Exhibit 10.32
SUBSCRIPTION AGREEMENT
SUBSCRIPTION AGREEMENT (this "Agreement") made as of this 31st
day of January, 2000 between MJD Communications, Inc., a Delaware corporation
with its principal offices at Morehead Place, 000 Xxxx Xxxxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000 (the "Company") and the undersigned members
of the management of the Company and/or its subsidiaries listed on Schedule A
attached hereto (the "Subscribers").
W I T N E S S E T H :
WHEREAS, the Company desires to issue, in the aggregate, the
number of shares of the Company's Class A Voting Common Stock, $0.01 par value,
set forth on Schedule A attached hereto (the "Shares") to the Subscribers on the
terms and conditions hereinafter set forth and each Subscriber desires to
acquire that number of Shares set forth on the signature page hereof and
Schedule A attached hereto;
NOW, THEREFORE, for and in consideration of the premises and the
mutual representations and covenants hereinafter set forth, the parties hereto
do hereby agree as follows:
I. SUBSCRIPTION FOR COMMON STOCK AND
REPRESENTATIONS BY SUBSCRIBER
1.1 Subject to the terms and conditions hereinafter set forth,
each Subscriber hereby subscribes for and agrees to purchase from the Company
for such Subscriber's own account such number of Shares as is set forth upon the
signature page hereof and Schedule A attached hereto at a price equal to $262.33
per Share and the Company agrees to sell such Shares to the Subscribers for said
purchase price. The purchase price is payable by wire transfer of cash or
certified or cashier's check made payable to the Company, contemporaneously with
the execution and delivery of this Agreement. The certificates for the Shares
will be delivered by the Company within five (5) business days following the
closing of this transaction.
1.2 Each Subscriber represents that (i) such Subscriber is able
to bear the economic risk of holding the Shares for an indefinite period and
(ii) such Subscriber can afford to suffer the complete loss of his investment in
the Shares.
1.3 Each Subscriber acknowledges that such Subscriber has prior
investment experience, including investment in non-listed and non-registered
securities, or that such Subscriber has employed the services of an investment
advisor, attorney and/or accountant to read all of the documents furnished or
made available by the Company both to such Subscriber and to all other
prospective investors in the Shares and to evaluate the merits and risks of such
an investment on such Subscriber's behalf; that such Subscriber recognizes the
highly speculative nature of this investment; and that such Subscriber is able
to bear the economic risk such Subscriber hereby assumes.
1.4 Each Subscriber hereby represents that such Subscriber has
been furnished by the Company during the course of this transaction with all
information regarding the Company which such Subscriber had requested or desired
to know; that all documents which could be reasonably provided have been made
available for such Subscriber's inspection and review; that such Subscriber has
been afforded the opportunity to ask questions of and receive answers from duly
authorized officers or other representatives of the Company concerning the terms
and conditions of this investment, and any additional information which such
Subscriber had requested.
1.5 Each Subscriber hereby acknowledges that the terms and
conditions of this transaction have not been reviewed by the United States
Securities and Exchange Commission (the "Commission") or any state regulatory
authority, since the transaction is intended to be a nonpublic transaction
pursuant to Regulation D promulgated under the Securities Act of 1933, as
amended (the "Act"). Each Subscriber represents that the Shares being purchased
by such Subscriber are being purchased for such Subscriber's own account, for
investment and not for distribution or resale to others. Each Subscriber agrees
that such Subscriber will not sell or otherwise transfer the Shares unless they
are registered under the Act or unless an exemption from such registration is
available.
1.6 Each Subscriber understands that the Shares have not been
registered under the Act or any state securities or "blue sky" laws by reason of
claimed exemptions under the provisions thereof which depend, in part, upon such
Subscriber's investment intention and related representations, warranties and
agreements made herein. In this connection, each Subscriber understands that it
is the position of the Commission and state regulatory authorities that the
statutory basis for such exemptions would not be present if such Subscriber's
representation merely meant that such Subscriber's present intention was to hold
the Shares for a short period, such as the capital gains period of tax statutes,
for a deferred sale, for a market rise, assuming that a market develops, or for
any other fixed period. Each Subscriber realizes that, in the view of the
Commission and state regulatory authorities, a purchase now with an intent to
resell would represent a purchase with an intent inconsistent with such
Subscriber's representation to the Company, and the Commission and such state
regulatory authorities might regard such a sale or disposition as a deferred
sale for which the exemption is not available.
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1.7 Each Subscriber understands that there is no market for the
Shares and that no market is expected to develop for the Shares. Each Subscriber
understands and hereby acknowledges that the Company is under no obligation to
register the Shares under the Act or any state securities or "blue sky" laws.
Each Subscriber consents that the Company may, if it desires, permit the
transfer of the Shares, out of such Subscriber's name only when such
Subscriber's request for transfer is accompanied by an opinion of counsel
reasonably satisfactory to the Company that neither the sale nor the proposed
transfer results in a violation of the Act or any applicable state securities or
"blue sky" laws and only if such transfer is in compliance with the
Stockholders' Agreement, dated as of January 20, 2000, among the Company, Xxxxxx
X. Xxx Equity Fund IV, L.P., Xxxxx Investment Associates V, L.P., Xxxxx Equity
Partners V, L.P., the Subscriber and the various other stockholders party
thereto (the "Stockholders' Agreement"). Each Subscriber agrees to hold the
Company and its affiliates and their respective directors, officers, controlling
persons, heirs, representatives, successors and assigns harmless and to
indemnify them against all liabilities, costs and expenses incurred by them as a
result of any sale or distribution by the undersigned Subscriber in violation of
the Act, any applicable state securities or "blue sky" laws or the Stockholders'
Agreement.
1.8 Each Subscriber consents to the placement of a legend on any
certificate or other document evidencing the Shares, stating that such Shares
have not been registered under the Act or any state securities or "blue sky"
laws and setting forth or referring to the restrictions on transferability and
sale thereof including without limitation those set forth in the Stockholders'
Agreement. Each Subscriber is aware that the Company will make a notation in its
appropriate records with respect to the restrictions on the transferability of
such Shares.
1.9 Each Subscriber represents and warrants that (i) such
Subscriber has duly executed and delivered this Agreement; (ii) this Agreement
constitutes and, upon execution thereof, the Stockholders' Agreement, will
constitute such Subscriber's legal, valid and binding obligations, enforceable
against such Subscriber in accordance with their respective terms, (iii) the
execution, delivery and performance of this Agreement and the Stockholders'
Agreement will not conflict with or result in the breach or termination of, or
constitute a default under, any lease, agreement, commitment or other
instrument, or any order, judgment or decree to which such Subscriber is a party
or by which such Subscriber is bound, (iv) no consent, approval, authorization,
order, filing, registration or qualification of or with any court, governmental
authority or third person is required to be obtained by such Subscriber in
connection with the execution and delivery of this Agreement or the
Stockholders' Agreement or the performance of such Subscriber's obligations
hereunder or thereunder and (v) such Subscriber is a resident of the state set
forth below such Subscriber's signature on the signature page attached hereto.
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II. REPRESENTATIONS OF THE COMPANY
2.1 The Company represents and warrants to each Subscriber as
follows:
(a) The Company is a corporation duly organized, existing and in
good standing under the laws of the State of Delaware and has the corporate
power to conduct the business which it proposes to conduct;
(b) the execution, delivery and performance of this Agreement by
the Company will have been duly approved by the Board of Directors of the
Company and all other actions required to authorize and effect the sale of the
Shares will have been duly taken and approved; and
(c) the Shares purchased pursuant hereto have been duly and
validly authorized and when issued and paid for in accordance with the terms
hereof, will be duly and validly issued, fully paid and nonassessable.
III. MISCELLANEOUS
3.1 Any notice or other communication given hereunder shall be
deemed sufficient if in writing and sent by registered or certified mail, return
receipt requested, or delivered by hand against written receipt therefor,
addressed to the Company, at its office, Morehead Place, 000 Xxxx Xxxxxxxx
Xxxxxx, Xxxxx 000, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000, Attention: Xxxxxx X. Xxxxx,
Xx. and to the Subscribers at their respective addresses indicated on the
signature page of this Agreement. Notices shall be deemed to have been given on
the date of mailing, except notices of change of address, which shall be deemed
to have been given when received.
3.2 This Agreement shall not be changed, modified or amended
except by a writing signed by the parties to be charged, and this Agreement may
not be discharged except by performance in accordance with its terms or by a
writing signed by the party to be charged.
3.3 This Agreement shall be binding upon and inure to the benefit
of the parties hereto and to their respective heirs, legal representatives,
successors and assigns. This Agreement sets forth the entire agreement and
understanding between the parties as to the subject matter thereof and merges
and supersedes all prior discussions, agreements and understandings of any and
every nature among them.
3.4 Upon the execution and delivery of this Agreement by the
Subscribers, this Agreement shall become a binding obligation of the Subscribers
with
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respect to the purchase of the Shares as herein provided; subject, however, to
the right hereby reserved to the Company to enter into the same agreements with
other subscribers and to add and/or delete other persons as subscribers.
3.5 Notwithstanding the place where this Agreement may be
executed by any of the parties hereto, the parties expressly agree that all the
terms and provisions hereof shall be construed in accordance with and governed
by the laws of the State of New York, without regard to principles of conflicts
of law.
3.6 The parties hereby waive trial by jury in any action or
proceeding involving, directly or indirectly, any matter (whether sounding in
tort, contract, fraud or otherwise) in any way arising out of or in connection
with this Agreement or the Shares issued hereunder.
3.7 The holding of any provision of this Agreement to be invalid
or unenforceable by a court of competent jurisdiction shall not affect any other
provision of this Agreement, which shall remain in full force and effect.
3.8 It is agreed that a waiver by any party of a breach of any
provision of this Agreement shall not operate, or be construed, as a waiver of
any subsequent breach by that same party.
3.9 The parties agree to execute and deliver all such further
documents, agreements and instruments and take such other and further action as
may be necessary or appropriate to carry out the purposes and intent of this
Agreement.
3.10 This Agreement may be executed in one or more counterparts
each of which shall be deemed an original, but all of which shall together
constitute one and the same instrument.
3.11 By execution of this Agreement, each Subscriber agrees to be
bound by the terms of the Stockholders' Agreement as a "Management Stockholder"
as required by Section 11 of the Stockholders' Agreement. Each Subscriber
represents and warrants that it has delivered a duly executed Spousal Waiver to
the Company to the extent required by the Stockholders' Agreement or is not
required to deliver such Spousal Waiver under the terms of the Stockholders'
Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as
of the day and year first set forth above.
MJD COMMUNICATIONS, INC.
By: /s/ Xxxxxx X. Xxxxx, Xx.
-----------------------------------
Name: Xxxxxx X. Xxxxx, Xx.
Title: Senior Vice President,
Chief Financial Officer
and Secretary
ACCEPTED AND AGREED:
[Counterparts of this page were executed by all parties listed on Schedule A
hereto]
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Signature of Subscriber
--------------------------------------
Name of Subscriber
--------------------------------------
Address of Subscriber
--------------------------------------
Social Security or Taxpayer
Identification Number of Subscriber
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Number of shares of Common Stock
to be Subscribed For
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SCHEDULE A
Number Of Shares
Subscriber To Be Purchased
---------- ---------------
Xxxxxxx Xxxxxxxxx 40
Xxxxx Xxxxxxx 382
Xxxx Cure 80
Xxxx Xxxxxxx 400
Xxx Xxxx 285
Xxx Fine 80
Xxxx Xxxxxxx 55
Xxxx Xxxxx 40
Xxx Gnaidek 40
Xxxx Xxxxxxxxxx 40
Xxx Xxxxx 40
Xxxx Xxxx 40
Xxx Xxxxxxxx 40
Xxxxx Xxxxxxx 40
Xxxx Xxxxxxxx 100
Xxx Xxxxx 100
Xxxxx Xxxxx 160
Xxxx Xxxxxx 880
City National Bank, Trustee, for the
benefit Xxxx Xxxxxx 851
Xxxx Xxxxx 100
Xxxx Xxxxxxx 1000
Xxxxx Brothers Xxxxxxxx Trust Co.
for the benefit of Xxxx X. Xxxxxxx,
GST exempt 100
Xxxxxx Xxxxx 40
Xxxxxx Xxxxx 40
