Exhibit 99(a)
ASSIGNMENT AGREEMENT
ASSIGNMENT AGREEMENT, dated as of April 22, 1998 (the "Agreement")
between MCI COMMUNICATIONS CORPORATION (the "Company" or "Assignor"), as
initial Callholder and as issuer of the 6.125% Callable/Redeemable Notes
due 2012 (the "Notes"), and NationsBanc Xxxxxxxxxx Securities LLC, as
assignee of the Call Option ("Assignee"). Capitalized terms not defined
herein shall have the meaning ascribed to such terms in the form of Note
attached hereto as Exhibit A.
WITNESSETH:
WHEREAS, the Company has executed and delivered an Indenture dated as
of February 17, 1995, as amended (the "Indenture") between the Company and
the Trustee providing for the issue from time to time of its debentures,
notes or other evidences of indebtedness in one or more series; and
WHEREAS, Paragraph I.E of the form of Note provides that the
Callholder may at any time assign its rights and obligations under the Call
Option without notice to, or consent of, the holders of the Notes,
provided, however, that (i) such rights and obligations are assigned in
whole and not in part and (ii) the Callholder provides notice to the
Trustee and the Company of such assignment contemporaneously with such
assignment; and
WHEREAS, all conditions and requirements necessary to assign the
initial Callholder's rights and obligations under the Call Option in
accordance with its terms have been satisfied;
NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained, the Assignor, as the initial Callholder and as the
issuer of the Notes, and Assignee hereby agree as follows:
Section 1. Assignment of Call Option. Pursuant to paragraph I.E of the
form of Note, the Company, as initial Callholder, hereby assigns all of its
right, title and interest in the Call Option to Assignee in consideration
for the payment of cash in an amount as separately agreed in writing by the
Company and Assignee.
Section 2. Covenants of the Company. The Company covenants with
Assignee as follows:
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(a) The Company agrees that neither it nor any of its subsidiaries or
affiliates shall defease, purchase or otherwise acquire, or enter into any
agreement to defease, purchase or otherwise acquire, any of the Notes prior
to the Coupon Reset Date, or in the event that the Assignee does not
exercise the Call Option, the Call Notice Date. Nothing in the paragraph
shall limit the Company's rights and obligations under paragraph II of the
form of Note or Section 4 hereof.
(b) Notwithstanding any provision to the contrary set forth in the Indenture,
the Company shall (i) use its reasonable best efforts to maintain the Notes
in book-entry form with The Depository Trust Company ("DTC") or any
successor thereto and to appoint a successor depositary to the extent
necessary to maintain the Notes in book-entry form, and (ii) waive any
discretionary right it otherwise has under the Indenture to cause the Notes
to be issued in certificated form.
(c) The Company shall not, without the prior written consent of Assignee,
permit the Indenture (including the Notes) to be amended in any manner, or
otherwise contain any provision not contained therein as of the date
hereof, that in either case, in the reasonable judgment of Assignee,
produces a material adverse change in (i) the terms and conditions of the
Notes or (ii) the procedures set forth in paragraphs I and III of the form
of Note. Nothing in this paragraph shall (x) limit the Company's right to
issue new series of Debt Securities under the Indenture, (y) limit the
Company's right to supplement or amend the Indenture as necessary to effect
a consolidation, merger, conveyance, transfer or lease transaction
otherwise allowed under the Indenture, or (z) prohibit the Company from
otherwise amending the Indenture.
Section 3. Conditions to Assignee's Obligations. The obligations of
Assignee under this Agreement have been undertaken in reliance on, and
shall be subject to, (a) the due performance by the Company of its
obligations and agreements as set forth in this Agreement and the accuracy,
in all material respects, of the representations and warranties in this
Agreement and any certificate delivered pursuant hereto, and (b) the
further condition that none of the following events shall have occurre at
any time on or prior to the Coupon Reset Date:
(i) the rating of any securities of the Company (or, if the Company's
securities are not rated, any entity into which the Company may be merged,
converted or consolidated, or any entity resulting from any merger,
conversion or consolidation to which the Company may be a party, or any
entity to which the Company may sell or otherwise transfer all or
substantially all of its business or the parent of any such entity) ranking
on par with or senior to the Notes is below BBB- or the equivalent rating
thereof by Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc. at any time later than the date 15 calendar
days prior to the Call Notice Date;
(ii) trading in any securities of the Company (or any entity into
which the Company may be merged, converted or consolidated, or any entity
resulting from any merger, conversion
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or consolidation to which the Company may be a party, or any entity to which
the Company may sell or otherwise transfer all or substantially all of its
business or the parent of any such entity) shall have been materially
suspended or materially limited by the Commission or the NASDAQ NMS at any
time later than the date 15 calendar days prior to the Call Notice Date
where the effect of such suspension or limitation is to make it, in the
reasonable judgment of Assignee, impracticable to conduct the Coupon Reset
Process or to enforce contracts for the sale of the Notes; provided,
however, that this paragraph 3(ii) shall not apply to any limitation of
trading in any securities that results from the issuing entity's having gone
private so that such securities are no longer publicly traded;
(iii) trading generally on the American Stock Exchange or the New York
Stock Exchange or in the NASDAQ NMS shall have been suspended or materially
limited, or minimum or maximum prices for trading shall have been fixed, or
maximum ranges for prices shall have been required, by any of said
exchanges or by such system or by order of the Commission, the National
Association of Securities Dealers, Inc. or any other governmental
authority, or if a banking moratorium shall have been declared by either
Federal or New York authorities; or there shall have occurred any material
adverse change in the financial markets in the United States or the
international financial markets, any outbreak of hostilities or escalation
thereof or other calamity or crisis or any change or development involving
a prospective change in national or international political, financial or
economic conditions, in each case, at any time later than the date 15
calendar days prior to the Call Notice Date, the effect o which is such as
to make it, in the reasonable judgment of the Assignee, impracticable to
conduct the Coupon Reset Process or to enforce contracts for the sale of
the Notes;
(iv) an Event of Default (as defined in the Indenture), or any event
which, with the giving of notice or passage of time, or both, would
constitute an Event of Default, with respect to the Notes shall have
occurred and be continuing; or
(v) a material adverse change in the condition, financial or
otherwise, or in the earnings or business affairs of the Company and its
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, shall have occurred during the period from the
Call Notice Date to the Coupon Reset Date which change, in the reasonable
opinion of Assignee, makes it impracticable or impossible to conduct the
Coupon Reset Process or remarket the Notes; and
Assignee shall have received on the Coupon Reset Date a certificate of the Chief
Financial Officer and Treasurer of the Company, dated as of such date, to the
effect that (A) the Company has in all material respects complied with all
agreements and satisfied all conditions on its part to be performed or satisfied
at or prior to Coupon Reset Date, (B) the representations and warranties in this
Agreement are true and correct in all material respects with the same force as
though expressly made at and as of the Coupon Reset Date, and (C) none of the
events specified in this Section 3, other than those events specifically waived
in writing by the Assignee, has occurred.
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In the event of the failure of any of the foregoing conditions, the Assignee may
terminate its obligations under this Agreement as provided in Section 5 hereof.
Section 4. Company's Option to Redeem.
If the Assignee elects to exercise the Call Option pursuant to paragraph I.A of
the form of Note, then not later than two Business Days prior to the Coupon
Reset Date, the Company shall notify the Assignee and the Trustee if the Company
irrevocably elects to exercise its right to redeem the Notes, in whole but not
in part, from the holders thereof on the Coupon Reset Date (the "Overcall
Option"). If the Company elects to exercise the Overcall Option it will pay on
the Coupon Reset Date (i) to th holders of the Notes, a price equal to 100% of
the aggregate principal amount of the Notes, plus all accrued and unpaid
interest thereon, and (ii) to the Assignee, the Notes Premium.
Section 5. Termination of Agreement.
(a) This Agreement shall terminate as to the Assignee on the effective date of
the repurchase of the Notes by the Company pursuant to Section 4 hereof or
the redemption of the Notes by the Company pursuant to paragraph II of the
form of Note.
(b) In addition, the Assignee may terminate all of its obligations under this
Agreement immediately by notifying the Company and the Trustee of its
election to do so, at any time on or before the Coupon Reset Date, in the
event that: (i) any of the conditions referred to or set forth in Section
3(a) hereof have not been met or satisfied, or (ii) any of the events set
forth in Section 3(b) shall have occurred at any time during the time
periods specified for such events on or prior to the Coupon Reset Date.
(c) If this Agreement is terminated pursuant to this Section, such termination
shall be without liability of any party to any other party, except that, in
the case of termination pursuant to Section 5(b) of this Agreement (other
than if termination of this Agreement is the result of the occurrence of
the event specified in Section 3(b)(iii) hereof) the Company shall (i)
reimburse the Assignee for all of its out-of-pocket expenses, including the
reasonable fees and disbursements of counsel for the Assignee in connection
with this Agreement, and (ii) pay to the Assignee such amounts are as set
forth in Section 5(d) below, except as otherwise provided below.
(d) In the case of either (i) termination of this Agreement pursuant to Section
5(b) after the Assignee elects on the Call Notice Date to exercise the Call
Option (but with respect to events or circumstances giving rise to such
right of termination that occur or arise prior to the Assignee's election
on the Call Notice Date to exercise the Call Option, only if, in the
reasonable judgment of the Assignee, the effect thereof is to make it
illegal or impracticable for the Assignee to conduct the Coupon Reset
Process), (ii) termination of this Agreement due to the occurrence, prior
to the Assignee's election on the Call Notice Date to exercise the Call
Option, of a breach of any
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covenant of the Company set forth in Section 2 hereof or of the occurrence
of any event set forth in Section 3 hereof, or (iii) termination of this
Agreement because (x) the Assignee, in its reasonable discretion,
determines that the remarketing of the Notes cannot be effected under the
Act without registration under the Act, and either (1) the Company
determines that it does not wish to register the Notes under the Act, or
(2) the Company and the Assignee are unable in good faith to agree on the
terms of the registration statement, underwriting agreement (including
provisions with respect to indemnification) and other documentation and the
Assignee determines in its sole judgment that such disagreement makes it
impracticable to conduct the Coupon Reset Process or remarket the Notes,
then, upon the request of th Assignee, the Company shall (u) with respect
to any Notes which were not tendered to the Assignee pursuant to the terms
of the Call Option, pay the Assignee, in same-day funds by wire transfer to
an account designated by the Assignee, an amount equal to the Notes Premium
in respect of the face amount of such Notes and (v) with respect to any
Notes which were unable to be sold by the Assignee pursuant to the terms of
the Call Option, the Company shall purchase such Notes from the Assignee
and pay to the Assignee, in same-day funds by wire transfer to an account
designated by the Assignee, an amount equal to the sum of (x) the aggregate
principal amount of such Notes and (y) the Notes Premium with respect to
such Notes; provided, however, that this Section 5(d) shall not apply in
the event that the termination of this Agreement is the result of the
occurrence of the event set forth in Section 3(b)(iv) hereof prior to the
Call Notice Date. In each case, the Notes Premium due in respect of such
principal amount of Notes not tendered or not sold shall be calculated in
accordance with the terms of paragraph III.B.(iii) of the form of Note,
using the Treasury Rate as determined on the third Business Day prior to
the Coupon Reset Date, and any amounts due under this Section shall be paid
by the Company to the Assignee on the Coupon Reset Date.
(e) This Agreement shall not be subject to termination by the Company.
(f) This Section 5 shall survive termination of this Agreement and remain in
full force and effect.
Section 6. Assignment of Agreement. The Assignor may not assign any of
its rights or obligations hereunder without the prior written consent of
the Assignee. The Assignee may assign its rights and obligations hereunder
in whole but not in part without the consent of the Assignor, provided,
that the conditions set forth in paragraph I.E of the form of Note are
satisfied.
Section 7. Miscellaneous.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED IN SUCH STATE (WITHOUT REFERENCE TO CHOICE OF LAW DOCTRINE).
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(b) This Agreement may be amended only by a written agreement signed by the
parties hereto.
(c) This Agreement may be executed in any number of counterparts each of which
so executed and delivered shall constitute an original, but such
counterparts shall constitute one and the same agreement.
(d) Any notices, requests or other communications given or made hereunder or
pursuant hereto shall be made in writing (including by facsimile) at the
addresses and facsimile numbers set forth below:
To the Company: MCI Communications Corporation
0000 Xxxxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Facsimile No.: (000) 000-0000
Attention: Treasurer
with a copy to:
MCI Communications Corporation
0000 Xxxxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Facsimile No.: (000) 000-0000
Attention: General Counsel
To the Assignee: NationsBanc Xxxxxxxxxx Securities LLC
000 X. Xxxxx Xxxxxx
XXX-000-00-00
Xxxxxxxxx, XX 00000
Attention: Syndicate
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IN WITNESS WHEREOF, the Assignor and the Assignee have each caused
this Agreement to be executed by their duly authorized officers or
signatories as of the date first above written.
MCI COMMUNICATIONS CORPORATION,
as Assignor
By: /s/ MCI COMMUNICATIONS CORPORATION
Name:
Title:
NATIONSBANC XXXXXXXXXX
SECURITIES LLC, as Assignee
By:/s/ NATIONSBANC XXXXXXXXXX SECURITIES LLC
Name:
Title:
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EXHIBIT A
FORM OF NOTE
