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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
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Date of Report (Date of earliest event reported): February 28, 2000 (February 24, 2000)
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NEXTEL COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 0-19656 36-3939651
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
2001 EDMUND HALLEY DRIVE, RESTON, VIRGINIA 20191
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (703) 433-4000
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS.
On February 24, 2000, Nextel obtained a commitment from Chase Securities Inc.
to activate the $1.0 billion incremental senior secured credit facility (the
"Incremental Facility") under its existing bank credit agreement. If activated,
the total amount of borrowings available under the bank credit agreement would
increase from $5.0 billion to $6.0 billion. Activation of the Incremental
Facility is subject to a number of conditions, including the negotiation and
execution of definitive agreements. Nextel cannot assure you that the
conditions to activation and/or funding of the Incremental Facility will be
satisfied. A copy of the commitment letter relating to the Incremental Facility
is filed as Exhibit 99.1 hereto and is incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) FINANCIAL STATEMENTS OF BUSINESS ACQUIRED.
NOT APPLICABLE
(b) PRO FORMA FINANCIAL INFORMATION.
NOT APPLICABLE
(C) EXHIBITS.
Exhibit No Exhibit Description
99.1 Commitment Letter dated February 24, 2000
among Nextel Finance Company, The Chase
Manhattan Bank and Chase Securities Inc.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
NEXTEL COMMUNICATIONS, INC.
Date: February 28, 2000 By: /s/ THOMAS J. SIDMAN
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Thomas J. Sidman
Senior Vice President and General Counsel
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EXHIBIT INDEX
Exhibit No Exhibit Description
99.1 Commitment Letter dated February 24, 2000
among Nextel Finance Company, The Chase
Manhattan Bank and Chase Securities Inc.
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[CHASE LOGO]
THE CHASE MANHATTAN BANK CHASE SECURITIES INC.
270 Park Avenue 270 Park Avenue
New York, New York 10017 New York, New York 10017
February 24, 2000
Nextel Finance Company
Incremental Facility
Commitment Letter
Nextel Finance Company
2001 Edmund Halley Drive
Reston, Virginia 20191
Attention: John S. Brittain, Jr.
Vice President and
Treasurer
Ladies and Gentlemen:
You have advised The Chase Manhattan Bank ("CHASE") and Chase
Securities Inc. ("CSI") that Nextel Finance Company (the "BORROWER") wishes, as
contemplated by Section 2.01(e) of the Amended and Restated Credit Agreement
dated as of November 9, 1999 among Nextel Communications, Inc. ("NCI"), the
Borrower and the other Restricted Companies party thereto, the Lenders party
thereto and the Agents party thereto (the "CREDIT AGREEMENT"), to establish an
additional tranche of term loans under the Credit Agreement in an aggregate
amount of $1,000,000,000 to be available for the working capital and other
general corporate purposes of the Borrower and its subsidiaries and to make
investments, acquisitions and capital expenditures. Such new tranche of term
loans is herein called the "TRANCHE D TERM LOANS". In that connection, you have
requested that CSI agree to structure, arrange and syndicate the Tranche D Term
Loans and that Chase commit to provide the entire principal amount of the
Tranche D Term Loans.
CSI is pleased to advise you that it is willing to act as
exclusive advisor, sole lead arranger and sole book manager for the Tranche D
Term Loans.
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Furthermore, Chase is pleased to advise you of (a) its commitment
to provide the entire amount of the Tranche D Term Loans upon the terms and
subject to the conditions set forth or referred to in this commitment letter
(the "COMMITMENT LETTER"), in the Summary of Terms and Conditions attached
hereto as Exhibit A (the "TERM SHEET") and in the Fee Letter dated the date
hereof and delivered herewith (the "FEE LETTER"). We intend to syndicate the
Tranche D Term Loans to a group of financial institutions (together with Chase,
the "TRANCHE D LENDERS") identified by us in consultation with you. Chase shall
be relieved of its obligation to provide the entire amount of the Tranche D Term
Loans to the extent that other Tranche D Lenders provide the Tranche D Term
Loans.
CSI intends to commence syndication efforts promptly upon the
execution of this Commitment Letter, and you agree actively to assist CSI in
completing a syndication satisfactory to it and you at or prior to the execution
and delivery of the definitive loan documentation for the Tranche D Term Loans.
Such assistance shall include (a) your using commercially reasonable efforts to
ensure that the syndication efforts benefit materially from your existing
lending relationships, (b) direct contact between senior management and advisors
of the Borrower and the proposed Tranche D Lenders, (c) assistance in the
preparation of a Confidential Information Memorandum and other marketing
materials to be used in connection with the syndication (which shall not,
however, require any updating or modifications of or to the projections
previously prepared and distributed in connection with the original syndication
of the facilities contemplated by the Credit Agreement) and (d) the hosting,
with CSI, of one or more meetings or telephone conference calls with prospective
Tranche D Lenders.
It is agreed that Chase will act as the sole and exclusive
Syndication Agent for the Tranche D Term Loans. CSI will act as the sole and
exclusive advisor, sole lead arranger and sole book manager, for the Tranche D
Term Loans, and will, in such capacities, perform the duties and exercise the
authority customarily performed and exercised by it in such roles. You agree
that no other agents, co-agents, arrangers or book managers will be appointed,
no other titles will be awarded and no compensation (other than that expressly
contemplated by the Fee Letter referred to below) will be paid in connection
with the Tranche D Term Loans unless you and we shall so agree, except that the
existing Collateral Agent and Administrative Agent under the Credit Agreement
shall continue in their current roles without any additional compensation or
fees by reason of the Tranche D Term Loans, except to the extent expressly
required by the Credit Agreement or consented to by the Borrower.
CSI, in consultation with you, will manage all aspects of the
syndication, including decisions as to the selection (subject to your approval)
of institutions to be approached and when they will be approached, when their
commitments will be accepted, which institutions will participate, the
allocations of the commitments among the Tranche D Lenders and the amount and
distribution of fees among the Tranche D Lenders. To assist CSI in its
syndication efforts, you agree promptly to prepare and provide to CSI and Chase
all information with respect to, NCI, the Borrower and its subsidiaries, and the
other transactions contemplated hereby as is reasonably necessary or appropriate
to supplement the information regarding NCI, the Borrower and its subsidiaries,
their respective businesses and financial condition since the original
syndication of the facilities contemplated by the Credit Agreement, including
all financial information as we may reasonably request in connection with the
arrangement and syndication of the Tranche D Term Loans. You hereby represent
and covenant that all such supplemental information (the "INFORMATION") that has
been or will be made available to Chase or CSI by you or any of your
representatives for the purposes of syndication of the Tranche D Term Loans is
or
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will be, when furnished, complete and correct in all material respects and does
not or will not, when furnished, contain any untrue statement of a material fact
or omit to state a material fact necessary in order to make the statements
contained therein not materially misleading in light of the circumstances under
which such statements are made. You understand that in arranging and syndicating
the Tranche D Term Loans we may use and rely on the Information without
independent verification thereof.
As consideration for Chase's commitment hereunder and CSI's
agreement to perform the services described herein, you agree to pay to Chase
and to the Tranche D Lenders the non-refundable fees set forth in the Fee
Letter.
Chase's commitment hereunder and CSI's agreement to perform the
services described herein are subject to (a) there not occurring or becoming
known to us any material adverse condition or material adverse change in or
affecting the business, operations, property, condition (financial or otherwise)
or prospects of NCI, the Borrower and their respective subsidiaries, taken as a
whole, (b) our not becoming aware after the date hereof of any information or
other matter affecting NCI, the Borrower and their respective subsidiaries or
the transactions contemplated hereby which is inconsistent in a material and
adverse manner with any such information or other matter disclosed to us prior
to the date hereof, (c) there not having occurred a material disruption of or
material adverse change in financial, banking or capital market conditions that,
in our judgment, could materially impair the syndication of the Tranche D Term
Loans, (d) our satisfaction that prior to and during the syndication of the
Tranche D Term Loans there shall be no competing offering, placement or
arrangement of any debt securities or bank financing by or on behalf of NCI, the
Borrower or any of its controlled affiliates (other than Motorola equipment
financing for Nextel International Inc. subsidiaries), (e) the negotiation,
execution and delivery on or before March 31, 2000 of definitive documentation
with respect to the Tranche D Term Loans consistent with the terms herein, in
the Term Sheet and in the Fee Letter and otherwise reasonably acceptable to the
Borrower and Chase, (f) the other conditions set forth or referred to in the
Term Sheet and (g) the payment when due of the fees or other compensation
provided for by the Fee Letter. The terms and conditions of Chase's commitment
hereunder and of the Tranche D Term Loans are not limited to those set forth
herein and in the Term Sheet. Those matters that are not covered by the
provisions hereof and of the Term Sheet are subject to the approval and
agreement of Chase, CSI and the Borrower, to the extent such matters are not
already addressed by the terms of the Credit Agreement.
You agree (a) to indemnify and hold harmless Chase, CSI, their
affiliates and their respective officers, directors, employees, advisors, and
agents (each, an "INDEMNIFIED PERSON") from and against any and all losses,
claims, damages and liabilities to which any such indemnified person may become
subject arising out of or in connection with this Commitment Letter, the Tranche
D Term Loans, the use of the proceeds thereof, the transactions contemplated
hereby or any claim, litigation, investigation or proceeding relating to any of
the foregoing, regardless of whether any indemnified person is a party thereto,
and to reimburse each indemnified person upon demand for any reasonable legal or
other out of pocket expenses incurred in connection with investigating or
defending any of the foregoing, provided that the foregoing indemnity will not,
as to any indemnified person, apply to losses, claims, damages, liabilities or
related expenses to the extent (i) they are found by a final, non-appealable
judgment of a court to arise from the willful misconduct or gross negligence of
such indemnified person or (ii) they arise from a settlement with respect to
which an indemnified person has admitted
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liability without your prior written consent, which shall not be unreasonably
withheld or delayed, and (b) to reimburse Chase, CSI and their affiliates on
demand for all reasonable out-of-pocket expenses (including due diligence
expenses, syndication expenses, travel expenses, and reasonable fees, charges
and disbursements of counsel) incurred in connection with the Tranche D Term
Loans and any related documentation (including this Commitment Letter, the Term
Sheet, the Fee Letter and the definitive financing documentation) or the
administration, amendment, modification or waiver thereof. Unless resulting
from conduct constituting gross negligence or wilful misconduct on the party of
the indemnified person, no indemnified person shall be liable for any damages
arising from the use by unintended recipients of Information or other materials
distributed through electronic, telecommunications or other information
transmission systems, or for any special, indirect, consequential or punitive
damages in connection with the Tranche D Term Loans.
You acknowledge that Chase and/or CSI may be providing debt
financing, equity capital or other services (including financial advisory
services) to other companies in respect of which you may have conflicting
interests regarding the transactions described in this Commitment Letter and
otherwise. Neither Chase nor CSI will use confidential information obtained from
you by virtue of the transactions contemplated by this Commitment Letter or
other relationships with you in connection with the performance by Chase or CSI
of services for other companies, and neither Chase nor CSI will furnish any such
information to other companies. You also acknowledge that neither Chase nor CSI
has any obligation to use in connection with the transactions contemplated by
this Commitment Letter, or to furnish to you, confidential information obtained
from other companies.
This Commitment Letter shall not be assignable by you without the
prior written consent of Chase and CSI (and any purported assignment without
such consent shall be null and void), is intended to be solely for the benefit
of the parties hereto and is not intended to confer any benefits upon, or create
any rights in favor of, any person other than the parties hereto. This
Commitment Letter may not be amended or waived except by an instrument in
writing signed by you, Chase and CSI. This Commitment Letter may be executed in
any number of counterparts, each of which shall be an original, and all of
which, when taken together, shall constitute one agreement. Delivery of an
executed signature page of this Commitment Letter by facsimile transmission
shall be effective as delivery of a manually executed counterpart hereof. This
Commitment Letter and the Fee Letter are the only agreements that have been
entered into among us with respect to the Tranche D Term Loans and set forth the
entire understanding of the parties with respect thereto. This Commitment Letter
shall be governed by, and construed in accordance with, the law of the State of
New York (without regard to conflict of law principals that would require
application of the law of any jurisdiction other than the State of New York).
This Commitment Letter is delivered to you on the understanding
that neither this Commitment Letter, the Term Sheet or the Fee Letter nor any of
their terms or substance shall be disclosed, directly or indirectly, to any
other person except (a) to your officers, agents and advisors who are directly
involved in the consideration of this matter or (b) as may be compelled in a
judicial or administrative proceeding or as otherwise required by law
(in which case you agree to inform us promptly thereof) and, provided, that the
foregoing restrictions shall cease to apply (except in respect of the Fee Letter
and its terms and substance) after this Commitment Letter has been accepted by
you, and Chase and CSI hereby consent to NCI's public announcement of the
existence of this Commitment Letter in, and the inclusion of a copy of this
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Commitment Letter and of the related Term Sheet as an exhibit to, reports that
NCI is required to file with the Securities and Exchange Commission.
Chase and CSI agree to maintain the confidentiality of the
Information (as defined below), except that Information may be disclosed (a) to
its and its affiliates, directors, officers, employees and agents, including
accountants, legal counsel and other advisors (it being understood that the
persons to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by any regulatory authority, (c) to
the extent required by applicable laws or regulations or by any subpoena or
similar legal process, (d) to any Incremental Facility Lender or prospective
Incremental Facility Lender (provided that such person has agreed to keep the
Information confidential to the same extent provided in this paragraph), (e) in
connection with the exercise of any remedies under this Commitment Letter or the
Fee Letter or any suit, action or proceeding relating to this Commitment Letter
or the Fee Letter or the enforcement of rights hereunder or thereunder, (f) with
the consent of NCI or the Borrower or (g) to the extent such Information (i)
becomes publicly available other than as a result of a breach of this paragraph
or (ii) becomes available to any Chase or CSI on a nonconfidential basis from a
source other than NCI or any of its subsidiaries. For the purposes hereof,
"Information" means all information received from NCI or any of its subsidiaries
relating to NCI or any of its subsidiaries or their business, other than any
such information that is available to Chase or CSI on a nonconfidential basis
prior to disclosure by NCI or its subsidiaries; provided that, in the case of
information received from NCI or its subsidiaries after the date hereof, such
information is clearly identified at the time of delivery as confidential. Any
person required to maintain the confidentiality of Information as provided in
this paragraph shall be considered to have complied with its obligation to do so
if such person has exercised the same degree of care to maintain the
confidentiality of such Information as such person would accord to its own
confidential information.
The compensation, reimbursement, indemnification and
confidentiality provisions contained herein and in the Fee Letter shall remain
in full force and effect regardless of whether definitive financing
documentation shall be executed and delivered and notwithstanding the
termination of this Commitment Letter or Chase's commitment hereunder.
If the foregoing correctly sets forth our agreement, please
indicate your acceptance of the terms hereof and of the Term Sheet and the Fee
Letter by returning to us executed counterparts hereof and of the Fee Letter not
later than 5:00 p.m., New York City time, on February 25, 2000. Chase's
commitment and CSI's agreements herein will expire at such time in the event
that executed counterparts in accordance with the immediately preceding sentence
have not been exchanged.
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Chase and CSI are pleased to have been given the opportunity to
assist you in connection with this important financing.
Very truly yours,
THE CHASE MANHATTAN BANK
By:
---------------------------------
Name:
Title:
CHASE SECURITIES INC.
By:
---------------------------------
Name:
Title:
Accepted and agreed to as of the date first written above by:
NEXTEL FINANCE COMPANY
By:
---------------------------------
Name:
Title:
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EXHIBIT A
NEXTEL FINANCE COMPANY
SUMMARY OF TERMS AND CONDITIONS
February 24, 2000
Nextel Finance Company (the "BORROWER") wishes, as contemplated
by Section 2.01(e) of the Amended and Restated Credit Agreement dated as of
November 9, 1999 among Nextel Communications, Inc. ("NCI"), the Borrower and the
other Restricted Companies party thereto, the Lenders party thereto and the
Agents party thereto (the "CREDIT AGREEMENT"), to establish an additional
tranche of term loans under the Credit Agreement in an aggregate amount of
$1,000,000,000 to be available for the working capital and other general
corporate purposes of the Borrower and its subsidiaries and to make investments,
acquisitions and capital expenditures. Such new tranche of term loans is herein
called the "TRANCHE D TERM LOANS".
These Summary of Terms and Conditions set forth the terms and
conditions applicable to the Tranche D Term Loans; all other terms and
conditions of the Credit Agreement (except to the extent indicated below) remain
unchanged. Terms not defined in these Summary of Terms and Conditions but used
herein have the meanings assigned to them in the Credit Agreement.
BORROWER: Nextel Finance Company ("NEXTEL" or the
"BORROWER")
SOLE ADVISOR,
BOOK MANAGER AND
LEAD ARRANGER: Chase Securities Inc.
LENDERS: Syndicate of banks acceptable to the
Borrower and the Lead Arranger (the
"TRANCHE D LENDERS")
TRANCHE D TERM LOANS: A $1,000,000,000 nine-year Senior Secured
Single-Draw Term Loan Facility. The
Tranche D Term Loans will mature on March
31, 2009.
PURPOSE: For the working capital and other general
corporate purposes and to make investments,
acquisitions and capital expenditures.
AVAILABILITY: The full amount of the Tranche D Term Loans
will be available in a single drawing at
closing, subject to compliance with
conditions precedent to drawdown, and must
be drawn in full at closing.
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Nextel Finance Company
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Notwithstanding the foregoing, if on any
date (the "TEST DATE") the maturity date
for any outstanding Public Notes (excluding
any Public Notes that mature after June 30,
2009) shall fall within six months of the
Test Date then, if the aggregate of all
such Public Notes that mature prior to June
30, 2009 is at such time greater than the
Threshold Amount (as defined below), the
maturity of the Incremental Facility Loans
shall be accelerated to the Test Date,
provided that the foregoing shall not apply
if either (x) the long-term debt rating for
outstanding unsecured and unenhanced Public
Notes is at least investment grade by
either S&P or Moody's (i.e. BBB- or better
by S&P or Baa3 or better by Moody's) or (y)
the Required Incremental Facility Lenders
shall elect otherwise at any time prior to
the Test Date. For purposes hereof, the
"THRESHOLD AMOUNT" means $1,000,000,000 at
all times when the ratio of Total
Indebtedness to Annualized Operating Cash
Flow is less than 5.00x and no default
exists, and zero at all other times.
AMORTIZATION: The Tranche D Term Loans shall amortize
quarterly beginning on March 31, 2003 and
ending on March 31, 2009 (the percentages
set forth below being the aggregate
percentage of the relevant Facility to be
paid during each four-quarter period, or on
each date, indicated below):
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Period Ending/Date Percentage
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Date: 3/31/03 .25%
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Period Ending: 3/31/04 1%
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Period Ending: 3/31/05 1%
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Period Ending: 3/31/06 1%
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Period Ending: 3/31/07 1%
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Period Ending: 3/31/08 1%
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Date: 6/30/08 .25%
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Date: 9/30/08 .25%
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Date: 12/31/08 .25%
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Date: 3/31/09 94%
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RATES OF INTEREST: Base Rate + ____% or LIBOR + ____%.
CLOSING DATE: The date upon which the Credit
Documentation (as defined below) shall have
been executed and delivered and the
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[CHASE LOGO] Nextel Finance Company
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conditions precedent to the making of the
Tranche D Term Loans shall have been
satisfied and the full amount of the
Tranche D Term Loans shall have been made
(which date shall occur no later than March
31, 2000), such conditions to include the
following:
i) NCI and each Restricted Company
shall have executed and delivered
satisfactory definitive financing
documentation with respect to the
Tranche D Term Loans (the "CREDIT
DOCUMENTATION").
ii) The Tranche D Lenders and the Sole
Lead Arranger shall have received
all fees required to be paid, and
all expenses for which invoices have
been presented.
iii) The Tranche D Lenders shall have
received opinions (including
opinions from counsel to the
Borrower and its subsidiaries),
documents and other instruments as
are customary for transactions of
this type or as they may reasonably
request.
COUNSEL TO CHASE: Milbank, Tweed, Hadley & McCloy LLP
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[CHASE LOGO] Nextel Finance Company
