and
any applicable blue sky securities laws of any state of the United States, and
accordingly the Transferor hereby further certifies that (check one):
(a) |_| such Transfer is being effected pursuant to and in accordance with Rule
144 under the Securities Act; or
(b) |_| such Transfer is being effected to the Company or a subsidiary thereof;
or
(c) |_| such Transfer is being effected pursuant to an effective registration
statement under the Securities Act and in compliance with the prospectus
delivery requirements of the Securities Act; or
(d) |_| such Transfer is being effected to an Institutional
Accredited Investor and pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 144A, Rule 144 or Rule 904,
and the Transferor hereby further certifies that it has not engaged in any
general solicitation within the meaning of Regulation D under the Securities Act
and the Transfer complies with the transfer restrictions applicable to
beneficial interests in a Restricted Global Note or Restricted Definitive Notes
and the requirements of the exemption claimed, which certification is supported
by (1) a certificate executed by the Transferee in the form of Exhibit F to the
Indenture and (2) if such Transfer is in respect of a principal amount of Notes
at the time of transfer of less than $250,000, an Opinion of Counsel provided by
the Transferor or the Transferee (a copy of which the Transferor has attached to
this certification), to the effect that such Transfer is in compliance with the
Securities Act. Upon consummation of the proposed transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the IAI Global Note and/or the Definitive Notes and
in the Indenture and the Securities Act.
4. |_| Check and complete if Transferee shall take delivery of a beneficial
interest in a Definitive Note pursuant to any provision of the Securities Act
other than Rule 144A or Regulation S. The Transfer is being effected in
compliance with the transfer restrictions applicable to beneficial interests in
Restricted Global Notes and Restricted Definitive Notes and pursuant to and in
accordance with the Securities Act and any applicable blue sky securities laws
of any state of the United States, and accordingly the Transferor hereby further
certifies that (check one):
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<PAGE>
(a) such Transfer is being effected pursuant to and in accordance
with Rule 144 under the Securities Act;
or
(b) such Transfer is being effected to the Company or a subsidiary
thereof;
or
(c) such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance with the
prospectus delivery requirements of the Securities Act;
or
(d) such Transfer is being effected to an Institutional Accredited
Investor and pursuant to an exemption from the registration requirements of the
Securities Act other than Rule 144A, Rule 144 or Rule 904, and the Transferor
hereby further certifies that it has not engaged in any general solicitation
within the meaning of Regulation D under the Securities Act and the Transfer
complies with the transfer restrictions applicable to beneficial interests in a
Restricted Global Note or Restricted Definitive Notes and the requirements of
the exemption claimed, which certification is supported by (1) an Opinion of
Counsel provided by the Transferor or the Transferee (a copy of which the
Transferor has attached to this certification), to the effect that such Transfer
is in compliance with the Securities Act. Upon consummation of the proposed
transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note shall be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Definitive
Notes and in the Indenture and the Securities Act.
5. |_| Check if Transferee shall take delivery of a beneficial interest in an
Unrestricted Global Note or of an Unrestricted Definitive Note.
(a) |_| Check if Transfer is pursuant to Rule 144. (i) The Transfer
is being effected pursuant to and in accordance with Rule 144 under the
Securities Act and in compliance with the transfer restrictions contained in the
Indenture and any applicable blue sky securities laws of any state of the United
States and (ii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act. Upon consummation of the proposed Transfer in accordance
with the terms of the Indenture, the transferred beneficial interest or
Definitive Note shall no longer be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes, on Restricted Definitive Notes and in the Indenture.
(b) |_| Check if Transfer is Pursuant to Regulation S. (i) The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of any
state of the United States and (ii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. Upon consummation of the proposed
Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note shall no longer be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the Restricted Global Notes, on Restricted Definitive Notes and in the
Indenture.
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(c) |_| Check if Transfer is Pursuant to Other Exemption. (i) The
Transfer is being effected pursuant to and in compliance with an exemption from
the registration requirements of the Securities Act other than Rule 144, Rule
903 or Rule 904 and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any State of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note shall not be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes or Restricted Definitive Notes and in the Indenture.
This certificate and the statements contained herein are made for
your benefit and the benefit of the Company.
________________________________________
[Insert Name of Transferor]
By: ____________________________________
Name:
Title:
Dated: ___________, ____
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<PAGE>
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) |_| a beneficial interest in the:
(i) |_| 144A Global Note (CUSIP _________), or
(ii) |_| Regulation S Global Note (CUSIP _________), or
(iii) |_| IAI Global Note (CUSIP _________), or
(iv) |_| a Restricted Definitive Note.
2. After the Transfer the Transferee shall hold:
[CHECK ONE]
(a) |_| a beneficial interest in the:
(i) |_| 144A Global Note (CUSIP ________), or
(ii) |_| Regulation S Global Note (CUSIP ________), or
(iii) |_| IAI Global Note (CUSIP _________), or
(iv) |_| Unrestricted Global Note (CUSIP ________); or
(b) |_| a Restricted Definitive Note; or
(c) |_| an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
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<PAGE>
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
UbiquiTel Operating Company
1 Bala Plaza, Suite 402
Bala Cynwyd, Pennsylvania 19004
American Stock Transfer & Trust Company
40 Wall Street, 46th Floor
New York, New York 10005
Re: 14% Senior Subordinated Discount Notes due 2010 of UbiquiTel
Operating Company
(CUSIP______________)
Reference is hereby made to the Indenture, dated as of April 11,
2000 (the "Indenture"), among UbiquiTel Operating Company, as issuer (the
"Company"), UbiquiTel Inc., as guarantor, and American Stock Transfer & Trust
Company, as trustee. Capitalized terms used but not defined herein shall have
the meanings given to them in the Indenture.
____________, (the "Owner") owns and proposes to exchange the
Note[s] or interest in such Note[s] specified herein, in the principal amount of
$____________ in such Note[s] or interests (the "Exchange"). In connection with
the Exchange, the Owner hereby certifies that:
1. Exchange of Restricted Definitive Notes or Beneficial Interests in a
Restricted Global Note for Unrestricted Definitive Notes or Beneficial Interests
in an Unrestricted Global Note
(a) |_| Check if Exchange is from beneficial interest in a
Restricted Global Note to beneficial interest in an Unrestricted Global Note. In
connection with the Exchange of the Owner's beneficial interest in a Restricted
Global Note for a beneficial interest in an Unrestricted Global Note in an equal
principal amount, the Owner hereby certifies (i) the beneficial interest is
being acquired for the Owner's own account without transfer, (ii) such Exchange
has been effected in compliance with the transfer restrictions applicable to the
Global Notes and pursuant to and in accordance with the United States Securities
Act of 1933 (the "Securities Act"), (iii) the restrictions on transfer contained
in the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the beneficial interest in
an Unrestricted Global Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
(b) |_| Check if Exchange is from beneficial interest in a
Restricted Global Note to Unrestricted Definitive Note. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for an
Unrestricted Definitive Note, the Owner
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<PAGE>
hereby certifies (i) the Definitive Note is being acquired for the Owner's own
account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to the Restricted Global Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Definitive Note is being acquired in compliance with any applicable blue sky
securities laws of any state of the United States.
(c) |_| Check if Exchange is from Restricted Definitive Note to
beneficial interest in an Unrestricted Global Note. In connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an
Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(d) |_| Check if Exchange is from Restricted Definitive Note to
Unrestricted Definitive Note. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
2. Exchange of Restricted Definitive Notes or Beneficial Interests in Restricted
Global Notes for Restricted Definitive Notes or Beneficial Interests in
Restricted Global Notes
(a) |_| Check if Exchange is from beneficial interest in a
Restricted Global Note to Restricted Definitive Note. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for a
Restricted Definitive Note with an equal principal amount, the Owner hereby
certifies that the Restricted Definitive Note is being acquired for the Owner's
own account without transfer. Upon consummation of the proposed Exchange in
accordance with the terms of the Indenture, the Restricted Definitive Note
issued shall continue to be subject to the restrictions on transfer enumerated
in the Private Placement Legend printed on the Restricted Definitive Note and in
the Indenture and the Securities Act.
(b) |_| Check if Exchange is from Restricted Definitive Note to
beneficial interest in a Restricted Global Note. In connection with the Exchange
of the Owner's Restricted Definitive Note for a beneficial interest in the
[CHECK ONE] 144A Global Note Regulation S Global Note IAI Global Note, with an
equal principal amount, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer and (ii) such
Exchange has been effected in compliance with the transfer
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<PAGE>
restrictions applicable to the Restricted Global Notes and pursuant to and in
accordance with the Securities Act, and in compliance with any applicable blue
sky securities laws of any state of the United States. Upon consummation of the
proposed Exchange in accordance with the terms of the Indenture, the beneficial
interest issued shall be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the relevant Restricted Global Note and
in the Indenture and the Securities Act.
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<PAGE>
This certificate and the statements contained herein are made for
your benefit and the benefit of the Company.
___________________________________
[Insert Name of Owner]
By: ____________________________________
Name:
Title:
Dated: ________________, ____
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<PAGE>
EXHIBIT D
FORM OF NOTATION ON NOTE RELATING TO NOTE GUARANTEE
Each Guarantor, as defined in the Indenture (the "Indenture"),
referred to in the Note upon which this notation is endorsed), (i) has jointly
and severally unconditionally guaranteed (a) the due and punctual payment of the
principal of, premium and interest and Liquidated Damages, if any, on the Notes,
whether at maturity or an interest payment date, by acceleration, call for
redemption or otherwise, (b) the due and punctual payment of interest on the
overdue principal and premium of, and interest and Liquidated Damages, if any,
on the Notes, and (c) in case of any extension of time of payment or renewal of
any Notes or any of such other obligations, the same shall be promptly paid in
full when due in accordance with the terms of the extension or renewal, whether
at stated maturity, by acceleration or otherwise and (ii) has agreed to pay any
and all costs and expenses (including reasonable attorneys' fees) incurred by
the Trustee or any Holder in enforcing any rights under this Note Guarantee.
Notwithstanding the foregoing, in the event that the Note Guarantor
would constitute or result in a violation of any applicable fraudulent
conveyance or similar law of any relevant jurisdiction, the liability of such
Guarantor under its Note Guarantee shall be reduced to the maximum amount
permissible under such fraudulent conveyance or similar law.
No past, present or future director, officer, employee, agent,
incorporator, stockholder or agent of any Guarantor, as such, shall have any
liability for any obligations of the Company or any Guarantor under the Notes,
any Note Guarantee, Indenture, any supplemental Indenture delivered pursuant to
the Indenture by such Guarantor or any Note Guarantees, or for any claim based
on, in respect of or by reason of such obligations or their creation. Each
Holder by accepting a Note waives and releases all such liability.
This Note Guarantee shall be binding upon each Guarantor and its
successors and assigns and shall inure to the benefit of the successors and
assigns of the Trustee and the Holders and, in the event of any transfer or
assignment of rights by the Holder or the Trustee, the rights and privileges
herein conferred upon that party shall automatically extend to and be vested in
such transferee or assignee, all subject to the terms and conditions hereof.
This Note Guarantee shall not be valid or obligatory for any purpose
until the certificate of authentication on the Note upon which this Note
Guarantee is noted have been executed by the Trustee under the Indenture by the
manual signature of one of its authorized officers. Capitalized terms used
herein have the meaning assigned to them in the Indenture.
GUARANTOR
By: ____________________________________
Name:
Title:
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<PAGE>
EXHIBIT E
FORM OF SUPPLEMENTAL INDENTURE
TO BE DELIVERED BY GUARANTORS
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
_____________, among ______________ (the "Guarantor"), a subsidiary of UbiquiTel
Operating Company (or its permitted successor), a Delaware corporation (the
"Company") and American Stock Transfer & Trust Company, as trustee under the
indenture referred to below (the "Trustee").
WITNESSETH
WHEREAS, the Company has heretofore executed and delivered to the
Trustee an indenture (the "Indenture"), dated as of April 11, 2000 providing for
the issuance of an aggregate principal amount of up to $300 million of 14%
Senior Subordinated Discount Notes due 2010 (the "Notes");
WHEREAS, the Indenture provides that under certain circumstances the
Guarantor shall execute and deliver to the Trustee a supplemental indenture
pursuant to which the Guarantor shall unconditionally guarantee all of the
Company's Obligations under the Notes and the Indenture on the terms and
conditions set forth herein (the "Note Guarantee"); and
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.
NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the
Guarantor and the Trustee mutually covenant and agree for the equal and ratable
benefit of the Holders of the Notes as follows:
1. Capitalized Terms. Capitalized Terms used herein without
definition shall have the meanings assigned to them in the Indenture.
2. Agreement to Guarantee. The Guarantor hereby agrees as follows:
a. Along with all Guarantors, to jointly and severally
Guarantee to each Holder of a Note authenticated and
delivered by the Trustee and to the Trustee and its
successors and assigns, irrespective of the validity and
enforceability of the Indenture, the Notes or the
Obligations of the Company hereunder or thereunder,
that:
(i) the principal of, premium, if any, and interest
and Liquidated Damages, if any, on the Notes shall
be promptly paid in full when due, whether at
maturity, by acceleration, redemption or
otherwise, and interest on
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<PAGE>
the overdue principal of to the extent and
interest and Liquidation Damages, if any, on the
Notes to the extent lawful, and all other
Obligations of the Company to the Holders or the
Trustee hereunder or under the Indenture shall be
promptly paid in full or performed, all in
accordance with the terms hereof and under the
Indenture;
(ii) in case of any extension of time of payment or
renewal of any Notes or any of such other
Obligations, that same shall be promptly paid in
full when due or performed in accordance with the
terms of the extension or renewal, whether at
stated maturity, by acceleration or otherwise.
Failing payment when due of any amount so
guaranteed or any performance so guaranteed for
whatever reason, the Guarantors shall be jointly
and severally obligated to pay the same
immediately.
b. The obligations hereunder shall be unconditional,
irrespective of the validity, regularity or
enforceability of the Notes or the Indenture, the
absence of any action to enforce the same, any waiver or
consent by any Holder of the Notes with respect to any
provisions hereof or thereof, the recovery of any
judgment against the Company, any action to enforce the
same or any other circumstance which might otherwise
constitute a legal or equitable discharge or defense of
a guarantor.
c. The following is hereby waived: diligence presentment,
demand of payment, filing of claims with a court in the
event of insolvency or bankruptcy of the Company, any
right to require a proceeding first against the Company,
protest, notice and all demands whatsoever.
d. This Note Guarantee shall not be discharged except by
complete performance of the obligations contained in the
Notes and the Indenture.
e. If any Holder or the Trustee is required by any court or
otherwise to return to the Company, the Guarantors, or
any Custodian, Trustee, liquidator or other similar
official acting in relation to either the Company or the
Guarantors, any amount paid by either to the Trustee or
such Holder, this Note Guarantee, to the extent
theretofore discharged, shall be reinstated in full
force and effect.
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<PAGE>
f. The Guarantor shall not be entitled to any right of
subrogation in relation to the Holders in respect of any
obligations guaranteed hereby until payment in full of
all obligations guaranteed hereby.
g. As between the Guarantors, on the one hand, the Holders
and the Trustee, on the other hand, (x) the maturity of
the obligations guaranteed hereby may be accelerated as
provided in Article 6 of the Indenture for the purposes
of this Note Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such
acceleration in respect of the obligations guaranteed
hereby, and (y) in the event of any declaration of
acceleration of such obligations as provided in Article
6 of the Indenture, such obligations (whether or not due
and payable) shall forthwith become due and payable by
the Guarantors for the purpose of this Note Guarantee.
h. The Guarantors shall have the right to seek contribution
from non-paying Guarantor so long as the exercise of
such right does not impair the rights of the Holders
under the Note Guarantee.
i. Notwithstanding the foregoing, in the event that this
Note Guarantee would constitute or result in a violation
of any applicable fraudulent conveyance or similar law
of any relevant jurisdiction, the liability of the
Guarantor under this Supplemental Indenture and its Note
Guarantee shall be reduced to the maximum amount
permissible under such fraudulent conveyance or similar
law.
j. Notwithstanding anything herein to the contrary, all
obligations of the Guarantor hereunder shall be
subordinated to the prior payment of Senior Indebtedness
to the same extent that the Notes are subordinated
pursuant to Article 11 of the Indenture.
3. Execution and Delivery. Each Subsidiary Guarantor agrees that the
Guarantees shall remain in full force and effect notwithstanding any failure to
endorse on each Note a notation of such Note Guarantee.
4. Guarantor May Consolidate, Etc. on Certain Terms.
a. A Guarantor (other than UbiquiTel Parent) may not sell
or otherwise dispose of all or substantially all of its
assets, or
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<PAGE>
consolidate with or merge with or into another Person,
other than the Company r another Guarantor, unless:
(i) immediately after giving effect to the
transaction, no Default exists under the
Indenture; and
(ii) Either
(a) the Person formed by or surviving any such
consolidation or merger (if other than a
Guarantor or the Company) unconditionally
assumes all the obligations of such
Guarantor, pursuant to a supplemental
Indenture in form and substance reasonably
satisfactory to the Trustee, under the
Notes, this Indenture, and the Note
Guarantee on the terms set forth herein or
therein; or
(b) the Net Proceeds of the transactions are
applied in accordance with Section 4.10 of
the Indenture.
b. In case of any such consolidation, merger, sale or
conveyance and upon the assumption by the successor
Person, by supplemental Indenture, executed and
delivered to the Trustee and satisfactory in form to the
Trustee, of the Note Guarantee endorsed upon the Notes
and the due and punctual performance of all of the
covenants and conditions of this Indenture to be
performed by the Guarantor, such successor Person shall
succeed to and be substituted for the Guarantor with the
same effect as if it had been named herein as a
Guarantor. Such successor Person thereupon may cause to
be signed any or all of the Note Guarantees to be
endorsed upon all of the Notes issuable hereunder which
theretofore shall not have been signed by the Company
and delivered to the Trustee. All the Note Guarantees so
issued shall in all respects have the same legal rank
and benefit under this Indenture as the Note Guarantees
theretofore and thereafter issued in accordance with the
terms of this Indenture as though all of such Note
Guarantees had been issued at the date of the execution
hereof.
c. Except as set forth in Articles 4 and 5 of the
Indenture, and notwithstanding clause (a) and (b) of
Section 12.05 of the Indenture, nothing contained in the
Indenture or in any of the Notes shall prevent any
consolidation or merger of a Guarantor with or into the
Company or another Guarantor, or shall prevent any sale
or conveyance of the property of a Guarantor as an
E-4
<PAGE>
entirety or substantially as an entirety to the Company
or another Guarantor.
5. Releases.
a. A Note Guarantee, other than the Note Guarantee of
UbiquiTel Parent, will be released (a) in connection
with any sale of all of the Capital Stock of a Guarantor
(including the Note Guarantee of any wholly-owned
Subsidiary of such Guarantor) to a Person (including by
way of merger or consolidation) that is not (either
before or after giving effect to such transaction) a
Subsidiary of the Company, if the Net Proceeds of that
transaction are applied (or the Company delivers an
Officer's Certificate to the Trustee certifying that
such Net Proceeds will be applied within the time period
specified in Section 4.10) in accordance with Section
4.10 hereof or (b) if the Company properly designates
any Restricted Subsidiary that is a Guarantor as an
Unrestricted Subsidiary in accordance with Section 4.20
of the Indenture.
b. Any Guarantor not released from its obligations under
its Note Guarantee shall remain liable for the full
amount of principal of and interest on the Notes and for
the other obligations of any Guarantor under the
Indenture as provided in the Indenture.
6. No Recourse Against Others. No past, present or future director,
officer, employee, incorporator, stockholder or agent of the Guarantor, as such,
shall have any liability for any obligations of the Company or any Guarantor
under the Notes, any Note Guarantees, the Indenture or this Supplemental
Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder of Notes by accepting a Note waives
and releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes. Such waiver may not be effective to
waive liabilities under the federal securities laws and it is the view of the
SEC that such a waiver is against public policy.
7. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK
SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT
THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
8. Counterparts . The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
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<PAGE>
9. Effect of Headings. The Section headings herein are for
convenience only and shall not affect the construction hereof.
10. The Trustee. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this Supplemental
Indenture or for or in respect of the recitals contained herein, all of which
recitals are made solely by the Guarantor and the Company.
E-6
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.
Dated:
[Guaranteeing Subsidiary]
By:
Name:
Title:
AMERICAN STOCK TRANSFER & TRUST COMPANY,
as Trustee
By:
Name:
Title:
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<PAGE>
EXHIBIT F
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
UbiquiTel Operating Company
1 Bala Plaza, Suite 402
Bala Cynwyd, Pennsylvania 19004
American Stock Transfer & Trust Company
40 Wall Street, 46th Floor
New York, New York 10005
Re: 14% Senior Subordinated Discount Notes due 2010
Reference is hereby made to the Indenture, dated as of April 11,
2000 (the "Indenture"), among UbiquiTel Operating Company, as issuer (the
"Company"), UbiquiTel Inc., as guarantor, and American Stock Transfer & Trust
Company, as trustee. Capitalized terms used but not defined herein shall have
the meanings given to them in the Indenture.
In connection with our proposed purchase of $____________ aggregate
principal amount of:
(a) |_| a beneficial interest in a Global Note, or
(b) |_| a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the Notes or any
interest therein is subject to certain restrictions and conditions set forth in
the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes and any interest therein
may not be offered or sold except as permitted in the following sentence. We
agree, on our own behalf and on behalf of any accounts for which we are acting
as hereinafter stated, that if we should sell the Notes or any interest therein,
we will do so only (A) to the Company or any subsidiary thereof, (B) in
accordance with Rule 144A under the Securities Act to a "qualified institutional
buyer" (as defined therein), (C) to an institutional "accredited investor" (as
defined below) that, prior to such transfer, furnishes (or has furnished on its
behalf by a U.S. broker-dealer) to you and to the Company a signed letter
substantially in the form of this letter and, if such transfer is in respect of
a principal amount of Notes, at the time of transfer of less than $250,000, an
Opinion of Counsel in form reasonably acceptable to the Company to the effect
that such transfer is in compliance with the Securities Act, (D) outside the
United States in accordance with Rule 904 of Regulation S under the Securities
Act, (E) pursuant to the provisions of Rule 144(k) under the Securities Act or
(F) pursuant to an effective registration statement under the Securities Act,
and we further agree to provide to any person purchasing the Definitive Note or
beneficial interest in a Global Note from us in a
F-1
<PAGE>
transaction meeting the requirements of clauses (A) through (E) of this
paragraph a notice advising such purchaser that resales thereof are restricted
as stated herein.
3. We understand that, on any proposed resale of the Notes or
beneficial interest therein, we will be required to furnish to you and the
Company such certifications, legal opinions and other information as you and the
Company may reasonably require to confirm that the proposed sale complies with
the foregoing restrictions. We further understand that the Notes purchased by us
will bear a legend to the foregoing effect.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Notes, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or its investment.
5. We are acquiring the Notes or beneficial interest therein
purchased by us for our own account or for one or more accounts (each of which
is an institutional "accredited investor") as to each of which we exercise sole
investment discretion.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby.
________________________________________
[Insert Name of Accredited Investor]
By: ____________________________________
Name:
Title:
Dated: ______________
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<PAGE>
Exhibit 10.21
- --------------------------------------------------------------------------------
WARRANT AGREEMENT
Dated April 11, 2000
by and between
UBIQUITEL INC.
and
AMERICAN STOCK TRANSFER & TRUST COMPANY
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
Page
Section 1. Certain Definitions..............................................1
Section 2. Appointment of Warrant Agent.....................................4
Section 3. Issuance of Warrants.............................................4
3.1 Warrant Certificates.........................................4
3.2 Regulation S Global Warrants.................................4
Section 4. Execution of Warrant Certificates................................5
Section 5. Separation of Unit Warrants......................................5
Section 6. Registration of Transfers and Exchanges..........................6
6.1 Transfer and Exchange of Global Warrants.....................6
6.2 Exchange of a Beneficial Interest in a Global Warrant
for a Definitive Warrant.....................................6
6.3 Transfer and Exchange of Definitive Warrants.................7
6.4 Restrictions on Exchange or Transfer of a Definitive Warrant
for a Beneficial Interest in a Global Warrant................8
6.5 Restrictions on Transfer and Exchange of Global Warrants.....8
6.6 Countersigning of Definitive Warrants in Absence of
Depositary...................................................9
6.7 Legends......................................................9
6.8 Cancellation of Global Warrant..............................11
6.9 Obligations with Respect to Transfers and Exchanges of
Warrants....................................................11
Section 7. Terms of Warrants; Exercise of Warrants.........................11
Section 8. Payment of Taxes................................................13
Section 9. Mutilated or Missing Warrant Certificates.......................13
Section 10. Reservation of Warrant Shares...................................13
Section 11. Obtaining Stock Exchange Listings...............................14
Section 12. Adjustment of Exercise Price and Number of Warrant Shares
Issuable........................................................14
12.1 Stock Splits, Combinations, etc.............................14
12.2 Reclassification, Combinations, Mergers, etc................15
12.3 Issuance of Options or Convertible Securities...............15
12.4 Dividends and Distributions.................................16
12.5 Adjustment for Sale of Common Stock Below Fair Market
Value.......................................................17
12.6 Fair Market Value...........................................18
12.7 Certain Distributions.......................................18
12.8 Consideration Received......................................18
i
<PAGE>
TABLE OF CONTENTS
(continued)
Page
12.9 Deferral of Certain Adjustments.............................18
12.10 Changes in Options and Convertible Securities...............19
12.11 Expiration of Options and Convertible Securities............19
12.12 Other Adjustments...........................................19
12.13 No Adjustment Required......................................20
Section 13. Statement on Warrants...........................................20
Section 14. Fractional Interest.............................................20
Section 15. Notices to Warrant Holders......................................21
Section 16. Merger, Consolidation or Change of Name of Warrant Agent........22
Section 17. Warrant Agent...................................................22
Section 18. Resignation and Removal of Warrant Agent; Appointment of
Successor.......................................................24
Section 19. Reports.........................................................25
Section 20. Notices to Company and Warrant Agent............................25
Section 21. Supplements and Amendments......................................26
Section 22. Successors......................................................26
Section 23. Termination.....................................................26
Section 24. Governing Law...................................................26
Section 25. Benefits of This Agreement......................................26
Section 26. Counterparts....................................................27
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WARRANT AGREEMENT dated as of April 11, 2000 (this "Agreement")
between UBIQUITEL INC., a Delaware corporation (together with any and all
successors thereto, the "Company"), and AMERICAN STOCK TRANSFER & TRUST COMPANY,
a New York corporation, as warrant agent (together with any and all successors
appointed in accordance with this Agreement, the "Warrant Agent"). Unless
otherwise noted, capitalized terms have the meanings set forth in Section 1
below.
WHEREAS, the Company proposes to issue 354,971 common stock
warrants, as hereinafter described (the "Warrants"), initially exercisable to
purchase an aggregate of 2,117,402.015 shares of the common stock, $0.001 par
value ("Common Stock"), of the Company;
WHEREAS, 300,000 Warrants (the "Unit Warrants"), initially
exercisable to purchase an aggregate of 1,789,500 shares of Common Stock, are
being issued in connection with an offering (the "Offering") by the Company and
UBIQUITEL OPERATING COMPANY, a Delaware corporation and wholly-owned subsidiary
of the Company ("UbiquiTel"), of units (the "Units"), each Unit consisting of
$1,000 principal amount at maturity of UbiquiTel's 14% Senior Subordinated
Discount Notes due 2010 (the "Notes") and one Warrant;
WHEREAS, 54,971 Warrants (the "Separate Warrants"), initially
exercisable to purchase 327,902.015 shares of Common Stock, are being issued to
one of the initial purchasers in the Offering and are not part of the Units;
WHEREAS, each such Warrant entitles the holder thereof to purchase
initially 5.965 shares of Common Stock of the Company; and
WHEREAS, the Company desires the Warrant Agent to act on behalf of
the Company, and the Warrant Agent is willing so to act, in connection with the
issuance of Warrant Certificates and other matters as provided herein.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, and for the purpose of defining the respective
rights and obligations of the Company, the Warrant Agent and the Holders, the
parties hereto agree as follows:
Section 1. Certain Definitions. (a) As used in this Agreement, the
following terms shall have the following respective meanings:
"Board of Directors" means (1) in respect of a limited liability
company, the board of advisors of the Company; (2) in respect of a corporation,
the board of directors of the corporation, or any authorized committee thereof;
and (3) in respect of any other Person, the board or committee of that Person
serving a similar function.
"Business Day" means any day other than a Legal Holiday.
"Capital Stock" means (a) in the case of a corporation, corporate
stock, (b) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
corporate stock, (c) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited) and (d) any
other interest or participation that confers on a Person the right to receive a
share of the profits and losses of, or distributions of assets of, the issuing
Person.
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"Cedel" means Cedel Bank, S.A.
"Common Stock" means the voting common stock, $0.001 par value, of
the Company or its successors and any other class of series of common equity
equivalent shares of the Company or its successors.
"DLJ Shares" means up to 11,837,024 shares of the Company's 7%
Senior Pay-in-Kind Non-Voting Convertible Preferred Stock which the Company has
reserved for issuance and sale to DLJ Merchant Banking Partners II, L.P.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Euroclear" means Morgan Guaranty Trust Company of New York,
Brussels office, as operator of the Euroclear System.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
(or any successor act), and the rules and regulations thereunder.
"Excluded Securities" shall have the meaning set forth in Section
12.13.
"Exercisability Date" means April 15, 2001.
"Exercise Price" means the purchase price per share of Common Stock
to be paid upon the exercise of each Warrant in accordance with the terms
hereof, which price shall initially be $22.74 per share, subject to adjustment
from time to time pursuant to Section 12 hereof.
"Expiration Date" means April 15, 2010.
"Fair Market Value" means the current price per share of the Common
Stock or the Warrant Shares, as applicable, as determined under Section 12.6
hereof.
"Holder" means a registered holder of Warrants.
"Indenture" means the Indenture, dated the date hereof, by and among
UbiquiTel Operating Company, as issuer, the Company, as guarantor, and American
Stock Transfer & Trust Company, as trustee relating to the Notes.
"Initial Purchasers" means Donaldson, Lufkin & Jenrette Securities
Corporation, Paribas Corporation and PNC Capital Markets, Inc., as initial
purchasers of the Units in the Offering.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If any action is required
to be taken on a date that is a Legal Holiday, such action may be taken on the
next succeeding day that is not a Legal Holiday.
"Notes" means the 14% Senior Subordinated Discount Notes due 2010 of
UbiquiTel, issued pursuant to the Indenture.
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"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof, including any subdivision or ongoing business of any such entity or
substantially all of the assets of any such entity, subdivision or business.
"Regulation S" means Regulation S under the Securities Act, as such
rules may be from time to time amended, revised or supplemented by the
Commission.
"Regulation S Global Warrant" means a permanent Global Warrant in
substantially the form of Exhibit A hereto, appropriately completed, and
deposited with or on behalf of and registered in the name of the Depositary or
its nominee.
"Restricted Period" means the one year period after the date of
issuance of the Warrants.
"Transfer Restricted Securities" shall have the meaning set forth in
the Warrant Registration Rights Agreement.
"SEC" means the Securities and Exchange Commission, or any successor
agency or body performing substantially similar functions.
"Securities Act" means the Securities Act of 1933, as amended.
"Separation Date" means the earliest of (i) 180 days after the
closing of the Offering, (ii) the commencement of the Exchange Offer (as defined
in the Registration Rights Agreement), (iii) the effective date of a Shelf
Registration Statement (as defined in the Registration Rights Agreement), (iv)
the commencement of a Change of Control Offer (as defined in the Indenture) or
upon the delivery by UbiquiTel to the Trustee of a notice of redemption in
accordance with the terms of the Notes, (v) upon the occurrence of an Event of
Default (as defined in the Indenture) under the Notes, and (vi) such date as
Donaldson, Lufkin & Jenrette Securities Corporation in its sole discretion shall
determine.
"Trustee" means the trustee under the Indenture.
"Warrant Agent" means the Warrant Agent or the successor or
successors of such Warrant Agent appointed in accordance with the terms hereof.
"Warrant Certificates" mean the registered certificates (including
without limitation, the global certificates) issued by the Company under this
Agreement representing the Warrants.
"Warrant Registration Rights Agreement" means that Warrant
Registration Rights Agreement, dated as of the date hereof, among the Company
and the Initial Purchasers, relating to registration of the resale and exercise
of Warrants and resale of the shares of Common Stock issuable thereunder under
the Securities Act.
"Warrant Shares" means the shares of Common Stock issued or issuable
upon the exercise of the Warrants.
(b) Other terms are defined in the respective sections set forth
below.
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Term Defined in Section
- ---- ------------------
Convertible Securities......................................................12.3
Cashless Exercise..............................................................7
Cashless Exercise Ratio........................................................7
Definitive Warrants..........................................................3.1
Depository...................................................................3.1
Distribution................................................................12.3
Exercise Date..................................................................7
Excluded Securities........................................................12.13
Fair Market Value..............................................................7
Global Warrants..............................................................3.1
Holder.......................................................................6.9
Options.....................................................................12.3
SEC Reports...................................................................19
STAMP..........................................................................7
Time of Determination.......................................................12.6
Transfer Agent................................................................10
Warrant Certificates...........................................................4
Section 2. Appointment of Warrant Agent. The Company hereby appoints
the Warrant Agent to act as agent for the Company in accordance with the
instructions set forth hereinafter in this Agreement, and the Warrant Agent
hereby accepts such appointment.
Section 3. Issuance of Warrants.
3.1 Warrant Certificates. The Unit Warrants will be issued in the form of
one or more global certificates (the "Global Warrants"), substantially in the
form of Exhibit A (including footnotes 1, 2, 4 and 5 thereto). The Global
Warrants shall be deposited on the Issue Date with, or with the Warrant Agent as
custodian for, The Depository Trust Company (the "Depositary") and registered in
the name of Cede & Co., as the Depositary's nominee. Each Global Warrant shall
represent such of the outstanding Warrants as shall be specified therein and
each shall provide that it shall represent the aggregate amount of outstanding
Warrants from time to time endorsed thereon and that the aggregate amount of
outstanding Warrants represented thereby may from time to time be reduced or
increased, as appropriate. Upon request, except as otherwise provided in Section
6.2(c) hereof, a Holder may receive from the Depositary and the Warrant Agent
Warrants in definitive form (the "Definitive Warrants"), substantially in the
form of Exhibit A (not including footnotes 1, 2, 3 and 4 thereto) as set forth
in Section 6 below. The Separate Warrants will initially be issued as one or
more Definitive Warrants (including footnote 3 thereto).
3.2 Regulation S Global Warrants . Unit Warrants offered and sold in
reliance on Regulation S shall initially be issued in the form of the Regulation
S Global Warrant, which shall be deposited on behalf of the purchasers of the
Warrants represented thereby with the Warrant Agent, at its New York office, as
custodian for the Depositary, and registered in the name of the Depositary or
the nominee of the Depositary for the accounts of designated agents holding on
behalf of Euroclear or Cedel, duly executed by the Company and authenticated by
the Trustee as hereinafter provided. The aggregate number of Warrants evidenced
by the Regulation S Global Warrant, as applicable, may from time to time be
increased or decreased by adjustments made on
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the records of the Warrant Agent and the Depositary or its nominee, as the case
may be, in connection with transfers of interest as hereinafter provided.
3.3 Registration and Countersignature. The Warrant Agent, on behalf of the
Company, shall number and register the Warrant Certificates in a register as
they are issued by the Company.
Warrant Certificates shall be manually countersigned by the Warrant Agent
and shall not be valid for any purpose unless so countersigned. The Warrant
Agent shall, upon written instructions of the Chairman of the Board, the
President. any Vice President, the Treasurer, the Controller or the Secretary of
the Company, initially countersign, issue and deliver Warrants entitling the
Holders thereof to purchase not more than the aggregate number of Warrant Shares
referred to above in the first recital hereof and shall countersign and deliver
Warrants as otherwise provided in this Agreement.
The Company and the Warrant Agent may deem and treat the Holder(s) of the
Warrant Certificates as the absolute owner(s) thereof (notwithstanding any
notation of ownership or other writing thereon made by anyone), for all
purposes, and neither the Company nor the Warrant Agent shall be affected by any
notice to the contrary. Prior to the Separation Date, the registered holder of a
Unit shall be deemed the registered Holder of the related Unit Warrants for all
purposes hereunder.
Section 4. Execution of Warrant Certificates. Certificates (the
"Warrant Certificates") evidencing Global Warrants or Definitive Warrants to be
delivered pursuant hereto shall be signed on behalf of the Company by its
Chairman of the Board, President, Chief Executive Officer, Chief Financial
Officer, any Vice President, Secretary, an Assistant Secretary, Treasurer or an
Assistant Treasurer. Each such signature upon the Warrant Certificates may be in
the form of a facsimile signature of the present or any future Chairman of the
Board, President, Chief Executive Officer, Chief Financial Officer, any Vice
President, Secretary, an Assistant Secretary, Treasurer or an Assistant
Treasurer and may be imprinted or otherwise reproduced on the Warrant
Certificates and for that purpose the Company may adopt and use the facsimile
signature of any person who shall have been Chairman of the Board, President,
Chief Executive Officer, Chief Financial Officer, any Vice President, Secretary,
an Assistant Secretary, Treasurer or an Assistant Treasurer, notwithstanding the
fact that at the time the Warrant Certificates shall be countersigned and
delivered or disposed of such person shall have ceased to hold such office.
In case any officer of the Company who shall have signed any of the
Warrant Certificates shall cease to be such officer before the Warrant
Certificates so signed shall have been countersigned by the Warrant Agent, or
disposed of by the Company, such Warrant Certificates nevertheless may be
countersigned and delivered or disposed of as though such person had not ceased
to be such officer of the Company; and any Warrant Certificate may be signed on
behalf of the Company by any person who, at the actual date of the execution of
such Warrant Certificate, shall be a proper officer of the Company to sign such
Warrant Certificate, although at the date of the execution of this Agreement any
such person was not such officer.
Warrant Certificates shall be dated the date of countersignature.
Section 5. Separation of Unit Warrants. The Notes and Unit Warrants
shall not be separately transferable prior to the Separation Date and shall be
automatically separated on the Separation Date. Beneficial interests in Global
Warrants representing the Separate Warrants shall not be transferred or
exchanged prior to the Separation Date.
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Section 6. Registration of Transfers and Exchanges.
6.1 Transfer and Exchange of Global Warrants. The transfer and exchange of
Global Warrants or beneficial interests therein shall be effected through the
Depositary, in accordance with this Agreement and the procedures of the
Depositary therefor.
6.2 Exchange of a Beneficial Interest in a Global Warrant for a Definitive
Warrant.
(a) Any Holder of a beneficial interest in a Global Warrant may upon
request exchange such beneficial interest for a Definitive Warrant. Upon receipt
by the Warrant Agent of written instructions or such other form of instructions
as is customary for the Depositary from the Depositary or its nominee on behalf
of any Person having a beneficial interest in a Global Warrant and, in the case
of a Transfer Restricted Security, the following additional information and
documents (all of which may be submitted by facsimile):
(i) if such beneficial interest is being delivered to the Person
designated by the Depositary as being the beneficial owner, a certification to
that effect (in substantially the form of Exhibit B hereto);
(ii) if such beneficial interest is being transferred (1) to a
"qualified institutional buyer" (as defined in Rule 144A under the Securities
Act) in accordance with Rule 144A under the Securities Act or (2) pursuant to an
exemption from registration in accordance with Rule 144 under the Securities Act
(based on an opinion of counsel if the Company so requests) or (3) pursuant to
an effective registration statement under the Securities Act, a certification to
that effect (in substantially the form of Exhibit B hereto);
(iii) if such beneficial interest is being transferred to any
institutional "accredited investor," within the meaning of Rule 50l(a)(l), (2),
(3) or (7) under the Securities Act pursuant to a private placement exemption
from the registration requirements of the Securities Act (based on an opinion of
counsel if the Company so requests), a certification to that effect (in
substantially the form of Exhibit B hereto) and a certification from the
applicable transferee;
(iv) if such beneficial interest is being transferred pursuant to an
exemption from registration in accordance with Rule 904 under the Securities Act
(and based on an opinion of counsel if the Company so requests), a certification
to that effect (in substantially the form of Exhibit B); provided, however, that
no such exchange shall be made during the Restricted Period; or
(v) if such beneficial interest is being transferred in reliance on
another exemption from the registration requirements of the Securities Act (and
based on an opinion of counsel if the Company so requests), a certification to
that effect (in substantially the form of Exhibit B hereto);
then the Warrant Agent shall cause, in accordance with the standing instructions
and procedures existing between the Depositary and Warrant Agent, the number of
Warrants and Warrant Shares represented by the Global Warrant to be reduced by
the number of Warrants and Warrant Shares to be represented by the Definitive
Warrants to be issued in exchange for the interest of such Person in the Global
Warrant and, following such reduction, the Company shall execute and the Warrant
Agent shall countersign and deliver to the transferee, as the case may be, a
Definitive Warrant.
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(b) Definitive Warrants issued in exchange for a beneficial interest
in a Global Warrant pursuant to this Section 6.2 shall be registered in such
names as the Depositary pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Warrant Agent. The Warrant Agent
shall deliver such Definitive Warrants to the Persons in whose names such
Warrants are so registered.
(c) Notwithstanding the foregoing, a beneficial interest in the
Regulation S Global Warrant may not be exchanged for a Definitive Warrant or
transferred to a Person who takes delivery thereof in the form of a Definitive
Warrant prior to (x) the expiration of the Restricted Period and (y) the receipt
by the Warrant Agent of any certificates required pursuant to Rule
903(c)(3)(ii)(B) under the Securities Act, except in the case of a transfer
pursuant to an exemption from the registration requirements of the Securities
Act other than Rule 903 or Rule 904.
6.3 Transfer and Exchange of Definitive Warrants.
When Definitive Warrants are presented to the Warrant Agent with a
request:
(a) to register the transfer of the Definitive Warrants; or
(b) to exchange such Definitive Warrants for an equal number of
Definitive Warrants of other authorized denominations,
the Warrant Agent shall register the transfer or make the exchange as requested
if its requirements for such transactions are met; provided, however, that the
Definitive Warrants presented or surrendered for registration of transfer or
exchange:
(x) shall be duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the Warrant Agent, duly
executed by the Holder thereof or by his attorney, duly authorized in
writing; and
(y) in the case of Transfer Restricted Securities (as defined
in the Warrant Registration Rights Agreement), such request shall be
accompanied by the following additional information and documents, as
applicable:
(i) if such Transfer Restricted Security is being delivered to the
Warrant Agent by a Holder for registration in the name of such
Holder, without transfer, a certification from such Holder to that
effect (in substantially the form of Exhibit B hereto);
(ii) if such Transfer Restricted Security is being transferred (1)
to a "qualified institutional buyer" (as defined in Rule 144A under
the Securities Act) in accordance with Rule 144A under the
Securities Act or (2) pursuant to an exemption from registration in
accordance with Rule 144 under the Securities Act (and based on an
opinion of counsel if the Company so requests) or (3) pursuant to an
effective registration statement under the Securities Act, a
certification to that effect (in substantially the form of Exhibit B
hereto);
(iii) if such Transfer Restricted Security is being transferred to
an institutional "accredited investor," within the meaning of Rule
501(a)(1), (2), (3) or (7) under the Securities Act pursuant to a
private placement exemption from the
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registration requirements of the Securities Act (and based on an
opinion of counsel if the Company so requests), a certification to
that effect (in substantially the form of Exhibit B hereto) and a
certification from the applicable transferee:
(iv) if such Transfer Restricted Security is being transferred
pursuant to an exemption from registration in accordance with Rule
904 under the Securities Act (and based on an opinion of counsel if
the Company so requests), a certification to that effect (in
substantially the form of Exhibit B hereto); or
(v) if such Transfer Restricted Security is being transferred in
reliance on another exemption from the registration requirements of
the Securities Act (and based on an opinion of counsel if the
Company so requests), a certification to that effect (in
substantially the form of Exhibit B hereto).
6.4 Restrictions on Exchange or Transfer of a Definitive Warrant for a
Beneficial Interest in a Global Warrant. A Definitive Warrant may not be
exchanged for a beneficial interest in a Global Warrant except upon satisfaction
of the requirements set forth below. Upon receipt by the Warrant Agent of a
Definitive Warrant, duly endorsed or accompanied by appropriate instruments of
transfer, in form satisfactory to the Warrant Agent, together with:
(a) if such Definitive Warrant is a Transfer Restricted Security,
certification from the Holder thereof (in substantially the form of Exhibit B
hereto) to the effect that such Definitive Warrant is being transferred by such
Holder either (A) to a "qualified institutional buyer" (as defined in Rule 144A
under the Securities Act) in accordance with Rule 144A under the Securities Act,
(B) outside the United States to a foreign Person in a transaction meeting the
requirements of Rule 904 under the Securities Act (and based on an opinion of
counsel if the Company so requests) or (C) to an "institutional accredited
investor" within the meaning of Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, pursuant to a private placement exemption from the registration
requirements of the Securities Act, who has provided a certification to that
effect (and based on an opinion of counsel if the Company so requests) and who
wishes to take delivery thereof in the form of a beneficial interest in a Global
Warrant; and
(b) whether or not such Definitive Warrant is a Transfer Restricted
Security, written instructions directing the Warrant Agent to make, or to direct
the Depositary to make, an endorsement on the Global Warrant to reflect an
increase in the number of Warrants and Warrant Shares represented by the Global
Warrant equal to the number of Warrants and Warrant Shares represented by such
Definitive Warrant,
then the Warrant Agent shall cancel such Definitive Warrant and cause, or direct
the Depositary to cause, in accordance with the standing instructions and
procedures existing between the Depositary and the Warrant Agent, the number of
Warrants and Warrant Shares represented by the Global Warrant to be increased
accordingly. If no Global Warrants are then outstanding, the Company shall issue
and the Warrant Agent shall countersign a new Global Warrant representing the
appropriate number of Warrants and Warrant Shares.
6.5 Restrictions on Transfer and Exchange of Global Warrants.
Notwithstanding any other provisions of this Agreement (other than the
provisions set forth in Section 6.6), a Global Warrant may not be transferred as
a whole except by the Depositary to a nominee of the Depositary or by a nominee
of the Depositary to the Depositary or another nominee of the Depositary or by
the Depositary or any such nominee to a successor Depositary or a nominee of
such successor Depositary.
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6.6 Countersigning of Definitive Warrants in Absence of Depositary. If at
any time:
(a) the Depositary for the Global Warrants notifies the Company that
the Depositary is unwilling or unable to continue as Depositary for the Global
Warrants and a successor Depositary for the Global Warrants is not appointed by
the Company within 90 days after delivery of such notice; or
(b) the Company, in its sole discretion, notifies the Warrant Agent
in writing that it elects to cause the issuance of Definitive Warrants under
this Agreement,
then the Company shall execute, and the Warrant Agent, upon written instructions
signed by an officer of the Company, shall countersign and deliver Definitive
Warrants, in an aggregate number equal to the number of Warrants represented by
the Global Warrants, in exchange for such Global Warrants.
6.7 Legends.
(a) Except for any Transfer Restricted Security sold or transferred
(including any Transfer Restricted Security represented by a Global Warrant) as
discussed in clause (ii) below, each Warrant Certificate evidencing the Global
Warrants and the Definitive Warrants (and all Warrants issued in exchange
therefor or substitution thereof) and each certificate representing the Warrant
Shares shall be substantially in the form of Exhibit A hereto and shall bear a
legend in substantially the following form:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE NEXT SENTENCE. BY ITS
ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER:
(1) REPRESENTS THAT (i) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE ACT)(A "QIB"), (ii) IT HAS ACQUIRED THIS
SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER
THE ACT OR (iii) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED
IN RULE 501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE ACT (AN
"IAI"),
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS SECURITY
EXCEPT (i) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES, (ii) 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, (iii) IN AN OFFSHORE TRANSACTION MEETING THE
REQUIREMENTS OF RULE 903 OR 904 OF THE ACT, (iv) IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 144 UNDER THE ACT, (v) TO AN IAI THAT, PRIOR TO
SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF THIS SECURITY
(THE FORM OF WHICH CAN BE
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OBTAINED FROM THE TRUSTEE) AND AN OPINION OF COUNSEL ACCEPTABLE TO THE
COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE ACT, (vi) IN
ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY)
OR (vii) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH
CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND
(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY OR AN
INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND.
AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" AND "UNITED STATES" HAVE THE
MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE ACT. THE INDENTURE
AND WARRANT AGREEMENT CONTAIN A PROVISION REQUIRING THE TRUSTEE TO REFUSE TO
REGISTER ANY TRANSFER OF THESE SECURITIES IN VIOLATION OF THE FOREGOING."
(b) Separability Legend. Until the Separation Date, each Warrant
Certificate representing Unit Warrants shall bear a legend in substantially the
following form:
"UNTIL THE SEPARATION DATE (AS DEFINED IN THE WARRANT AGREEMENT), THIS
WARRANT HAS BEEN ISSUED AS, AND MUST BE TRANSFERRED AS, A UNIT TOGETHER
WITH THE ASSOCIATED 14% SENIOR SUBORDINATED DISCOUNT NOTES DUE 2010 OF
UBIQUITEL OPERATING COMPANY. EACH UNIT CONSISTS OF $1,000 PRINCIPAL AMOUNT
OF NOTES AND A WARRANT TO PURCHASE 5.965 SHARES OF COMMON STOCK OF THE
COMPANY, SUBJECT TO ADJUSTMENT UNDER CERTAIN CIRCUMSTANCES. A COPY OF THE
INDENTURE PURSUANT TO WHICH THE NOTES HAVE BEEN ISSUED IS AVAILABLE FROM
THE COMPANY UPON REQUEST."
(c) Regulation S Global Security Legend. The Regulation S Global
Warrant shall bear a legend in substantially the following form:
"THE RIGHTS ATTACHING TO THIS REGULATION S GLOBAL WARRANT, AND THE
CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED
WARRANTS, ARE AS SPECIFIED IN THE WARRANT AGREEMENT (AS DEFINED HEREIN)."
(d) Separate Warrants Global Security Legend. The Global Warrant
representing beneficial interests in Separate Warrants shall bear a legend in
substantially the following form:
"UNTIL THE SEPARATION DATE (AS DEFINED IN THE WARRANT AGREEMENT), THIS
WARRANT MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED."
(e) Upon any sale or transfer of a Transfer Restricted Security
(including any Transfer Restricted Security represented by a Global Warrant)
pursuant to an effective
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registration statement under the Securities Act, pursuant to Rule 144 under the
Securities Act or pursuant to an opinion of counsel reasonably satisfactory to
the Company that no legend is required:
(i) in the case of any Transfer Restricted Security that is a
Definitive Warrant, the Warrant Agent shall permit the Holder thereof to
exchange such Transfer Restricted Security for a Definitive Warrant that does
not bear the legend set forth in clause (i) above and rescind any restriction on
the transfer of such Transfer Restricted Security; and
(ii) in the case of any Transfer Restricted Security represented by
a Global Warrant, such Transfer Restricted Security shall not be required to
bear the legend set forth in clause (i) above but shall continue to be subject
to the provisions of Section 6.5 hereof; provided, however, that with respect to
any request for an exchange of a Transfer Restricted Security that is
represented by a Global Warrant for a Definitive Warrant that does not bear the
legend set forth in clause (i) above, which request is made in reliance upon
Rule 144 (and based upon an opinion of counsel if the Company so requests), the
Holder thereof shall certify in writing to the Warrant Agent that such request
is being made pursuant to Rule 144 (such certification to be substantially in
the form of Exhibit B hereto).
6.8 Cancellation of Global Warrant. At such time as all beneficial
interests in Global Warrants have either been exchanged for Definitive Warrants,
redeemed, repurchased or cancelled, all Global Warrants shall be returned to or
retained and cancelled by the Warrant Agent.
6.9 Obligations with Respect to Transfers and Exchanges of Warrants.
(a) To permit registrations of transfers and exchanges, the Company
shall execute and the Warrant Agent is hereby authorized to countersign, in
accordance with the provisions of Section 3 and this Section 6, Definitive
Warrants and Global Warrants as required pursuant to the provisions of this
Section 6.
(b) All Definitive Warrants and Global Warrants issued upon any
registration of transfer or exchange of Definitive Warrants or Global Warrants
shall be the valid obligations of the Company, entitled to the same benefits
under this Agreement as the Definitive Warrants or Global Warrants surrendered
upon such registration of transfer or exchange.
(c) Prior to due presentment for registration of transfer or
exchange of any Warrant, the Warrant Agent and the Company may deem and treat
the Person in whose name any Warrant is registered (the "Holder" of such
Warrant) as the absolute owner of such Warrant and neither the Warrant Agent,
nor the Company shall be affected by notice to the contrary.
(d) No service charge shall be made to a Holder for any
registration, transfer or exchange.
Section 7. Terms of Warrants; Exercise of Warrants.
Subject to the terms of this Agreement, each Warrant Holder shall
have the right, which may be exercised commencing at the opening of business on
the Exercisability Date and until 5:00 p.m., New York City time, on the
Expiration Date to receive from the Company the number of fully paid and
nonassessable Warrant Shares which the Holder may at the time be entitled to
receive on exercise of such Warrants and payment of the Exercise Price then in
effect
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for such Warrant Shares; provided, however, that no Holder shall be entitled to
exercise such Holder's Warrants at any time, unless, at the time of exercise,
(i) a registration statement under the Securities Act relating to the Warrant
Shares has been filed with, and declared effective by, the Commission, and no
stop order suspending the effectiveness of such registration statement has been
issued by the Commission or (ii) the issuance of the Warrant Shares is permitted
pursuant to an exemption from the registration requirements of the Securities
Act. Subject to the provisions of the following paragraph of this Section 7,
each Warrant not exercised prior to 5:00 p.m., New York City time, on the
Expiration Date shall become void and all rights thereunder and all rights in
respect thereof under this Agreement shall cease as of such time. No adjustments
as to dividends will be made upon exercise of the Warrants.
The Company shall give notice not less than 90 days prior to the
Expiration Date to the Holders of all then outstanding Warrants to the effect
that the Warrants will terminate and become void as of 5:00 p.m., New York City
time, on the Expiration Date. If the Company fails to give such notice, the
Warrants will not expire until 90 days after the Company gives such notice;
provided, however, in no event will Holders be entitled to any damages or other
remedy for the Company's failure to give such notice other than any such
extension.
A Warrant may be exercised upon surrender to the Company at the
principal office of the Warrant Agent of the certificate or certificates
evidencing the Warrant to be exercised with the form of election to purchase on
the reverse thereof duly completed and signed, which signature shall be
guaranteed by an "eligible guarantor institution" meeting the requirements of
the Warrant Agent which requirements include membership or participation in the
Security Transfer Agent Medallion Program ("STAMP") or such other signature
guarantee program "as may be determined by the Warrant Agent in addition to, in
or substitution for, STAMP, all in accordance with the Securities Exchange Act
of 1934, as amended," and upon payment to the Exercise Price as adjusted as
herein provided for each of the Warrant Shares in respect of which such Warrant
is then exercised. Payment of the aggregate Exercise Price shall be made by
Federal wire transfer to the account designated by the Company or by certified
or official bank check, payable to the order of the Company. In the alternative,
each Holder may exercise its right to receive Warrant Shares without payment of
cash (the "Cashless Exercise"), by reducing the number of Warrant Shares that
would be obtainable upon the exercise of a Warrant and payment of the Exercise
Price in cash so as to yield a number of Warrant Shares upon the exercise of the
Warrant equal to the product of (a) the number of shares of Common Stock for
which the Warrant is exercisable as of the date of exercise (the "Exercise
Date") (if the Exercise Price were being paid in cash) and (b) the Cashless
Exercise Ratio.
The "Cashless Exercise Ratio" shall equal a fraction, the numerator
of which is the excess of the Fair Market Value (as defined below) per share of
Common Stock on the Exercise Date over the Exercise Price per share as of the
Exercise Date and the denominator of which is the Fair Market Value per share of
the Common Stock on the Exercise Date. When a Holder surrenders a Warrant
certificate representing more than one Warrant in connection with such Holder's
option to elect a Cashless Exercise, the number of shares of Common Stock
deliverable upon a Cashless Exercise shall be equal to the number of shares of
Common Stock issuable upon the exercise of Warrants that the Holder specifies to
be exercised pursuant to a Cashless Exercise multiplied by the Cashless Exercise
Ratio. For purposes of the foregoing, "Fair Market Value" of the Warrant Shares
shall be determined by the procedures set forth in Section 12.6. The exercise of
Warrants by Holders of beneficial interests in Global Warrants shall be effected
in accordance with this Agreement and the procedures of the Depositary therefor.
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Subject to the provisions of Section 8 hereof, upon surrender of
Warrants and payment of the Exercise Price or effecting a Cashless Exercise as
provided above by any Holder, the Warrant Agent shall promptly notify the
Company. and the Company shall promptly transfer to such Holder a certificate or
certificates for the appropriate number of Warrant Shares or other securities or
property (including any money) to which such Holder is entitled, registered or
otherwise placed in, or payable to the order of, such name or names as may be
directed in writing by such Holder, and shall deliver such certificate or
certificates representing the Warrant Shares and any other securities or
property (including any money) to such Holder or any other Person or Persons
entitled to receive the same, together with an amount in cash in lieu of any
fraction of a share as provided in Section 14. Any such certificate or
certificates representing the Warrant Shares shall be deemed to have been issued
and any Person so designated to be named therein shall be deemed to have become
a Holder of record of such Warrant Shares as of the date of the surrender of
such Warrants and payment of the Exercise Price.
The Warrants shall be exercisable commencing on the Exercisability
Date, at the election of the Holders thereof, either in full or from time to
time in part, and, in the event that a certificate evidencing Warrants is
exercised in respect of fewer than all of the Warrant Shares issuable on such
exercise at any time prior to the Expiration Date, a new certificate evidencing
the remaining Warrant or Warrants will be issued, and the Warrant Agent is
hereby irrevocably authorized to countersign and to deliver the required new
Warrant Certificate or Certificates pursuant to the provisions of this Section 7
and of Section 4 hereof, and the Company, whenever required by the Warrant
Agent, will supply the Warrant Agent with Warrant Certificates duly executed on
behalf of the Company for such purpose.
All Warrant Certificates surrendered upon exercise of Warrants shall
be cancelled by the Warrant Agent. Such cancelled Warrant Certificates shall,
upon the Company's written request, then be returned by the Warrant Agent to the
Company. The Warrant Agent shall account promptly to the Company with respect to
Warrants exercised and concurrently pay to the Company all monies received by
the Warrant Agent for the purchase of the Warrant Shares through the exercise of
such Warrants.
The Warrant Agent shall keep copies of this Agreement and any
notices given or received hereunder by or from the Company available for
inspection by the Holders during normal business hours at its office. The
Company shall supply the Warrant Agent from time to time with such numbers of
copies of this Agreement as the Warrant Agent may request.
Section 8. Payment of Taxes. The Company will pay all documentary
stamp taxes attributable to the initial issuance of Warrant Shares upon the
exercise of Warrants or to any separation of the Warrants from the Notes;
provided, however, that the Company shall not be required to pay any tax or
taxes which may be payable in respect of any transfer involved in the issue of
any Warrant Certificates or any certificates for Warrant Shares in a name other
than that of the Holder of a Warrant Certificate surrendered upon the exercise
of a Warrant, and the Company shall not be required to issue or deliver such
Warrant Certificates unless or until the Person or Persons requesting the
issuance thereof shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax has been paid.
Section 9. Mutilated or Missing Warrant Certificates. In case any of
the Warrant Certificates shall be mutilated, lost, stolen or destroyed, the
Company may in its discretion issue and the Warrant Agent may countersign, in
exchange and substitution for and upon cancellation of the mutilated Warrant
Certificate, or in lieu of and substitution for the Warrant Certificate lost,
stolen or destroyed, a new Warrant Certificate of like tenor and
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representing an equivalent number of Warrants, but only upon receipt of evidence
reasonably satisfactory to the Company and the Warrant Agent of such loss, theft
or destruction of such Warrant Certificate and indemnity, if requested, also
reasonably satisfactory to them. Applicants for such substitute Warrant
Certificates shall also comply with such other reasonable regulations and pay
such other reasonable charges as the Company or the Warrant Agent may prescribe.
Section 10. Reservation of Warrant Shares. The Company will at all
times reserve and keep available, free from preemptive rights, out of the
aggregate of its authorized but unissued Common Stock or its authorized and
issued Common Stock held in its treasury, for the purpose of enabling it to
satisfy any obligation to issue Warrant Shares upon exercise of Warrants, the
maximum number of shares of Common Stock which may then be deliverable upon the
exercise of all outstanding Warrants.
The transfer agent for the Common Stock (the "Transfer Agent") and
every subsequent transfer agent for any shares of the Company's Capital Stock
issuable upon the exercise of any of the rights of purchase aforesaid will be
irrevocably authorized and directed at all times to reserve such number of
authorized shares as shall be required for such purpose. The Company will keep a
copy of this Agreement on file with the Transfer Agent and with every subsequent
transfer agent for any shares of the Company's Capital Stock issuable upon the
exercise of the rights of purchase represented by the Warrants. The Warrant
Agent is hereby irrevocably authorized to requisition from time to time from
such Transfer Agent the stock certificates required to honor outstanding
Warrants upon exercise thereof in accordance with the terms of this Agreement.
The Company will supply such Transfer Agent with duly executed certificates for
such purposes and will provide or otherwise make available any cash which may be
payable as provided in Section 14. The Company will furnish such Transfer Agent
a copy of all notices of adjustments and certificates related thereto,
transmitted to each Holder of the Warrants pursuant to Section 15 hereof. Prior
to the initial underwritten public offering of Capital Stock of the Company, the
Company may act as Transfer Agent for the Common Stock. The Warrant Agent hereby
agrees that it will not issue any stock certificates delivered hereunder other
than upon the exercise of Warrants in accordance with the terms of this
Agreement and, promptly after the issuance of any such stock certificates, to
notify the Transfer Agent of such issuance.
Before taking any action which would cause an adjustment pursuant to
Section 12 hereof that would reduce the Exercise Price below the then par value
(if any) of the Warrant Shares, the Company will take any corporate action which
may, in the opinion of its counsel (which may be counsel employed by the
Company), be necessary in order that the Company may validly and legally issue
fully paid and nonassessable Warrant Shares at the Exercise Price as so
adjusted.
The Company covenants that all Warrant Shares which may be issued
upon exercise of Warrants in accordance with the terms of this Agreement
(including the payment of the Exercise Price) will, upon issue, be duly and
validly issued, fully paid, nonassessable, free of preemptive rights and free
from all taxes, liens, charges and security interests with respect to the issue
thereof.
Section 11. Obtaining Stock Exchange Listings. The Company will from
time to time use its best efforts to take all action which may be necessary so
that the Warrant Shares, immediately upon their issuance upon the exercise of
Warrants, will be listed on the principal securities exchanges and markets
(including, without limitation, the Nasdaq National Market) within the United
States of America, if any, on which other shares of Common Stock are then
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listed. Upon the listing of such Warrant Shares, the Company shall notify the
Warrant Agent in writing. The Company will obtain and keep all required permits
and records in connection with such listing.
Section 12. Adjustment of Exercise Price and Number of Warrant
Shares Issuable. The number and kind of shares issuable upon exercise of a
Warrant and the Exercise Price shall be subject to adjustment from time to time
as follows:
12.1 Stock Splits, Combinations, etc. In case the Company shall hereafter
(A) pay a dividend or make a distribution on its Common Stock in shares of its
capital stock (whether shares of Common Stock or of capital stock of any other
class), (B) subdivide its outstanding shares of Common Stock, (C) combine its
outstanding shares of Common Stock into a smaller number of shares, or (D) issue
by reclassification of its shares of Common Stock any shares of capital stock of
the Company, the Exercise Price in effect and the number of Warrant Shares
issuable upon exercise of each Warrant immediately prior to such action shall be
adjusted so that the Holder of any Warrant thereafter exercised shall be
entitled to receive the number of shares of capital stock of the Company which
such Holder would have owned immediately following such action had such Warrant
been exercised immediately prior thereto. An adjustment made pursuant to this
Section 12.1 shall become effective immediately after the record date in the
case of a dividend and shall become effective immediately after the effective
date in the case of a subdivision, combination or reclassification. If, as a
result of an adjustment made pursuant to this Section 12.1, the Holder of any
Warrant thereafter exercised shall become entitled to receive shares of two or
more classes of capital stock of the Company, the Board of Directors of the
Company (whose good faith determination shall be conclusive) shall determine the
allocation of the adjusted Exercise Price between or among shares of such
classes of capital stock.
12.2 Reclassification, Combinations, Mergers, etc. In case of any
reclassification or change of outstanding shares of Common Stock issuable upon
exercise of the Warrants (other than as set forth in Section 12.1 and other than
a change in par value, or from par value to no par value, or from no par value
to par value or as a result of a subdivision or combination), or in case of any
consolidation or merger of the Company with or into another corporation (other
than a merger or acquisition in which the Company is the continuing corporation
and which does not result in any reclassification or change of the then
outstanding shares of Common Stock or other capital stock issuable upon exercise
of the Warrants) or in case of any sale or conveyance to another corporation of
the property of the Company as an entirety or substantially as an entirety,
then, as a condition of such reclassification, change, consolidation, merger,
sale or conveyance, the Company or such a successor or purchasing corporation,
as the case may be, shall forthwith make lawful and adequate provision whereby
the Holder of each Warrant then outstanding shall have the right thereafter to
receive on exercise of such Warrant the kind and amount of shares of stock and
other securities and property receivable upon such reclassification, change,
consolidation, merger, sale or conveyance equivalent in value to the number of
shares of Common Stock issuable upon exercise of such Warrant immediately prior
to such reclassification, change, consolidation, merger, sale or conveyance and
enter into a supplemental warrant agreement so providing. Such provisions shall
include provision for adjustments which shall be as nearly equivalent as may be
practicable to the adjustments provided for in this Section 12. If the issuer of
securities deliverable upon exercise of Warrants under the supplemental warrant
agreement is an affiliate of the formed, surviving or transferee corporation,
that issuer shall join in the supplemental warrant agreement. The above
provisions of this Section 12.2 shall similarly apply to successive
reclassifications and changes of shares of Common Stock and to successive
consolidations, mergers, sales or conveyances.
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12.3 Issuance of Options or Convertible Securities. In the event the
Company shall, at any time or from time to time after the date hereof, issue,
sell, distribute or otherwise grant in any manner (including by assumption) to
all holders of the Common Stock (x) any rights to subscribe for or to purchase,
or any warrants or options for the purchase of, Common Stock (any such rights,
warrants or options being referred to herein as "Options") or (y) any stock or
securities convertible into or exchangeable for Common Stock (any such
convertible or exchangeable stock being referred to herein as "Convertible
Securities") or any Options to acquire Convertible Securities, whether or not
such Options or the rights to convert or exchange such Convertible Securities
are immediately exercisable, and the price per share at which Common Stock is
issuable upon the exercise of such Options or upon the conversion or exchange of
such Convertible Securities (determined by dividing (i) the aggregate amount, if
any, received or receivable by the Company as consideration for the issuance,
sale, distribution or granting of such Options or any such Convertible Security,
plus the minimum aggregate amount of additional consideration, if any, payable
to the Company upon the exercise of all such Options or upon conversion or
exchange of all such Convertible Securities, plus, in the case of Options to
acquire Convertible Securities, the minimum aggregate amount of additional
consideration, if any, payable upon the conversion or exchange of all such
Convertible Securities, by (ii) the total maximum number of shares of Common
Stock issuable upon the exercise of all such Options or upon the conversion or
exchange of all such Convertible Securities or upon the conversion or exchange
of all Convertible Securities issuable upon the exercise of all such Options)
shall be less than the Fair Market Value per share of Common Stock on the record
date for the issuance, sale, distribution or granting of such Options or
Convertible Securities (any such event being herein called a "Distribution"),
then, effective upon such Distribution, (I) the Exercise Price of each Warrant
shall be reduced to the price (calculated to the nearest 1/1,000 of one cent)
determined by multiplying the Exercise Price in effect immediately prior to such
Distribution by a fraction, the numerator of which shall be the sum of (i) the
number of shares of Common Stock outstanding (exclusive of any treasury shares)
immediately prior to such Distribution multiplied by the Fair Market Value per
share of Common Stock on the date of such Distribution plus (ii) the
consideration, if any, received by the Company upon such Distribution, and the
denominator of which shall be the product of (A) the total number of shares of
Common Stock outstanding (exclusive of any treasury shares) immediately after
such Distribution multiplied by (B) the Fair Market Value per share of Common
Stock on the record date for such Distribution and (II) the number of shares of
Common Stock purchasable upon the exercise of each Warrant shall be increased to
a number determined by multiplying the number of shares of Common Stock so
purchasable immediately prior to the record date for such Distribution by a
fraction, the numerator of which shall be the Exercise Price in effect
immediately prior to the adjustment required by clause (I) of this sentence and
the denominator of which shall be the Exercise Price in effect immediately after
such adjustment. For purposes of the foregoing, the total maximum number of
shares of Common Stock issuable upon exercise of all such Options or upon
conversion or exchange of all such Convertible Securities or upon the conversion
or exchange of the total maximum amount of the Convertible Securities issuable
upon the exercise of all such Options shall be deemed to have been issued as of
the date of such Distribution and thereafter shall be deemed to be outstanding
and the Company shall be deemed to have received as consideration therefor such
price per share, determined as provided above. Except as provided in Sections
12.10 and 12.11 below, no additional adjustment of the Exercise Price shall be
made upon the actual exercise of such Options or upon conversion or exchange of
the Convertible Securities or upon the conversion or exchange of the Convertible
Securities issuable upon the exercise of such Options.
12.4 Dividends and Distributions. In the event the Company shall, at any
time or from time to time after the date hereof, distribute to all the holders
of Common Stock (x) any dividend
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or other distribution of cash, evidences of its indebtedness, other securities
or other properties or assets (in each case other than (i) dividends payable in
Common Stock, Options or Convertible Securities and (ii) any cash dividend or
other cash distributions from current or retained earnings), or (y) any options,
warrants or other rights to subscribe for or purchase any of the foregoing, then
(A) the Exercise Price shall be decreased to a price determined by multiplying
the Exercise Price then in effect by a fraction, the numerator of which shall be
the Fair Market Value per share of Common Stock on the record date for such
distribution less the sum of (X) the cash portion, if any, of such distribution
per share of Common Stock outstanding (exclusive of any treasury shares) on the
record date for such distribution plus (Y) the then fair market value (as
determined in good faith by the Board of Directors of the Company) per share of
Common Stock outstanding (exclusive of any treasury shares) on the record date
for such distribution of that portion, if any, of such distribution consisting
of evidences of indebtedness, other securities, properties, assets, options,
warrants or subscription or purchase rights, and the denominator of which shall
be such Fair Market Value per share of Common Stock and (B) the number of shares
of Common Stock purchasable upon the exercise of each Warrant shall be increased
to a number determined by multiplying the number of shares of Common Stock so
purchasable immediately prior to the record date for such distribution by a
fraction, the numerator of which shall be the Exercise Price in effect
immediately prior to the adjustment required by clause (A) of this sentence and
the denominator of which shall be the Exercise Price in effect immediately after
such adjustment. The adjustments required by this Section 12.4 shall be made
whenever any such distribution occurs retroactive to the record date for the
determination of stockholders entitled to receive such distribution.
12.5 Issuance of Common Stock. In the event the Company shall, at any time
or from time to time after the date hereof, issue, sell, distribute or otherwise
grant in any manner (including by assumption) (each, a "Sale") any Common Stock
(other than (i) pursuant to the exercise of the Warrants or (ii) Excluded
Securities) at a price per share less than the Fair Market Value: (I) the
Exercise Price of each Warrant shall be reduced to the price (calculated to the
nearest 1/1,000 of one cent) determined by multiplying the Exercise Price in
effect immediately prior to the date of such Sale by a fraction, the numerator
of which shall be the sum of (i) the number of shares of Common Stock
outstanding (exclusive of any treasury shares) immediately prior to such Sale
multiplied by the Fair Market Value per share of Common Stock on the date of
such Sale plus (ii) the consideration, if any, received by the Company upon such
Sale, and the denominator of which shall be the product of (A) the total number
of shares of Common Stock outstanding (exclusive of any treasury shares)
immediately after such Sale multiplied by (B) the Fair Market Value per share of
Common Stock on the record date for such Sale and (II) the number of shares of
Common Stock purchasable upon the exercise of each Warrant shall be increased to
a number determined by multiplying the number of shares of Common Stock so
purchasable immediately prior to the record date for such Sale by a fraction,
the numerator of which shall be the Exercise Price in effect immediately prior
to the adjustment required by clause (i) of this sentence and the denominator of
which shall be the Exercise Price in effect immediately after such adjustment.
12.6 Fair Market Value. For the purpose of any computation of Fair Market
Value under Section 7, this Section 12 or Section 14, the Fair Market Value per
share of Common Stock at any date shall be (x) for purposes of Section 7 or
Section 14, as the case may be, the closing price on the Business Day
immediately prior to the exercise of the applicable Warrant pursuant to Section
7 and (y) in all other cases, the average of the daily closing prices for the
shorter of (i) the 20 consecutive trading days ending on the last full trading
day on the exchange or market specified in the second succeeding sentence prior
to the Time of Determination (as defined below) and (ii) the period commencing
on the date next succeeding the first public announcement
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of the issuance, sale, distribution or granting in question through such last
full trading day prior to the Time of Determination. The term "Time of
Determination" as used herein shall be the time and date of the earlier to occur
of (A) the date as of which the Fair Market Value is to be computed and (B) the
last full trading day on such exchange or market before the commencement of
"ex-dividend" trading in the Common Stock relating to the event giving rise to
the adjustment required by Sections 12.1, 12.2, 12.3, 12.4 or 12.5. The closing
price for any day shall be the last reported sale price regular way or, in case
no such reported sale takes place on such day, the average of the closing bid
and asked prices regular way for such day, in each case (1) on the principal
national securities exchange on which the shares of Common Stock are listed or
to which such shares are admitted to trading or (2) if the Common Stock is not
listed or admitted to trading on a national securities exchange, in the
over-the-counter market as reported by Nasdaq National Market or any comparable
system. In the absence of all of the foregoing, or if for any other reason the
Fair Market Value per share cannot be determined pursuant to the foregoing
provisions of this Section 12.6, the Fair Market Value per share shall be the
fair market value thereof as determined in good faith by the Board of Directors
of the Company.
12.7 Certain Distributions. If the Company shall pay a dividend or make
any other distribution to all holders of Common Stock payable in Options or
Convertible Securities, then, for purposes of Section 12.4 above, such Options
or Convertible Securities shall be deemed to have been issued or sold without
consideration.
12.8 Consideration Received. If any shares of Common Stock, Options or
Convertible Securities shall be issued, sold or distributed for a consideration
other than cash, the amount of the consideration other than cash received by the
Company in respect thereof shall be deemed to be the then fair market value of
such consideration (as determined in good faith by the Board of Directors of the
Company). If any Options shall be issued in connection with the issuance and
sale of other securities of the Company, together comprising one integral
transaction in which no specific consideration is allocated to such Options by
the parties thereto, such Options shall be deemed to have been issued without
consideration; provided, however, that if such Options have an exercise price
equal to or greater than the Fair Market Value of the Common Stock on the date
of issuance of such Options, then such Options shall be deemed to have been
issued for consideration equal to such exercise price.
12.9 Deferral of Certain Adjustments. No adjustment to the Exercise Price
(including the related adjustment to the number of shares of Common Stock
purchasable upon the exercise of each Warrant) shall be required hereunder
unless such adjustment, together with other adjustments carried forward as
provided below, would result in an increase or decrease of at least one percent
of the Exercise Price; provided that any adjustments which by reason of this
Section 12.9 are not required to be made shall be carried forward and taken into
account in any subsequent adjustment. No adjustment need be made for a change in
the par value of the Common Stock. All calculations under this Section 12 shall
be made to the nearest 1/1,000 of one cent or to the nearest 1/1000 of a share,
as the case may be.
12.10 Changes in Options and Convertible Securities. If the exercise price
provided for in any Options referred to in Section 12.3 above, the additional
consideration, if any, payable upon the conversion or exchange of any
Convertible Securities referred to in Section 12.3 above, or the rate at which
any Convertible Securities referred to in Section 12.3 above are convertible
into or exchangeable for Common Stock shall change at any time (other than under
or by reason of provisions designed to protect against dilution upon an event
which results in a related adjustment pursuant to this Section 12), the Exercise
Price then in effect and the number of shares of Common Stock purchasable upon
the exercise of each Warrant shall forthwith be readjusted
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(effective only with respect to any exercise of any Warrant after such
readjustment) to the Exercise Price and number of shares of Common Stock so
purchasable that would then be in effect had the adjustment made upon the
issuance, sale, distribution or granting of such Options or Convertible
Securities been made based upon such changed purchase price, additional
consideration or conversion rate, as the case may be, but only with respect to
such Options and Convertible Securities as then remain outstanding.
12.11 Expiration of Options and Convertible Securities. If, at any time
after any adjustment to the Exercise Price or number of shares of Common Stock
purchasable upon the exercise of each Warrant shall have been made pursuant to
Sections 12.3 or 12.10 above or this Section 12.11, any Options or Convertible
Securities shall have expired unexercised, the number of such shares so
purchasable shall, upon such expiration, be readjusted and shall thereafter be
such as they would have been had they been originally adjusted (or had the
original adjustment not been required, as the case may be) as if (i) the only
shares of Common Stock deemed to have been issued in connection with such
Options or Convertible Securities were the shares of Common Stock, if any,
actually issued or sold upon the exercise of such Options or Convertible
Securities and (ii) such shares of Common Stock, if any, were issued or sold for
the consideration actually received by the Company upon such exercise plus the
aggregate consideration, if any, actually received by the Company for the
issuance, sale, distribution or granting of all such Options or Convertible
Securities, whether or not exercised; provided that no such readjustment shall
have the effect of decreasing the number of such shares so purchasable by an
amount (calculated by adjusting such decrease to account for all other
adjustments made pursuant to this Section 12 following the date of the original
adjustment referred to above) in excess of the amount of the adjustment
initially made in respect of the issuance, sale, distribution or granting of
such Options or Convertible Securities.
12.12 Other Adjustments. In the event that at any time, as a result of an
adjustment made pursuant to this Section 12, the Holders shall become entitled
to receive any securities of the Company other than shares of Common Stock,
thereafter the number of such other securities so receivable upon exercise of
the Warrants and the Exercise Price applicable to such exercise shall be subject
to adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to the shares of Common Stock
contained in this Section 12.
12.13 No Adjustment Required. Without limiting any other exception
contained in this Section 12, and in addition thereto, no adjustment will be
made for:
(i) exercises or conversions of any Options or Convertible
Securities outstanding on the date hereof (to the extent in accordance with the
terms of such securities as in effect on the date of this Agreement);
(ii) issuances of Options, Convertible Securities or Common Stock to
employees, directors or consultants of the Company or any of its subsidiaries
pursuant to a plan approved by the Board of Directors of the Company;
(iii) rights to purchase Common Stock pursuant to a Company plan for
reinvestment of dividends or interest;
(iv) issuances of Options, Convertible Securities or Common Stock in
bona fide public offerings or private placements pursuant to Section 4(2) of the
Securities Act,
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Regulation D thereunder or Regulation S, involving at least one investment bank
of national reputation;
(v) issuances of Options, Convertible Securities or Common Stock in
connection with the establishment of commercial bank facilities, capital lease
obligations or other issuances of primarily debt obligations or securities;
(vi) the conversion of the DLJ Shares; or
(vii) issuances of Options, Convertible Securities or Common Stock
in connection with mergers and acquisitions with non-affiliated third parties
(the shares of Common Stock, Options or Convertible Securities set forth in
clauses (i) through (vii) being referred to as "Excluded Securities").
The Exercise Price will in no event be less than the par value of the Common
Stock; provided, however, the foregoing minimum Exercise Price shall not be
applicable for purposes of determining adjustments to the number of shares
issuable upon exercise of a Warrant
Section 13. Statement on Warrants. Irrespective of any adjustment in
the number or kind of shares issuable upon the exercise of the Warrants or the
Exercise Price, Warrants theretofore or thereafter issued may continue to
express the same number and kind of shares as are stated in the Warrants
initially issuable pursuant to this Agreement.
Section 14. Fractional Interest. The Company shall not be required
to issue fractional shares of Common Stock on the exercise of Warrants. If more
than one Warrant shall be presented for exercise in full at the same time by the
same Holder, the number of full shares of Common Stock which shall be issuable
upon such exercise shall be computed on the basis of the aggregate number of
shares of Common Stock acquirable on exercise of the Warrants so presented. If
any fraction of a share of Common Stock would, except for the provisions of this
Section 14, be issuable on the exercise of any Warrant (or specified portion
thereof), the Company shall direct the Transfer Agent to pay an amount in cash
calculated by it to equal the then Fair Market Value per share multiplied by
such fraction computed to the nearest whole cent. The Holders, by their
acceptance of the Warrant Certificates, expressly waive any and all rights to
receive any fraction of a share of Common Stock or a stock certificate
representing a fraction of a share of Common Stock.
Section 15. Notices to Warrant Holders. Upon any adjustment of the
Exercise Price pursuant to Section 12, the Company shall promptly thereafter (i)
cause to be filed with the Warrant Agent a certificate of a firm of independent
public accountants of recognized standing selected by the Board of Directors of
the Company (who may be the regular auditors of the Company) setting forth the
Exercise Price after such adjustment and setting forth in reasonable detail the
method of calculation and the facts upon which such calculations are based and
setting forth the number of Warrant Shares (or portion thereof) issuable after
such adjustment in the Exercise Price, upon exercise of a Warrant and payment of
the adjusted Exercise Price, which certificate shall be conclusive evidence of
the correctness of the matters set forth therein, and (ii) cause to be given to
each of the registered Holders of the Warrant Certificates at his address
appearing on the Warrant register written notice of such adjustments by
first-class mail, postage prepaid. The Warrant Agent shall be entitled to rely
on the above-referenced accountant's certificate and shall be under no duty or
responsibility with respect to any such certificate, except to exhibit the same
from time to time to any Holder desiring an inspection thereof during reasonable
business hours. The Warrant Agent shall not at any time be under any duty or
20
<PAGE>
responsibility to any Holder to determine whether any facts exist that may
require any adjustment of the number of shares of Common Stock or other stock or
property issuable on exercise of the Warrants or the Exercise Price, or with
respect to the nature or extent of any such adjustment when made, or with
respect to the method employed in making such adjustment or the validity or
value (or the kind or amount) of any shares of Common Stock or other stock or
property which may be issuable on exercise of the Warrants. The Warrant Agent
shall not be responsible for any failure of the Company to make any cash payment
or to issue, transfer or deliver any shares of Common Stock or stock
certificates or other common stock or property upon the exercise of any Warrant.
In case:
(a) the Company shall authorize the issuance to all holders of
shares of Common Stock of rights, options or warrants to subscribe for or
purchase shares of Common Stock or of any other subscription rights or warrants;
or
(b) the Company shall authorize the distribution to all holders of
shares of Common Stock of evidences of its indebtedness or assets (other than
cash dividends or cash distributions payable out of consolidated earnings or
earned surplus or dividends payable in shares of Common Stock or distributions
referred to in Section 12 hereof); or
(c) of any consolidation or merger to which the Company is a party
and for which approval of any shareholders of the Company is required, or of the
conveyance or transfer of the properties and assets of the Company substantially
as an entirety, or of any reclassification or change of Common Stock issuable
upon exercise of the Warrants (other than a change in par value, or from par
value to no par value, or from no par value to par value, or as a result of a
subdivision or combination), or a tender offer or exchange offer for shares of
Common Stock; or
(d) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company;
then the Company shall cause to be filed with the Warrant Agent and shall cause
to be given to each of the registered Holders of the Warrant Certificates at
such Holder's address appearing on the Warrant register, at least 20 days (or 10
days in any case specified in clauses (a) or (b) above) prior to the applicable
record date hereinafter specified, or promptly in the case of events for which
there is no record date, by first class mail, postage prepaid, a written notice
stating (i) the date as of which the holders of record of shares of Common Stock
to be entitled to receive any such rights, options, warrants or distribution are
to be determined, or (ii) the initial expiration date set forth in any tender
offer or exchange offer for shares of Common Stock, or (iii) the date on which
any such consolidation, merger, conveyance, transfer, dissolution, liquidation
or winding up is expected to become effective or consummated, and the date as of
which it is expected that holders of record of shares of Common Stock shall be
entitled to exchange such shares for securities or other property, if any,
deliverable upon such reclassification, consolidation, merger, conveyance,
transfer, dissolution, liquidation or winding up. The failure to give the notice
required by this Section 15 or any defect therein shall not affect the legality
or validity of any distribution, right, option, warrant, consolidation, merger,
conveyance, transfer, dissolution, liquidation or winding up, or the vote upon
any action. Nothing contained in this Agreement or in any of the Warrant
Certificates shall be construed as conferring upon the Holders thereof the right
to vote or to consent or to receive notice as shareholders in respect of the
meetings of shareholders or the election of directors of the Company or any
other matter, or any rights whatsoever as shareholders of the Company.
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Section 16. Merger, Consolidation or Change of Name of Warrant
Agent. Any corporation into which the Warrant Agent may be merged or with which
it may be consolidated, or any corporation resulting from any merger or
consolidation to which the Warrant Agent shall be a party, or any corporation
succeeding to the business of the Warrant Agent, shall be the successor to the
Warrant Agent hereunder without the execution or filing of any paper or any
further act on the part of any of the parties hereto, provided that such
corporation would be eligible for appointment as a successor warrant agent under
the provisions of Section 18. Any such successor Warrant Agent shall promptly
cause notice of its succession as Warrant Agent to be mailed (by first class
mail, postage prepaid) to each Holder at such Holder's last address as shown on
the register maintained by the Warrant Agent pursuant to this Agreement. In case
at the time such successor to the Warrant Agent shall succeed to the agency
created by this Agreement, and in case at that time any of the Warrant
Certificates shall have been countersigned but not delivered, any such successor
to the Warrant Agent may adopt the countersignature of the original Warrant
Agent; and in case at that time any of the Warrant Certificates shall not have
been countersigned, any successor to the Warrant Agent may countersign such
Warrant Certificates either in the name of the predecessor Warrant Agent or in
the name of the successor to the Warrant Agent; and in all such cases such
Warrant Certificates shall have the full force and effect provided in the
Warrant Certificates and in this Agreement.
In case at any time the name of the Warrant Agent shall be changed
and at such time any of the Warrant Certificates shall have been countersigned
but not delivered, the Warrant Agent whose name has been changed may adopt the
countersignature under its prior name, and in case at that time any of the
Warrant Certificates shall not have been countersigned, the Warrant Agent may
countersign such Warrant Certificates either in its prior name or in its changed
name, and in all such cases such Warrant Certificates shall have the full force
and effect provided in the Warrant Certificates and in this Agreement.
Section 17. Warrant Agent. The Warrant Agent undertakes the duties
and obligations imposed by this Agreement upon the following terms and
conditions, by all of which the Company and the Holders of Warrants, by their
acceptance thereof, shall be bound:
(a) The statements contained herein and in the Warrant Certificates
shall be taken as statements of the Company and the Warrant Agent assumes no
responsibility for the correctness of any of the same except such as describe
the Warrant Agent or action taken or to be taken by it. The Warrant Agent
assumes no responsibility with respect to the distribution of the Warrant
Certificates except as herein otherwise provided.
(b) The Warrant Agent shall not be responsible for any failure of
the Company to comply with any of the covenants contained in this Agreement or
in the Warrant Certificates to be complied with by the Company.
The Warrant Agent may consult at any time with counsel satisfactory
to it (who may be counsel for the Company) and the Warrant Agent shall incur no
liability or responsibility to the Company or to any Holder of any Warrant
Certificate in respect of any action taken, suffered or omitted by it hereunder
in good faith and in accordance with the opinion or the advice of such counsel.
The Warrant Agent shall incur no liability or responsibility to the
Company or to any Holder of any Warrant Certificate for any action taken in
reliance on any Warrant Certificate, certificate of shares, notice, resolution,
waiver, consent, order, certificate, or other paper,
22
<PAGE>
document or instrument believed by it to be genuine and to have been signed,
sent or presented by the proper parry or parties.
The Company agrees to pay to the Warrant Agent such compensation for
all services rendered by the Warrant Agent in the execution of this Agreement as
the parties shall agree from time to time, to reimburse the Warrant Agent for
all expenses, taxes and governmental charges and other charges of any kind and
nature reasonably incurred by the Warrant Agent in the execution of this
Agreement and to indemnify the Warrant Agent and save it harmless against any
and all liabilities, including judgments, costs and counsel fees, for anything
done or omitted by the Warrant Agent in the execution of this Agreement except
as a result of its negligence or willful misconduct.
The Warrant Agent shall be under no obligation to institute any
action, suit or legal proceeding or to take any other action likely to involve
expense unless the Company or one or more Holders of Warrant Certificates shall
furnish the Warrant Agent with security and indemnity satisfactory to the
Warrant Agent for any costs and expenses which may be incurred, but this
provision shall not affect the power of the Warrant Agent to take such action as
it may consider proper, whether with or without any such security or indemnity.
All rights of action under this Agreement or under any of the Warrants may be
enforced by the Warrant Agent without the possession of any of the Warrant
Certificates or the production thereof at any trial or other proceeding relative
thereto, and any such action, suit or proceeding instituted by the Warrant Agent
shall be brought in its name as Warrant Agent and any recovery of judgment shall
be for the ratable benefit of the Holders of the Warrants, as their respective
rights or interests may appear. No provision of this Agreement shall require the
Warrant Agent to expend or risk its own funds.
The Warrant Agent, and any stockholder, director, officer or
employee of it, may buy, sell or deal in any of the Warrants or other securities
of the Company or become pecuniarily interested in any transaction in which the
Company may be interested, or contract with or lend money to the Company or
otherwise act as fully and freely as though it were not Warrant Agent under this
Agreement. Nothing herein shall preclude the Warrant Agent from acting in any
other capacity for the Company or for any other legal entity.
The Warrant Agent shall act hereunder solely as agent for the
Company, and its duties shall be determined solely by the provisions hereof. The
Warrant Agent shall not be liable for anything which it may do or refrain from
doing in connection with this Agreement except for its own negligence or willful
misconduct.
The Warrant Agent shall not at any time be under any duty or
responsibility to any Holder of any Warrant Certificate to make or cause to be
made any adjustment of the Exercise Price or number of the Warrant Shares or
other securities or property deliverable as provided in this Agreement, or to
determine whether any facts exist which may require any of such adjustments, or
with respect to the nature or extent of any such adjustments, when made, or with
respect to the method employed in making the same. The Warrant Agent shall not
be accountable with respect to the validity or value or the kind or amount of
any Warrant Shares or of any securities or property which may at any time be
issued or delivered upon the exercise of any Warrant or with respect to whether
any such Warrant Shares or other securities will when issued be validly issued
and fully paid and nonassessable. and makes no representation with respect
thereto.
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<PAGE>
Section 18. Resignation and Removal of Warrant Agent; Appointment of
Successor. No resignation or removal of the Warrant Agent and no appointment of
a successor warrant agent shall become effective until the acceptance of
appointment by the successor warrant agent as provided herein. The Warrant Agent
may resign its duties and be discharged from all further duties and liability
hereunder (except liability arising as a result of the Warrant Agent's own
negligence or willful misconduct) after giving written notice to the Company.
The Company may remove the Warrant Agent upon written notice, and the Warrant
Agent shall thereupon in like manner be discharged from all further duties and
liabilities hereunder, except as aforesaid. The Warrant Agent shall, at the
Company's expense, cause to be mailed (by first class mail, postage prepaid) to
each Holder of a Warrant at such Holder's last address as shown on the register
of the Company maintained by the Warrant Agent a copy of said notice of
resignation or notice of removal, as the case may be. Upon such resignation or
removal, the Company shall appoint in writing a new warrant agent. If the
Company shall fail to make such appointment within a period of 30 days after it
has been notified in writing of such resignation by the resigning Warrant Agent
or after such removal, then the resigning Warrant Agent or the Holder of any
Warrant may apply to any court of competent jurisdiction for the appointment of
a new warrant agent. Any new warrant agent, whether appointed by the Company or
by such a court, shall be a corporation doing business under the laws of the
United States or any state thereof, in good standing and having a combined
capital and surplus of not less than $50,000,000. The combined capital and
surplus of any such new warrant agent shall be deemed to be the combined capital
and surplus as set forth in the most recent annual report of its condition
published by such warrant agent prior to its appointment, provided that such
reports are published at least annually pursuant to law or to the requirements
of a federal or state supervising or examining authority. After acceptance in
writing of such appointment by the new warrant agent, it shall be vested with
the same powers, rights, duties and responsibilities as if it had been
originally named herein as the Warrant Agent, without any further assurance,
conveyance, act or deed; but if for any reason it shall be necessary or
expedient to execute and deliver any further assurance, conveyance, act or deed,
the same shall be done at the expense of the Company and shall be legally and
validly executed and delivered by the resigning or removed Warrant Agent. Not
later than the effective date of any such appointment, the Company shall give
notice thereof to the resigning or removed Warrant Agent. Failure to give any
notice provided for in this Section 18, however, or any defect therein, shall
not affect the legality or validity of the resignation of the Warrant Agent or
the appointment of a new warrant agent, as the case may be.
Section 19. Reports.
(a) Whether or not required by the rules and regulations of the
Commission, so long as any Warrants are outstanding, the Company will furnish to
the holders of Warrants upon request (i) all quarterly and annual financial
information that would be required to be contained in a filing with the
Commission on Forms l0-Q and 10-K if the Company were required to file such
forms, including a "Management's Discussion and Analysis of Financial Condition
and Results of Operations" and, with respect to the annual information only, a
report thereon by the Company's certified independent accountants, and (ii) all
current reports that would be required to be filed with the Commission on Form
8-K if the Company were required to file such reports, in each case within the
time periods specified in the Commissions rules and regulations (the information
and reports in clauses (i) and (ii), collectively, "SEC Reports").
(b) The Company shall provide the Warrant Agent with a sufficient
number of copies of all SEC Reports that the Warrant Agent may be required to
deliver to the Holders of the Warrants under this Section 19.
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<PAGE>
Section 20. Notices to Company and Warrant Agent. Any notice or
demand authorized by this Agreement to be given or made by the Warrant Agent or
by the Holder of any Warrant Certificate to or on the Company shall be
sufficiently given or made when and if deposited in the mail, first class or
registered, postage prepaid, addressed (until another address is filed in
writing by the Company with the Warrant Agent), as follows:
UbiquiTel Inc.
1 Bala Plaza, Suite 402
Bala Cynwyd, Pennsylvania 19004
Telecopy: (610) 660-9558
Telephone: (610) 660-9510
Attention: Donald A. Harris
with copies to:
Greenberg & Traurig, LLP
1750 Tysons Boulevard
Tysons Corner, Virginia 22102
Telecopy: (703) 749-1301
Telephone: (703) 749-1300
Attention: Lee R. Marks, Esq.
and:
Greenberg & Traurig, P.A.
1221 Brickell Avenue, 21st Floor
Miami, Florida 33131
Telecopy: (305) 579-0500
Telephone: (305) 579-0717
Attention: Rebecca R. Orand, Esq.
In case the Company shall fail to maintain such office or agency or
shall fail to give such notice of the location or of any change in the location
thereof, presentations may be made and notices and demands may be served at the
principal office of the Warrant Agent.
Any notice pursuant to this Agreement to be given by the Company or
by the Holder(s) of any Warrant Certificate to the Warrant Agent shall be
sufficiently given when and if deposited in the mail, first-class or registered,
postage prepaid, addressed (until another address is filed in writing by the
Warrant Agent with the Company) to the Warrant Agent as follows:
American Stock Transfer & Trust Company
40 Wall Street, 46th Floor
New York, New York 10005
Telecopy: (718) 331-1852
Attention: Corporate Trust Trustee Administration
Section 21. Supplements and Amendments. The Company and the Warrant
Agent may from time to time supplement or amend this Agreement without the
approval of any Holders of Warrant Certificates in order to cure any ambiguity
or to correct or supplement any provision contained herein which may be
defective or inconsistent with any other provision herein, or to make any other
provisions in regard to matters or questions arising hereunder which
25
<PAGE>
the Company and the Warrant Agent may deem necessary or desirable and which
shall not in any way adversely affect the interests of the Holders of Warrant
Certificates. Any amendment or supplement to this Agreement that has a material
adverse effect on the interests of Holders shall require the written consent of
Holders representing a majority of the then outstanding Warrants. The consent of
each Holder of a Warrant affected shall be required for any amendment pursuant
to which the Exercise Price would be increased or the number of Warrant Shares
purchasable upon exercise of Warrants would be decreased (other than pursuant to
adjustments provided for in Section 12 hereof or amendments to Section 12 which
can be made by the written consent of Holders representing a majority of the
then outstanding Warrants). The Warrant Agent shall be entitled to receive and,
subject to Section 17, shall be fully protected in relying upon, an officers'
certificate and opinion of counsel as conclusive evidence that any such
amendment or supplement is authorized or permitted hereunder, that it is not
inconsistent herewith, and that it will be valid and binding upon the Company in
accordance with its terms.
Section 22. Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Warrant Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder.
Section 23. Termination. This Agreement (other than any party's
obligations with respect to Warrants previously exercised and with respect to
indemnification under Section 17) shall terminate at 5:00 p.m., New York City
time on the Expiration Date.
Section 24. Governing Law. THIS AGREEMENT AND EACH WARRANT
CERTIFICATE ISSUED HEREUNDER SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE
LAWS OF THE STATE OF NEW YORK AND FOR ALL PURPOSES SHALL BE CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF SAID STATE, WITHOUT GIVING EFFECT TO THE
CONFLICT OF LAWS PROVISIONS THEREOF
Section 25. Benefits of This Agreement.
(a) Nothing in this Agreement shall be construed to give to any
Person other than the Company, the Warrant Agent and the Holders of the Warrant
Certificates any legal or equitable right, remedy or claim under this Agreement;
but this Agreement shall be for the sole and exclusive benefit of the Company,
the Warrant Agent and the Holders of the Warrant Certificates.
(b) Prior to the exercise of the Warrants, no Holder of a Warrant
Certificate, as such, shall be entitled to any rights of a stockholder of the
Company, including, without limitation, the right to receive dividends or
subscription rights, the right to vote, to consent, to exercise any preemptive
right, to receive any notice of meetings of stockholders for the election of
directors of the Company or any other matter or to receive any notice of any
proceedings of the Company, except as may be specifically provided for herein.
The Holders of the Warrants are not entitled to share in the assets of the
Company in the event of the liquidation, dissolution or winding up of the
Company's affairs.
(c) All rights of action in respect of this Agreement are vested in
the Holders of the Warrants, and any Holder of any Warrant, without the consent
of the Warrant Agent or the Holder of any other Warrant, may, on such Holder's
own behalf and for such Holder's own benefit, enforce, and may institute and
maintain any suit, action or proceeding against the Company suitable to enforce,
or otherwise in respect of, such Holder's rights hereunder,
26
<PAGE>
including the right to exercise, exchange or surrender for purchase such
Holder's Warrants in the manner provided in this Agreement.
Section 26. Counterparts. This Agreement may be executed in any
number of counterparts and each of such counterparts shall for all purposes be
deemed to be an original, and all such counterparts shall together constitute
but one and the same instrument.
[The remainder of this page is intentionally left blank.]
27
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, as of the day and year first above written.
UBIQUITEL INC.
By:___________________________________________
Name:____________________________________
Title:___________________________________
AMERICAN STOCK TRANSFER & TRUST
COMPANY
By:___________________________________________
Name:____________________________________
Title:___________________________________
28
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EXHIBIT A
[FORM OF WARRANT CERTIFICATE]
[FACE]
THIS GLOBAL WARRANT IS HELD BY THE DEPOSITARY (AS DEFINED IN THE WARRANT
AGREEMENT GOVERNING THIS WARRANT) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF
THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE WARRANT AGENT MAY MAKE SUCH NOTATIONS HEREON
AS MAY BE REQUIRED PURSUANT TO SECTION 9 OF THE WARRANT AGREEMENT, (II) THIS
GLOBAL WARRANT MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 6.1
OF THE WARRANT AGREEMENT, (III) THIS GLOBAL WARRANT MAY BE DELIVERED TO THE
WARRANT AGENT FOR CANCELLATION PURSUANT TO SECTION 6.8 OF THE WARRANT AGREEMENT
AND (IV) THIS GLOBAL WARRANT MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH
THE PRIOR WRITTEN CONSENT OF THE COMPANY.(1)
UNLESS THIS WARRANT CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY TO THE COMPANY OR THE WARRANT AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.(1)
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT
NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS
SET FORTH IN SECTION 6 OF THE WARRANT AGREEMENT.(1)
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE NEXT SENTENCE. BY ITS
ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER:
(1) REPRESENTS THAT (i) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE ACT)(A "QIB"), (ii) IT HAS ACQUIRED THIS
SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER
THE ACT OR (iii) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED
IN RULE
- ----------
(1) These paragraphs are to be included only if the Warrant is in global form.
A-1
<PAGE>
501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE ACT (AN "IAI"),
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS SECURITY
EXCEPT (i) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES, (ii) 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, (iii) IN AN OFFSHORE TRANSACTION MEETING THE
REQUIREMENTS OF RULE 903 OR 904 OF THE ACT, (iv) IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 144 UNDER THE ACT, (v) TO AN IAI THAT, PRIOR TO
SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF THIS SECURITY
(THE FORM OF WHICH CAN BE OBTAINED FROM THE TRUSTEE) AND AN OPINION OF
COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH
THE ACT, (vi) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE
TO THE COMPANY) OR (vii) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
AND, IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF
ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND
(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY OR AN
INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND.
AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" AND "UNITED STATES" HAVE THE
MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE ACT. THE WARRANT
AGREEMENT CONTAINS A PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY
TRANSFER OF THESE SECURITIES IN VIOLATION OF THE FOREGOING.
A-2
<PAGE>
UNTIL THE SEPARATION DATE (AS DEFINED IN THE WARRANT AGREEMENT), THIS WARRANT
HAS BEEN ISSUED AS, AND MUST BE TRANSFERRED AS, A UNIT TOGETHER WITH THE
ASSOCIATED 14% SENIOR SUBORDINATED NOTES DUE 2010. EACH UNIT CONSISTS OF $1,000
PRINCIPAL AMOUNT OF NOTES AND A WARRANT TO PURCHASE 5.965 SHARES OF COMMON
STOCK, SUBJECT TO ADJUSTMENT UNDER CERTAIN CIRCUMSTANCES. A COPY OF THE
INDENTURE PURSUANT TO WHICH THE NOTES HAVE BEEN ISSUED IS AVAILABLE FROM THE
COMPANY UPON REQUEST.(2)
UNTIL THE SEPARATION DATE (AS DEFINED IN THE WARRANT AGREEMENT), THIS WARRANT
MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED.(3)
THE RIGHTS ATTACHING TO THIS REGULATION S GLOBAL WARRANT, AND THE CONDITIONS AND
PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED WARRANTS, ARE AS SPECIFIED IN
THE WARRANT AGREEMENT (AS DEFINED HEREIN).(4)
- ----------
(2) This paragraph to be included on Unit Warrants only until the Separation
Date, as defined in the Warrant Agreement.
(3) This paragraph to be included on Separate Warrants only until the Separation
Date, as defined in the Warrant Agreement.
(4) This paragraph to be included only until the Restricted Period, as defined
in the Warrant Agreement, expires.
A-3
<PAGE>
UBIQUITEL INC.
[CUSIP] [CINS] [ISIN) No. ________
No. ____________
WARRANTS TO PURCHASE COMMON STOCK
This certifies that CEDE & CO., or its registered assigns, is the
owner of up to ________(5) Warrants, each of which initially represents the
right to purchase, after April 15, 2001 (the "Exercisability Date"), 5.965
shares (the "Warrant Shares") of the Common Stock, par value $0.001 per share
(the "Common Stock"), of UbiquiTel Inc., a Delaware corporation (the "Company"),
at an exercise price (the "Exercise Price") of $22.74 per share of Common Stock
(subject to adjustment as provided in the Warrant Agreement referred to below),
upon surrender hereof at the office of American Stock Transfer & Trust Company,
or to its successor, as the warrant agent under the Warrant Agreement (any such
warrant agent being herein called the "Warrant Agent"), or such other location
contemplated by Section 20 of the Warrant Agreement, with the Subscription Form
on the reverse hereof duly executed, with signature guaranteed as therein
specified and simultaneous payment in full by Federal wire transfer to the
account designated by the Company or by certified or official bank or bank
cashier's check payable to the order of the Company. Notwithstanding the
foregoing, each Holder (as defined in the Warrant Agreement) may exercise its
right to receive Warrant Shares on a net basis, such that without the exchange
of any funds, the Holder receives that number of Warrant Shares otherwise
issuable upon exercise of its Warrants less that number of Warrant Shares having
a fair market value equal to the aggregate Exercise Price that would otherwise
have been paid by the Holder for the Warrant Shares being issued, as
contemplated and upon the terms set forth in Section 7. At any time after the
Exercisability Date and on or before the Expiration Date, any outstanding
Warrants may be exercised on any Business Day; provided, however, that a
Registration Statement relating to the Warrants is, at the time of exercise,
effective and available for the exercise of Warrants or the exercise of such
Warrants is exempt from the registration requirements of the Securities Act.
This Warrant Certificate is issued under and in accordance with a
Warrant Agreement dated April 11, 2000 (the "Warrant Agreement"), between the
Company and American Stock Transfer & Trust Company, as Warrant Agent, and is
subject to the Certificate of Incorporation and Bylaws of the Company and to the
terms and provisions contained therein, to all of which terms and provisions the
Holder of this Warrant Certificate consents by acceptance hereof. The terms of
the Warrant Agreement are hereby incorporated herein by reference and made a
part hereof. Reference is hereby made to the Warrant Agreement for a full
description of the rights, limitations of rights, obligations, duties and
immunities thereunder of the Company and the Holders of the Warrants. The
summary of the terms of the Warrant Agreement contained in this Warrant
Certificate is qualified in its entirety by express reference to the Warrant
Agreement. All terms used in this Warrant Certificate that are defined in the
Warrant Agreement shall have the meanings assigned to them in such agreements.
- ------------------------
(5) To evidence initially ___________ Warrants, subject to increase and decrease
in accordance with the Schedule of Exchanges related hereto maintained by the
Warrant Agent, and, in combination with Warrant number ______ identified by
CUSIP No. _______ and Warrant number ______ identified by CUSIP No. ________, to
equal 354,971 Warrants.
A-4
<PAGE>
The number of Warrant Shares purchasable upon the exercise of each
Warrant and the price per share are subject to adjustment as provided in the
Warrant Agreement. Except as stated in the Warrant Agreement, in the event the
Company merges or consolidates with, or sells all or substantially all of its
assets to, another Person, each Warrant will, upon exercise, entitle the Holder
thereof to receive the number of shares of Capital Stock or other securities or
the amount of money and other property which the Holder of the number of Warrant
Shares (or other securities or property issuable upon exercise of a Warrant)
purchasable upon the exercise of the Warrant is entitled to receive upon
completion of such merger, consolidation or sale.
As to any final fraction of a share which the same Holder of one or
more Warrant Certificates would otherwise be entitled to purchase upon exercise
thereof in the same transaction, the Company may pay the cash value thereof
determined as provided in the Warrant Agreement.
All Warrant Shares issuable by the Company upon the exercise of
Warrants shall be validly issued, fully paid and not subject to any calls for
funds, and the Company shall pay any taxes and other governmental charges that
may be imposed under the laws of the United States of America or any political
subdivision or taxing authority thereof or therein in respect of the issue or
delivery thereof upon exercise of Warrants (other than income taxes imposed on
the Holder). The Company shall not be required, however, to pay any tax or other
charge imposed in connection with any transfer involved in the issue of any
certificate for Warrant Shares (including other securities or property issuable
upon the exercise of the Warrants) or payment of cash to any Person other than
the Holder of a Warrant Certificate surrendered upon the exercise of a Warrant
and in case of such transfer or payment, the Warrant Agent and the Company shall
not be required to issue any share certificate or pay any cash until such tax or
charge has been paid or it has been established to the Warrant Agent's and the
Company's satisfaction that no such tax or charge is due.
Subject to the restrictions on and conditions to transfer set forth
in Section 6 of the Warrant Agreement, this Warrant Certificate and all rights
hereunder are transferable by the registered Holder hereof, in whole or in part,
on the register of the Company maintained by the Warrant Agent for such purpose
at the Warrant Agent's office in New York, New York, upon surrender of this
Warrant Certificate duly endorsed, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Warrant Agent duly
executed, with signatures guaranteed as specified in the attached Form of
Assignment, by the registered Holder hereof or such Holder's attorney duly
authorized in writing and by such other documentation required pursuant to the
Warrant Agreement and upon payment of any necessary transfer tax or other
governmental charge imposed upon such transfer. Upon any partial transfer, the
Company will sign and issue and the Warrant Agent will countersign and deliver
to such Holder a new Warrant Certificate or Certificates with respect to any
portion not so transferred. Each taker and Holder of this Warrant Certificate,
by taking and holding the same, consents and agrees that prior to the
registration of transfer as provided in the Warrant Agreement, the Company and
the Warrant Agent may treat the Person in whose name the Warrants are registered
as the absolute owner hereof for any purpose and as the Person entitled to
exercise the rights represented hereby, any notice to the contrary
notwithstanding. Accordingly, the Company and/or the Warrant Agent shall not,
except as ordered by a court of competent jurisdiction as required by law, be
bound to recognize any equitable or other claim to or interest in the Warrants
on the part of any Person other than such registered Holder, whether or not it
shall have express or other notice thereof.
This Warrant Certificate may be exchanged at the office of the
Warrant Agent maintained for such purpose in New York, New York, for Warrant
Certificates representing the
A-5
<PAGE>
same aggregate number of Warrants, each new Warrant Certificate to represent
such number of Warrants as the Holder hereof shall designate at the time of such
exchange.
Prior to the exercise of the Warrants represented hereby, the Holder
of this Warrant Certificate, as such, shall not be entitled to any rights of a
shareholder of the Company, including, without limitation, the right to vote or
to consent to any action of the shareholders, to receive any distributions, to
exercise any preemptive right or to receive any notice of meetings of
shareholders, and shall not be entitled to receive any notice of any proceedings
of the Company except as provided in the Warrant Agreement.
This Warrant Certificate shall be void and all rights evidenced
hereby shall cease on April 15, 2010, unless sooner terminated by the
liquidation, dissolution or winding-up of the Company or as otherwise provided
in the Warrant Agreement upon the consolidation or merger of the Company with,
or sale of the Company to, another Person or unless such date is extended as
provided in the Warrant Agreement.
This Warrant Certificate shall not be valid for any purpose until it
shall have been countersigned by the Warrant Agent.
UBIQUITEL INC.
By: _______________________________________
Name: _________________________________
Title: ________________________________
Dated:
Countersigned:
AMERICAN STOCK TRANSFER &
TRUST COMPANY, as Warrant Agent
By: __________________________
Authorized Signatory
A-6
<PAGE>
SUBSCRIPTION FORM
(To be executed only upon exercise of Warrant)
To: American Stock Transfer & Trust Company,
as Warrant Agent
40 Wall Street, 46th floor
New York, New York 10005
Attention: Corporate Trust Administration
The undersigned irrevocably exercises _________ of the Warrants
represented by this Warrant Certificate and herewith makes payment of $
_________ (such payment being by Federal wire transfer to the account designated
by UbiquiTel Inc.. or by certified or official bank or bank cashier's check
payable to the order or at the direction of UbiquiTel Inc.), or each Holder may
exercise its right to receive Warrant Shares on a net basis, such that without
the exchange of any funds, the Holder receives that number of Warrant Shares
otherwise issuable upon exercise of its Warrants less that number of Warrant
Shares having a fair market value equal to the aggregate Exercise Price that
would otherwise have been paid by the Holder for the Warrant Shares being
issued, all at the exercise price and on the terms and conditions specified in
this Warrant Certificate and in the Warrant Agreement and the Warrant
Registration Rights Agreement referred to herein and surrenders this Warrant
Certificate and all right, title and interest therein to and directs that the
Common Stock, par value $0.001 per share, of UbiquiTel Inc. deliverable upon the
exercise of such Warrants be registered or placed in the name and at the address
specified below and delivered thereto.
Dated:______________
____________________________________________________
(Signature of Owner)
____________________________________________________
(Street Address)
____________________________________________________
(City) (State) (Zip Code)
Signature Guaranteed By:
____________________________________________________
Signatures must be guaranteed by an "eligible
guarantor institution" meeting the requirements of
the Warrant Agent, which requirements include
membership or participation in the Security Transfer
Agent Medallion Program ("STAMP") or such other
"signature guarantee program" as may be determined
by the Warrant Agent in addition to, or in
substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
A-7
<PAGE>
Securities and/or check or other property to be issued or delivered to:
Please insert social security or identifying number: _______________________
Name: _______________________________________
Street Address: _____________________________
City, State and Zip Code: ___________________
A-8
<PAGE>
FORM OF ASSIGNMENT
In consideration of monies or other valuable consideration received
from the Assignee(s) named below, the undersigned registered Holder of this
Warrant Certificate hereby sells, assigns, and transfers unto the Assignee(s)
named below (including the undersigned with respect to any Warrants constituting
a part of the Warrants evidenced by this Warrant Certificate not being assigned
hereby) all of the right of the undersigned under this Warrant Certificate, with
respect to the number of Warrants set forth below:
Name(s) of Assignee(s):________________________________________
Address:_______________________________________________________
No. of Warrants:_______________________________________________
Please insert social security or other identifying number of assignee(s):
and does hereby irrevocably constitute and appoint _________________________ the
undersigned's attorney to make such transfer on the books of___________________
maintained for the purposes, with full power of substitution in the premises.
In connection with any transfer of Warrants, the undersigned
confirms that without utilizing any general solicitation or general advertising
that:
[Check One]
|_| (a) these Warrants are being transferred in compliance with the
exemption from registration under the United States Securities Act
of 1933, as amended, provided by Rule 144A thereunder.
or
|_| (b) these Warrants are being transferred other than in accordance with
(a) above and documents are being furnished which comply with the
conditions of transfer set forth in this Warrant Certificate and the
Warrant Agreement.
or
|_| (c) these Warrants are being transferred pursuant to an effective
registration statement under the United States Securities Act of
1933, as amended.
If none of the foregoing boxes is checked, the Warrant Agent shall
not be obligated to register the Warrants in the name of any Person other than
the Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Section 6 of the Warrant Agreement shall
have been satisfied.
Dated: __________________
A-9
<PAGE>
_________________________________________________________
(Signature of Owner)
_________________________________________________________
(Street Address)
_________________________________________________________
(City) (State) (Zip Code)
Signature Guaranteed By:
_________________________________________________________
Signatures must be guaranteed by an "eligible guarantor
institution" meeting the requirements of the Warrant
Agent, which requirements include membership or
participation in the Security Transfer Agent Medallion
Program ("STAMP") or such other "signature guarantee
program" as may be determined by the Warrant Agent in
addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as
amended.
A-10
<PAGE>
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing the
Warrant(s) for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the United States
Securities Act of 1933, as amended, and is aware that the sale to it is being
made in reliance on Rule 144A and acknowledges that it has received such
information regarding UbiquiTel Inc. as the undersigned has requested pursuant
to Rule 144A or has determined not to request such information and that it is
aware that the transferor is relying upon the undersigned's foregoing
representations in order to claim the exemption from registration provided by
Rule 144A.
Dated:__________________
__________________________________________________
[NOTE: To be executed by an executive officer]
A-11
<PAGE>
SCHEDULE OF EXCHANGES OF INTERESTS IN GLOBAL WARRANT
The following exchanges of a part of this Global Warrant for an
interest in another Global Warrant or for a Definitive Warrant, or exchanges of
a part of another Global Warrant or Definitive Warrant for an interest in this
Global Warrant have been made:
Number of
Amount of Amount of Warrants of
decrease in increase in this Global
Number of Number of Warrant Signature of
Warrants of Warrants of following authorized
Date of this Global this Global such decrease signatory of
Exchange Warrant Warrant (or increase) Warrant Agent
- --------------------------------------------------------------------------------
A-12
<PAGE>
EXHIBIT B
CERTIFICATE TO BE DELIVERED UPON EXCHANGE
OR REGISTRATION OF TRANSFER OF WARRANTS
Re: Warrants to Purchase Common Stock (the "Warrants") of UBIQUITEL INC.
This Certificate relates to ____ Warrants held in* _ book-entry or*
_ certificated form by __________________________________________ (the
"Transferor").
The Transferor:*
|_| has requested the Warrant Agent by written order to deliver, in
exchange for its beneficial interest in the Global Warrant held by the
Depositary, a Warrant or Warrants in definitive, registered form of authorized
denominations and an aggregate number equal to its beneficial interest in such
Global Warrant (or the portion thereof indicated above); or
|_| has requested the Warrant Agent by written order to exchange or
register the transfer of a Warrant or Warrants.
In connection with such request and in respect of each such Warrant,
the Transferor does hereby certify that Transferor is familiar with the Warrant
Agreement relating to the above captioned Warrants and the restrictions on
transfers thereof as provided in Section 6 of such Warrant Agreement, and that
the transfer of this Warrant does not require registration under the Securities
Act of 1933, as amended (the "Securities Act") because:
|_| Such Warrant is being acquired for the Transferor's own account,
without transfer (in satisfaction of Section 6.2(a)(i) or Section 6.3(y)(i) of
the Warrant Agreement).
|_| Such Warrant is being transferred to a qualified institutional
buyer (as defined in Rule 144A under the Securities Act), in accordance with
Rule 144A.
|_| Such Warrant is being transferred pursuant to an exemption from
registration in accordance with Rule 144 under the Securities Act.
|_| Such Warrant is being transferred to an institutional
"accredited investor," within the meaning of Rule 501(a)(1), (2), (3) or (7)
under the Securities Act pursuant to a private placement exemption from the
registration requirements of the Securities Act.
|_| Such Warrant is being transferred in accordance with Rule 904
under the Securities Act.
B-1
<PAGE>
|_| Such Warrant is being transferred in reliance on and in
compliance with an exemption from the registration requirements of the
Securities Act other than Rule 144A, Rule 144 or Rule 904 under the Securities
Act. An opinion of counsel to the effect that such transfer does not require
registration under the Securities Act accompanies this Certificate.
______________________________________________
[INSERT NAME OF TRANSFEROR]
By: __________________________________________
Date: _______________
B-2
<PAGE>
Exhibit 10.22
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is made and
entered into as of April 11, 2000, by and among UbiquiTel Operating Company, a
Delaware corporation (the "Company"), UbiquiTel Inc., a Delaware corporation
(the "Guarantor"), and Donaldson, Lufkin & Jenrette Securities Corporation,
Paribas Corporation and PNC Capital Markets, Inc., (each an "Initial Purchaser"
and, collectively, the "Initial Purchasers"), each of whom has agreed to
purchase the Company's and UbiquiTel Inc.'s units (the "Units") which consist of
the Company's 14% Senior Subordinated Discount Notes due 2010 (the "Initial
Notes") and warrants (the "Warrants") to purchase common stock $0.001 par value
per share, of the Guarantor pursuant to the Purchase Agreement (as defined
below).
This Agreement is made pursuant to the Purchase Agreement, dated
April 4, 2000, (the "Purchase Agreement"), by and among the Company, the
Guarantor and the Initial Purchasers. In order to induce the Initial Purchasers
to purchase the Units, the Company and the Guarantor have agreed to provide the
registration rights set forth in this Agreement. The execution and delivery of
this Agreement is a condition to the obligations of the Initial Purchasers set
forth in Section 3 of the Purchase Agreement. Capitalized terms used herein and
not otherwise defined shall have the meaning assigned to them in the Indenture,
dated April 11, 2000 (the "Indenture"), between the Company, the Guarantor and
American Stock Transfer & Trust Company, as Trustee, relating to the Initial
Notes and the Exchange Notes (as hereinafter defined).
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized terms shall
have the following meanings:
Act: The Securities Act of 1933, as amended.
Affiliate: As defined in Rule 144 of the Act.
Affiliated Market Maker: A Broker-Dealer who is deemed to be an
Affiliate of the Company and who is, therefore, required to deliver a prospectus
in connection with sales of or market-making activities in the Initial Notes.
Broker-Dealer: Any broker or dealer registered under the Exchange
Act.
Certificated Securities: Definitive Notes, as defined in the
Indenture.
Closing Date: The date hereof.
Commission: The Securities and Exchange Commission.
Consummate: An Exchange Offer shall be deemed "Consummated" for
purposes of this Agreement upon the occurrence of (a) the filing and
effectiveness under the Act
<PAGE>
of the Exchange Offer Registration Statement relating to the Exchange Notes to
be issued in the Exchange Offer, (b) the maintenance of such Exchange Offer
Registration Statement continuously effective and the keeping of the Exchange
Offer open for a period not less than the period required pursuant to Section
3(b) hereof and (c) the delivery by the Company to the Registrar under the
Indenture of Exchange Notes in the same aggregate principal amount as the
aggregate principal amount of Initial Notes tendered by Holders thereof pursuant
to the Exchange Offer.
Consummation Deadline: As defined in Section 3(b) hereof.
Effectiveness Deadline: As defined in Sections 3(a) and 4(a) hereof.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Exchange Notes: The Company's 14% Senior Subordinated Discount Notes
due 2010 to be issued pursuant to the Indenture: (i) in the Exchange Offer or
(ii) as contemplated by Section 4 hereof.
Exchange Offer: The exchange and issuance by the Company of a
principal amount of Exchange Notes (which shall be registered pursuant to the
Exchange Offer Registration Statement) equal to the outstanding principal amount
of Initial Notes that are tendered by such Holders in connection with such
exchange and issuance.
Exchange Offer Registration Statement: The Registration Statement
relating to the Exchange Offer, including the related Prospectus.
Exempt Resales: The transactions in which the Initial Purchasers
propose to sell the Initial Notes to certain "qualified institutional buyers,"
as such term is defined in Rule 144A under the Act and pursuant to Regulation S
under the Act.
Filing Deadline: As defined in Sections 3(a) and 4(a) hereof.
Holders: As defined in Section 2 hereof.
Prospectus: The prospectus included in a Registration Statement at
the time such Registration Statement is declared effective, as amended or
supplemented by any prospectus supplement and by all other amendments thereto,
including post-effective amendments, and all material incorporated by reference
into such Prospectus.
Recommencement Date: As defined in Section 6(d) hereof.
Registration Default: As defined in Section 5 hereof.
Registration Statement: Any registration statement of the Company
and the Guarantor relating to (a) an offering of Exchange Notes pursuant to an
Exchange Offer or (b) the registration for resale of Transfer Restricted
Securities pursuant to the Shelf Registration Statement, in each case, (i) that
is filed pursuant to the provisions of this Agreement and (ii)
2
<PAGE>
including the Prospectus included therein, all amendments and supplements
thereto (including post-effective amendments) and all exhibits and material
incorporated by reference therein.
Regulation S: Regulation S promulgated under the Act.
Rule 144: Rule 144 promulgated under the Act.
Shelf Registration Statement: As defined in Section 6(b) hereof.
Suspension Notice: As defined in Section 6(d) hereof.
TIA: The Trust Indenture Act of 1939 (15 U.S.C. Section
77aaa-77bbbb) as in effect on the date of the Indenture.
Transfer Restricted Securities: Each Initial Note, until the
earliest to occur of (a) the date on which such Initial Note is exchanged in the
Exchange Offer for an Exchange Note which is entitled to be resold to the public
by the Holder thereof without complying with the prospectus delivery
requirements of the Act, (b) the date on which such Initial Note has been
disposed of in accordance with a Shelf Registration Statement (and the
purchasers thereof have been issued Exchange Notes), or (c) the date on which
such Initial Note is distributed to the public pursuant to Rule 144 under the
Act (and purchasers thereof have been issued Exchange Notes) and each Exchange
Note until the date on which such Exchange Note is disposed of by a
Broker-Dealer pursuant to the "Plan of Distribution" contemplated by the
Exchange Offer Registration Statement (including the delivery of the Prospectus
contained therein).
Underwritten Registration: A registration in which the Transfer
Restricted Securities are sold to an underwriter for reoffering and resale to
the public.
SECTION 2. HOLDERS
A Person is deemed to be a holder of Transfer Restricted Securities
(each, a "Holder") whenever such Person owns Transfer Restricted Securities.
SECTION 3. REGISTERED EXCHANGE OFFER
(a) Unless the Exchange Offer shall not be permitted by applicable
law (after the procedures set forth in Section 6(a)(i) below have been complied
with), the Company and the Guarantor shall (i) cause the Exchange Offer
Registration Statement to be filed with the Commission as soon as practicable
after the Closing Date, but in no event later than 75 days after the Closing
Date (such 75th day being the "Filing Deadline"), (ii) use its reasonable best
efforts to cause such Exchange Offer Registration Statement to become effective
at the earliest possible time, but in no event later than 180 days after the
Closing Date (such 180th day being the "Effectiveness Deadline"), (iii) in
connection with the foregoing, (A) file all pre-effective amendments to such
Exchange Offer Registration Statement as may be necessary in order to cause it
to become effective, (B) file, if applicable, a post-effective amendment to such
Exchange Offer Registration Statement pursuant to Rule 430A under the Act and
(C) cause all necessary filings, if any, in connection with the registration and
qualification of the Exchange Notes to be made under the Blue Sky laws of such
jurisdictions as are necessary to permit Consummation of
3
<PAGE>
the Exchange Offer, and (iv) upon the effectiveness of such Exchange Offer
Registration Statement, commence and Consummate the Exchange Offer. The Exchange
Offer shall be on the appropriate form permitting (i) registration of the
Exchange Notes to be offered in exchange for the Initial Notes that are Transfer
Restricted Securities and (ii) resales of Exchange Notes by Broker-Dealers that
tendered into the Exchange Offer Initial Notes that such Broker-Dealer acquired
for its own account as a result of market making activities or other trading
activities (other than Initial Notes acquired directly from the Company or any
of its Affiliates) as contemplated by Section 3(c) below.
(b) The Company and the Guarantor shall use their respective best
efforts to cause the Exchange Offer Registration Statement to be effective
continuously, and shall keep the Exchange Offer open for a period of not less
than the minimum period required under applicable federal and state securities
laws to Consummate the Exchange Offer; provided, however, that in no event shall
such period be less than 20 Business Days. The Company and the Guarantor shall
cause the Exchange Offer to comply with all applicable federal and state
securities laws. No securities other than the Exchange Notes shall be included
in the Exchange Offer Registration Statement. The Company and the Guarantor
shall use their respective best efforts to cause the Exchange Offer to be
Consummated on the earliest practicable date after the Exchange Offer
Registration Statement has become effective, but in no event later than 30
Business Days thereafter (such 30th day being the "Consummation Deadline").
(c) The Company shall include a "Plan of Distribution" section in
the Prospectus contained in the Exchange Offer Registration Statement and
indicate therein that any Broker-Dealer who holds Transfer Restricted Securities
that were acquired for the account of such Broker-Dealer as a result of
market-making activities or other trading activities (other than Initial Notes
acquired directly from the Company or any Affiliate of the Company), may
exchange such Transfer Restricted Securities pursuant to the Exchange Offer.
Such "Plan of Distribution" section shall also contain all other information
with respect to such sales by such Broker-Dealers that the Commission may
require in order to permit such sales pursuant thereto, but such "Plan of
Distribution" shall not name any such Broker-Dealer or disclose the amount of
Transfer Restricted Securities held by any such Broker-Dealer, except to the
extent required by the Commission as a result of a change in policy, rules or
regulations after the date of this Agreement. See the Shearman & Sterling
no-action letter (available July 2, 1993).
Because such Broker-Dealer may be deemed to be an "underwriter"
within the meaning of the Act and must, therefore, deliver a prospectus meeting
the requirements of the Act in connection with its initial sale of any Exchange
Notes received by such Broker-Dealer in the Exchange Offer, the Company and
Guarantor shall permit the use of the Prospectus contained in the Exchange Offer
Registration Statement by such Broker-Dealer to satisfy such prospectus delivery
requirement. To the extent necessary to ensure that the prospectus contained in
the Exchange Offer Registration Statement is available for sales of Exchange
Notes by Broker-Dealers, the Company and the Guarantor agree to use their
respective best efforts to keep the Exchange Offer Registration Statement
continuously effective, supplemented, amended and current as required by and
subject to the provisions of Sections 6(a) and (c) hereof and in conformity with
the requirements of this Agreement, the Act and the policies, rules and
regulations of the Commission as announced from time to time, for a period of
one year from the Consummation Deadline or such shorter period as will terminate
when all Transfer Restricted
4
<PAGE>
Securities covered by such Registration Statement have been sold pursuant
thereto. The Company and the Guarantor shall provide sufficient copies of the
latest version of such Prospectus to such Broker-Dealers, promptly upon request,
and in no event later than one day after such request, at any time during such
period.
SECTION 4. SHELF REGISTRATION
(a) Shelf Registration. If (i) the Exchange Offer is not permitted
by applicable law (after the Company and the Guarantor have complied with the
procedures set forth in Section 6(a)(i) below) or (ii) if any Holder of Transfer
Restricted Securities shall notify the Company within 20 Business Days following
the Consummation Deadline that (A) such Holder was prohibited by law or
Commission policy from participating in the Exchange Offer or (B) such Holder
may not resell the Exchange Notes acquired by it in the Exchange Offer to the
public without delivering a prospectus and the Prospectus contained in the
Exchange Offer Registration Statement is not appropriate or available for such
resales by such Holder or (C) such Holder is a Broker-Dealer and holds Initial
Notes acquired directly from the Company or any of its Affiliates, then the
Company and the Guarantor shall:
(x) cause to be filed, on or prior to 30 days after the
earlier of (i) the date on which the Company determines that the Exchange Offer
Registration Statement cannot be filed as a result of clause (a)(i) above and
(ii) the date on which the Company receives the notice specified in clause
(a)(ii) above, (such earlier date, the "Filing Deadline"), a shelf registration
statement pursuant to Rule 415 under the Act (which may be an amendment to the
Exchange Offer Registration Statement (the "Shelf Registration Statement")),
relating to all Transfer Restricted Securities, and
(y) shall use their respective best efforts to cause such
Shelf Registration Statement to become effective on or prior to 60 days after
the Filing Deadline for the Shelf Registration Statement (such 60th day the
"Effectiveness Deadline").
If, after the Company has filed an Exchange Offer Registration
Statement that satisfies the requirements of Section 3(a) above, the Company is
required to file and make effective a Shelf Registration Statement solely
because the Exchange Offer is not permitted under applicable law (i.e., clause
(a)(i) above), then the filing of the Exchange Offer Registration Statement
shall be deemed to satisfy the requirements of clause (x) above; provided that,
in such event, the Company shall remain obligated to meet the Effectiveness
Deadline set forth in clause (y).
To the extent necessary to ensure that the Shelf Registration
Statement is available for sales of Transfer Restricted Securities by the
Holders thereof entitled to the benefit of this Section 4(a) and the other
securities required to be registered therein pursuant to Section 6(b)(ii)
hereof, the Company and the Guarantor shall use their respective best efforts to
keep any Shelf Registration Statement required by this Section 4(a) continuously
effective, supplemented, amended and current as required by and subject to the
provisions of Sections 6(b) and (c) hereof and in conformity with the
requirements of this Agreement, the Act and the policies, rules and regulations
of the Commission as announced from time to time, for as long as an Initial
Purchaser is deemed to be an affiliate of the Company but in no event less than
the shorter of (i)
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two years (as extended pursuant to Section 6(d)) following the Closing or (ii)
the date on which all Transfer Restricted Securities covered by such Shelf
Registration Statement have been sold pursuant thereto.
(b) Provision by Holders of Certain Information in Connection with
the Shelf Registration Statement. No Holder of Transfer Restricted Securities
may include any of its Transfer Restricted Securities in any Shelf Registration
Statement pursuant to this Agreement unless and until such Holder furnishes to
the Company in writing, within 20 days after receipt of a request therefor, the
information specified in Item 507 or 508 of Regulation S-K, as applicable, of
the Act for use in connection with any Shelf Registration Statement or
Prospectus or preliminary Prospectus included therein. No Holder of Transfer
Restricted Securities shall be entitled to liquidated damages pursuant to
Section 5 hereof unless and until such Holder shall have provided all such
information. Each selling Holder agrees to promptly furnish additional
information required to be disclosed in order to make the information previously
furnished to the Company by such Holder not materially misleading.
SECTION 5. LIQUIDATED DAMAGES
If (i) any Registration Statement required by this Agreement is not
filed with the Commission on or prior to the applicable Filing Deadline, (ii)
any such Registration Statement has not been declared effective by the
Commission on or prior to the applicable Effectiveness Deadline, (iii) the
Exchange Offer has not been Consummated on or prior to the Consummation Deadline
or (iv) any Registration Statement required by this Agreement is filed and
declared effective but shall thereafter cease to be effective or fail to be
usable for its intended purpose without being succeeded within five Business
Days by a post-effective amendment to such Registration Statement that cures
such failure and that is itself declared effective within seven Business Days of
filing such post-effective amendment to such Registration Statement (each such
event referred to in clauses (i) through (iv), a "Registration Default"), then
the Company and the Guarantor hereby jointly and severally agree to pay to each
Holder of Transfer Restricted Securities affected thereby liquidated damages in
an amount equal to $.05 per week per $1,000 in principal amount of Transfer
Restricted Securities held by such Holder for each week or portion thereof that
the Registration Default continues for the first 90-day period immediately
following the occurrence of such Registration Default. The amount of the
liquidated damages shall increase by an additional $.05 per week per $1,000 in
principal amount of Transfer Restricted Securities with respect to each
subsequent 90-day period until all Registration Defaults have been cured, up to
a maximum amount of liquidated damages of $.50 per week per $1,000 in principal
amount of Transfer Restricted Securities; provided that the Company and the
Guarantor shall in no event be required to pay liquidated damages for more than
one Registration Default at any given time. Notwithstanding anything to the
contrary set forth herein, (1) upon filing of the Exchange Offer Registration
Statement (and/or, if applicable, the Shelf Registration Statement), in the case
of (i) above, (2) upon the effectiveness of the Exchange Offer Registration
Statement (and/or, if applicable, the Shelf Registration Statement), in the case
of (ii) above, (3) upon Consummation of the Exchange Offer, in the case of (iii)
above, or (4) upon the filing of a post-effective amendment to the Registration
Statement or an additional Registration Statement that causes the Exchange Offer
Registration Statement (and/or, if applicable, the Shelf Registration Statement)
to again be declared effective or made usable in the case of (iv) above, the
liquidated damages payable with respect to the Transfer Restricted Securities as
a result of
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such clause (i), (ii), (iii) or (iv), as applicable, shall cease.
Notwithstanding the foregoing, neither the Company nor the Guarantor shall be
deemed to have failed to perform its obligations under clauses (i) through (iv)
above by reason of the failure of any Holder to provide information regarding
itself reasonably requested by the Company or the Guarantor or any regulatory
agency having jurisdiction over any of the Holders at least 10 Business Days
prior to a Registration Default.
All accrued liquidated damages shall be paid to the Holders entitled
thereto, in the manner provided for the payment of interest in the Indenture, on
each Interest Payment Date, as more fully set forth in the Indenture and the
Notes. Notwithstanding the fact that any securities for which liquidated damages
are due cease to be Transfer Restricted Securities, all obligations of the
Company and the Guarantor to pay liquidated damages with respect to securities
shall survive until such time as such obligations with respect to such
securities shall have been satisfied in full.
SECTION 6. REGISTRATION PROCEDURES
(a) Exchange Offer Registration Statement. In connection with the
Exchange Offer, the Company and the Guarantor shall (x) comply with all
applicable provisions of Section 6(c) below, (y) use their respective best
efforts to effect such exchange and to permit the resale of Exchange Notes by
Broker-Dealers that tendered in the Exchange Offer Initial Notes that such
Broker-Dealer acquired for its own account as a result of its market making
activities or other trading activities (other than Initial Notes acquired
directly from the Company or any of its Affiliates) being sold in accordance
with the intended method or methods of distribution thereof, and (z) comply with
all of the following provisions:
(i) If, following the date hereof there has been announced a
change in Commission policy with respect to exchange offers such as the Exchange
Offer, that in the reasonable opinion of counsel to the Company raises a
substantial question as to whether the Exchange Offer is permitted by applicable
law, the Company and the Guarantor hereby agree to seek a no-action letter or
other favorable decision from the Commission allowing the Company and the
Guarantor to Consummate an Exchange Offer for such Transfer Restricted
Securities. The Company and the Guarantor hereby agree to pursue the issuance of
such a decision to the Commission staff level. In connection with the foregoing,
the Company and the Guarantor hereby agree to take all such other actions as may
be requested by the Commission or otherwise required in connection with the
issuance of such decision, including without limitation (A) participating in
telephonic conferences with the Commission, (B) delivering to the Commission
staff an analysis prepared by counsel to the Company setting forth the legal
bases, if any, upon which such counsel has concluded that such an Exchange Offer
should be permitted and (C) diligently pursuing a resolution (which need not be
favorable) by the Commission staff.
(ii) As a condition to its participation in the Exchange
Offer, each Holder of Transfer Restricted Securities (including, without
limitation, any Holder who is a Broker Dealer) shall furnish, upon the request
of the Company, prior to the Consummation of the Exchange Offer, a written
representation to the Company and the Guarantor (which may be contained in the
letter of transmittal contemplated by the Exchange Offer Registration Statement)
to the effect that (A) it is not an Affiliate of the Company or the Guarantor,
(B) it is not engaged
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in, and does not intend to engage in, and has no arrangement or understanding
with any Person to participate in, a distribution of the Exchange Notes to be
issued in the Exchange Offer and (C) it is acquiring the Exchange Notes in its
ordinary course of business. As a condition to its participation in the Exchange
Offer each Holder using the Exchange Offer to participate in a distribution of
the Exchange Notes shall acknowledge and agree that, if the resales are of
Exchange Notes obtained by such Holder in exchange for Initial Notes acquired
directly from the Company or an Affiliate thereof, it (1) could not, under
Commission policy as in effect on the date of this Agreement, rely on the
position of the Commission enunciated in Morgan Stanley and Co., Inc. (available
June 5, 1991) and Exxon Capital Holdings Corporation (available May 13, 1988),
as interpreted in the Commission's letter to Shearman & Sterling dated July 2,
1993, and similar no-action letters (including, if applicable, any no-action
letter obtained pursuant to clause (i) above), and (2) must comply with the
registration and prospectus delivery requirements of the Act in connection with
a secondary resale transaction and that such a secondary resale transaction must
be covered by an effective registration statement containing the selling
security holder information required by Item 507 or 508, as applicable, of
Regulation S-K.
(iii) Prior to effectiveness of the Exchange Offer
Registration Statement, the Company and the Guarantor shall provide a
supplemental letter to the Commission (A) stating that the Company and the
Guarantor are registering the Exchange Offer in reliance on the position of the
Commission enunciated in Exxon Capital Holdings Corporation (available May 13,
1988), Morgan Stanley and Co., Inc. (available June 5, 1991) as interpreted in
the Commission's letter to Shearman & Sterling dated July 2, 1993, and, if
applicable, any no-action letter obtained pursuant to clause (i) above, (B)
including a representation that neither the Company nor any Guarantor has
entered into any arrangement or understanding with any Person to distribute the
Exchange Notes to be received in the Exchange Offer and that, to the best of the
Company's and each Guarantor's information and belief, each Holder participating
in the Exchange Offer is acquiring the Exchange Notes in its ordinary course of
business and has no arrangement or understanding with any Person to participate
in the distribution of the Exchange Notes received in the Exchange Offer and (C)
any other undertaking or representation required by the Commission as set forth
in any no-action letter obtained pursuant to clause (i) above, if applicable.
(b) Shelf Registration Statement. In connection with the Shelf
Registration Statement, the Company and the Guarantor shall:
(i) comply with all the provisions of Section 6(c) below and
use their respective best efforts to effect such registration to permit the sale
of the Transfer Restricted Securities being sold in accordance with the intended
method or methods of distribution thereof (as indicated in the information
furnished to the Company pursuant to Section 4(b) hereof), and pursuant thereto
the Company and the Guarantor will prepare and file with the Commission a
Registration Statement relating to the registration on any appropriate form
under the Act, which form shall be available for the sale of the Transfer
Restricted Securities in accordance with the intended method or methods of
distribution thereof within the time periods and otherwise in accordance with
the provisions hereof.
(ii) issue, upon the request of any Holder or purchaser of
Initial Notes covered by any Shelf Registration Statement contemplated by this
Agreement, Exchange Notes
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having an aggregate principal amount equal to the aggregate principal amount of
Initial Notes sold pursuant to the Shelf Registration Statement and surrendered
to the Company for cancellation; the Company shall register Exchange Notes on
the Shelf Registration Statement for this purpose and issue the Exchange Notes
to the purchaser(s) of securities subject to the Shelf Registration Statement in
the names as such purchaser(s) shall designate.
(c) General Provisions. In connection with any Registration
Statement and any related Prospectus required by this Agreement, the Company and
the Guarantor shall:
(i) use their respective best efforts to keep such
Registration Statement continuously effective and provide all requisite
financial statements for the period specified in Section 3 or 4 of this
Agreement, as applicable. Upon the occurrence of any event that would cause any
such Registration Statement or the Prospectus contained therein (A) to contain
an untrue statement of material fact or omit to state any material fact
necessary to make the statements therein not misleading or (B) not to be
effective and usable for resale of Transfer Restricted Securities during the
period required by this Agreement, the Company and the Guarantor shall file
promptly an appropriate amendment to such Registration Statement curing such
defect, and, if Commission review is required, use their respective best efforts
to cause such amendment to be declared effective as soon as practicable.
(ii) prepare and file with the Commission such amendments and
post-effective amendments to the applicable Registration Statement as may be
necessary to keep such Registration Statement effective for the applicable
period set forth in Section 3 or 4 hereof, as the case may be; cause the
Prospectus to be supplemented by any required Prospectus supplement, and as so
supplemented to be filed pursuant to Rule 424 under the Act, and to comply fully
with Rules 424, 430A and 462, as applicable, under the Act in a timely manner;
and comply with the provisions of the Act with respect to the disposition of all
securities covered by such Registration Statement during the applicable period
in accordance with the intended method or methods of distribution by the sellers
thereof set forth in such Registration Statement or supplement to the
Prospectus;
(iii) advise each Holder and each Initial Purchaser who is an
Affiliated Market Maker promptly and, if requested by such Holder/Person,
confirm such advice in writing, (A) when the Prospectus or any Prospectus
supplement or post-effective amendment has been filed, and, with respect to any
applicable Registration Statement or any post-effective amendment thereto, when
the same has become effective, (B) of any request by the Commission for
amendments to the Registration Statement or amendments or supplements to the
Prospectus or for additional information relating thereto, (C) of the issuance
by the Commission of any stop order suspending the effectiveness of the
Registration Statement under the Act or of the suspension by any state
securities commission of the qualification of the Transfer Restricted Securities
for offering or sale in any jurisdiction, or the initiation of any proceeding
for any of the preceding purposes, and (D) of the existence of any fact or the
happening of any event that makes any statement of a material fact made in the
Registration Statement, the Prospectus, any amendment or supplement thereto or
any document incorporated by reference therein untrue, or that requires the
making of any additions to or changes in the Registration Statement in order to
make the statements therein not misleading, or that requires the making of any
additions to or changes in the Prospectus in order to make the statements
therein, in the light of the
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<PAGE>
circumstances under which they were made, not misleading. If at any time the
Commission shall issue any stop order suspending the effectiveness of the
Registration Statement, or any state securities commission or other regulatory
authority shall issue an order suspending the qualification or exemption from
qualification of the Transfer Restricted Securities under state securities or
Blue Sky laws, the Company and the Guarantor shall use their respective best
efforts to obtain the withdrawal or lifting of such order at the earliest
possible time;
(iv) subject to Section 6(c)(i), if any fact or event
contemplated by Section 6(c)(iii)(D) above shall exist or have occurred, prepare
a supplement or post-effective amendment to the Registration Statement or
related Prospectus or any document incorporated therein by reference or file any
other required document so that, as thereafter delivered to the purchasers of
Transfer Restricted Securities, the Prospectus will not contain 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;
(v) furnish to each Holder and each Affiliated Market Maker in
connection with such exchange or sale, if any, before filing with the
Commission, copies of any Registration Statement or any Prospectus included
therein or any amendments or supplements to any such Registration Statement or
Prospectus (including all documents incorporated by reference after the initial
filing of such Registration Statement), which documents will be subject to the
review and comment of such Holders or Persons in connection with such sale, if
any, for a period of at least five Business Days, and the Company will not file
any such Registration Statement or Prospectus or any amendment or supplement to
any such Registration Statement or Prospectus (including all such documents
incorporated by reference) to which such Holders or Persons shall reasonably
object within five Business Days after the receipt thereof. A Holder and such
Person shall be deemed to have reasonably objected to such filing if such
Registration Statement, amendment, Prospectus or supplement, as applicable, as
proposed to be filed, contains an untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein not misleading
or fails to comply with the applicable requirements of the Act;
(vi) promptly prior to the filing of any document (other than
any document relative to the ordinary course of the Company's business) that is
to be incorporated by reference into a Registration Statement or Prospectus,
provide copies of such document to each Holder and each Affiliated Market Maker
in connection with such exchange or sale, if any, make the Company's and the
Guarantor's representatives available for discussion of such document and other
customary due diligence matters, and include such information in such document
prior to the filing thereof as such Holders or Persons may reasonably request;
(vii) make available, at reasonable times, for inspection by
each Holder and each Affiliated Market Maker and any attorney or accountant
retained by such Holders and Persons, all financial and other records, pertinent
corporate documents of the Company and the Guarantor and cause the Company's and
the Guarantor's officers, directors and employees to supply all information
reasonably requested by any such Holder or Persons, attorney or accountant in
connection with such Registration Statement or any post-effective amendment
thereto subsequent to the filing thereof and prior to its effectiveness.
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<PAGE>
(viii) if requested by any Holders in connection with such
exchange or sale or any Affiliated Market Maker, promptly include in any
Registration Statement or Prospectus, pursuant to a supplement or post-effective
amendment if necessary, such information as such Persons may reasonably request
to have included therein, including, without limitation, information relating to
the "Plan of Distribution" of the Transfer Restricted Securities and the use of
the Registration Statement or Prospectus for market making activities; and make
all required filings of such Prospectus supplement or post-effective amendment
as soon as practicable after the Company is notified of the matters to be
included in such Prospectus supplement or post-effective amendment;
(ix) furnish to each Holder in connection with such exchange
or sale and each Affiliated Market Maker without charge, at least one copy of
the Registration Statement, as first filed with the Commission, and of each
amendment thereto, including all documents incorporated by reference therein and
all exhibits (excluding exhibits incorporated therein by reference);
(x) deliver to each Holder and each Affiliated Market Maker
without charge, as many copies of the Prospectus (including each preliminary
prospectus) and any amendment or supplement thereto as such Persons reasonably
may request; the Company and the Guarantor hereby consent to the use (in
accordance with law) of the Prospectus and any amendment or supplement thereto
by each selling Person in connection with the offering and the sale of the
Transfer Restricted Securities covered by the Prospectus or any amendment or
supplement thereto and all market making activities of such Affiliated Market
Maker, as the case may be;
(xi) upon the request of any Holder, enter into such
agreements (including underwriting agreements) and make such representations and
warranties and take all such other actions in connection therewith in order to
expedite or facilitate the disposition of the Transfer Restricted Securities
pursuant to any applicable Registration Statement contemplated by this Agreement
as may be reasonably requested by any Holder in connection with any sale or
resale pursuant to any applicable Registration Statement. In such connection and
also in connection with market making activities by any Affiliated Market Maker,
the Company and the Guarantor shall:
(A) upon request of any Person, furnish (or in the case
of paragraphs (2) and (3), use its best efforts to cause to be furnished) to
each Person, upon Consummation of the Exchange Offer or upon the effectiveness
of the Shelf Registration Statement, as the case may be:
1. a certificate, dated such date, signed on
behalf of the Company and each Guarantor by (x) the President or any Vice
President and (y) a principal financial or accounting officer of the Company and
such Guarantor, confirming, as of the date thereof, the matters set forth in
Sections (6)(ee) (with respect to the applicable registration statement and
prospectus), 9(a) and 9(b) of the Purchase Agreement and such other similar
matters as such Person may reasonably request;
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2. an opinion, dated the date of Consummation of
the Exchange Offer or the date of effectiveness of the Shelf Registration
Statement, as the case may be, of counsel for the Company and the Guarantor
covering matters similar to those set forth in paragraph (e) of Section 9 of the
Purchase Agreement and such other matter as such Person may reasonably request,
and in any event including a statement to the effect that such counsel has
participated in conferences with officers and other representatives of the
Company and the Guarantor, representatives of the independent public accountants
for the Company and the Guarantor and have considered the matters required to be
stated therein and the statements contained therein, although such counsel has
not independently verified the accuracy, completeness or fairness of such
statements; and that such counsel advises that, on the basis of the foregoing
(relying as to materiality to the extent such counsel deems appropriate upon the
statements of officers and other representatives of the Company and the
Guarantor and without independent check or verification), no facts came to such
counsel's attention that caused such counsel to believe that the applicable
Registration Statement, at the time such Registration Statement or any
post-effective amendment thereto became effective and, in the case of the
Exchange Offer Registration Statement, as of the date of Consummation of the
Exchange Offer, contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, or that the Prospectus contained in such
Registration Statement as of its date and, in the case of the opinion dated the
date of Consummation of the Exchange Offer, as of the date of Consummation,
contained an untrue statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. Without limiting the
foregoing, such counsel may state further that such counsel assumes no
responsibility for, and has not independently verified, the accuracy,
completeness or fairness of the financial statements, notes and schedules and
other financial data as well as statistical data included in any Registration
Statement contemplated by this Agreement or the related Prospectus; and
3. a customary comfort letter, dated the date of
Consummation of the Exchange Offer, or as of the date of effectiveness of the
Shelf Registration Statement, as the case may be, from the Company's independent
accountants, in the customary form and covering matters of the type customarily
covered in comfort letters to underwriters in connection with underwritten
offerings, and affirming the matters set forth in the comfort letters delivered
pursuant to Section 9(g) of the Purchase Agreement; and
(B) deliver such other documents and certificates as may
be reasonably requested by such Persons to evidence compliance with the matters
covered in clause (A) above and with any customary conditions contained in any
agreement entered into by the Company and the Guarantor pursuant to this clause
(xi);
(xii) prior to any public offering of Transfer Restricted
Securities, cooperate with the selling Holders and their counsel in connection
with the registration and qualification of the Transfer Restricted Securities
under the securities or Blue Sky laws of such jurisdictions as the selling
Holders may request and do any and all other acts or things necessary or
advisable to enable the disposition in such jurisdictions of the Transfer
Restricted Securities covered by the applicable Registration Statement;
provided, however, that neither the Company nor any Guarantor shall be required
to register or qualify as a foreign corporation where it is not
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now so qualified or to take any action that would subject it to the service of
process in suits or to taxation, other than as to matters and transactions
relating to the Registration Statement, in any jurisdiction where it is not now
so subject;
(xiii) in connection with any sale of Transfer Restricted
Securities that will result in such securities no longer being Transfer
Restricted Securities, cooperate with the Holders to facilitate the timely
preparation and delivery of certificates representing Transfer Restricted
Securities to be sold and not bearing any restrictive legends; and to register
such Transfer Restricted Securities in such denominations and such names as the
selling Holders may request at least two Business Days prior to such sale of
Transfer Restricted Securities;
(xiv) use their respective best efforts to cause the
disposition of the Transfer Restricted Securities covered by the Registration
Statement to be registered with or approved by such other governmental agencies
or authorities as may be necessary to enable the seller or sellers thereof to
consummate the disposition of such Transfer Restricted Securities, subject to
the proviso contained in clause (xii) above;
(xiii) provide a CUSIP number for all Transfer Restricted
Securities not later than the effective date of a Registration Statement
covering such Transfer Restricted Securities and provide the Trustee under the
Indenture with printed certificates for the Transfer Restricted Securities which
are in a form eligible for deposit with the Depository Trust Company;
(xiv) otherwise use their respective best efforts to comply
with all applicable rules and regulations of the Commission, and make generally
available to its security holders with regard to any applicable Registration
Statement, as soon as practicable, a consolidated earnings statement meeting the
requirements of Rule 158 (which need not be audited) covering a twelve-month
period beginning after the effective date of the Registration Statement (as such
term is defined in paragraph (c) of Rule 158 under the Act);
(xv) cause the Indenture to be qualified under the TIA not
later than the effective date of the first Registration Statement required by
this Agreement and, in connection therewith, cooperate with the Trustee and the
Holders to effect such changes to the Indenture as may be required for such
Indenture to be so qualified in accordance with the terms of the TIA; and
execute and use its best efforts to cause the Trustee to execute, all documents
that may be required to effect such changes and all other forms and documents
required to be filed with the Commission to enable such Indenture to be so
qualified in a timely manner; and
(xvi) provide promptly to each Holder and Affiliated Market
Maker, upon request, each document filed with the Commission pursuant to the
requirements of Section 13 or Section 15(d) of the Exchange Act.
(d) Restrictions on Holders. Each Holder agrees by acquisition of a
Transfer Restricted Security and each Affiliated Market Maker agrees that, upon
receipt of the notice referred to in Section 6(c)(iii)(C) or any notice from the
Company of the existence of any fact of the kind described in Section
6(c)(iii)(D) hereof (in each case, a "Suspension Notice"), such Person will
forthwith discontinue disposition of Transfer Restricted Securities pursuant to
the
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applicable Registration Statement until (i) such Person has received copies of
the supplemented or amended Prospectus contemplated by Section 6(c)(iv) hereof,
or (ii) such Person is advised in writing by the Company that the use of the
Prospectus may be resumed, and has received copies of any additional or
supplemental filings that are incorporated by reference in the Prospectus (in
each case, the "Recommencement Date"). Each Holder Person receiving a Suspension
Notice hereby agrees that it will either (i) destroy any Prospectuses, other
than permanent file copies, then in such Person's possession which have been
replaced by the Company with more recently dated Prospectuses or (ii) deliver to
the Company (at the Company's expense) all copies, other than permanent file
copies, then in such Person's possession of the Prospectus covering such
Transfer Restricted Securities that was current at the time of receipt of the
Suspension Notice. The time period regarding the effectiveness of such
Registration Statement set forth in Section 3 or 4 hereof, as applicable, shall
be extended by a number of days equal to the number of days in the period from
and including the date of delivery of the Suspension Notice to the date of
delivery of the Recommencement Date.
SECTION 7. REGISTRATION EXPENSES
(a) All expenses incident to the Company's and the Guarantor's
performance of or compliance with this Agreement will be borne by the Company,
regardless of whether a Registration Statement becomes effective, including
without limitation: (i) all registration and filing fees and expenses; (ii) all
fees and expenses of compliance with federal securities and state Blue Sky or
securities laws; (iii) all expenses of printing (including printing certificates
for the Exchange Notes to be issued in the Exchange Offer and printing of
Prospectuses whether for exchanges, sales, market making or otherwise),
messenger and delivery services and telephone; (iv) all fees and disbursements
of counsel for the Company and the Guarantor, and one counsel designated by the
Holders of a majority of the Transfer Restricted Securities registered under a
Registration Statement; and (v) all fees and disbursements of independent
certified public accountants of the Company and the Guarantor (including the
expenses of any special audit and comfort letters required by or incident to
such performance).
The Company will, in any event, bear its and the Guarantor's
internal expenses (including, without limitation, all salaries and expenses of
its officers and employees performing legal or accounting duties), the expenses
of any annual audit and the fees and expenses of any Person, including special
experts, retained by the Company or the Guarantor.
(b) In connection with any Registration Statement required by this
Agreement (including, without limitation, the Exchange Offer Registration
Statement and the Shelf Registration Statement), the Company and the Guarantor
will reimburse the Initial Purchasers and the Holders of Transfer Restricted
Securities who are tendering Initial Notes in the Exchange Offer and/or selling
or reselling Initial Notes or Exchange Notes pursuant to the "Plan of
Distribution" contained in the Exchange Offer Registration Statement or the
Shelf Registration Statement, as applicable, for the reasonable fees and
disbursements of not more than one counsel, who shall be Weil, Gotshal & Manges
LLP, unless another firm shall be chosen by the Holders of a majority in
principal amount of the Transfer Restricted Securities for whose benefit such
Registration Statement is being prepared.
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SECTION 8. INDEMNIFICATION
(a) The Company and the Guarantor agree, jointly and severally, to
indemnify and hold harmless each Holder, its directors, officers and each
Person, if any, who controls such Holder (within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act), from and against any and all losses,
claims, damages, liabilities, judgments, (including without limitation, any
reasonable legal or other expenses incurred in connection with investigating or
defending any matter, including any action that could give rise to any such
losses, claims, damages, liabilities or judgments) caused by any untrue
statement or alleged untrue statement of a material fact contained in any
Registration Statement, preliminary prospectus or Prospectus (or any amendment
or supplement thereto) provided by the Company to any Holder or any prospective
purchaser of Exchange Notes or registered Initial Notes, or caused by any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, liabilities or judgments are
caused by an untrue statement or omission or alleged untrue statement or
omission that is based upon information relating to any of the Holders furnished
in writing to the Company by or on behalf of any of the Holders.
(b) Each Holder of Transfer Restricted Securities agrees, severally
and not jointly, to indemnify and hold harmless the Company and the Guarantor,
and their respective directors and officers, and each person, if any, who
controls (within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act) the Company, or the Guarantors to the same extent as the foregoing
indemnity from the Company and the Guarantor set forth in Section 8(a) above,
but only with reference to information relating to such Holder furnished in
writing to the Company by or on behalf of such Holder expressly for use in any
Registration Statement. In no event shall any Holder, its directors, officers or
any Person who controls such Holder be liable or responsible for any amount in
excess of the amount by which the total amount received by such Holder with
respect to its sale of Transfer Restricted Securities pursuant to a Registration
Statement exceeds (i) the amount paid by such Holder for such Transfer
Restricted Securities and (ii) the amount of any damages that such Holder, its
directors, officers or any Person who controls such Holder has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission.
(c) In case any action shall be commenced involving any person in
respect of which indemnity may be sought pursuant to Section 8(a) or 8(b) (the
"indemnified party"), the indemnified party shall promptly notify the person
against whom such indemnity may be sought (the "indemnifying person") in writing
and the indemnifying party shall assume the defense of such action, including
the employment of counsel reasonably satisfactory to the indemnified party and
the payment of all fees and expenses of such counsel, as incurred (except that
in the case of any action in respect of which indemnity may be sought pursuant
to both Sections 8(a) and 8(b), a Holder shall not be required to assume the
defense of such action pursuant to this Section 8(c), but may employ separate
counsel and participate in the defense thereof, but the fees and expenses of
such counsel, except as provided below, shall be at the expense of the Holder).
Any indemnified party shall have the right to employ separate counsel in any
such action and participate in the defense thereof, but the fees and expenses of
such counsel shall be at the expense of the indemnified party unless (i) the
employment of such counsel shall have been specifically authorized in writing by
the indemnifying party, (ii) the indemnifying party shall
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<PAGE>
have failed to assume the defense of such action or employ counsel reasonably
satisfactory to the indemnified party or (iii) the named parties to any such
action (including any impleaded parties) include both the indemnified party and
the indemnifying party, and the indemnified party shall have been advised by
such counsel that there may be one or more legal defenses available to it which
are different from or additional to those available to the indemnifying party
(in which case the indemnifying party shall not have the right to assume the
defense of such action on behalf of the indemnified party). In any such case,
the indemnifying party shall not, in connection with any one action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the fees and
expenses of more than one separate firm of attorneys (in addition to any local
counsel) for all indemnified parties and all such fees and expenses shall be
reimbursed as they are incurred. Such firm shall be designated in writing by the
Holders of a majority of the Transfer Restricted Securities covered by the
applicable Registration Statement, in the case of the parties indemnified
pursuant to Section 8(a), and by the Company and Guarantor, in the case of
parties indemnified pursuant to Section 8(b). The indemnifying party shall
indemnify and hold harmless the indemnified party from and against any and all
losses, claims, damages, liabilities and judgments by reason of any settlement
of any action (i) effected with its written consent or (ii) effected without its
written consent if the settlement is entered into more than twenty business days
after the indemnifying party shall have received a request from the indemnified
party for reimbursement for the fees and expenses of counsel (in any case where
such fees and expenses are at the expense of the indemnifying party) and, prior
to the date of such settlement, the indemnifying party shall have failed to
comply with such reimbursement request. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement or
compromise of, or consent to the entry of judgment with respect to, any pending
or threatened action in respect of which the indemnified party is or could have
been a party and indemnity or contribution may be or could have been sought
hereunder by the indemnified party, unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from all
liability on claims that are or could have been the subject matter of such
action and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of the indemnified party.
(d) To the extent that the indemnification provided for in this
Section 8 is unavailable to an indemnified party in respect of any losses,
claims, damages, liabilities or judgments referred to therein, then each
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities or judgments (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 Holders, on the other hand, from their
sale of Transfer Restricted Securities or (ii) if the allocation provided by
clause 8(d)(i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause
8(d)(i) above but also the relative fault of the Company and the Guarantor, on
the one hand, and of the Holder, on the other hand, in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or judgments, as well as any other relevant equitable
considerations. The relative fault of the Company and the Guarantor, on the one
hand, and of the Holder, 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 Company or such Guarantor, on the one
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<PAGE>
hand, or by or on behalf of the Holder, on the other hand, and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
The Company, the Guarantor and each Holder agree that it would not
be just and equitable if contribution pursuant to this Section 8(d) were
determined by pro rata allocation (even if the Holders were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, liabilities or judgments referred to in
the immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any reasonable legal or other expenses incurred by
such indemnified party in connection with investigating or defending any matter,
including any action that could have given rise to such losses, claims, damages,
liabilities or judgments. Notwithstanding the provisions of this Section 8, no
Holder, its directors, its officers or any Person, if any, who controls such
Holder shall be required to contribute, in the aggregate, any amount in excess
of the amount by which the total received by such Holder with respect to the
sale of Transfer Restricted Securities pursuant to a Registration Statement
exceeds (i) the amount paid by such Holder for such Transfer Restricted
Securities and (ii) the amount of any damages which such Holder 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 Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Holders' obligations to contribute pursuant to this
Section 8(d) are several in proportion to the respective principal amount of
Transfer Restricted Securities held by each Holder hereunder and not joint.
(e) The Company and Guarantor agree that the cross indemnity and
contribution provisions of this Section 8 shall apply to Affiliated Market
Makers to the same extent, on the same conditions, as it applies to Holders.
SECTION 9. RULE 144A and RULE 144
The Company and each Guarantor agrees with each Holder, for so long
as any Transfer Restricted Securities remain outstanding and during any period
in which the Company or such Guarantor (i) is not subject to Section 13 or 15(d)
of the Exchange Act, to make available, upon request of any Holder, to such
Holder or beneficial owner of Transfer Restricted Securities in connection with
any sale thereof and any prospective purchaser of such Transfer Restricted
Securities designated by such Holder or beneficial owner, the information
required by Rule 144A(d)(4) under the Act in order to permit resales of such
Transfer Restricted Securities pursuant to Rule 144A, and (ii) is subject to
Section 13 or 15 (d) of the Exchange Act, to make all filings required thereby
in a timely manner in order to permit resales of such Transfer Restricted
Securities pursuant to Rule 144.
SECTION 10. UNDERWRITTEN REGISTRATIONS
(a) If any of the Restricted Transfer Securities covered by a Shelf
Registration Statement are to be sold in an Underwritten Registration, the
managing underwriters shall be
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<PAGE>
selected by the Holders of a majority in aggregate principal amount of the
Transfer Restricted Securities to be included in such offering; provided, that
such managing underwriters must be reasonably satisfactory to the Company.
(b) No Holder may participate in any Underwritten Registration,
unless such Holder: (i) agrees to sell its Restricted Transfer Securities on the
basis reasonably provided in any underwriting arrangements approved in
accordance with paragraph (a) above; and (ii) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents reasonably required under the terms of such underwriting
arrangements.
SECTION 11. MISCELLANEOUS
(a) Remedies. The Company and the Guarantor acknowledge and
agree that any failure by the Company and/or the Guarantors to comply with their
respective obligations under Sections 3 and 4 hereof may result in material
irreparable injury to the Initial Purchasers or the Holders or Affiliated Market
Makers for which there is no adequate remedy at law, that it will not be
possible to measure damages for such injuries precisely and that, in the event
of any such failure, the Initial Purchasers or any Holder or Affiliated Market
Makers may obtain such relief as may be required to specifically enforce the
Company's and the Guarantor's obligations under Sections 3 and 4 hereof. The
Company and the Guarantors further agree to waive the defense in any action for
specific performance that a remedy at law would be adequate.
(b) No Inconsistent Agreements. Neither the Company nor any
Guarantor will, on or after the date of this Agreement, enter into any agreement
with respect to its securities that is inconsistent with the rights granted to
the Holders in this Agreement or otherwise conflicts with the provisions hereof.
Except for rights described in (or contemplated by the agreements referenced in)
the Offering Memorandum (as defined in the Purchase Agreement), neither the
Company nor any Guarantor has previously entered into any agreement granting any
registration rights with respect to its securities to any Person. The rights
granted to the Holders hereunder do not in any way conflict with and are not
inconsistent with the rights granted to the holders of the Company's and the
Guarantor's securities under any agreement in effect on the date hereof, except
for any rights granted under agreements described in (or contemplated by the
agreements referenced in) the Offering Memorandum (as defined in the Purchase
Agreement) which have been waived.
(c) Amendments and Waivers. The provisions of this Agreement
may not be amended, modified or supplemented, and waivers or consents to or
departures from the provisions hereof may not be given unless (i) in the case of
Section 5 hereof and this Section 10(c)(i), the Company has obtained the written
consent of Holders of all outstanding Transfer Restricted Securities and (ii) in
the case of all other provisions hereof, the Company has obtained the written
consent of Holders of a majority of the outstanding principal amount of Transfer
Restricted Securities (excluding Transfer Restricted Securities held by the
Company or its Affiliates). Notwithstanding the foregoing, a waiver or consent
to departure from the provisions hereof that relates exclusively to the rights
of Holders whose Transfer Restricted Securities are being tendered pursuant to
the Exchange Offer, and that does not affect directly or indirectly the rights
of other Holders whose Transfer Restricted Securities are not being tendered
pursuant to
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<PAGE>
such Exchange Offer, may be given by the Holders of a majority of the
outstanding principal amount of Transfer Restricted Securities subject to such
Exchange Offer.
(d) Third Party Beneficiary. The Holders and Affiliated Market
Makers shall be third party beneficiaries to the agreements made hereunder
between the Company and the Guarantors, on the one hand, and the Initial
Purchasers, on the other hand, and shall have the right to enforce such
agreements directly to the extent they may deem such enforcement necessary or
advisable to protect its rights or the rights of Holders and Affiliated Market
Makers hereunder.
(e) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail
(registered or certified, return receipt requested), telex, telecopier, or air
courier guaranteeing overnight delivery:
(i) if to a Holder, at the address set forth on the records of
the Registrar under the Indenture, with a copy to the Registrar under the
Indenture; and
(ii) if to the Company or the Guarantor:
3 Bala Plaza
Bala Cynwyd, PA 19004
Telecopier No.: (610) 660-4920
Attention: Donald A. Harris
With a copy to:
Greenberg Traurig, LLP
1750 Tysons Boulevard
Tysons Corner, VA 22102
Telecopier No.: (703) 749-1301
Attention: Lee R. Marks
All such notices and communications shall be deemed to have been
duly given: at the time delivered by hand, if personally delivered; five
Business Days after being deposited in the mail, postage prepaid, if mailed;
when receipt acknowledged, if telecopied; and on the next business day, if
timely delivered to an air courier guaranteeing overnight delivery.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address specified in the Indenture.
Upon the date of filing of the Exchange Offer or a Shelf
Registration Statement, as the case may be, notice shall be delivered to
Donaldson, Lufkin & Jenrette Securities Corporation, on behalf of the Initial
Purchasers (in the form attached hereto as Exhibit A) and shall be addressed to:
Attention: Louise Guarneri (Compliance Department), 277 Park Avenue, New York,
New York 10172.
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<PAGE>
(f) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties, including without limitation and without the need for an express
assignment, subsequent Holders; provided, that nothing herein shall be deemed to
permit any assignment, transfer or other disposition of Transfer Restricted
Securities in violation of the terms hereof or of the Purchase Agreement or the
Indenture. If any transferee of any Holder shall acquire Transfer Restricted
Securities in any manner, whether by operation of law or otherwise, such
Transfer Restricted Securities shall be held subject to all of the terms of this
Agreement, and by taking and holding such Transfer Restricted Securities such
Person shall be conclusively deemed to have agreed to be bound by and to perform
all of the terms and provisions of this Agreement, including the restrictions on
resale set forth in this Agreement and, if applicable, the Purchase Agreement or
Indenture, as the case may be, and such Person shall be entitled to receive the
benefits hereof.
(g) Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(h) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO THE CONFLICT OF LAW RULES THEREOF.
(j) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be affected or impaired thereby.
(k) Entire Agreement. This Agreement is intended by the
parties as a final expression of their agreement and intended to be a complete
and exclusive statement of the agreement and understanding of the parties hereto
in respect of the subject matter contained herein. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein with respect to the registration rights granted with respect to the
Transfer Restricted Securities. This Agreement supersedes all prior agreements
and understandings between the parties with respect to such subject matter.
[The remainder of this page is intentionally left blank.]
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<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
UBIQUITEL OPERATING COMPANY
By:_____________________________________
Peter Lucas
Interim Chief Financial Officer
UBIQUITEL INC.
By:_____________________________________
Peter Lucas
Interim Chief Financial Officer
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
PARIBAS CORPORATION
PNC CAPITAL MARKETS, INC.
By: DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
By:______________________________
William G. Payne
Senior Vice President
<PAGE>
EXHIBIT A
NOTICE OF FILING OF
A/B EXCHANGE OFFER REGISTRATION STATEMENT
To: Donaldson, Lufkin & Jenrette Securities Corporation
277 Park Avenue
New York, New York 10172
Attention: Louise Guarneri (Compliance Department)
Fax: (212) 892-7272
From: UbiquiTel Operating Company
14% Senior Subordinated Discount Notes due 2010
Date: ___, 200_
For your information only (NO ACTION REQUIRED):
Today, ______, 2000, we filed [an A/B Exchange Registration
Statement/a Shelf Registration Statement] with the Securities and Exchange
Commission. We currently expect this registration statement to be declared
effective within __ business days of the date hereof.
<PAGE>
A/B EXCHANGE
REGISTRATION RIGHTS AGREEMENT
by and among
UbiquiTel Operating Company,
UbiquiTel Inc.
and
Donaldson, Lufkin & Jenrette Securities Corporation,
Paribas Corporation
and
PNC Capital Markets, Inc.
Dated as of April 11, 2000
<PAGE>
Exhibit 10.23
WARRANT REGISTRATION RIGHTS AGREEMENT
UBIQUITEL INC.
----------------------------------------
354,971 Warrants Initially Exercisable to Purchase 2,117,402.015
Shares of Common Stock
----------------------------------------
Dated as of April 11, 2000
----------------------------------------
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
PARIBAS CORPORATION
PNC CAPITAL MARKETS, INC.
<PAGE>
WARRANT REGISTRATION RIGHTS AGREEMENT
This WARRANT REGISTRATION RIGHTS AGREEMENT (this "Agreement") is
made and entered into as of April 11, 2000, by and among UbiquiTel Inc., a
Delaware corporation (the "Issuer"), and Donaldson, Lufkin & Jenrette Securities
Corporation, Paribas Corporation and PNC Capital Markets, Inc. (the "Initial
Purchasers"), which have agreed to purchase the Warrants of the Issuer issued
pursuant to the Warrant Agreement (the "Warrant Agreement") between the Issuer
and American Stock Transfer & Trust Company, as warrant agent (the "Warrant
Agent").
The Warrants are being issued and sold in connection with the
offering (the "Offering") by UbiquiTel Operating Company, a Delaware corporation
and wholly-owned subsidiary of the Issuer ("UbiquiTel"), and the Issuer of
300,000 Units each consisting of (i) $1,000 principal amount at maturity of 14%
Senior Subordinated Discount Notes due 2010 (the "Notes") of UbiquiTel and (ii)
one Warrant. In connection with the Offering, the Issuer is also issuing 54,971
Warrants to Donaldson, Lufkin & Jenrette Securities Corporation. Each Warrant
entitles the holder thereof to purchase 5.965 shares of the common stock, $0.001
par value ("Common Stock"), of the Issuer, subject to adjustment as set forth in
the Warrant Agreement.
This Agreement is made pursuant to the Purchase Agreement, dated
April 4, 2000 (the "Purchase Agreement"), by and between the Issuer, UbiquiTel
and the Initial Purchaser. In order to induce the Initial Purchasers to purchase
the Warrants, the Issuer has agreed to provide the registration rights set forth
in this Agreement. The execution and delivery of this Agreement is a condition
to the obligations of the Initial Purchasers set forth in Section 9 of the
Purchase Agreement. Capitalized terms used herein and not otherwise defined
shall have the meaning assigned to them in the Warrant Agreement.
The parties hereby agree as follows:
1. DEFINITIONS
As used in this Agreement, the following capitalized terms shall
have the following meanings:
Act: The Securities Act of 1933, as amended.
Affiliate: As defined in Rule 144.
Black Out Notice: As defined in Section 4(b) hereof.
Black Out Period: As defined in Section 3(a) hereof.
Closing Date: The date hereof.
Commission: The Securities and Exchange Commission.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Expiration Date: 5:00 p.m. New York City time on April 15, 2010.
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<PAGE>
Holders: As defined in Section 2 hereof.
Prospectus: The prospectus included in a Registration Statement at
the time such Registration Statement is declared effective, as amended or
supplemented by any prospectus supplement and by all other amendments thereto,
including post-effective amendments, and all material incorporated by reference
into such Prospectus.
Registration Statement: Any registration statement of the Issuer
relating to the registration for resale of Transfer Restricted Securities that
is filed pursuant to the provisions of this Agreement and including the
Prospectus included therein, all amendments and supplements thereto (including
post-effective amendments) and all exhibits and material incorporated by
reference therein.
Rule 144: Rule 144 promulgated under the Act.
Transfer Restricted Securities: (a) Each Warrant and Warrant Share
held by an Affiliate of the Issuer and (b) each other Warrant and Warrant Share
until the earlier to occur of (i) the date on which such Warrant or Warrant
Share (other than any Warrant Share issued upon exercise of a Warrant in
accordance with a Registration Statement) has been disposed of in accordance
with a Registration Statement and (ii) the date on which such Warrant or Warrant
Share (or the related Warrant) is distributed to the public pursuant to Rule 144
under the Act.
2. HOLDERS
A Person is deemed to be a holder of Transfer Restricted Securities
(each, a "Holder") whenever such Person is the holder of record of Transfer
Restricted Securities.
3. SHELF REGISTRATION
(a) Shelf Registration. The Issuer shall prepare and cause to be
filed with the Commission on or before 75 days from the Closing Date pursuant to
Rule 415 under the Securities Act a Registration Statement on the appropriate
form relating to resales of Transfer Restricted Securities by the Holders
thereof. The Issuer shall use its reasonable best efforts to cause the
Registration Statement to be declared effective by the Commission on or before
180 days after the Closing Date.
To the extent necessary to ensure that the Registration Statement is
available for sales of Transfer Restricted Securities by the Holders thereof
entitled to the benefit of this Section 3(a), the Issuer shall use its
reasonable best efforts to keep any Registration Statement required by this
Section 3(a) continuously effective, supplemented, amended and current as
required by and subject to the provisions of Section 4(a) hereof and in
conformity with the requirements of this Agreement, the Act and the policies,
rules and regulations of the Commission as announced from time to time, until
the earlier of (A) the Expiration Date and (B) the first date as of which all
Warrants or Warrant Shares have been sold or otherwise transferred pursuant to
the Registration Statement by the Holders thereof; provided that such obligation
shall expire before such date if the Issuer delivers to the Warrant Agent a
written opinion of counsel to the Issuer (which opinion of counsel shall be
satisfactory to the Warrant Agent) that all Holders (other than Affiliates of
the Issuer) of Warrants and Warrant Shares may resell the Warrants and the
Warrant Shares without registration under the Act and without restriction as to
the manner, timing or volume of any such sale; and provided, further, that
notwithstanding the foregoing, any Affiliate of the Issuer may, with notice to
the Issuer, require the Issuer to keep the Registration Statement continuously
effective for resales by such Affiliate for so long as such Affiliate holds
Warrants or Warrant Shares,
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<PAGE>
including as a result of any market-making activities or other trading
activities of such Affiliate. Notwithstanding the foregoing, the Issuer shall
not be required to amend or supplement the Registration Statement, any related
prospectus or any document incorporated therein by reference, for a period (a
"Black Out Period") not to exceed, for so long as this Agreement is in effect,
an aggregate of 60 days in any calendar year, in the event that (i) an event
occurs and is continuing as a result of which the Registration Statement, any
related prospectus or any document incorporated therein by reference as then
amended or supplemented would, in the Issuer's good faith judgment, contain an
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading, and (ii)(A) the Issuer determines in its
good faith judgment that the disclosure of such event at such time would have a
material adverse effect on the business, operations or prospects of the Issuer
or (B) the disclosure otherwise relates to a material business transaction which
has not yet been publicly disclosed; provided that such Black Out Period shall
be extended for any period, not to exceed an aggregate of 30 days in any
calendar year, during which the Commission is reviewing any proposed amendment
or supplement to the Registration Statement, any related prospectus or any
document incorporated therein by reference which has been filed by the Issuer;
and provided, further, that no Black Out Period may be in effect during the
three months prior to the Expiration Date.
(b) Provision by Holders of Certain Information in Connection with
the Registration Statement. No Holder of Transfer Restricted Securities may
include any of its Transfer Restricted Securities in any Registration Statement
pursuant to this Agreement unless and until such Holder furnishes to the Issuer
in writing, within 20 days after receipt of a request therefor, the information
specified in Item 507 or 508 of Regulation S-K, as applicable, of the Act for
use in connection with any Registration Statement or Prospectus or preliminary
Prospectus included therein. No Holder of Transfer Restricted Securities shall
be entitled to liquidated damages pursuant to Section 8 unless and until such
Holder shall have provided all such information. Each selling Holder agrees to
promptly furnish additional information required to be disclosed in order to
make the information previously furnished to the Issuer by such Holder not
materially misleading.
4. REGISTRATION PROCEDURES
(a) In connection with the Registration Statement and any related
Prospectus required by this Agreement, the Issuer shall:
(i) use its reasonable best efforts to effect such
registration to permit the sale of the Transfer Restricted Securities
being sold in accordance with the intended method or methods of
distribution thereof (as indicated in the information furnished to the
Issuer pursuant to Section 3(b) hereof), and pursuant thereto the Issuer
will prepare and file with the Commission a Registration Statement
relating to the registration on any appropriate form under the Act, which
form shall be available for the sale of the Transfer Restricted Securities
in accordance with the intended method or methods of distribution thereof
within the time periods and otherwise in accordance with the provisions
hereof;
(ii) use its reasonable best efforts to keep such Registration
Statement continuously effective and provide all requisite financial
statements for the period specified in Section 3 of this Agreement. Upon
the occurrence of any event that would cause any such Registration
Statement or the Prospectus contained therein (A) to contain an untrue
statement of 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 (B) not
4
<PAGE>
to be effective and usable for resale of Transfer Restricted Securities
during the period required by this Agreement, the Issuer shall, subject to
Section 3(a), file promptly an appropriate amendment to such Registration
Statement or a supplement to the Prospectus, as applicable, curing such
defect, and, in the case of an amendment, use its reasonable best efforts
to cause such amendment to be declared effective as soon as practicable;
(iii) prepare and file with the Commission such amendments and
post-effective amendments to the applicable Registration Statement as may
be necessary to keep such Registration Statement effective for the
applicable period set forth in Section 3; cause the Prospectus to be
supplemented by any required Prospectus supplement, and as so supplemented
to be filed pursuant to Rule 424 under the Act, and to comply fully with
Rules 424, 430A and 462, as applicable, under the Act in a timely manner;
and comply with the provisions of the Act with respect to the disposition
of all securities covered by such Registration Statement during the
applicable period in accordance with the intended method or methods of
distribution by the sellers thereof set forth in such Registration
Statement or supplement to the Prospectus;
(iv) advise the Initial Purchasers promptly and, if requested
by the Initial Purchasers, confirm such advice in writing, (A) when the
Prospectus or any Prospectus supplement or post-effective amendment has
been filed, and, with respect to any applicable Registration Statement or
any post-effective amendment thereto, when the same has become effective,
(B) of any request by the Commission for amendments to the Registration
Statement or amendments or supplements to the Prospectus or for additional
information relating thereto, (C) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement
under the Act or of the suspension by any state securities commission of
the qualification of the Transfer Restricted Securities for offering or
sale in any jurisdiction, or the initiation of any proceeding for any of
the preceding purposes, and (D) of the existence of any fact or the
happening of any event that makes any statement of a material fact made in
the Registration Statement, the Prospectus, any amendment or supplement
thereto or any document incorporated by reference therein untrue, or that
requires the making of any additions to or changes in the Registration
Statement in order to make the statements therein not misleading, or that
requires the making of any additions to or changes in the Prospectus in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading. If at any time the Commission
shall issue any stop order suspending the effectiveness of the
Registration Statement, or any state securities commission or other
regulatory authority shall issue an order suspending the qualification or
exemption from qualification of the Transfer Restricted Securities under
state securities or Blue Sky laws, the Issuer shall use its reasonable
best efforts to obtain the withdrawal or lifting of such order at the
earliest possible time;
(v) subject to Section 4(a)(ii), if any fact or event
contemplated by Section 4(a)(iv)(D) hereof shall exist or have occurred,
prepare a supplement or post-effective amendment to the Registration
Statement or related Prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter
delivered to the purchasers of Transfer Restricted Securities, the
Prospectus will not contain 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;
(vi) furnish to the Initial Purchasers, before filing with the
Commission, copies of any Registration Statement or any Prospectus
included therein or any amendments or supplements to any such Registration
Statement or Prospectus (including all
5
<PAGE>
documents incorporated by reference after the initial filing of such
Registration Statement), which documents will be subject to the review and
comment of such Persons, if any, for a period of at least five Business
Days, and the Issuer will not file any such Registration Statement or
Prospectus or any amendment or supplement to any such Registration
Statement or Prospectus (including all such documents incorporated by
reference) to which the Initial Purchasers shall reasonably object within
five Business Days after the receipt thereof. The Initial Purchasers shall
be deemed to have reasonably objected to such filing if such Registration
Statement, amendment, Prospectus or supplement, as applicable, as proposed
to be filed, contains 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
fails to comply with the applicable requirements of the Act;
(vii) promptly prior to the filing of any document (other than
any document relative to the ordinary course of the Issuer's business)
that is to be incorporated by reference into a Registration Statement or
Prospectus, provide copies of such document to the Initial Purchasers,
make the Issuer's representatives available for discussion of such
document and other customary due diligence matters, and include such
information in such document prior to the filing thereof as the Initial
Purchasers may reasonably request;
(viii) make available, at reasonable times, for inspection by
the Initial Purchasers and any attorney or accountant retained by the
Initial Purchasers, all financial and other records, pertinent corporate
documents of the Issuer and cause the Issuer's officers, directors and
employees to supply all information reasonably requested by the Initial
Purchasers, attorney or accountant in connection with such Registration
Statement or any post-effective amendment thereto subsequent to the filing
thereof and prior to its effectiveness;
(ix) if requested by the Initial Purchasers, promptly include
in any Registration Statement or Prospectus, pursuant to a supplement or
post-effective amendment if necessary, such information as the Initial
Purchasers may reasonably request to have included therein, including,
without limitation, information relating to the "Plan of Distribution" of
the Transfer Restricted Securities and the use of the Registration
Statement or Prospectus for market-making activities; and make all
required filings of such Prospectus supplement or post-effective amendment
as soon as practicable after the Issuer is notified of the matters to be
included in such Prospectus supplement or post-effective amendment;
(x) furnish to the Initial Purchasers and each Holder upon
request, without charge, at least one copy of the Registration Statement,
as first filed with the Commission, and of each amendment thereto,
including all documents incorporated by reference therein and all exhibits
(excluding exhibits incorporated therein by reference);
(xi) deliver to the Initial Purchasers and each Holder,
without charge, as many copies of the Prospectus (including each
preliminary prospectus) and any amendment or supplement thereto as the
Initial Purchasers or such Holder reasonably may request; the Issuer
hereby consents to the use (in accordance with law and subject to Section
4(d) hereof) of the Prospectus and any amendment or supplement thereto by
each selling Person in connection with the offering and the sale of the
Transfer Restricted Securities covered by the Prospectus or any amendment
or supplement thereto and all market-making activities of the Initial
Purchasers, as the case may be;
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(xii) upon the request of the Initial Purchasers, enter into
such agreements (including underwriting agreements) and make such
representations and warranties and take all such other actions in
connection therewith in order to expedite or facilitate the disposition of
the Transfer Restricted Securities pursuant to any applicable Registration
Statement contemplated by this Agreement as may be reasonably requested by
the Initial Purchasers in connection with any sale or resale pursuant to
any applicable Registration Statement. In such connection, the Issuer
shall:
(A) upon request of the Initial Purchasers, furnish (or
in the case of paragraphs (2) and (3), use its reasonable best
efforts to cause to be furnished) to the Initial Purchasers, upon
the effectiveness of the Registration Statement:
(1) a certificate, dated such date, signed on
behalf of the Issuer by (x) the President or any Vice
President and (y) a principal financial or accounting officer
of the Issuer, confirming, as of the date thereof, the matters
set forth in Sections 6(ee) (with respect to the applicable
registration statement and prospectus), 9(a) and 9(b) of the
Purchase Agreement and such other similar matters as such
Person may reasonably request;
(2) an opinion, dated the date of effectiveness of
the Registration Statement, of counsel for the Issuer covering
matters similar to those set forth in Sections 9(e) of the
Purchase Agreement and such other matters as the Initial
Purchasers may reasonably request, and in any event including
a statement to the effect that such counsel has participated
in conferences with officers and other representatives of the
Issuer, representatives of the independent public accountants
for the Issuer and have considered the matters required to be
stated therein and the statements contained therein, although
such counsel has not independently verified the accuracy,
completeness or fairness of such statements; and that such
counsel advises that, on the basis of the foregoing (relying
as to materiality to the extent such counsel deems appropriate
upon the statements of officers and other representatives of
the Issuer) and without independent check or verification), no
facts came to such counsel's attention that caused such
counsel to believe that the applicable Registration Statement,
at the time such Registration Statement or any post-effective
amendment thereto became effective contained an untrue
statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading, or that the Prospectus
contained in such Registration Statement as of its date
contained an untrue statement of a material fact or omitted to
state a material fact necessary in order to make the
statements therein, in the light of the circumstances under
which they were made, not misleading. Without limiting the
foregoing, such counsel may state further that such counsel
assumes no responsibility for, and has not independently
verified, the accuracy, completeness or fairness of the
financial statements, notes and schedules and other financial
or statistical data included in any Registration Statement
contemplated by this Agreement or the related Prospectus; and
(3) a customary comfort letter, dated the date of
effectiveness of the Registration Statement, from the Issuer's
independent accountants, in the customary form and covering
matters of the type customarily
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covered in comfort letters to underwriters in connection with
underwritten offerings, and affirming the matters set forth in
the comfort letters delivered pursuant to Section 9(g) of the
Purchase Agreement; and
(B) deliver such other documents and certificates as may
be reasonably requested by the Initial Purchasers to evidence
compliance with the matters covered in clause (A) above and with any
customary conditions contained in any agreement entered into by the
Issuer pursuant to this clause;
(xiii) prior to any public offering of Transfer Restricted
Securities, cooperate with the selling Holders and their counsel in
connection with the registration and qualification of the Transfer
Restricted Securities under the securities or Blue Sky laws of such
jurisdictions as the selling Holders may request and do any and all other
acts or things necessary or advisable to enable the disposition in such
jurisdictions of the Transfer Restricted Securities covered by the
applicable Registration Statement; provided that the Issuer shall not be
required 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 the
service of process in suits or to taxation, other than as to matters and
transactions relating to the Registration Statement, in any jurisdiction
where it is not now so subject;
(xiv) in connection with any sale of Transfer Restricted
Securities that will result in such securities no longer being Transfer
Restricted Securities, cooperate with the Holders to facilitate the timely
preparation and delivery of certificates representing Transfer Restricted
Securities to be sold and not bearing any restrictive legends; and to
register such Transfer Restricted Securities in such denominations and
such names as the selling Holders may request at least two Business Days
prior to such sale of Transfer Restricted Securities;
(xv) use its reasonable best efforts to cause the disposition
of the Transfer Restricted Securities covered by the Registration
Statement to be registered with or approved by such other governmental
agencies or authorities as may be necessary to enable the seller or
sellers thereof to consummate the disposition of such Transfer Restricted
Securities, subject to the proviso contained in clause (xiii) above;
(xvi) provide a CUSIP number for all Transfer Restricted
Securities not later than the effective date of a Registration Statement
covering such Transfer Restricted Securities and provide the Warrant Agent
or the Transfer Agent and Registrar for the Warrant Shares, as applicable,
with printed certificates for the Transfer Restricted Securities which are
in a form eligible for deposit with The Depository Trust Company;
(xvii) otherwise use its reasonable best efforts to comply
with all applicable rules and regulations of the Commission, and make
generally available to its security holders with regard to any applicable
Registration Statement, as soon as practicable, a consolidated earnings
statement meeting the requirements of Rule 158 (which need not be audited)
covering a twelve-month period beginning after the effective date of the
Registration Statement (as such term is defined in Rule 158(c) under the
Act); and
(xviii) provide promptly to the Initial Purchaser, upon
request, each document filed with the Commission pursuant to the
requirements of Section 13 or Section 15(d) of the Exchange Act.
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(b) Restrictions on Holders. Each Holder agrees by acquisition of a
Transfer Restricted Security and the Initial Purchaser agrees that, upon receipt
of the notice from the Issuer of the commencement of a Black Out Period (in each
case, a "Black Out Notice"), such Person will forthwith discontinue disposition
of Transfer Restricted Securities pursuant to the applicable Registration
Statement until such Person is advised in writing by the Issuer of the
termination of the Black Out Period. Each Person receiving a Black Out Notice
hereby agrees that it will either (i) destroy any Prospectuses, other than
permanent file copies, then in such Person's possession which have been replaced
by the Issuer with more recently dated Prospectuses or (ii) deliver to the
Issuer (at the Issuer's expense) all copies, other than permanent file copies,
then in such Person's possession of the Prospectus covering such Transfer
Restricted Securities that was current at the time of receipt of the Black Out
Notice.
5. REGISTRATION EXPENSES
All expenses incident to the Issuer's performance of or compliance
with this Agreement will be borne by the Issuer, regardless of whether a
Registration Statement becomes effective, including, without limitation: (i) all
registration and filing fees and expenses; (ii) all fees and expenses of
compliance with federal securities and state Blue Sky or securities laws; (iii)
all expenses of printing (including printing Prospectuses (whether for sales,
market-making or otherwise), messenger and delivery services and telephone; (iv)
all fees and disbursements of counsel for the Issuer; (v) if the Common Stock
shall then be listed on any national securities exchange or automated quotation
system, all application and filing fees in connection with listing the Warrant
Shares thereon, and (vi) all fees and disbursements of independent certified
public accountants of the Issuer (including the expenses of any special audit
and comfort letters required by or incident to such performance).
The Issuer will, in any event, bear its internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), the expenses of any annual
audit and the fees and expenses of any Person, including special experts,
retained by the Issuer.
6. INDEMNIFICATION
(a) The Issuer agrees to indemnify and hold harmless each Holder,
its directors, officers and each Person, if any, who controls such Holder
(within the meaning of Section 15 of the Act or Section 20 of the Exchange Act),
from and against any and all losses, claims, damages, liabilities, judgments,
(including, without limitation, any reasonable legal or other expenses incurred
in connection with investigating or defending any matter, including any action
that could give rise to any such losses, claims, damages, liabilities or
judgments) caused by any untrue statement or alleged untrue statement of a
material fact contained in any Registration Statement, preliminary prospectus or
Prospectus (or any amendment or supplement thereto) provided by the Issuer to
any Holder or any prospective purchaser of Transfer Restricted Securities, or
caused by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as such losses, claims, damages, liabilities or
judgments are caused by an untrue statement or omission or alleged untrue
statement or omission that is based upon information relating to a Holder
furnished in writing to the Issuer by or on behalf of such Holder.
(b) Each Holder of Transfer Restricted Securities agrees, severally
and not jointly, to indemnify and hold harmless the Issuer, its directors and
officers, and each person, if any, who controls (within the meaning of Section
15 of the Act or Section 20 of the Exchange Act) the Issuer, to the same extent
as the foregoing indemnity from the Issuer set forth in Section 6(a) hereof, but
only with
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<PAGE>
reference to information relating to such Holder furnished in writing to the
Issuer by or on behalf of such Holder expressly for use in any Registration
Statement. In no event shall any Holder, its directors, officers or any Person
who controls such Holder be liable or responsible for any amount in excess of
the amount by which the total amount received by such Holder with respect to its
sale of Transfer Restricted Securities pursuant to a Registration Statement
exceeds (i) the amount paid by such Holder for such Transfer Restricted
Securities and (ii) the amount of any damages that such Holder, its directors,
officers or any Person who controls such Holder has otherwise been required to
pay by reason of such untrue or alleged untrue statement or omission or alleged
omission.
(c) In case any action shall be commenced involving any person in
respect of which indemnity may be sought pursuant to Section 6(a) or 6(b) (the
"indemnified party"), the indemnified party shall promptly notify the person
against whom such indemnity may be sought (the "indemnifying party") in writing,
and the indemnifying party shall assume the defense of such action, including
the employment of counsel reasonably satisfactory to the indemnified party and
the payment of all fees and expenses of such counsel, as incurred (except that,
in the case of any action in respect of which indemnity may be sought pursuant
to both Sections 6(a) and 6(b), a Holder shall not be required to assume the
defense of such action pursuant to this Section 6(c), but may employ separate
counsel and participate in the defense thereof, but the fees and expenses of
such counsel, except as provided below, shall be at the expense of the Holder).
Any indemnified party shall have the right to employ separate counsel in any
such action and participate in the defense thereof, but the fees and expenses of
such counsel shall be at the expense of the indemnified party, unless (i) the
employment of such counsel shall have been specifically authorized in writing by
the indemnifying party, (ii) the indemnifying party shall have failed to assume
the defense of such action or employ counsel reasonably satisfactory to the
indemnified party or (iii) the named parties to any such action (including any
impleaded parties) include both the indemnified party and the indemnifying
party, and the indemnified party shall have been advised by such counsel that
there may be one or more legal defenses available to it which are different from
or additional to those available to the indemnifying party (in which case the
indemnifying party shall not have the right to assume the defense of such action
on behalf of the indemnified party). In any such case, the indemnifying party
shall not, in connection with any one action or separate but substantially
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the fees and expenses of
more than one separate firm of attorneys (in addition to any local counsel) for
all indemnified parties and all such fees and expenses shall be reimbursed as
they are incurred. Such firm shall be designated in writing by a majority of the
Holders, in the case of the parties indemnified pursuant to Section 6(a), and by
the Issuer, in the case of parties indemnified pursuant to Section 6(b). The
indemnifying party shall indemnify and hold harmless the indemnified party from
and against any and all losses, claims, damages, liabilities and judgments by
reason of any settlement of any action (i) effected with its written consent or
(ii) effected without its written consent if the settlement is entered into more
than twenty business days after the indemnifying party shall have received a
request from the indemnified party for reimbursement for the fees and expenses
of counsel (in any case where such fees and expenses are at the expense of the
indemnifying party) and, prior to the date of such settlement, the indemnifying
party shall have failed to comply with such reimbursement request. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement or compromise of, or consent to the entry of
judgment with respect to, any pending or threatened action in respect of which
the indemnified party is or could have been a party and indemnity or
contribution may be or could have been sought hereunder by the indemnified
party, unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability on claims that
are or could have been the subject matter of such action and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to
act, by or on behalf of the indemnified party.
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(d) To the extent that the indemnification provided for in this
Section 6 is unavailable to an indemnified party in respect of any losses,
claims, damages, liabilities or judgments referred to therein, then each
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities or judgments (i) in such proportion
as is appropriate to reflect the relative benefits received by the Issuer, on
the one hand, and the Holders, on the other hand, from their sale of Transfer
Restricted Securities or (ii) if the allocation provided by clause 6(d)(i) is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause 6(d)(i) hereof but also the
relative fault of the Issuer, on the one hand, and of the Holder, on the other
hand, in connection with the statements or omissions which resulted in such
losses, claims, damages, liabilities or judgments, as well as any other relevant
equitable considerations. The relative fault of the Issuer, on the one hand, and
of the Holder, 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, on the one hand, or by or on behalf of the
Holder, on the other hand, and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or omission.
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages, liabilities or judgments referred to above shall be deemed to
include, subject to the limitations set forth in the second paragraph of Section
6(a), any legal or other fees or expenses reasonably incurred by such
indemnified party in connection with investigating or defending any matter,
including any action that could have given rise to such losses, claims, damages,
liabilities or judgments.
The Issuer and each Holder agree that it would not be just and
equitable if contribution pursuant to this Section 6(d) were determined by pro
rata allocation (even if the Holders were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 6, no Holder, its directors, its
officers or any Person, if any, who controls such Holder shall be required to
contribute, in the aggregate, any amount in excess of the amount by which the
total received by such Holder with respect to the sale of Transfer Restricted
Securities pursuant to a Registration Statement exceeds (i) the amount paid by
such Holder for such Transfer Restricted Securities and (ii) the amount of any
damages which such Holder 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 Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The Holders' obligations to contribute
pursuant to this Section 6(d) are several in proportion to the respective
principal amount of Transfer Restricted Securities held by each Holder hereunder
and not joint.
(e) The Issuer agrees that the cross indemnity and contribution
provisions of this Section 6 shall apply to the Initial Purchaser to the same
extent, on the same conditions, as it applies to Holders.
7. RULE 144
The Issuer agrees with each Holder, for so long as any Transfer
Restricted Securities remain outstanding and during any period in which the
Issuer is subject to Section 13 or 15(d) of the Exchange Act, to make all
filings required thereby in a timely manner in order to permit resales of such
Transfer Restricted Securities pursuant to Rule 144.
8. LIQUIDATED DAMAGES
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(a) Liquidated Damages. The Issuer and the Initial Purchasers agree
that the Holders will suffer damages if the Issuer fails to fulfill its
obligations pursuant to Section 3 and 4 of this Agreement and that it would not
be possible to ascertain the extent of such damages. Accordingly, in the event
of such failure by the Issuer to fulfill such obligations, the Issuer hereby
agrees to pay liquidated damages ("Liquidated Damages") to each Holder under the
circumstances and to the extent set forth below:
(i) if the Registration Statement has not been filed with the
Commission within 75 days after the Closing Date;
(ii) if the Registration Statement has not been declared
effective by the Commission within 180 days after the Closing Date; or
(iii) if the Registration Statement has been declared
effective by the Commission and such Registration Statement ceases to be
effective or usable at any time after the expiration of a Black Out Period
until the earlier of (A) the Expiration Date and (B) the first date as of
which all Warrants or Warrant Shares have been sold or otherwise
transferred pursuant to the Registration Statement by the Holders
thereof(the "Effectiveness Period"), without being succeeded on the same
day immediately by a post-effective amendment to such Registration
Statement that cures such failure and that is itself immediately declared
effective on the same day, (any of the foregoing, a "Registration
Default"),
then the Issuer shall pay Liquidated Damages to each Holder in an amount equal
to $0.03 per week per Warrant held by such Holder for each week or portion
thereof that the Registration Default continues for the first 90-day period
immediately following the occurrence of such Registration Default. This amount
will increase by an additional $0.02 per week per Warrant with respect to each
subsequent 90-day period, up to a maximum amount of Liquidated Damages equal to
$0.07 per week per Warrant. The provision for Liquidated Damages will continue
until such Registration Default has been cured. The Issuer will not be required
to pay Liquidated Damages for more than one Registration Default at any given
time. A Registration Default under clause (i) above shall be cured on the date
that the Registration Statement is filed with the Commission; a Registration
Default under clause (ii) above shall be cured on the date that the Registration
Statement is declared effective by the Commission; a Registration Default under
clause (iii) above shall be cured on the earlier of (A) the date that the
post-effective amendment curing the deficiency in the Registration Statement is
declared effective or (B) the Effectiveness Period expires. Notwithstanding the
foregoing, the Issuer shall not be deemed to have failed to perform its
obligations under clauses (i) through (iii) above by the reason of the failure
of any Holder to provide information regarding itself reasonably requested by
the Issuer or any regulatory agency having jurisdiction over any of the Holders
at least 10 business days prior to a Registration Default.
(b) Payment of Liquidated Damages. The Issuer shall notify the
Warrant Agent within one Business Day after each and every date on which a
Registration Default occurs (an "Event Date"). Liquidated Damages shall accrue
from the most recent date to which Liquidated Damages have been paid or, if no
Liquidated Damages have been paid, from the date hereof. Liquidated Damages
accrued as of April 15 or October 15 of each year (each a "Payment Date") will
be payable on such Payment Date. The Issuer shall pay Liquidated Damages on the
applicable Payment Date to the Persons who are Holders of Warrants at the close
of business on the April 1 or October 1 next preceding the Payment Date.
Liquidated Damages shall be payable at the office of the Warrant Agent or, at
the option of the Issuer, payment of Liquidated Damages may be made by check
mailed to the Holders at their addresses set forth in the register of Holders,
provided that payment by wire transfer of immediately
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available funds shall be required with respect to the Liquidated Damages on all
Warrants the Holders of which shall have provided written wire transfer
instructions to the Issuer and the Warrant Agent. Such payment shall be in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts.
9. MISCELLANEOUS
(a) Remedies. The Issuer acknowledges and agrees that any failure by
the Issuer to comply with its obligations under Section 3 hereof may result in
material irreparable injury to the Initial Purchaser or the Holders for which
there is no adequate remedy at law, that it will not be possible to measure
damages for such injuries precisely and that, in the event of any such failure,
the Initial Purchaser or any Holder may obtain such relief as may be required to
specifically enforce the Issuer's obligations under Section 3 hereof. The Issuer
further agrees to waive the defense in any action for specific performance that
a remedy at law would be adequate.
(b) No Inconsistent Agreements. Neither the nor UbiquiTel will, on
or after the date of this Agreement, enter into any agreement with respect to
its securities that is inconsistent with the rights granted to the Holders in
this Agreement or otherwise conflicts with the provisions hereof. Except for
rights described in (or contemplated by the agreements referenced in) the
Offering Memorandum (as defined in the Purchase Agreement), neither the Issuer
nor UbiquiTel has previously entered into any agreement granting any
registration rights with respect to its securities to any Person. The rights
granted to the Holders hereunder do not in any way conflict with and are not
inconsistent with the rights granted to the holders of the Issuer's and
UbiquiTel's securities under any agreement in effect on the date hereof, except
for any rights granted under agreements described in (or contemplated by the
agreements referenced in) the Offering Memorandum (as defined in the Purchase
Agreement) which have been waived.
(c) Amendments and Waivers. The provisions of this Agreement may not
be amended, modified or supplemented, and waivers or consents to or departures
from the provisions hereof may not be given unless (i) in the case of this
Section 9(c)(i), the Issuer has obtained the written consent of Holders of all
outstanding Transfer Restricted Securities, and (ii) in the case of all other
provisions hereof, the Issuer has obtained the written consent of Holders of a
majority of the outstanding principal amount of Transfer Restricted Securities
(excluding Transfer Restricted Securities held by the Issuer or its Affiliates);
provided that this Agreement may be amended without the consent of any Holder in
order to cure any ambiguity or to correct or supplement any provision contained
herein which may be defective or inconsistent with any other provision herein,
or to make any other provisions in regard to matters or questions arising
hereunder which the Issuer may deem necessary or desirable and which shall not
in any way adversely affect any Holder.
(d) Third Party Beneficiary. The Holders shall be third party
beneficiaries to the agreements granting rights to Holders made hereunder
between the Issuer, on the one hand, and the Initial Purchaser, on the other
hand, and shall have the right to enforce such agreements directly to the extent
they may deem such enforcement necessary or advisable to protect its rights or
the rights of Holders hereunder.
(e) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail
(registered or certified, return receipt requested), telex, telecopier, or air
courier guaranteeing overnight delivery:
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(i) if to a Holder, at the address set forth on the records of
the Warrant Agent, with a copy to the Warrant Agent; and
(ii) if to the Issuer:
UbiquiTel Inc.
1 Bala Plaza, Suite 402
Bala Cynwyd, Pennsylvania 19004
Telecopier No.: (610) 660-9558
Attention: Donald A. Harris
With a copy to:
Greenberg Traurig, LLP
1750 Tysons Boulevard
Tysons Corner, Virginia 22102
Telecopier No.: (703) 749-1301
Attention: Lee R. Marks, Esq.
and:
Greenberg Traurig, P.A.
1221 Brickell Avenue
Miami, Florida 33131
Telecopier No.: (305) 579-0717
Attention: Rebecca R. Orand, Esq.
All such notices and communications shall be deemed to have been
duly given: at the time delivered by hand, if personally delivered; five
Business Days after being deposited in the mail, postage prepaid, if mailed;
when receipt acknowledged, if telecopied; and on the next Business Day, if
timely delivered to an air courier guaranteeing overnight delivery.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Warrant Agent at the
address specified in Warrant Agreement.
(f) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties, including, without limitation, and without the need for an express
assignment, subsequent Holders; provided that nothing herein shall be deemed to
permit any assignment, transfer or other disposition of Transfer Restricted
Securities in violation of the terms hereof or of the Purchase Agreement or the
Warrant Agreement. If any transferee of any Holder shall acquire Transfer
Restricted Securities in any manner, whether by operation of law or otherwise,
such Transfer Restricted Securities shall be held subject to all of the terms of
this Agreement, and by taking and holding such Transfer Restricted Securities
such Person shall be conclusively deemed to have agreed to be bound by and to
perform all of the terms and provisions of this Agreement, including the
restrictions on resale set forth in this Agreement and, if applicable, the
Purchase Agreement or Warrant Agreement, as the case may be, and such Person
shall be entitled to receive the benefits hereof.
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(g) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(h) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
CONFLICT OF LAW RULES THEREOF.
(j) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be affected or impaired thereby.
(k) Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein
with respect to the registration rights granted with respect to the Transfer
Restricted Securities. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject matter.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
UBIQUITEL INC.
By:_______________________________________
Peter Lucas
Interim Chief Financial Officer
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
PARIBAS CORPORATION
PNC CAPITAL MARKETS, INC.
By: DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
By:_______________________________
William G. Payne
Senior Vice President
