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Exhibit 1
EXECUTION COPY
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INTERMEDIA COMMUNICATIONS INC.
$450,000,000
8.60% Senior Notes due 2008
Note Purchase Agreement
May 21, 1998
BEAR, XXXXXXX & CO. INC.
SALOMON BROTHERS INC
XXXXXXX XXXXX & CO.
SBC WARBURG DILLON READ INC.
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INTERMEDIA COMMUNICATIONS INC.
$450,000,000
8.60% Senior Notes Due 2008
NOTE PURCHASE AGREEMENT
May 21, 1998
New York, New York
BEAR, XXXXXXX & CO. INC.
SALOMON BROTHERS INC
XXXXXXX XXXXX & CO.
SBC WARBURG DILLON READ INC.
c/o Bear, Xxxxxxx & Co. Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies & Gentlemen:
Intermedia Communications Inc., a Delaware corporation (the
"Company"), proposes to issue and sell to Bear, Xxxxxxx & Co. Inc., Salomon
Brothers Inc, Xxxxxxx Xxxxx & Co. and SBC Warburg Dillon Read Inc. (together,
the "Initial Purchasers") $450,000,000 aggregate principal amount of 8.60%
Senior Notes due 2008 subject to the terms and conditions set forth herein,
which will be issued pursuant to an indenture (the "Indenture"), to be dated the
Closing Date (as defined below), between the Company and SunTrust Bank, Central
Florida, National Association, as trustee (the "Trustee").
1. Issuance of Senior Notes. The Company proposes to, upon the
terms and subject to the conditions set forth herein, issue and sell to the
Initial Purchasers $450,000,000 aggregate principal amount of 8.60% Senior Notes
due 2008 (the "Firm Notes"). The Company also proposes to sell to the Initial
Purchasers, upon the terms and conditions set forth herein, up to an additional
$50,000,000 principal amount of 8.60% Senior Notes due 2008 (the "Additional
Notes" and together with the "Firm Notes", the "Senior Notes"). The Senior Notes
are more fully described in the Offering Memorandum referred to below. For
purposes of this Purchase Agreement (this "Agreement"), the term "Subsidiaries"
shall mean the entities listed on Exhibit D hereto. Capitalized terms used but
not otherwise defined herein shall have the meanings given to such terms in the
Indenture.
The proceeds to the Company from the sale to the Initial
Purchasers of the Senior Notes will be used to fund up to 80% of the cost of
acquisition or construction of Telecommunications Related Assets (as described
in the Offering Memorandum).
Upon original issuance thereof, and until such time as the
same is no longer required under the applicable requirements of the Act, the
Senior Notes shall bear the following legend:
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"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY
WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM
REGISTRATION UNDER XXXXXXX 0 XX XXX XXXXXX XXXXXX SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND THE
SECURITY EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR
AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THE
SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION
5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE
HOLDER OF THE SECURITY EVIDENCED HEREBY AGREES FOR THE BENEFIT
OF THE COMPANY THAT (A) SUCH SECURITY MAY BE RESOLD, PLEDGED
OR OTHERWISE TRANSFERRED, ONLY (1) TO THE COMPANY, (2)
PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT, (3) TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS
DEFINED IN RULE 144A IN A TRANSACTION MEETING THE REQUIREMENTS
OF RULE 144A, (4) TO AN INSTITUTIONAL "ACCREDITED INVESTOR"
(AS DEFINED IN RULE 501(A)(1), (2), (3) OR (7) OF REGULATION D
UNDER THE SECURITIES ACT THAT, PRIOR TO SUCH TRANSFER,
FURNISHES TO THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF
THIS SECURITY (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM
THE TRUSTEE) OR (5) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION
FROM THE REGISTRATION REQUIREMENTS UNDER THE SECURITIES ACT
(AND BASED ON AN OPINION OF COUNSEL IF THE COMPANY SO
REQUESTS), SUBJECT IN EACH OF THE FOREGOING CASES TO
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES
OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE HOLDER WILL,
AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY
PURCHASER FROM IT OF THE SECURITY EVIDENCED HEREBY OF THE
RESALE RESTRICTIONS SET FORTH IN (A) ABOVE."
2. Offering. The Senior Notes will be offered and sold to the
Initial Purchasers pursuant to an exemption from the registration requirements
under the Securities Act of 1933, as amended (the "Act"). The Company has
prepared a preliminary offering memorandum, dated May 18, 1998 (the "Preliminary
Offering Memorandum"), and a final offering memorandum, dated May 21, 1998 the
"Offering Memorandum"), relating to the Company and the Senior Notes.
The Initial Purchasers have advised the Company that the
Initial Purchasers will make offers (the "Exempt Resales") of the Senior Notes
on the terms set forth in the Offering Memorandum, as amended or supplemented,
solely to persons whom any of the Initial Purchasers reasonably believe to be
"qualified institutional buyers," as defined in Rule 144A under the Act
("QIBs"). Such QIBs shall be
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referred to herein as the "Eligible Purchasers." The Initial Purchasers will
offer the Senior Notes to such Eligible Purchasers initially at a purchase price
of 100% of the principal amount of such Senior Notes. Such price may be changed
at any time without notice.
Holders (including subsequent transferees) of the Senior Notes
will have the registration rights set forth in the registration rights agreement
relating thereto (the "Registration Rights Agreement") hereto, to be dated the
Closing Date for so long as such Senior Notes constitute "Transfer Restricted
Securities" (as defined in such agreement). Pursuant to the Registration Rights
Agreement, the Company will agree to file with the Securities and Exchange
Commission (the "Commission"), under the circumstances set forth therein, (i) a
registration statement under the Act (the "Exchange Offer Registration
Statement") with respect to an offer to exchange (the "Exchange Offer") the
Senior Notes for a new issue of 8.60% Senior Notes due 2008 (the "Exchange
Notes") to be offered in exchange for the Senior Notes and/or (ii) a shelf
registration statement pursuant to Rule 415 under the Act (the "Shelf
Registration Statement") relating to the resale by certain holders of the Senior
Notes, and to use its best efforts to cause such Registration Statements to be
declared effective and consummate the Exchange Offer. This Agreement, the Senior
Notes, the Indenture, and the Registration Rights Agreement are hereinafter
sometimes referred to collectively as the "Operative Documents."
3. Purchase, Sale and Delivery. (a) On the basis of the
representations, warranties and covenants contained in this Agreement, and
subject to its terms and conditions, the Company agrees to issue and sell to
each Initial Purchaser, and each Initial Purchaser agrees severally and not
jointly to purchase from the Company, that amount of Senior Notes set forth
opposite its name on Schedule I hereto. The purchase price for the Senior Notes
shall be 97.75% of the principal amount thereof.
The Company also agrees, subject to all the terms and
conditions set forth herein, to sell to the Initial Purchasers, and upon the
basis of the representations, warranties and agreements of the Company herein
contained and subject to all the terms and conditions set forth herein, the
Initial Purchasers shall have the right to purchase from the Company, solely for
the purpose of covering over-allotments in connection with sales of the Firm
Notes, at the purchase price per note of 97.75% of the principal amount thereof
plus accrued interest from the date of issuance of the Firm Notes to the date of
closing of the Additional Notes, pursuant to an option (the "over-allotment
option") which may be exercised at any one time prior to 10:00 a.m., New York
City time, on the 30th day after the date of the Offering Memorandum (or, if
such 30th day shall be a Saturday or Sunday or a holiday, on the next business
day thereafter when the New York Stock Exchange is open for trading), up to an
aggregate principal amount of $50,000,000 of Additional Notes. Upon any exercise
of the over-allotment option, each Initial Purchaser, severally and not jointly,
agrees to purchase from the Company the number of Additional Notes (subject to
such adjustments as the Initial Purchasers may determine in order to avoid
fractional Notes) that bears the same proportion to the aggregate number of
Additional Notes to be purchased by the Initial Purchasers as the number of Firm
Notes set forth opposite the name of such Initial Purchasers as the number of
Firm Notes set forth opposite the name of such Initial Purchaser on Schedule I
hereto bears to the aggregate number of Firm Notes.
(b) Delivery of, and payment of the purchase price for, the
Senior Notes shall be made, against payment of the purchase price, at the
offices of Xxxxxx & Xxxxxxx, 000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000, or such other
location as may be mutually acceptable. Such delivery and payment shall be made
at 9:00 A.M. New York time, on May 27, 1998 or at such other time as shall be
agreed upon by
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the Initial Purchasers and the Company. The time and date of such delivery and
payment are herein called the "Closing Date."
Delivery to the Initial Purchasers of any payment for any
Additional Notes to be purchased by the Initial Purchasers shall be made at the
office of Xxxxxx & Xxxxxxx, 000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000, or such other
location as may be mutually acceptable at such time on such date (the "Option
Closing Date"), which may be the same as the Closing Date but shall in no event
be earlier that the Closing Date nor later than ten business days after the
giving of the notice hereinafter referred to, as shall be specified in a written
notice from Bear, Xxxxxxx & Co., Inc. on behalf of the Initial Purchasers to
purchase a number, specified in such notice, of Additional Notes.
(c) One or more Senior Notes in global form, (the "Global
Securities"), registered in the name of Cede & Co. (such nominee the "Global
Security Holder"), as nominee of the Depository Trust Company ("DTC"), having an
aggregate principal amount corresponding to the aggregate principal amount of
the Senior Notes sold shall be delivered by the Company to the Initial
Purchasers (or as the Initial Purchasers direct), against payment by the Initial
Purchasers of the purchase price therefor, by wire transfer of immediately
available funds to an account specified by the Company or as the Company may
direct in writing, provided that the Company shall give at least two business
days' prior written notice to the Initial Purchasers of the information required
to effect such wire transfers. The Global Securities 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.
4. Agreements of the Company. The Company covenants and agrees
with each of 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 Senior Notes for offering
or sale in any jurisdiction, or the initiation of any proceeding for such
purpose by any state securities commission or other regulatory authority and
(ii) of the happening of any event that, in the reasonable opinion of either
counsel to the Company or counsel to the Initial Purchasers, makes any statement
of a material fact made in the Preliminary Offering Memorandum or the Offering
Memorandum untrue or that requires the making of any additions to or changes in
the Preliminary Offering Memorandum or the Offering Memorandum in order to make
the statements therein, in the light of the circumstances under which they are
made, not misleading. The Company shall use its best efforts to prevent the
issuance of any stop order or order suspending the qualification or exemption of
any Senior Notes under any state securities or Blue Sky laws and, if at any time
any state securities commission or other regulatory authority shall issue an
order suspending the qualification or exemption of any Senior Notes under any
state securities or Blue Sky laws, the Company shall use its 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, without charge, as many
copies of the Preliminary Offering Memorandum and the Offering Memorandum, and
any amendments or supplements thereto, as the Initial Purchasers may reasonably
request. The Company consents to the use of the Preliminary Offering Memorandum
and the
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Offering Memorandum, and any amendments and supplements thereto required
pursuant hereto, by the Initial Purchasers in connection with Exempt Resales.
(c) Not to amend or supplement the Preliminary Offering
Memorandum or the Offering Memorandum prior to the Closing Date unless the
Initial Purchasers shall previously have been advised thereof and shall not have
objected thereto within a reasonable time after being furnished a copy thereof.
The Company shall promptly prepare, upon the Initial Purchasers' request, any
amendment or supplement to the Preliminary Offering Memorandum or the Offering
Memorandum that may be necessary or advisable in connection with Exempt Resales.
(d) If, after the date hereof and prior to consummation of any
Exempt Resale, any event shall occur as a result of which, in the judgment of
the Company or in the reasonable opinion of either counsel to the Company or
counsel to the Initial Purchasers, it becomes necessary or advisable to amend or
supplement the Preliminary Offering Memorandum or 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 which is a prospective
purchaser, not misleading, or if it is necessary or advisable to amend or
supplement the Preliminary Offering Memorandum or Offering Memorandum to comply
with applicable law, (i) notify the Initial Purchasers and (ii) 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.
(e) To cooperate with the Initial Purchasers and counsel to
the Initial Purchasers in connection with the qualification or registration of
the Senior Notes under the securities or Blue Sky laws of such jurisdictions as
the Initial Purchasers may reasonably request and to continue such qualification
in effect so long as required for the Exempt Resales; provided, however that the
Company shall not be required in connection therewith to register or qualify as
a foreign corporation where it is not now so qualified or to take any action
that would subject it to service of process in suits or taxation, in each case,
other than as to matters and transactions relating to the Preliminary Offering
Memorandum, the Offering Memorandum or Exempt Resales, in any jurisdiction where
it is not now so subject.
(f) Whether or not the transactions contemplated by this
Agreement are consummated or this Agreement becomes effective or is terminated,
to pay all costs, expenses, fees and taxes incident to the performance of the
obligations of the Company hereunder, including in connection with: (i) the
preparation, printing, filing and distribution of the Preliminary Offering
Memorandum and the Offering Memorandum (including, without limitation, financial
statements) and all amendments and supplements thereto required pursuant hereto,
(ii) the preparation (including, without limitation, duplication costs) and
delivery of all preliminary and final Blue Sky memoranda prepared and delivered
in connection herewith and with the Exempt Resales, (iii) the issuance, transfer
and delivery by the Company of the Senior Notes to the Initial Purchasers, (iv)
the qualification or registration of the Senior Notes for offer and sale under
the securities or Blue Sky laws of the several states (including, without
limitation, the cost of printing and mailing a preliminary and final Blue Sky
Memorandum and the reasonable fees and disbursements of counsel to the Initial
Purchasers relating thereto), (v) furnishing such copies of the Preliminary
Offering Memorandum and the Offering Memorandum, and all amendments and
supplements thereto, as may be requested for use in connection with Exempt
Resales, (vi) the preparation of certificates for the Senior Notes (including,
without limitation, printing and engraving thereof), (vii) the fees,
disbursements and
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expenses of the Company's counsel and accountants, (viii) all expenses and
listing fees in connection with the application for quotation of the Senior
Notes in the National Association of Securities Dealers, Inc. ("NASD") Automated
Quotation System - PORTAL ("PORTAL"), (ix) all fees and expenses (including fees
and expenses of counsel to the Company) of the Company in connection with the
approval of the Senior Notes by DTC for "book-entry" transfer, (x) rating the
Senior Notes by rating agencies, (xi) the reasonable fees and expenses of the
Trustee and its counsel in connection with the Indenture and the Senior Notes,
(xii) the performance by the Company of its other obligations under this
Agreement and the other Operative Documents and (ix) "roadshow" travel and other
expenses incurred in connection with the marketing and sale of the Senior Notes
(other than out-of-pocket expenses incurred by the Initial Purchasers for
travel, meals and lodgings).
(g) To use the proceeds from the sale of the Senior Notes in
the manner described in the Offering Memorandum under the caption "Use of
Proceeds."
(h) Not to voluntarily claim, and to resist actively any
attempts to claim, the benefit of any usury laws against the holders of any
Senior Notes.
(i) To do and perform all things required to be done and
performed under this Agreement by it prior to or after the Closing Date and to
satisfy all conditions precedent on its part to the delivery of the Senior
Notes.
(j) Not to sell, offer for sale or solicit offers to buy or
otherwise negotiate in respect of any security (as defined in the Act) that
would be integrated with the sale of the Senior Notes in a manner that would
require the registration under the Act of the sale to the Initial Purchasers or
the Eligible Purchasers of the Senior Notes or to take any other action that
would result in the Exempt Resales not being exempt from registration under the
Act.
(k) For so long as any of the Senior Notes remain outstanding
and during any period in which the Company is 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 QIB or beneficial owner of Senior Notes in connection with any
sale thereof and any prospective purchaser of such Senior Notes from such QIB or
beneficial owner, the information required by Rule 144A(d)(4) under the Act.
(l) To cause the Exchange Offer to be made in the appropriate
form to permit registered Senior Notes to be offered in exchange for the Senior
Notes and to comply with all applicable federal and state securities laws in
connection with the Exchange Offer.
(m) To comply with all of its agreements set forth in the
Registration Rights Agreement and all agreements set forth in the representation
letters of the Company to DTC relating to the approval of the Senior Notes by
DTC for "book-entry" transfer.
(n) To use its best efforts to effect the inclusion of the
Senior Notes in PORTAL and to obtain approval of the Senior Notes by DTC for
"book-entry" transfer.
(o) During a period of five years following the Closing Date,
to deliver without charge to each of the Initial Purchasers, as they may
reasonably request, promptly upon their becoming available, copies of (i) all
reports or other publicly available information that the Company shall mail or
otherwise
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make available to its stockholders and (ii) all reports, financial statements
and proxy or information statements filed by the Company with the Commission or
any national securities exchange and such other publicly available information
concerning the Company or its Subsidiaries, including without limitation, press
releases.
(p) Prior to the Closing Date, to furnish to each of the
Initial Purchasers, as soon as they have been prepared in the ordinary course by
the Company, copies of any consolidated financial statements or any unaudited
interim financial statements of the Company for any period subsequent to the
periods covered by the financial statements appearing in the Offering
Memorandum.
(q) Neither the Company nor any of its subsidiaries will take,
directly or indirectly, any action designed to, or that might reasonably be
expected to, cause or result in stabilization or manipulation of the price of
any security of the Company to facilitate the sale or resale of the Senior
Notes. Except as permitted by the Act, the Company will not distribute any
preliminary offering memorandum, offering memorandum or other offering material
in connection with the offering and sale of the Senior Notes.
(r) To comply with the agreements in the Indenture, the
Registration Rights Agreement, and any other Operative Document.
(s) Not to engage in any directed selling efforts with respect
to the Senior Notes within the meaning of Regulation S, and that the Company and
each person acting on behalf of the Company has complied and will comply with
the offering restrictions requirement of Regulation S.
5. Representations and Warranties. (a) The Company represents
and warrants to each of the Initial Purchasers that:
(i) The Preliminary Offering Memorandum and the Offering Memorandum
have been prepared in connection with the Exempt Resales. The Preliminary
Offering Memorandum and the Offering Memorandum do not, and any supplement or
amendment to them will not, contain any untrue statement of a material fact or
omit to state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, except that the representations and warranties contained in this
paragraph shall not apply to statements in or omissions from the Preliminary
Offering Memorandum and the Offering Memorandum (or any supplement or amendment
thereto) made in reliance upon and in conformity with information relating to
the Initial Purchasers furnished to the Company in writing by the Initial
Purchasers expressly for use therein. No stop order preventing the use of the
Preliminary Offering Memorandum or the Offering Memorandum, or any amendment or
supplement thereto, or any order asserting that any of the transactions
contemplated by this Agreement are subject to the registration requirements of
the Act, has been issued.
(ii) When the Senior Notes are issued and delivered pursuant to this
Agreement, no Senior Notes will be of the same class (within the meaning of Rule
144A under the Act) as securities of the Company that are listed on a national
securities exchange registered under Section 6 of the Exchange Act or that are
quoted in a United States automated inter-dealer quotation system.
(iii) Each of the Company and the Subsidiaries (A) has been duly
organized, is
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validly existing as a corporation in good standing under the laws of its
respective jurisdiction of incorporation, (B) has all requisite corporate power
and authority to carry on its business as it is currently being conducted and as
described in the Offering Memorandum and to own, lease and operate its
properties, and (C) is duly qualified and in good standing as a foreign
corporation authorized to do business in each jurisdiction in which the nature
of its business or its ownership or leasing of property requires such
qualification except, with respect to this clause (C), where the failure to be
so qualified or in good standing does not and could not reasonably be expected
to (x) individually or in the aggregate, result in a material adverse effect on
the properties, business, results of operations, condition (financial or
otherwise), affairs or prospects of the Company and the Subsidiaries, taken as a
whole, (y) interfere with or adversely affect the issuance or marketability of
the Senior Notes pursuant hereto or (z) in any manner draw into question the
validity of this Agreement or any other Operative Document or the transactions
described in the Offering Memorandum under the caption "Use of Proceeds" (any of
the events set forth in clauses (x), (y) or (z), a "Material Adverse Effect").
The Company has no direct or indirect subsidiaries as of the Closing Date other
than the Subsidiaries.
(iv) All of the outstanding shares of capital stock of the Company
have been duly authorized, validly issued, and are fully paid and nonassessable
and were not issued in violation of any preemptive or similar rights. At March
31, 1998, on a combined basis, after giving effect to the issuance and sale of
the Senior Notes pursuant hereto and to the events stated therein, the Company
had an authorized and outstanding consolidated capitalization as set forth in
the Offering Memorandum under the caption "Capitalization."
(v) All of the outstanding capital stock of the Subsidiaries is owned
by the Company, free and clear of any security interest, claim, lien, limitation
on voting rights or encumbrance. Except as disclosed in the Offering Memorandum
there are not currently, and will not be as a result of the Offering, any
outstanding subscriptions, rights, warrants, calls, commitments of sale or
options to acquire (other than options issued pursuant to the Company's stock
option plans, the 160,000 warrants each to purchase 2.19 shares of Common Stock,
a warrant to purchase 100,000 shares of Common Stock, the 7% Series D Junior
Convertible Preferred Stock and the Series E Preferred Stock, and noting that at
present rights trade with the Common Stock), or instruments convertible into or
exchangeable for, any capital stock or other equity interest of the Company or
any Subsidiary.
(vi) The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under this Agreement, the
Indenture, the Registration Rights Agreement, and the other Operative Documents
and to consummate the transactions contemplated hereby and thereby, including,
without limitation, the corporate power and authority to issue, sell and deliver
the Senior Notes as provided herein and therein.
(vii) This Agreement has been duly and validly authorized, executed
and delivered by the Company and is the legal, valid and binding agreement of
the Company, enforceable against it in accordance with its terms, except insofar
as indemnification and contribution provisions may be limited by applicable law
or equitable principles and subject to applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization or similar laws affecting the rights of
creditors generally and subject to general principles of equity.
(viii) The Indenture has been duly and validly authorized by the
Company and, when
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duly executed and delivered by the Company, will be the legal, valid and binding
obligation of the Company, enforceable against the Company in accordance with
its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization or similar laws affecting the rights of creditors generally and
subject to general principles of equity. The Offering Memorandum contains a fair
summary of the terms of the Indenture.
(ix) The Senior Notes have been duly and validly authorized by the
Company, and have been duly and validly authorized for issuance and sale to the
Initial Purchasers by the Company pursuant to this Agreement and, when issued
and authenticated in accordance with the terms of the Indenture and delivered
against payment therefor in accordance with the terms hereof and thereof, will
be the legal, valid and binding obligations of the Company, enforceable against
the Company in accordance with their terms and entitled to the benefits of the
Indenture, subject to applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization or similar laws affecting the rights of creditors generally and
subject to general principles of equity. The Offering Memorandum contains a fair
summary of the terms of the Senior Notes.
(x) The Exchange Notes have been duly and validly authorized for
issuance by the Company and, when issued and authenticated in accordance with
the terms of the Exchange Offer and the Indenture, will be the legal, valid and
binding obligations of the Company, enforceable against the Company in
accordance with their terms and entitled to the benefits of the Indenture,
subject to applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization or similar laws affecting the rights of creditors generally and
subject to general principles of equity. The Offering Memorandum contains a fair
summary of the terms of the Exchange Notes.
(xi) The Registration Rights Agreement has been duly and validly
authorized by the Company and, when duly executed and delivered by the Company,
will be the legal, valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms, subject to applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization or similar laws
affecting the rights of creditors generally and subject to general principles of
equity. The Offering Memorandum contains a fair summary of the terms of the
Registration Rights Agreement.
(xii) None of the Company or any of the Subsidiaries is and, after
giving effect to the Offering, will not be (A) in violation of its charter or
bylaws, (B) in default in the performance of any bond, debenture, note,
indenture, mortgage, deed of trust or other agreement or instrument to which it
is a party or by which it is bound or to which any of its properties is subject,
or (C) in violation of any local, state or Federal law, statute, ordinance,
rule, regulation, requirement, judgment or court decree (including, without
limitation, the Communications Act and the rules and regulations of the FCC and
environmental laws, statutes, ordinances, rules, regulations, judgments or court
decrees) applicable to the Company or any Subsidiary or any of their assets or
properties (whether owned or leased) other than, in the case of clauses (B) and
(C), any default or violation that (i) could not reasonably be expected to have
a Material Adverse Effect or (2) which is disclosed in the Offering Memorandum.
There exists no condition that, with notice, the passage of time or otherwise,
would constitute a default under any such document or instrument, except as
disclosed in the Offering Memorandum.
(xiii) None of (A) the execution, delivery or performance by the
Company of this Agreement and the other Operative Documents, (B) the issuance
and sale of the Senior Notes and (C)
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consummation by the Company and the Subsidiaries of the transactions described
in the Offering Memorandum under the caption "Use of Proceeds" violate, conflict
with or constitute a breach of any of the terms or provisions of, or a default
under (or an event that with notice or the lapse of time, or both, would
constitute a default), or require consent under, or result in the imposition of
a lien or encumbrance on any properties of the Company or any Subsidiary, or an
acceleration of any indebtedness of the Company or any Subsidiary pursuant to,
(i) the charter or bylaws of the Company or any Subsidiary, (ii) any bond,
debenture, note, indenture, mortgage, deed of trust or other agreement or
instrument to which the Company or any Subsidiary is a party or by which any of
them or their property is or may be bound, (iii) any statute, rule or regulation
applicable to the Company or any Subsidiary or any of their respective assets or
properties or (iv) any judgment, order or decree of any court or governmental
agency or authority having jurisdiction over the Company or the Subsidiaries or
any of their assets or properties, except in the case of clauses (ii), (iii) and
(iv) for such violations conflicts, breaches, defaults, consents, impositions of
liens or accelerations that (x) would not singly, or in the aggregate, have a
Material Adverse Effect or (y) which are disclosed in the Offering Memorandum.
Other than as described in the Offering Memorandum, no consent, approval,
authorization or order of, or filing, registration, qualification, license or
permit of or with, (A) any court or governmental agency, body or administrative
agency (including, without limitation, the FCC) or (B) any other person is
required for (1) the execution, delivery and performance by the Company of this
Agreement and the other Operative Documents, (2) the issuance and sale of the
Senior Notes and the transactions contemplated hereby and thereby, except (x)
such as have been obtained and made (or, in the case of the Registration Rights
Agreement, will be obtained and made) under the Act, the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act") and state securities or Blue Sky
laws and regulations or such as may be required by the NASD or (y) where the
failure to obtain any such consent, approval, authorization or order of, or
filing registration, qualification, license or permit would not reasonably be
expected to result in a Material Adverse Effect.
(xiv) There is (i) no action, suit or proceeding before or by any
court, arbitrator or governmental agency, body or official, domestic or foreign,
now pending or, to the best knowledge of the Company or any Subsidiary,
threatened or contemplated to which the Company or any of the Subsidiaries is a
party or to which the business or property of the Company or any Subsidiary is
subject, (ii) no statute, rule, regulation or order that has been enacted,
adopted or issued by any governmental agency or that has been proposed by any
governmental body or (iii) no injunction, restraining order or order of any
nature by a federal or state court or foreign court of competent jurisdiction to
which the Company or any Subsidiary is or may be subject or to which the
business, assets, or property of the Company or any Subsidiary are or may be
subject, that, in the case of clauses (i), (ii) and (iii) above, (w) is required
to be disclosed in the Preliminary Offering Memorandum and the Offering
Memorandum and that is not so disclosed, or (x) could reasonably be expected to
individually or in the aggregate, result in a Material Adverse Effect.
(xv) No action has been taken and no statute, rule, regulation or
order has been enacted, adopted or issued by any governmental agency that
prevents the issuance of the Senior Notes or prevents or suspends the use of the
Offering Memorandum; no injunction, restraining order or order of any nature by
a federal or state court of competent jurisdiction has been issued that prevents
the issuance of the Senior Notes or prevents or suspends the sale of the Senior
Notes in any jurisdiction referred to in Section 4(e) hereof; and every request
of any securities authority or agency of any jurisdiction for additional
information has been complied with in all material respects.
(xvi) Except as set forth in the Offering Memorandum, there is (i) no
significant
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unfair labor practice complaint pending against the Company or any Subsidiary
nor, to the best knowledge of the Company, threatened against any of them,
before the National Labor Relations Board, any state or local labor relations
board or any foreign labor relations board, and no significant grievance or
significant arbitration proceeding arising out of or under any collective
bargaining agreement is so pending against the Company or any Subsidiary to the
best knowledge of the Company, threatened against any of them, (ii) no
significant strike, labor dispute, slowdown or stoppage pending against the
Company or any Subsidiary nor, to the best knowledge of the Company, threatened
against the Company or any Subsidiary and (iii) to the best knowledge of the
Company, no union representation question existing with respect to the employees
of the Company or any Subsidiary that, in the case of clauses (i), (ii) or
(iii), could reasonably be expected to result in a Material Adverse Effect. To
the best knowledge of the Company, no collective bargaining organizing
activities are taking place with respect to the Company or the Subsidiaries.
None of the Company or any Subsidiary has violated (A) any federal, state or
local law or foreign law relating to discrimination in hiring, promotion or pay
of employees (except as set forth in the Offering Memorandum), (B) any
applicable wage or hour laws or (C) any provision of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), or the rules and regulations
thereunder, which in the case of clause (A), (B) or (C) above could reasonably
be expected to result in a Material Adverse Effect.
(xvii) None of the Company or any Subsidiary has violated any
environmental, safety or similar law or regulation applicable to it or its
business or property relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), lacks any permit, license or other approval
required of it under applicable Environmental Laws or is violating any term or
condition of such permit, license or approval which could reasonably be expected
to, either individually or in the aggregate, have a Material Adverse Effect.
(xviii) Each of the Company and the Subsidiaries has (i) good and
marketable title to all of the properties and assets described in the Offering
Memorandum as owned by it, free and clear of all liens, charges, encumbrances
and restrictions, except such as are described in the Offering Memorandum or as
would not have a Material Adverse Effect, (ii) peaceful and undisturbed
possession under all material leases to which any of them is a party as lessee,
(iii) all licenses, certificates, permits, authorizations, approvals, franchises
and other rights from, and has made all declarations and filings with, all
federal, state and local authorities (including, without limitation, the FCC),
all self-regulatory authorities and all courts and other tribunals (each an
"Authorization") necessary to engage in the business conducted by any of them in
the manner described in the Offering Memorandum, except as described in the
Offering Memorandum or where failure to hold such Authorizations would not,
individually or in the aggregate, have a Material Adverse Effect and (iv) no
reason to believe that any governmental body or agency is considering limiting,
suspending or revoking any such Authorization. Except where the failure to be in
full force and effect would not have a Material Adverse Effect, all such
Authorizations are valid and in full force and effect and each of the Company
and the Subsidiaries is in compliance in all material respects with the terms
and conditions of all such Authorizations and with the rules and regulations of
the regulatory authorities having jurisdiction with respect thereto. All
material leases to which the Company and the Subsidiaries is a party are valid
and binding and no default by the Company or any Subsidiary has occurred and is
continuing thereunder and, to the best knowledge of the Company and the
Subsidiaries, no material defaults by the landlord are existing under any such
lease that could reasonably be expected to result in a Material Adverse Effect.
(xix) Each of the Company and the Subsidiaries owns, possesses or has
the right to
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employ all patents, patent rights, licenses (including all FCC, state, local or
other jurisdictional regulatory licenses), inventions, copyrights, know-how
(including trade secrets and other unpatented and/or unpatentable proprietary or
confidential information, software, systems or procedures), trademarks, service
marks and trade names, inventions, computer programs, technical data and
information (collectively, the "Intellectual Property") presently employed by it
or its subsidiaries in connection with the businesses now operated by it or
which are proposed to be operated by it or its subsidiaries free and clear of
and without violating any right, claimed right, charge, encumbrance, pledge,
security interest, restriction or lien of any kind of any other person and none
of the Company or any Subsidiary has received any notice of infringement of or
conflict with asserted rights of others with respect to any of the foregoing
except as could not reasonably be expected to have a Material Adverse Effect.
The use of the Intellectual Property in connection with the business and
operations of the Company and the Subsidiaries does not infringe on the rights
of any person, except as could not reasonably be expected to have a Material
Adverse Effect.
(xx) None of the Company or any Subsidiary, or to the best knowledge
of the Company, any of their respective officers, directors, partners,
employees, agents or affiliates or any other person acting on behalf of the
Company or any Subsidiary has, directly or indirectly, given or agreed to give
any money, gift or similar benefit (other than legal price concessions to
customers in the ordinary course of business) to any customer, supplier,
employee or agent of a customer or supplier, official or employee of any
governmental agency (domestic or foreign), instrumentality of any government
(domestic or foreign) or any political party or candidate for office (domestic
or foreign) or other person who was, is or may be in a position to help or
hinder the business of the Company and any Subsidiary (or assist the Company or
any Subsidiary in connection with any actual or proposed transaction) which (i)
might subject the Company or any Subsidiary, or any other individual or entity
to any damage or penalty in any civil, criminal or governmental litigation or
proceeding (domestic or foreign), (ii) if not given in the past, might have had
a material adverse effect on the assets, business or operations of the Company
or any Subsidiary or (iii) if not continued in the future, might have a Material
Adverse Effect.
(xxi) All material tax returns required to be filed by the Company and
each of the Subsidiaries in all jurisdictions have been so filed. All taxes,
including withholding taxes, penalties and interest, assessments, fees and other
charges due or claimed to be due from such entities or that are due and payable
have been paid, other than those being contested in good faith and for which
adequate reserves have been provided or those currently payable without penalty
or interest. To the knowledge of the Company, there are no material proposed
additional tax assessments against the Company, the assets or property of the
Company or any Subsidiary.
(xxii) None of the Company or the Subsidiaries is (i) an "investment
company" or a company "controlled" by an "investment company" within the meaning
of the Investment Company Act of 1940, as amended (the "Investment Company
Act"), or (ii) a "holding company" or a "subsidiary company" or an "affiliate"
of a holding company within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
(xxiii) Except as disclosed in the Offering Memorandum, there are no
holders of securities of the Company or the Subsidiaries who, by reason of the
execution by the Company of this Agreement or any other Operative Document to
which it is a party or the consummation by the Company of the transactions
contemplated hereby and thereby, have the right to request or demand that the
Company or any of the Subsidiaries register under the Act or analogous foreign
laws and regulations securities held
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by them.
(xxiv) Each of the Company and the Subsidiaries maintains a system of
internal accounting controls sufficient to provide reasonable assurance that:
(i) transactions are executed in accordance with management's general or
specific authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets; (iii) access to
assets is permitted only in accordance with management's general or specific
authorization and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect thereto.
(xxv) Each of the Company and the Subsidiaries maintains insurance
covering its properties, operations, personnel and businesses. Such insurance
insures against such losses and risks as are adequate in accordance with
customary industry practice to protect the Company and the Subsidiaries and
their respective businesses. None of the Company or any Subsidiary has received
notice from any insurer or agent of such insurer that substantial capital
improvements or other expenditures will have to be made in order to continue
such insurance. All such insurance is outstanding and duly in force on the date
hereof, subject only to changes made in the ordinary course of business,
consistent with past practice, which do not, singly or in the aggregate,
materially alter the coverage thereunder or the risks covered thereby.
(xxvi) None of the Company or any Subsidiary has (i) taken, directly
or indirectly, any action designed to, or that might reasonably be expected to,
cause or result in stabilization or manipulation of the price of any security of
the Company to facilitate the sale or resale of the Senior Notes or (ii) since
the date of the Preliminary Offering Memorandum (A) sold, bid for, purchased or
paid any person any compensation for soliciting purchases of, the Senior Notes
or (B) paid or agreed to pay to any person any compensation for soliciting
another to purchase any other securities of the Company.
(xxvii) No registration under the Act of the Senior Notes is required
for the sale thereof to the Initial Purchasers as contemplated hereby or for the
Exempt Resales assuming (i) that the purchasers who buy the Senior Notes in the
Exempt Resales are Eligible Purchasers and (ii) the accuracy of the Initial
Purchasers' representations regarding the absence of general solicitation in
connection with the sale of Senior Notes to the Initial Purchasers and the
Exempt Resales contained herein. No form of general solicitation or general
advertising was used by the Company or any of its representatives (other than
the Initial Purchasers, as to which the Company makes no representation or
warranty) in connection with the offer and sale of any of the Senior Notes in
connection with Exempt Resales, including, but not limited to, articles, notices
or other communications published in any newspaper, magazine, or similar medium
or broadcast over television or radio, or any seminar or meeting whose attendees
have been invited by any general solicitation or general advertising.
(xxviii) Set forth on Exhibit A hereto is a list of each employee
pension or benefit plan with respect to which the Company or any corporation
considered an affiliate of the Company within the meaning of Section 407(d)(7)
of ERISA (an "ERISA Affiliate") is a party in interest or disqualified person.
The execution and delivery of this Agreement, the other Operative Documents and
the sale of the Senior Notes to be purchased by the Eligible Purchasers will not
involve any prohibited transaction within the meaning of Section 406 of ERISA or
Section 4975 of the Internal Revenue Code of 1986. The
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representation made by the Company in the preceding sentence is made in reliance
upon and subject to the accuracy of, and compliance with, the representations
and covenants made or deemed made by the Eligible Purchasers as set forth in the
Offering Memorandum under the caption "Notice to Investors."
(xxix) Each of the Preliminary Offering Memorandum and the Offering
Memorandum, as of its date, and each amendment or supplement thereto, as of its
date, contains the information specified in, and meets the requirements of, Rule
144A(d)(4) under the Act.
(xxx) Subsequent to the respective dates as of which information is
given in the Offering Memorandum and up to the Closing Date, except as set forth
in the Offering Memorandum, (i) none of the Company or any Subsidiary has
incurred any liabilities or obligations, direct or contingent, which are
material, individually or in the aggregate, to the Company and the Subsidiaries
taken as a whole, nor entered into any transaction not in the ordinary course of
business, (ii) none of the Company or any Subsidiary has incurred any
liabilities or obligations, direct or contingent, which will be material to the
Company and the Subsidiaries taken as a whole, (iii) there has not been, singly
or in the aggregate, any change or development which could reasonably be
expected to result in a Material Adverse Effect and (iv) there has been no
dividend or distribution of any kind declared, paid or made by the Company or
any of its Subsidiaries on any class of its capital stock, except for the stock
dividend payable pursuant to the two-for-one split of the Company's Common
Stock, dividends paid in respect of the Series B Redeemable Exchangeable
Preferred Stock due 2009 (the "Series B Preferred Stock") the Series D Junior
Convertible Preferred Stock (the "Series D Preferred Stock") or the Series E
Junior Convertible Preferred Stock (the "Series E Preferred Stock").
(xxxi) None of the execution, delivery and performance of this
Agreement, the issuance and sale of the Senior Notes, the application of the
proceeds from the issuance and sale of the Senior Notes and the consummation of
the transactions contemplated thereby as set forth in the Offering Memorandum,
will violate Regulations G, T, U or X promulgated by the Board of Governors of
the Federal Reserve System or analogous foreign laws and regulations.
(xxxii) To the best knowledge of the Company, each of the accountants
who have certified or will certify the financial statements included or to be
included as part of the Offering Memorandum are independent accountants. The
historical financial statements of the Company and its Subsidiaries comply as to
form in all material respects with the requirements applicable to registration
statements on Form S-1 under the Act and present fairly in all material respects
the financial position and results of operations of the Company and its
Subsidiaries at the respective dates and for the respective periods indicated.
Such financial statements have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis throughout the
periods presented. The pro forma financial statements included in the Offering
Memorandum have been prepared on a basis consistent with such historical
statements, except for the pro forma adjustments specified therein, and give
effect to assumptions made on a reasonable basis and present fairly in all
material respects the historical and proposed transactions contemplated by this
Agreement, the other Operative Documents; and such pro forma financial
statements comply as to form in all material respects with the requirements
applicable to pro forma financial statements included in registration statements
on Form S-1 under the Act. The other financial and statistical information and
data included in the Offering Memorandum, historical and pro forma, are
accurately presented in all material respects and prepared on a basis consistent
with the financial statements, historical and pro forma, included in the
Offering Memorandum and the books and
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records of the Company and its Subsidiaries, as applicable.
(xxxiii) The Company does not intend to, nor does it believe that it
will, incur debts beyond its ability to pay such debts as they mature. The
present fair saleable value of the assets of the Company on a consolidated basis
exceeds the amount that will be required to be paid on or in respect of the
existing debts and other liabilities (including contingent liabilities) of the
Company on a consolidated basis as they become absolute and matured. The assets
of the Company on a consolidated basis do not constitute unreasonably small
capital to carry out the business of the Company and the Subsidiaries, taken as
a whole, as conducted or as proposed to be conducted. Upon the issuance of the
Senior Notes, the present fair saleable value of the assets of the Company on a
consolidated basis will exceed the amount that will be required to be paid on or
in respect of the existing debts and other liabilities (including contingent
liabilities) of the Company on a consolidated basis as they become absolute and
matured. Upon the issuance of the Senior Notes, the assets of the Company on a
consolidated basis will not constitute unreasonably small capital to carry out
its businesses as now conducted, including the capital needs of the Company on a
consolidated basis, taking into account the projected capital requirements and
capital availability.
(xxxiv) Except pursuant to this Agreement, there are no contracts,
agreements or understandings between the Company and its Subsidiaries and any
other person that would give rise to a valid claim against the Company or either
of the Initial Purchasers for a brokerage commission, finder's fee or like
payment in connection with the issuance, purchase and sale of the Senior Notes.
(xxxv) Each certificate signed by any officer of the Company and
delivered to the Initial Purchasers or counsel for the Initial Purchasers shall
be deemed to be a representation and warranty by the Company to the Initial
Purchasers as to the matters covered thereby.
(xxxvi) Each of the Company and its Subsidiaries have implemented Year
2000 compliance programs designed to ensure that each respective company's
computer systems and applications will function properly beyond 1999. The
Company believes that adequate resources have been allocated for this purpose
and expects the Company's and its Subsidiaries' Year 2000 date conversion
programs to be completed on a timely basis.
The Company acknowledges that each of the Initial Purchasers and, for
purposes of the opinions to be delivered to the Initial Purchasers pursuant to
Section 8 hereof, counsel to the Company and counsel to the Initial Purchasers,
will rely upon the accuracy and truth of the foregoing representations and
hereby consents to such reliance.
(b) Each of the Initial Purchasers severally and not jointly
represents, warrants and covenants to the Company and agrees that:
(i) Such Initial Purchaser is a QIB, with such knowledge and
experience in financial and business matters as are necessary in order to
evaluate the merits and risks of an investment in the Senior Notes.
(ii) Such Initial Purchaser (A) is not acquiring the Senior Notes with
a view to any distribution thereof that would violate the Act or the securities
laws of any state of the United States or any
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other applicable jurisdiction and (B) will be reoffering and reselling the
Senior Notes only to QIBs in reliance on the exemption from the registration
requirements of the Act provided by Rule 144A.
(iii) No form of general solicitation or general advertising has been
or will be used by either of the Initial Purchasers or any of their
representatives in connection with the offer and sale of any of the Senior
Notes, including, but not limited to, articles, notices or other communications
published in any newspaper, magazine, or similar medium or broadcast over
television or radio, or any seminar or meeting whose attendees have been invited
by any general solicitation or general advertising.
(iv) Each of the Initial Purchasers agrees that, in connection with
the Exempt Resales, it will solicit offers to buy the Senior Notes only from,
and will offer to sell the Senior Notes only to, Eligible Purchasers. The
Initial Purchasers further agree (A) that they will offer to sell the Senior
Notes only to, and will solicit offers to buy the Senior Notes only from QIBs
who in purchasing such Senior Notes will be deemed to have represented and
agreed that they are purchasing the Senior Notes for their own accounts or
accounts with respect to which they exercise sole investment discretion and that
they or such accounts are QIBs and (B) that such Eligible Purchasers shall
acknowledge and agree that such Senior Notes will not have been registered under
the Act and may be resold, pledged or otherwise transferred only (i) to the
Company, (ii) pursuant to a registration statement which has been declared
effective under the Securities Act, (iii) to a person it reasonably believes is
a QIB in a transaction meeting the requirements of Rule 144A under the
Securities Act, (iv) to an institutional "accredited investor" (as defined in
Rule 501(a) (1), (2), (3) or (7) of Regulation D under the Securities Act that,
prior to such transfer, furnishes to the trustee a signed letter containing
certain representations and agreements relating to the transfer of the Senior
Notes (the form of which letter can be obtained from the Trustee) or (v)
pursuant to any other available exemption from the registration requirements of
the Securities Act (and based on an opinion of counsel if the Company so
requests) subject in each of the foregoing cases to the applicable state
securities laws of any State of the United States or any other applicable
jurisdiction and (C) that the holder will, and each subsequent holder is
required to, notify any purchaser of the security evidenced thereby of the
resale restrictions set forth in (B) above. Accordingly, each of the Initial
Purchasers agrees that neither it, its affiliates nor any persons acting on its
behalf has engaged or will engage in any directed selling efforts within the
meaning of Rule 902 of Regulation S with respect to the Senior Notes and it, its
affiliates and all persons acting on its or their behalf have complied and will
comply with the offering restrictions requirements of Regulation S.
(v) Each of the Initial Purchasers understands that the Company and,
for purposes of the opinions to be delivered to the Initial Purchasers pursuant
to Section 8 hereof, counsel to the Company and counsel to the Initial
Purchasers will rely upon the accuracy and truth of the foregoing
representations and hereby consents to such reliance.
6. Indemnification.
(a) The Company agrees to indemnify and hold harmless (i) each
of the Initial Purchasers, (ii) each person, if any, who controls either of the
Initial Purchasers within the meaning of Section 15 of the Act or Section 20(a)
of the Exchange Act and (iii) the respective officers, directors, partners,
employees, representatives and agents of any of the Initial Purchasers or any
controlling person to the fullest extent lawful, from and against any and all
losses, liabilities, claims, damages and expenses whatsoever (including but not
limited to attorneys' fees and any and all expenses whatsoever incurred in
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investigating, preparing or defending against any investigation or litigation,
commenced or threatened, or any claim whatsoever, and any and all amounts paid
in settlement of any claim or litigation), joint or several, to which they or
any of them may become subject under the Act, the Exchange Act or otherwise,
insofar as such losses, liabilities, claims, damages or expenses (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in the Preliminary Offering
Memorandum or the Offering Memorandum, or in any supplement thereto or amendment
thereof, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that the Company will not be liable in
any such case to the extent, but only to the extent, that (i) any such loss,
liability, claim, damage or expense arises out of or is based upon any such
untrue statement or alleged untrue statement or omission or alleged omission
made therein in reliance upon and in conformity with written information
furnished to the Company by or on behalf of the Initial Purchasers expressly for
use therein and (ii) the foregoing indemnity with respect to any untrue
statement contained in or omitted from a preliminary offering memorandum shall
not inure to the benefit of any Initial Purchaser (or any person controlling
such Initial Purchaser), from whom the person asserting any such loss,
liability, claim, damage or expense purchased any of the Senior Notes which are
the subject thereof if it is finally judicially determined that such loss,
liability, claim, damage or expense resulted solely from the fact that the
Initial Purchaser sold Senior Notes to a person to whom there was not sent or
given, at or prior to the written confirmation of such sale, a copy of the
Offering Memorandum, as amended or supplemented, and (x) the Company shall have
previously and timely furnished sufficient copies of the Offering Memorandum, as
so amended or supplemented, to such Initial Purchaser in accordance with this
Agreement and (y) the Offering Memorandum, as so amended or supplemented, would
have corrected such untrue statement or omission of a material fact. This
indemnity agreement will be in addition to any liability which the Company may
otherwise have, including, under this Agreement.
(b) Each Initial Purchaser, severally and not jointly, agrees
to indemnify and hold harmless the Company and each person, if any, who controls
the Company within the meaning of Section 15 of the Act or Section 20(a) of the
Exchange Act, against any losses, liabilities, claims, damages and expenses
whatsoever (including but not limited to attorneys' fees and any and all
expenses whatsoever incurred in investigating, preparing or defending against
any investigation or litigation, commenced or threatened, or any claim
whatsoever and any and all amounts paid in settlement of any claim or
litigation), joint or several, to which they or any of them may become subject
under the Act, the Exchange Act or otherwise, insofar as such losses,
liabilities, claims, damages or expenses (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the Preliminary Offering Memorandum or the Offering
Memorandum, or in any amendment thereof or supplement thereto, or arise out of
or are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading, in
each case to the extent, but only to the extent, that any such loss, liability,
claim, damage or expense arises out of or is based upon any untrue statement or
alleged untrue statement or omission or alleged omission made therein in
reliance upon and in conformity with written information furnished to the
Company by or on behalf of either Initial Purchaser expressly for use therein;
provided, however, that in no case shall either Initial Purchaser be liable or
responsible for any amount in excess of the discounts and commissions received
by such Initial Purchaser, as set forth on the cover page of the Offering
Memorandum. This indemnity will be in addition to any liability which either
Initial Purchaser may otherwise have, including under this Agreement.
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(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify each party against whom
indemnification is to be sought in writing of the commencement thereof (but the
failure so to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 6 except to the extent that it
has been prejudiced in any material respect by such failure or from any
liability which it may otherwise have). In case any such action is brought
against any indemnified party, and it notifies an indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein, and to the extent it may elect by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party. Notwithstanding the foregoing, the
indemnified party or parties shall have the right to employ its or their own
counsel in any such case, but the fees and expenses of such counsel shall be at
the expense of such indemnified party or parties unless (i) the employment of
such counsel shall have been authorized in writing by the indemnifying parties
in connection with the defense of such action, (ii) the indemnifying parties
shall not have employed counsel to take charge of the defense of such action
within a reasonable time after notice of commencement of the action, or (iii)
such indemnified party or parties shall have reasonably concluded that there may
be defenses available to it or them which are different from or additional to
those available to one or all of the indemnifying parties (in which case the
indemnifying party or parties shall not have the right to direct the defense of
such action on behalf of the indemnified party or parties), in any of which
events such fees and expenses of counsel shall be borne by the indemnifying
parties; provided, however, that the indemnifying party under subsection (a) or
(b) above, shall only be liable for the legal expenses of one counsel (in
addition to any local counsel) for all indemnified parties in each jurisdiction
in which any claim or action is brought. Anything in this subsection to the
contrary notwithstanding, an indemnifying party shall not be liable for any
settlement of any claim or action effected without its prior written consent;
provided, however, that such consent was not unreasonably withheld.
7. Contribution. In order to provide for contribution in
circumstances in which the indemnification provided for in Section 6 is for any
reason held to be unavailable from the Company or is insufficient to hold
harmless a party indemnified thereunder, the Company and the Initial Purchasers
shall contribute to the aggregate losses, claims, damages, liabilities and
expenses of the nature contemplated by such indemnification provision (including
any investigation, legal and other expenses incurred in connection with, and any
amount paid in settlement of, any action, suit or proceeding or any claims
asserted, but after deducting in the case of losses, claims, damages,
liabilities and expenses suffered by the Company, any contribution received by
the Company from persons, other than the Initial Purchasers, who may also be
liable for contribution, including persons who control the Company within the
meaning of Section 15 of the Act or Section 20(a) of the Exchange Act) to which
the Company and one or both of the Initial Purchasers may be subject, in such
proportion as is appropriate to reflect the relative benefits received by the
Company and the Initial Purchasers from the offering of the Senior Notes or, if
such allocation is not permitted by applicable law or indemnification is not
available as a result of the indemnifying party not having received notice as
provided in Section 6, in such proportion as is appropriate to reflect not only
the relative benefits referred to above but also the relative fault of the
Company and the Initial Purchasers in connection with the statements or
omissions which resulted in such losses, claims, damages, liabilities or
expenses, as well as any other relevant equitable considerations. The relative
benefits received by the Company and the Initial Purchasers shall be deemed to
be in the same proportion as (x) the total proceeds from the offering of Senior
Notes (net of discounts but before deducting expenses) received by the Company
and (y) the
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discounts received by the Initial Purchasers, respectively, in each case as set
forth in the table on the cover page of the Offering Memorandum. The relative
fault of the Company and of the Initial Purchasers 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 the Initial Purchasers and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company and the Initial
Purchasers agree that it would not be just and equitable if contribution
pursuant to this Section 7 were determined by pro rata allocation or by any
other method of allocation which does not take into account the equitable
considerations referred to above. Notwithstanding the provisions of this Section
7, (i) in no case shall either of the Initial Purchasers be required to
contribute any amount in excess of the amount by which the discount applicable
to the Senior Notes purchased by such Initial Purchaser pursuant to this
Agreement exceeds the amount of any damages which such Initial Purchaser has
otherwise been required to pay by reason of any untrue or alleged untrue
statement or omission or alleged omission and (ii) no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 7, (A) each person,
if any, who controls either of the Initial Purchasers within the meaning of
Section 15 of the Act or Section 20(a) of the Exchange Act and (B) the
respective officers, directors, partners, employees, representatives and agents
of any of the Initial Purchasers or any controlling person shall have the same
rights to contribution as such Initial Purchaser, and each person, if any, who
controls the Company within the meaning of Section 15 of the Act or Section
20(a) of the Exchange Act shall have the same rights to contribution as the
Company, subject in each case to clauses (i) and (ii) of this Section 7. Any
party entitled to contribution will, promptly after receipt of notice of
commencement of any action, suit or proceeding against such party in respect of
which a claim for contribution may be made against another party or parties
under this Section 7, notify such party or parties from whom contribution may be
sought, but the failure to so notify such party or parties shall not relieve the
party or parties from whom contribution may be sought from any obligation it or
they may have under this Section 7 or otherwise. No party shall be liable for
contribution with respect to any action or claim settled without its prior
written consent; provided, however, that such written consent was not
unreasonably withheld.
8. Conditions of Initial Purchasers' Obligations. The several
obligations of the Initial Purchasers to purchase and pay for the Senior Notes,
as provided herein, shall be subject to the satisfaction of the following
conditions, except that with respect to the Additional Notes, references to the
term Closing Date shall mean the Option Closing Date:
(a) All of the representations and warranties of the Company
contained in this Agreement shall be true and correct on the date hereof and on
the Closing Date with the same force and effect as if made on and as of the date
hereof and the Closing Date, respectively. The Company shall have performed or
complied with all of the agreements herein contained and required to be
performed or complied with by it at or prior to the Closing Date.
(b) The Offering Memorandum shall have been printed and copies
distributed to the Initial Purchasers not later than 10:00 a.m., New York City
time, on the day following the date of this Agreement or at such later date and
time as to which the Initial Purchasers may agree, and no stop order suspending
the qualification or exemption from qualification of the Senior Notes in any
jurisdiction referred to in Section 4(e) shall have been issued and no
proceeding for that purpose shall have been commenced or shall be pending or
threatened.
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(c) No action shall have been taken and no statute, rule,
regulation or order shall have been enacted, adopted or issued by any
governmental agency which would, as of the Closing Date, prevent the issuance of
the Senior Notes; no action, suit or proceeding shall have been commenced and be
pending against or affecting or, to the best knowledge of the Company,
threatened against, the Company or the Subsidiaries before any court or
arbitrator or any governmental body, agency or official that (1) could
reasonably be expected to result in a Material Adverse Effect or (2) has not
been disclosed in the Offering Memorandum; and no stop order shall have been
issued preventing the use of the Offering Memorandum, or any amendment or
supplement thereto, or which could reasonably be expected to have a Material
Adverse Effect.
(d) Since the dates as of which information is given in the
Offering Memorandum and except as contemplated by the Offering Memorandum, (i)
there shall not have been any material adverse change, or any development that
is reasonably likely to result in a material adverse change, in the capital
stock or the long-term debt, or material increase in the short-term debt, of the
Company or the Subsidiaries from that set forth in the Offering Memorandum, (ii)
no dividend or distribution of any kind shall have been declared, paid or made
by the Company or any Subsidiary on any class of its capital stock, except for
the stock dividend payable pursuant to the two-for-one split of the Company's
Common Stock, dividends paid in respect of the Series B Preferred Stock, the
Series D Preferred Stock or the Series E Preferred Stock, (iii) neither the
Company nor any Subsidiary shall have incurred any liabilities or obligations,
direct or contingent, that are material, individually or in the aggregate, to
the Company and the Subsidiaries, taken as a whole, and that are required to be
disclosed on a balance sheet or notes thereto in accordance with generally
accepted accounting principles and are not disclosed on the latest balance sheet
or notes thereto included in the Offering Memorandum. Since the date hereof and
since the dates as of which information is given in the Offering Memorandum,
there shall not have occurred any Material Adverse Effect.
(e) The Initial Purchasers shall have received a certificate,
dated the Closing Date, signed on behalf of the Company by (i) Xxxxx X. Xxxxxx,
Chairman of the Board, President and Chief Executive Officer and (ii) Xxxxxx
Xxxxxxx, Senior Vice President and Chief Financial Officer, in form and
substance reasonably satisfactory to the Initial Purchasers, confirming, as of
the Closing Date, the matters set forth in paragraphs (a), (b), (c) and (d) of
this Section 8 and that, as of the Closing Date, the obligations of the Company
to be performed hereunder on or prior thereto have been duly performed in all
material respects.
(f) The Initial Purchasers shall have received on the Closing
Date an opinion, dated the Closing Date, in form and substance satisfactory to
the Initial Purchasers and counsel to the Initial Purchasers, of Kronish, Lieb,
Weiner & Xxxxxxx LLP, counsel for the Company, to the effect set forth in
Exhibit B hereto.
(g) The Initial Purchasers shall have received on the Closing
Date an opinion, dated the Closing Date, in form and substance satisfactory to
the Initial Purchasers and counsel to the Initial Purchasers, of Xxxxxx, Xxxx &
Xxxxxx, special regulatory counsel to the Company, to the effect set forth in
Exhibit C hereto.
(h) The Initial Purchasers shall have received an opinion,
dated the Closing Date, in form and substance reasonably satisfactory to the
Initial Purchasers, of Xxxxxx & Xxxxxxx, counsel to the Initial Purchasers,
covering such matters as are customarily covered in such opinions.
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(i) At the time this Agreement is executed and at the Closing
Date the Initial Purchasers shall have received from Ernst & Young LLP,
independent public accountants for the Company and its Subsidiaries, dated as of
the date of this Agreement and as of the Closing Date, customary comfort letters
addressed to the Initial Purchasers and in form and substance satisfactory to
the Initial Purchasers and counsel to the Initial Purchasers with respect to the
financial statements and certain financial information of the Company and its
Subsidiaries contained in the Offering Memorandum.
(j) Xxxxxx & Xxxxxxx shall have been furnished with such
documents, in addition to those set forth above, as they may reasonably require
for the purpose of enabling them to review or pass upon the matters referred to
in this Section 8 and in order to evidence the accuracy, completeness or
satisfaction in all material respects of any of the representations, warranties
or conditions herein contained.
(k) Prior to the Closing Date, the Company and the
Subsidiaries shall have furnished to the Initial Purchasers such further
information, certificates and documents as the Initial Purchasers may reasonably
request.
(l) The Company and the Trustee shall have entered into the
Indenture and the Initial Purchasers shall have received counterparts, conformed
as executed, thereof.
(m) The Company shall have entered into the Registration
Rights Agreement and the Initial Purchasers shall have received counterparts,
conformed as executed, thereof.
All opinions, certificates, letters and other documents
required by this Section 8 to be delivered by the Company will be in compliance
with the provisions hereof only if they are reasonably satisfactory in form and
substance to the Initial Purchasers. The Company will furnish the Initial
Purchasers with such conformed copies of such opinions, certificates, letters
and other documents as it shall reasonably request.
9. Initial Purchasers' Information. The Company and the
Initial Purchasers severally acknowledge that the statements with respect to the
offering of the Senior Notes set forth in the last paragraph of the cover page,
and the third, fifth and seventh paragraphs under the caption "Plan of
Distribution" in such Offering Memorandum constitute the only information
furnished in writing by the Initial Purchasers expressly for use in the Offering
Memorandum.
10. Survival of Representations and Agreements. All
representations and warranties, covenants and agreements of the Initial
Purchasers and the Company contained in this Agreement, including the agreements
contained in Sections 4(f) and 11(d), the indemnity agreements contained in
Section 6 and the contribution agreements contained in Section 7, shall remain
operative and in full force and effect regardless of any investigation made by
or on behalf of the Initial Purchasers any controlling person thereof or by or
on behalf of the Company or any controlling person thereof, and shall survive
delivery of and payment for the Senior Notes to and by the Initial Purchasers.
The representations contained in Section 5 and the agreements contained in
Sections 4(f), 6, 7 and 11(d) shall survive the termination of this Agreement,
including any termination pursuant to Section 11.
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11. Effective Date of Agreement; Termination.
(a) This Agreement shall become effective upon execution and
delivery of a counterpart hereof by each of the parties hereto.
(b) The Initial Purchasers shall have the right to terminate
this Agreement at any time prior to the Closing Date by notice to the Company
from the Initial Purchasers, without liability (other than with respect to
Sections 6 and 7) on the Initial Purchasers' part to the Company if, on or prior
to such date, (i) the Company shall have failed, refused or been unable to
perform in any material respect any agreement on its part to be performed
hereunder, (ii) any other condition to the obligations of the Initial Purchasers
hereunder as provided in Section 8 is not fulfilled when and as required in any
material respect, (iii) in the reasonable judgment of the Initial Purchasers any
material adverse change shall have occurred since the respective dates as of
which information is given in the Offering Memorandum in the condition
(financial or otherwise), business, properties, assets, liabilities, prospects,
net worth, results of operations or cash flows of the Company and the
Subsidiaries taken as a whole, other than as set forth in the Offering
Memorandum, or (iv)(A) any domestic or international event or act or occurrence
has materially disrupted, or in the opinion of the Initial Purchasers will in
the immediate future materially disrupt, the market for the Company's securities
or for securities in general; or (B) trading in securities generally on the New
York or American Stock Exchanges shall have been suspended or materially
limited, or minimum or maximum prices for trading shall have been established,
or maximum ranges for prices for securities shall have been required, on such
exchange, or by such exchange or other regulatory body or governmental authority
having jurisdiction; or (C) a banking moratorium shall have been declared by
Federal or state authorities, or a moratorium in foreign exchange trading by
major international banks or persons shall have been declared; or (D) there is
an outbreak or escalation of armed hostilities involving the United States on or
after the date hereof, or if there has been a declaration by the United States
of a national emergency or war, the effect of which shall be, in the Initial
Purchasers' judgment, to make it inadvisable or impracticable to proceed with
the offering or delivery of the Senior Notes on the terms and in the manner
contemplated in the Offering Memorandum; or (E) there shall have been such a
material adverse change in general economic, political or financial conditions
or if the effect of international conditions on the financial markets in the
United States shall be such as, in the Initial Purchasers' judgment, makes it
inadvisable or impracticable to proceed with the delivery of the Senior Notes as
contemplated hereby.
(c) Any notice of termination pursuant to this Section 11
shall be by telephone, telex, telephonic facsimile, or telegraph, confirmed in
writing by letter.
(d) If this Agreement shall be terminated pursuant to any of
the provisions hereof (otherwise than pursuant to any of clauses (iii) or (iv)
of Section 11(b), in which case each party will be responsible for its own
expenses), or if the sale of the Senior Notes provided for herein is not
consummated because any condition to the obligations of the Initial Purchasers
set forth herein is not satisfied or because of any refusal, inability or
failure on the part of the Company to perform any agreement herein or comply
with any provision hereof, the Company will, subject to demand by the Initial
Purchasers, reimburse the Initial Purchasers for all out-of-pocket expenses
(including the reasonable fees and expenses of Initial Purchasers' counsel),
incurred by the Initial Purchasers in connection herewith.
12. Notice. All communications hereunder, except as may be
otherwise specifically provided herein, shall be in writing and, if sent to the
Initial Purchasers shall be mailed, delivered, or
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telexed, telegraphed or telecopied and confirmed in writing the Initial
Purchasers, c/o Bear, Xxxxxxx & Co. Inc., 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Corporate Finance Department, telecopy number: (000) 000-0000;
and if sent to the Company, shall be mailed, delivered or telexed, telegraphed
or telecopied and confirmed in writing to Intermedia Communications Inc., 0000
Xxxxx Xxxx Xxxxx, Xxxxx, Xxxxxxx 00000, Attention: Chief Financial Officer,
telecopy number: (000) 000-0000, with a copy to Kronish, Lieb, Weiner & Xxxxxxx
LLP, 1114 Avenue of the Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxxx X. Xxxxxxxxx; provided, however, that any notice pursuant to
Section 7 shall be mailed, delivered or telexed, telegraphed or telecopied and
confirmed in writing.
13. Parties. This Agreement shall inure solely to the benefit
of, and shall be binding upon, the Initial Purchasers and the Company and the
controlling persons and agents referred to in Sections 6 and 7, and their
respective successors and assigns, and no other person shall have or be
construed to have any legal or equitable right, remedy or claim under or in
respect of or by virtue of this Agreement or any provision herein contained. The
term "successors and assigns" shall not include a purchaser, in its capacity as
such, of Senior Notes from the Initial Purchasers.
14. Construction. This Agreement shall be construed in
accordance with the internal laws of the State of New York. TIME IS OF THE
ESSENCE IN THIS AGREEMENT.
15. Captions. The captions included in this Agreement are
included solely for convenience of reference and are not to be considered a part
of this Agreement.
16. Counterparts. This Agreement may be executed in various
counterparts which together shall constitute one and the same instrument.
[Signature page to follow]
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If the foregoing correctly sets forth the understanding among
the Initial Purchasers and the Company, please so indicate in the space provided
below for that purpose, whereupon this letter shall constitute a binding
agreement between us.
Very truly yours,
Intermedia Communications Inc.
By:________________________________
Name:
Title:
Accepted and agreed to as of
the date first above written:
BEAR, XXXXXXX & CO. INC.
By:_________________________________
Name:
Title:
SALOMON BROTHERS INC
By:_________________________________
Name:
Title:
XXXXXXX XXXXX & CO.
By:_________________________________
Name:
Title:
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SBC WARBURG DILLON READ INC.
By:_________________________________
Name:
Title:
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SCHEDULE I
Amount of
Senior
Notes to
Initial Purchaser be Purchased
----------------- ------------
Bear, Xxxxxxx & Co. Inc. $247,500,000
Salomon Brothers Inc 90,000,000
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated 90,000,000
SBC Warburg Dillon Read Inc. 22,500,000
------------
Total $450,000,000
Sched - 1
28
EXHIBIT A
List of Employee Pension and Benefit Plans
of Intermedia Communications Inc.
and its Subsidiaries
1. Intermedia Communications Inc. 401(k) Profit Sharing Plan
A-1
29
EXHIBIT B
Form of Opinion of Kronish, Lieb, Weiner & Xxxxxxx LLP
1. Each of the Company and the Subsidiaries is duly organized
and validly existing as a corporation in good standing under the laws of its
jurisdiction of incorporation, and has all requisite corporate power and
authority to carry on its business as it is being conducted and as described in
the Offering Memorandum and to own, lease and operate its properties, and is
duly qualified and in good standing as a foreign corporation authorized to do
business in each jurisdiction in which the nature of its business or its
ownership or leasing of property requires such qualification, except where the
failure to be so qualified would not, singly or in the aggregate, have a
Material Adverse Effect.
2. All of the outstanding shares of capital stock of the
Company has been duly authorized, validly issued, and are fully paid and
nonassessable and were not issued in violation of any preemptive or similar
rights under the Delaware General Corporation Law. The authorized, issued and
outstanding capital stock of the Company conforms in all respects to the
description thereof set forth in the Offering Memorandum.
3. To our knowledge, after reasonable inquiry, all of the
issued and outstanding capital stock of the Company's Subsidiaries have been
duly authorized and validly issued, are fully paid and non-assessable and were
not issued in violation of or subject to any preemptive or similar rights under
the Delaware General Corporation Law or known to us, after reasonable inquiry,
and, is owned by the Company of record, free and clear of any security interest,
claim, lien, limitation on voting rights or encumbrance. Except as set forth on
Schedule A hereto, there are not, to our knowledge, currently, and will not be
following the Offering, any outstanding subscriptions, rights, warrants, calls,
commitments of sale or options to acquire (other than options issued pursuant to
the Company's stock option plans, the 160,000 warrants each to purchase 2.19
shares of Common Stock, the 7% Series D Junior Convertible Preferred Stock and
the Series E Preferred Stock, and noting that at present rights trade with the
Common Stock), or instruments convertible into or exchangeable for, any capital
stock or other equity interest of the Company or any Subsidiary.
4. When the Senior Notes are issued and delivered pursuant to
this Agreement, no Senior Notes will be of the same class (within the meaning of
Rule 144A under the Act) as securities of the Company that are listed on a
national securities exchange registered under Section 6 of the Exchange Act or
that are quoted in a United States automated inter-dealer quotation system.
5. The Company has all requisite corporate power and authority
to execute, deliver and perform its obligations under this Agreement, the
Indenture, the Registration Rights Agreement, and the other Operative Documents,
as applicable, and to consummate the transactions contemplated thereby,
including, without limitation, the corporate power and authority to issue, sell
and deliver the Senior Notes as provided herein and therein.
6. This Agreement has been duly and validly authorized,
executed and delivered by the Company and, assuming due execution by the other
parties hereto, is the legally valid and binding agreement of the Company.
B-1
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7. Each of the Indenture and the Registration Rights Agreement
has been duly and validly authorized, executed and delivered by the Company,
and, assuming due execution by the other parties thereto, is the legal, valid
and binding obligation of the Company, enforceable against the Company in
accordance with its terms, except that we express no opinion as to the validity
or enforceability of rights of indemnity or contribution, or both and except as
such enforceability may be limited by bankruptcy, insolvency, fraudulent
conveyance, reorganization or similar laws affecting the rights of creditors
generally and subject to general principles of equity.
8. The Senior Notes have been duly and validly authorized for
issuance and sale to the Initial Purchasers by the Company pursuant to this
Agreement and, when issued and authenticated in accordance with the terms of the
Indenture and delivered against payment therefor in accordance with the terms of
this Agreement and the Indenture, assuming due execution by the other parties
thereto, will be the legal, valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms and entitled to
the benefits of the Indenture, except that we express no opinion as to the
validity or enforceability of rights of indemnity or contribution, or both, and
except as such enforceability may be limited by bankruptcy, insolvency,
fraudulent conveyance, reorganization or similar laws affecting the rights of
creditors generally and subject to general principles of equity.
9. The Exchange Notes have been duly and validly authorized
for issuance by the Company and, when issued and authenticated in accordance
with the terms of the Indenture, assuming due execution by the other parties
thereto, will be the legal, valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms and entitled to
the benefits of the Indenture, except that we express no opinion as to the
validity or enforceability of rights of indemnity or contribution, or both, and
except as such enforceability may be limited by bankruptcy, insolvency,
fraudulent conveyance, reorganization or similar laws affecting the rights of
creditors generally and subject to general principles of equity.
10. The Offering Memorandum contains a fair summary of each of
the Senior Notes, the Indenture, and the Registration Rights Agreement.
11. No registration under the Act of the Senior Notes is
required for the sale of the Senior Notes to the Initial Purchasers as
contemplated by this Agreement or for the Exempt Resales assuming (i) that the
Initial Purchasers are Qualified Institutional Buyers, as defined in Rule 144A
under the Act ("QIB"), (ii) that the purchasers who buy the Senior Notes in the
Exempt Resales are Eligible Purchasers, (iii) the accuracy of the Initial
Purchasers' representations regarding the absence of general solicitation in
connection with the sale of Senior Notes to the Initial Purchasers and the
Exempt Resales contained in this Agreement and (iv) the accuracy of the
Company's representations in Sections 5(a)(ii), (xxvi), (xxvii) (other than with
respect to the first sentence) and (xxix) of this Agreement.
12. The Offering Memorandum, as of its date (except for the
financial statements, including the notes thereto, and supporting schedules and
other financial, statistical and accounting data included therein or omitted
therefrom, as to which no opinion need be expressed), and each amendment or
supplement thereto, as of its date, contains all the information specified in,
and meets the requirements of, Rule 144A(d)(4) under the Act.
X-0
00
00. Prior to the effectiveness of the Exchange Offer
Registration Statement or the Shelf Registration Statement, the Indenture is not
required to be qualified under the Trust Indenture Act.
14. None of (A) the execution, delivery or performance by the
Company of this Agreement and the other Operative Documents, (B) the issuance
and sale of the Senior Notes or (C) consummation by the Company and the
Subsidiaries of the transactions described in the Offering Memorandum under the
caption "Use of Proceeds" will violate, conflict with or constitute a breach of
any of the terms or provisions of, or a default under (or an event that with
notice or the lapse of time, or both, would constitute a default), or require
consent under, or result in the imposition of a lien or encumbrance on any
properties of the Company or any Subsidiary, or an acceleration of any
indebtedness of the Company or any Subsidiary pursuant to, (i) the charter or
bylaws of the Company or any Subsidiary, (ii) any bond, debenture, note,
indenture, mortgage, deed of trust or other agreement or instrument to which the
Company or any Subsidiary is a party or by which any of them or their property
is or may be bound identified to such counsel as material (assuming all of such
agreements are governed by New York law), (iii) any judgment, order or decree of
any court or governmental agency or authority having jurisdiction over the
Company or any Subsidiary or any of their assets or properties known to such
counsel, except that we express no opinion as to the matters addressed by the
opinion of Xxxxxx, Xxxx & Xxxxxx LLP, and except in the case of clauses (ii) and
(iii) for such violations, conflicts, breaches, defaults, consents, impositions
of liens or accelerations that (x) would not, singly or in the aggregate, have a
Material Adverse Effect or (y) are disclosed in the Offering Memorandum.
Assuming compliance with applicable state securities and Blue Sky laws, as to
which such counsel need express no opinion, and except for the filing of a
registration statement under the Act and qualification of the Indenture under
the Trust Indenture Act of 1939, as amended, in connection with the Registration
Rights Agreement, no consent, approval, authorization or order of, or filing,
registration, qualification, license or permit of or with, any court or
governmental agency, body or administrative agency is required for (1) the
execution, delivery and performance by the Company of this Agreement and the
other Operative Documents, (2) the issuance and sale of the Senior Notes or (3)
consummation by the Company and the Subsidiaries of the transactions described
in the Offering Memorandum under the caption "Use of Proceeds," except (i) such
as have been obtained and made or have been disclosed in the Offering
Memorandum, (ii) where the failure to obtain such consents or waivers would not,
singly or in the aggregate, have a Material Adverse Effect, and (iii) we express
no opinion as to the matters addressed by the opinion of Xxxxxx, Xxxx & Xxxxxx
LLP. To the best of such counsel's knowledge, after reasonable inquiry, no
consents or waivers from any other person are required for the execution,
delivery and performance by the Company of this Agreement and the other
Operative Documents, the issuance and sale of the Senior Notes, other than such
consents and waivers as have been obtained or are being applied for.
15. None of the Company and any of its Subsidiaries is (i) an
"investment company" or a company "controlled" by an "investment company" within
the meaning of the Investment Company Act of 1940, as amended, or (ii) a
"holding company" or a "subsidiary company" or an "affiliate" of a holding
company within the meaning of the Public Utility Holding Company Act of 1935, as
amended.
16. Except as set forth in this Agreement or in the
Registration Rights Agreement, to such counsel's knowledge, after reasonable
inquiry there are no holders of any securities of the Company who, by reason of
the execution by the Company of this Agreement or any other Operative Document
to which it is a party or the consummation by the Company of the transactions
contemplated thereby, have the right to request or demand that the Company
register under the Act securities held by them.
X-0
00
00. Xxxx of the execution, delivery and performance of this
Agreement, the issuance and sale of the Senior Notes, the application of the
proceeds from the issuance and sale of the Senior Notes and the consummation of
the transactions contemplated thereby as set forth in the Offering Memorandum,
will violate Regulations G, T, U or X promulgated by the Board of Governors of
the Federal Reserve System.
18. To the knowledge of such counsel, after reasonable
inquiry, no search of courts having been made, there is (i) no action, suit,
investigation or proceeding before or by any court, arbitrator or governmental
agency, body or official, domestic or foreign, now pending, or threatened or
contemplated to which any of the Company or any Subsidiary is or may be a party
or to which the business or property of any of the Company or any Subsidiary is
or may be subject, (ii) no statute, rule, regulation or order that has been
enacted, adopted or issued by any governmental agency or that has been proposed
by any governmental body, or (iii) no injunction, restraining order or order of
any nature by a federal or state court of competent jurisdiction to which any of
the Company or any Subsidiary is or may be subject has been issued that, in the
case of clauses (i), (ii) and (iii) above, (w) is required to be disclosed in
the Preliminary Offering Memorandum and the Offering Memorandum and that is not
so disclosed or, (x) could reasonably be expected to have, either individually
or in the aggregate, a Material Adverse Effect, except as disclosed in the
Offering Memorandum; or (y) might interfere with, adversely affect or in any
manner question the validity of the issuance and sale of the Senior Notes or any
of the other transactions contemplated by this Agreement or any of the other
Operative Documents, except that such counsel shall express no opinion as to the
matters addressed in the opinion of Xxxxxx, Xxxx & Xxxxxx LLP.
19. The statements contained in the Offering Memorandum under
the caption "Certain Federal Income Tax Consequences" are a fair and accurate
summary of the matters discussed herein.
We have participated in conferences with officers and other
representatives of the Company, representatives of the independent certified
public accountants of the Company and the Initial Purchasers and their
representatives at which the contents of the Preliminary Offering Memorandum and
the Offering Memorandum and related matters were discussed and, although we have
not undertaken to investigate or verify independently, and do not assume any
responsibility for, the accuracy, completeness or fairness of the statements
contained in the Preliminary Offering Memorandum or the Offering Memorandum
(except as indicated above), on the basis of the foregoing, no facts have come
to our attention which led us to believe that the Preliminary Offering
Memorandum or the Offering Memorandum, as of its date or the Closing Date,
contained an untrue statement of a material fact or omitted to state any fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading
(except as to financial statements and related notes, the financial statement
schedules and other financial and statistical data included therein).
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EXHIBIT C
Form of Opinion of Xxxxxx, Xxxx & Xxxxxx
C-1
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EXHIBIT D
Subsidiaries of Intermedia Communications Inc.
Intermedia Communications Inc., a Virginia corporation
EMI Telecommunications Inc.
Eastern Message Communications Inc.
Intermedia Licensing Company
Intermedia Capital Inc.
DIGEX Incorporated
Shared Technologies Xxxxxxxxx, Inc.
Shared Technologies Xxxxxxxxx Telecom, Inc.
Shared Technologies Xxxxxxxxx Communications Corp.
Access Network Services, Inc.
STF Canada Inc.
Access Virginia, Inc.
Long Distance Savers, Inc. (Florida)
Long Distance Savers, Inc. (Louisiana)
LDS-Natchez, Inc.
Long Distance Savers - Longview, Inc.
Netwave Systems, Inc.
LDS - Oklahoma City, Inc.
Long Distance Savers of the Metroplex, Inc.
LDS Communications, Inc.
LDS - Ventures, Inc.
LDS I - America, Inc. (Delaware)
LDS I - America, Inc. (Louisiana)
Express Communications, Inc.
National Telecommunications of Florida, Inc.
NTC, Inc.
LDS of Tulsa (Limited Partnership)
D-1
