Exhibit E
SECURITIES PURCHASE AGREEMENT
by and among
CARRIER ONE, LLC
PROVIDENCE EQUITY PARTNERS L.P.,
PROVIDENCE EQUITY PARTNERS II L.P.
STIG JOHANSSON, XXXXXXX XXXXX, XXXXXX X. XXXXX,
KEES VAN OPHEM AND XXXX XXXXXX
Dated as of March 4 , 1998
TABLE OF CONTENTS
-----------------
Page
----
ARTICLE I
DEFINITIONS.......................................................................................... 1
-----------
Section 1.1 Definitions............................................................... 1
-----------
Section 1.2 Hereof, Herein, etc....................................................... 5
-------------------
Section 1.3 Computation of Time Periods............................................... 6
---------------------------
ARTICLE II
SALE AND PURCHASE OF PURCHASED SECURITIES............................................................ 6
-----------------------------------------
Section 2.1 Sale and Purchase of the Purchased Securities............................. 6
---------------------------------------------
Section 2.2 Closing................................................................... 6
-------
Section 2.3 Purchase of Additional Purchased Securities; Subsequent
Closings.................................................................. 6
--------
Section 2.4 Use of Proceeds........................................................... 7
---------------
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY........................................................ 8
---------------------------------------------
Section 3.1 Organization and Existence................................................ 8
--------------------------
Section 3.2 Authorization; No Conflicts............................................... 8
---------------------------
Section 3.3 Enforceability............................................................ 9
--------------
Section 3.4 Necessary Licenses........................................................ 9
------------------
Section 3.5 Compliance with Law....................................................... 9
-------------------
Section 3.6 Litigation................................................................ 10
----------
ARTICLE IV
PURCHASERS' REPRESENTATIONS.......................................................................... 10
---------------------------
Section 4.1 Organization and Good Standing............................................ 10
------------------------------
Section 4.2 Authorization............................................................. 10
-------------
Section 4.3 Enforceability............................................................ 10
--------------
ARTICLE V
CONDITIONS TO PURCHASERS' OBLIGATION TO PURCHASE
AND THE COMPANY'S OBLIGATION TO SELL................................................................. 11
------------------------------------
Section 5.1 Purchasers' Closing Conditions............................................ 11
------------------------------
Section 5.2 Company's Closing Conditions.............................................. 12
----------------------------
ARTICLE VI
EXPENSES; INDEMNITY.................................................................................. 12
-------------------
Section 6.1 Expenses.................................................................. 12
--------
Section 6.2 Indemnification........................................................... 12
---------------
-i-
ARTICLE VII
NOTICES............................................................................................. 13
-------
ARTICLE VIII
AMENDMENTS, WAIVERS AND ASSIGNMENT.................................................................. 14
----------------------------------
ARTICLE IX
GOVERNING LAW....................................................................................... 15
-------------
ARTICLE X
ENTIRE AGREEMENT; COUNTERPARTS; SECTION HEADINGS.................................................... 15
------------------------------------------------
LIST OF EXHIBITS
----------------
Exhibit A Limited Liability Company Agreement
Exhibit B Form of Employment Agreement
Exhibit C Form of Registration Rights Agreement
Exhibit D Form of Securityholders' Agreement
Exhibit E Form of Opinion of Counsel to the Company
Exhibit F Form of Opinion of Xxxxxxxx Chance
Exhibit G Form of Opinion of Xxxx, Xxxxxxxxx & Xxxxxxxxx
-ii-
SECURITIES PURCHASE AGREEMENT
-----------------------------
CARRIER ONE, LLC
000 Xxxxx Xxxxxx
00 Xxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxx Xxxxxx 00000
As of March 4, 1998
Providence Equity Partners L.P.
Providence Equity Partners II L.P.
000 Xxxxx Xxxxxx
00 Xxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxx Xxxxxx 00000
and
Xxxx Xxxxxxxxx
Xxxxxxx Xxxxx
Xxxxxx X. Xxxxx
Xxxx Van Ophem
Xxxx Xxxxxx
do Carrier One AG
Regus Building
Stockerhof
Xxxxxxxxx Xxxxxxx 00 X
0000 Xxxxxx, Xxxxxxxxxxx
Ladies and Gentlemen:
The undersigned, Carrier One, LLC, a Delaware limited liability company
(the "Company"), hereby agrees with you as follows:
ARTICLE I
DEFINITIONS
-----------
Section 1.1 Definitions. Capitalized terms used herein and not otherwise
-----------
defined herein shall have the meanings set forth in this Article 1:
---------
1
Affiliate. The term "Affiliate" shall mean any Person directly or
---------
indirectly controlling, controlled by or under direct or indirect common control
with the Company (or other specified Person) and shall include (a) any Person
who is a manager, officer, director or beneficial owner of at least 8% of the
then Equity Securities (on a fully diluted basis) of the Company (or other
specified Person) and Family Members of any such Person, (b) any Person of which
the Company (or other specified Person) or an Affiliate (as defined in clause
(a) above) of the Company (or other specified Person) shall, directly or
indirectly, either beneficially own at least 10% of the then outstanding Equity
Securities or constitute at least a 10% equity participant, and (c) in the case
of a specified Person who is an individual, Family Members of such Person.
Business Day. The term "Business Day" shall mean any day other than
------------
Saturday, Sunday, a federal holiday or other day on which commercial banks in
the State of Rhode Island are required or permitted to close by law.
Charter. The term "Charter" means the certificate or articles of
-------
incorporation, by-laws, statute, constitution, joint venture, certificate of
limited partnership, partnership agreement, articles of organization, limited
liability company operating agreement or other organizational document of any
Person other than an individual, each as from time to time amended or modified.
Class A Units. The term "Class A Units" shall mean the Class A Units of the
-------------
Company, having the rights, restrictions, privileges and preferences set forth
in the LLC Agreement.
Class B Units. The term "Class B Units" shall mean the Class B Units of the
-------------
Company, having the rights, restrictions, privileges and preferences set forth
in the LLC Agreement.
Closing Date. The term Closing Date shall mean March 4, 1998 or such other
------------
date as the Company and the Purchasers may agree upon.
Company. The term "Company" shall mean Carrier One, LLC, a Delaware limited
-------
liability company, or any corporation into which Carrier One, LLC is converted
or merged into or which becomes the direct or indirect owner of all the Equity
Securities of Carrier One, LLC as contemplated by Section 4 of the
Securityholders' Agreement.
Contract. The term "Contract" shall mean all material contracts, leases,
--------
plans and commitments and other agreements entered into by the Company or any
Subsidiary which are in writing or have been orally agreed to by the Company or
any of its Subsidiaries.
Dollars. The term "Dollars" and "$" shall mean United States dollars.
-------
Employment Agreements. The term "Employment Agreements" shall mean those
---------------------
certain Employment Agreements, each dated as of the date hereof, by and between
Carrier One AG, a Swiss corporation, which is an indirect wholly-owned
subsidiary of the Company, and each of Stig Johansson, Xxxxxxx Xxxxx, Xxxxxx X.
Xxxxx, Xxxx Van Ophem and Xxxx Xxxxxx in the form of
2
Exhibit B attached hereto, as the same may be amended, modified or supplemented
---------
from time to time.
Environment. The term "Environment" shall mean soil, surface waters,
-----------
groundwater, land, stream sediments, surface or subsurface strata, ambient air
and any environmental medium, whether indoors or outdoors.
Environmental Laws. The term "Environmental Laws" shall mean all federal,
------------------
foreign, state, local or municipal environmental, health or safety-related laws,
regulations, by-laws, rules, ordinances, judicial or administrative decrees or
decisions, orders or requirements applicable to the Company or any of its
Subsidiaries relating to the physical or environmental condition or use of their
respective properties, their respective businesses or pollution or protection of
human health or the Environment, including, without limitation, the
Comprehensive Environmental Response Compensation and Liability Act, 42
U.S.C.,ss.9601, et seq., as amended ("CERCLA"), the Resource Conservation and
-- ---
Recovery Act, 42 U.S.C.ss.690 1, et seq., as amended, the Clean Air Act, 42
-- ---
U.S.C. ss.7401 et seq., as amended, the Clean Water Act, 33 U.S.Css.1251, et
-- --- --
seq., the Toxic Substance Control Act, 15 U.S.C.ss.2601 et seq., the
--- -- ---
Occupational Safety and Health Act, laws relating to Releases or threatened
Releases of Hazardous Substances into the Environment or otherwise relating to
the manufacture, generation, processing, distribution, use, treatment, storage,
abatement, existence, holding, Release, transport or handling of Hazardous
Substances, and all laws and regulations with regard to recordkeeping,
notification, disclosure and reporting requirements respecting Hazardous
Substances.
Equity Securities. The term "Equity Securities" means all authorized Units
-----------------
or capital stock of the Company, including (i) all classes of Units or capital
stock, voting and non-voting (including, without limitation, the Purchased
Securities), (ii) any warrants, options or other rights to subscribe for or to
acquire, directly or indirectly, whether pursuant to any division or split of
any class of Unit or capital stock of the Company or in connection with a
combination, exchange, reorganization. recapitalization, reclassification,
merger, consolidation or similar business combination transaction involving the
Company or otherwise, (iii) any other equity interests in the Company or any
bonds, notes, debentures, or other securities convertible into or exchangeable
for, directly or indirectly, any Units, capital stock or equity interests of the
Company and (iv) any interests in any of the foregoing in each case outstanding
at any time.
Governmental Entities. The term "Governmental Entities" shall have the
---------------------
meaning given such term in the Securityholders Agreement.
Hazardous Substances. The term "Hazardous Substances" means any pollutant,
--------------------
contaminant, toxic substance, hazardous waste, hazardous material, or hazardous
substance, or any oil, petroleum or petroleum product, each as defined or listed
in, or classified pursuant to, any Environmental Laws.
Licenses. The term "Licenses" shall mean all licenses, permits, consents,
--------
approvals, concessions and authorizations of all Governmental Entities, whether
foreign, federal, state or local,
3
including, without limitation, any state public utilities commission and their
equivalents in foreign countries.
Lien. The term "Lien" shall mean (a) any encumbrance, mortgage, pledge,
----
lien, charge or other security interest of any kind upon any property or assets
of any character, or upon the income or profits therefrom; (b) any acquisition
of or agreement to have an option to acquire any property or assets upon
conditional sale or other title retention agreement, device or arrangement
(including a capitalized lease); or (c) any sale, assignment, pledge or other
transfer for security of any accounts, general intangibles or chattel paper,
with or without recourse.
LLC Agreement. The term "LLC Agreement" shall mean that certain Limited
-------------
Liability Company Agreement of the Company in the form of Exhibit A attached
hereto, as amended, modified, supplemented or restated from time to time.
Majority Purchasers. The term "Majority Purchasers" shall mean, at any
-------------------
time, the holders of at least a majority of the outstanding Purchased
Securities.
Management. The term "Management" shall mean Stig Johansson, Xxxxxxx Xxxxx,
----------
Xxxxxx X. Xxxxx, Kees Van Ophem and Xxxx Xxxxxx.
Material Adverse Effect. The term "Material Adverse Effect" shall mean,
------------------------
with respect to any Person, any effect that is, or series of related effects
that are, in the aggregate, materially adverse to the business, assets,
properties, condition (financial or otherwise) or prospects of such Person.
Option Agreements. The term "Option Agreements" shall mean the Option
-----------------
Agreements of even date herewith between the Company and each member of
Management.
Person. The term "Person" shall mean an individual, partnership, limited
------
liability company, corporation, association, trust, joint venture,
unincorporated organization and any Governmental Entity.
Purchased Securities. The term "Purchased Securities" shall mean the Class
--------------------
A Units being purchased by the Purchasers pursuant to Section 2.1 of this
Agreement, the capital stock issued or issuable or otherwise received by the
Purchasers and/or the holders of their Equity Securities in connection with the
transactions contemplated by Section 4 of the Securityholders' Agreement and any
Units, capital stock or other securities of the Company issued or issuable upon
an exchange, conversion, reorganization, reclassification, recapitalization,
merger, consolidation or other similar business transaction involving the
Company, its Subsidiaries or otherwise.
Purchaser. The term "Purchaser" shall mean the several purchasers named in
---------
Schedule 2.1 (individually, a "Purchaser" and collectively, the "Purchasers")
and their respective successors and assigns.
4
Related Agreements. The term "Related Agreements" shall mean the Employment
------------------
Agreements, the LLC Agreement, the Securityholders' Agreement, the Registration
Rights Agreement and the Option Agreements.
Release. The term "Release" shall mean a "Release" as defined in any
-------
Environmental Laws, including, but not limited to, any releasing, spilling,
leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping,
leaching, disposing or dumping into the Environment in violation of any
Environmental Laws.
Registration Rights Agreement. The term "Registration Rights Agreement"
-----------------------------
shall mean that certain Registration Rights Agreement, dated the date hereof, by
and among the Company, and the Purchasers, in the form of Exhibit C attached
hereto, as the same may be amended, modified or supplemented from time to time.
Securities Act. The term "Securities Act" shall mean all applicable
--------------
securities laws, rules, regulations, notices and policies in force in the United
States, as amended, modified or supplemented from time to time.
Securityholders' Agreement. The term "Securityholders' Agreement" shall
--------------------------
mean that certain Securityholders' Agreement, dated the date hereof, among the
Company, the Purchasers and Management, in the form of Exhibit D attached
hereto, as the same may be amended, modified or supplemented from time to time.
Subsidiary. The term "Subsidiary" shall mean any Person of which the
----------
Company or other specified Person now or hereafter shall at the time own,
directly or indirectly through a Subsidiary, at least a majority of the
outstanding Equity Securities (or other shares of beneficial interest) entitled
to vote generally.
"Tax" or "Taxes". The term "Tax" or "Taxes" shall mean all taxes, charges,
---------------
fees, levies, imposts and other assessments, including all income, sales, use,
goods and services, value added, capital, capital gains, alternative net worth,
transfer, profits, withholding, payroll, employer health, excise, real property
and personal property taxes, and any other taxes, customs duties, fees,
assessments or similar charges in the nature of a tax, including, without
limitation, pension plan contributions and workers compensation premiums,
together with any interest, fines and penalties imposed by any Governmental
Authority, and whether disputed or not.
Units. The term "Units" shall mean the Units of the Company issued to its'
-----
members pursuant to the LLC Agreement, including, without limitation, the Class
A Units and the Class B Units.
Section 1.2 Hereof, Herein, etc. The words "hereof', "herein" and
-------------------
"hereunder" and words of similar import when used in this Agreement shall refer
to this Agreement as a whole and not to any particular provision of this
Agreement. Unless otherwise specified herein, the term "or" has the
5
inclusive meaning represented by the term "and/or" and the term "including" is
not limiting. All references as to "Sections", "Subsections", "Articles",
"Schedules" and "Exhibits" shall be to Section, Subsections, Articles, Schedules
and Exhibits, respectively, of this Agreement unless otherwise specifically
provided.
Section 1.3 Computation of Time Periods. In the computation of periods of
---------------------------
time from a specified date to a later specified date, unless otherwise specified
herein the words "commencing on" mean "commencing on and including",
the word "from" means "from and including" and the words "to" and "until" each
means "to and including".
ARTICLE II
SALE AND PURCHASE OF PURCHASED SECURITIES
-----------------------------------------
Section 2.1 Sale and Purchase of the Purchased Securities. Subject to all
---------------------------------------------
of the terms and conditions hereof and in reliance on the representations and
warranties set forth or referred to herein, the Company agrees to issue and sell
to each Purchaser and each Purchaser agrees to purchase, on the Closing Date,
the number and class of Purchased Securities set forth opposite the name of such
Purchaser under the heading "Number of Purchased Securities to be Purchased at
Initial Closing" on Schedule 2.1, at a purchase price per Unit of $1.00 (U.S.)
(the "Per Unit Price"). The sale of the Purchased Securities to each Purchaser
at the Initial Closing and each Subsequent Closing (as defined in Section
2.3(b), shall constitute a separate sale hereunder.
Section 2.2 Closing. The initial closing of the purchase and sale of the
-------
Purchased Securities contemplated by Section 2.1 (the "Initial Closing") will
take place at the offices of Xxxxxxx & Xxxxxx, 0000 Xxxxxxxx Xxxxx Xxxxx,
Xxxxxxxxxx, Xxxxx Xxxxxx 00000 at 10:00 a.m. on March 4, 1998, or at such other
time, date and place as the parties hereto may agree upon. Subject to the
satisfaction of the conditions to closing set forth in Article V. as payment in
full for the Purchased Securities being purchased by the Purchasers under this
Agreement on the Closing Date, on the Closing Date (i) each Purchaser shall
deliver to the Company, in immediately available funds, an amount equal to (a)
the aggregate number of Purchased Securities set forth opposite such Purchaser's
name under the heading "Number of Purchased Securities to be Purchased at
Initial Closing" on Schedule2A, multiplied by (b) $1.00 (U.S.), and (ii) the
Company will issue and deliver a written receipt or certificate or certificates
evidencing the number of Purchased Securities issued to such Purchaser.
Section 2.3 Purchase of Additional Purchased Securities; Subsequent
-------------------------------------------------------
Closings.
--------
(a) At the Subsequent Closings, subject to the terms and
conditions set forth herein, the Company shall sell to each Purchaser, and each
Purchaser severally agrees to purchase from the Company, at the Per Unit Price,
an aggregate of up to that number of Purchased Securities indicated on Schedule
--------
2.1 under the heading "Number of Shares of Purchased Securities to be
---
6
Purchased at Subsequent Closings" (collectively, the "Additional Purchased
Securities"). The maximum number of Additional Purchased Securities shall
aggregate the maximum number of Class A Units to be purchased by all Purchasers
as reflected on Schedule 2.1 less the aggregate number of Class A Units
purchased at the Initial Closing.
(b) The Company may, upon at least thirty (30) days prior written
notice to each Purchaser given by the Company's Board of Directors (the "Call
Notice"), designate a date (which shall be a Business Day) for the closing (a
"Subsequent Closing") of the purchase by the Purchasers of Additional Purchased
Securities (each a "Subsequent Closing Date"), which Call Notice shall specify
the aggregate number of Purchased Securities to be purchased by the Purchasers
on such Subsequent Closing Date. The determination of whether to make a Call
Notice shall be in the sole and absolute discretion of the Board of Directors.
No Call Notices shall be given after March 31, 2001 without the written approval
of the Majority Purchasers. Notwithstanding the foregoing, the Company shall be
obligated to cause one or more Call Notices to be made to assure that the
Company and its Subsidiaries have sufficient funds to pay the amounts owed to
Management under the Employment Agreements from the date hereto to March 1, 1999
(the "Management Compensation Calls"). Subject to the provisions of this Section
2.3, at each Subsequent Closing the Purchasers shall purchase the Additional
Purchased Securities specified in the applicable Call Notice pro rata in
proportion to the number of Purchased Securities initially purchased by each
Purchaser at the Initial Closing. Each Subsequent Closing will take place at the
offices of Xxxxxxx & Xxxxxx, 0000 Xxxxxxxx Xxxxx Xxxxx, Xxxxxxxxxx, Xxxxx Xxxxxx
00000 at 10:00 a.m. on the date specified in the Call Notice or at such other
time, date and place as the Company and the Majority Purchasers may agree upon.
(c) The obligation of each Purchaser to purchase and pay for the
Additional Purchased Securities at each Subsequent Closing is subject to (i)
each of the Company's representations and warranties set forth in Section 3
---------
being true and correct in all material aspects as of the Closing Date and being
true and correct in all material respects as of such Subsequent Closing Date,
(ii) there shall have occurred no material adverse change in the assets,
business, condition (financial or otherwise) or prospects of the Company or its
Subsidiaries taken as a whole as determined by the Majority Purchasers in their
sole and absolute discretion, (iii) there shall have been no material breach or
violation by any party (other than a Purchaser) under any Related Agreement and
(iv) the Company shall have developed a business plan satisfactory to the
Majority Purchasers and shall be in material compliance therewith; provided the
satisfaction of the conditions set forth in clauses (i) - (iv) shall not be
applicable to Management Compensation Calls. Any one or more of such conditions
may be waived with the prior written consent of the Majority Purchasers, in
their sole and absolute discretion, and all Purchasers shall be bound by such
waiver of conditions, provided that a waiver of any of the foregoing conditions
with respect to a Subsequent Closing shall not operate as a waiver of such
condition with respect to any other Subsequent Closing.
Section 2.4 Use of Proceeds. Proceeds from the sale of the Purchased
---------------
Securities hereunder shall be used for working capital and general corporate
purposes as determined from time to time by the Company's Board of Directors.
7
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
---------------------------------------------
In order to induce the Purchasers to enter into this Agreement and to
purchase the Purchased Securities, the Company hereby represents and warrants
that:
Section 3.1 Organization and Existence. (a) The Company is duly organized,
--------------------------
validly existing and in good standing in its jurisdiction of organization and is
duly qualified as a foreign limited liability company and authorized to do
business in all other jurisdictions in which the nature of its business or
property makes such qualification necessary except where the failure to so
qualify would not have a Material Adverse Effect. The Company has the power to
own its properties and to carry on its business as now conducted and as proposed
to be conducted.
(b) Each of the Company's Subsidiaries is duly organized, validly
existing and in good standing in its jurisdiction of incorporation and is duly
qualified as a foreign entity and authorized to do business in all other
jurisdictions in which the nature of its business or property makes such
qualification necessary and where the failure to so qualify would not have a
Material Adverse Effect. Schedule 3.1(b) sets forth, for each Subsidiary of the
---------------
Company, its jurisdiction of incorporation and each jurisdiction where it is
duly qualified as a foreign entity. Each of the Subsidiaries has the power to
own its properties and to carry on its business as now conducted and as proposed
to be conducted.
Section 3.2 Authorization; No Conflicts. The execution, delivery and
---------------------------
performance by the Company of this Agreement and of each Related Agreement, and
the issuance and sale by the Company of the Purchased Securities hereunder, (a)
are within its power and authority, and (b) have been duly authorized by all
necessary action of the Company and its members and by all other requisite
proceedings. Neither the execution and delivery by the Company of this Agreement
or any Related Agreement nor the consummation by the Company of the transactions
contemplated thereby (including, without limitation, the purchase and sale of
the Purchased Securities hereunder) (a) will violate any provision of the
Charter of the Company or any of its Subsidiaries, (b) will violate or conflict
with any applicable statute, law, ordinance, rule, regulation, order, judgment,
writ, injunction, license, permit or decree applicable to the Company or any of
its Subsidiaries, (c) will conflict with or constitute a violation of or a
default (or an event which with notice or lapse of time or both, would
constitute a default) under, or will result in the termination of, or accelerate
performance required by, any contract to which the Company or any of its
Subsidiaries is a party or to which any of the assets or properties of the
Company or any of its Subsidiaries are subject, (d) will result in the creation
of any Lien upon any of the Equity Securities of the Company or any of its
Subsidiaries or upon any of the property or assets of the Company or any of its
Subsidiaries, or (e) will require the consent, authorization or approval of, or
notice to or filing or registration with, any Person.
8
Section 3.3 Enforceability. The execution and delivery by the Company
--------------
of this Agreement and of each of the Related Agreements, and the issuance and
sale by the Company of the Purchased Securities hereunder, will result in
legally binding obligations of the Company enforceable against the Company in
accordance with the respective terms and provisions hereof and thereof.
Section 3.4 Necessary Licenses. (a) Schedule 3.4 sets forth a list of
------------------ ------------
each License held by the Company or any of its Subsidiaries in the conduct of
its business. Except as set forth on Schedule 3.4, the Company and its
------------
Subsidiaries holds all necessary Licenses which are required in connection with
the ownership and operation of its business. All Licenses are in full force and
effect. The Company and its Subsidiaries have complied with the terms of the
Licenses which they hold and there are no pending modifications, amendments or
revocations of the Licenses which would adversely affect the ownership or the
operation of its business. All fees due and payable from the Company or any of
its Subsidiaries to Governmental Entities pursuant to the Licenses have been
paid. All reports required of the Company or any of its Subsidiaries to be filed
in connection with the Licenses have been timely filed and are accurate and
complete.
(b) Except as specified in Schedule 3.4, no registrations,
------------
filings, applications, notices, transfers, consents, approvals, audits,
qualifications, waivers or other action of any kind is required by virtue of the
execution and delivery of this Agreement or any Related Agreement, or of the
consummation of the transactions contemplated hereby or thereby (a) to avoid the
loss of any License or any asset, property or right pursuant to the terms
thereof or the violation or breach of any law applicable thereto, or (b) to
enable the Company and its Subsidiaries to hold and enjoy the same after the
Closing Date in the conduct of its business as conducted immediately prior to
the Closing Date. In particular, except as set forth in Schedule 3.4. execution
------------
and delivery of this Agreement and the Related Agreements, and consummation of
the transactions contemplated therein, will not constitute a change of control
in the Company or its Subsidiaries, or otherwise require authorization,
approval, consent, or filing of registration with any Governmental Entity, and
will not violate or conflict with any applicable provision of the laws, rules,
and regulations administered by any Governmental Entity.
Section 3.5 Compliance with Law.
-------------------
Neither the Company nor any Subsidiary is in default under, or in
violation of, any laws, rules or regulations (including, without limitation,
foreign, federal, state or local laws, rules or regulations relating to the
issuance or sale of securities, telecommunications, anti-trust, occupational
safety, the protection of the environment, transportation, storage or disposal
of hazardous waste, anti-pollution and air and water quality laws), or any
Licenses, granted by, or any judgment, decree, writ, injunction or order of, any
Governmental Entity, applicable to its business or any of its properties or
assets, which defaults and violations would in the aggregate expose the Company
and its Subsidiaries to liabilities in excess of an aggregate of $50,000 or
otherwise materially adversely affect the assets or properties or business or
operations of the Company and its Subsidiaries or requiring or prohibiting
future activities. Neither the Company nor any Subsidiary has received any
notification alleging any
9
violations of any of the foregoing with respect to which adequate corrective
action has not been taken.
Section 3.6 Litigation. (a) There is no suit, claim, action, proceeding
----------
or investigation pending or, to the best knowledge of the Company after
inquiring of its officers and employees, threatened against or adversely
affecting the Company or any of its Subsidiaries, any of their assets or
properties, any officer or director of the Company or any of its Subsidiaries or
the consummation of the transactions contemplated by this Agreement or any
Related Agreement, at law or in equity or before any Governmental Entity or
before any arbitrator of any kind and there is no reasonable basis for any such
suit, claim, action, proceeding or investigation. Neither the Company nor any
Subsidiary nor any officer or director thereof is a party to or subject to (x)
any judgment, order, writ, injunction or decree affecting it or any of its
assets or properties or requiring or prohibiting future activities or (y) any
settlement agreement.
(b) Neither the Company nor any Subsidiary nor any officer or director
thereof has been party to administrative or regulatory proceedings or other
governmental investigations or inquiries, pending or threatened, affecting
business operations of the Company or any Subsidiary.
ARTICLE IV
PURCHASERS' REPRESENTATIONS
---------------------------
Section 4.1 Organization and Good Standing. Each Purchaser that is not
------------------------------
an individual represents that it is validly existing and in good standing under
the laws of the state of its formation.
Section 4.2 Authorization. Each Purchaser represents that this
-------------
Agreement and the Related Agreements to which it is a party have been executed
by him, or in the case of a Purchaser which is not an individual by a duly
authorized Person on its behalf and the execution, delivery and performance
hereof and thereof (a) have been duly authorized by all appropriate action, and
(b) will not violate the provision of any material law or regulation of any
Governmental Entity applicable to it or constitute a violation of any material
agreement or instrument by which it is bound.
Section 4.3 Enforceability. Each Purchaser represents that the
--------------
execution and delivery of this Agreement and the Related Agreements and the
transactions contemplated thereunder will result in legally binding obligations
of such Purchaser enforceable against such Purchaser in accordance with the
respective terms and provisions hereof and thereof, subject, however, to
limitations with respect to enforcement imposed by law in connection with
bankruptcy or similar proceedings to the extent that equitable remedies such as
specific performance and injunction are in the discretion of the court from
which they are sought.
10
ARTICLE V
CONDITIONS TO PURCHASERS' OBLIGATION TO PURCHASE
AND THE COMPANY'S OBLIGATION TO SELL
------------------------------------
Section 5.1 Purchasers' Closing Conditions. Each Purchaser's obligation
------------------------------
to purchase the Purchased Securities pursuant to Section 2.1 is subject to
-----------
compliance by the Company with its agreements herein contained, and to the
satisfaction, on or prior to the Closing Date of the following conditions:
(a) Related Agreements. Each of the Related Agreements shall
------------------
have been executed and delivered in a form satisfactory to the Purchasers. All
covenants, agreements and conditions contained in the Related Agreements which
are to be performed or complied with on or prior to the Closing Date shall have
been performed or complied with in all material respects.
(b) Legal Opinion. The Purchaser shall have received from
-------------
Xxxxxxx & Xxxxxx, counsel to the Company, an opinion substantially in the form
of Exhibit E attached hereto.
---------
(c) UK Opinion. The Purchasers shall have received from Xxxxxxxx
----------
Chance, special United Kingdom counsel to the Company, an opinion substantially
in the form of Exhibit F attached hereto.
---------
(d) Management Counsel Opinion. The Purchasers shall have
--------------------------
received from Xxxx, Xxxxxxxxx & Xxxxxxxxx, counsel to Management, an opinion in
the form of Exhibit G attached hereto.
----------
(e) Legality: Governmental and Other Authorizations. The
-----------------------------------------------
purchase of the Purchased Securities shall not be prohibited by any law or
governmental order or regulation, and shall not subject any Purchaser to any
penalty, special Tax, or other onerous condition. All necessary consents,
approvals, Licenses, orders and authorizations of. and registrations,
declarations and filings with, any Governmental Entity or any other Person, with
respect to any of the transactions contemplated by this Agreement or any of the
Related Agreements, shall have been duly obtained or made and shall be in full
force and effect.
(f) No Default. The Company shall not be in material default
----------
under any of its Contracts.
(g) General. All instruments and corporate proceedings in
-------
connection with the transactions contemplated by this Agreement and the Related
Agreements shall be satisfactory in form and substance to the Purchasers and
their counsel, and the Purchasers shall have received copies of all documents,
including, without limitation, records of corporate or other proceedings,
opinions of counsel and consents which the Purchaser may have reasonably
requested in connection therewith.
11
Section 5.2 Company's Closing Conditions. The Company's obligation to
----------------------------
sell the Purchased Securities pursuant to Section 2.1 is subject to the
-----------
representations and warranties of the Purchasers contained herein being true and
correct in all material respects on and as of the Closing Date.
ARTICLE VI
EXPENSES; INDEMNITY
-------------------
Section 6.1 Expenses. The Company hereby agrees to pay at the Closing
--------
all reasonable fees, costs and expenses incurred by the Purchasers, and approved
by the Majority Purchasers, in connection with the transactions hereunder and in
connection with any amendments or waivers (whether or not the same become
effective) hereof and all reasonable expenses incurred by the Purchasers in
connection with the enforcement of any rights hereunder or with respect to any
Purchased Security, including without limitation (i) the cost and expenses of
preparing and duplicating this Agreement, each Related Agreement and the
Purchased Securities; (ii) the cost of delivering to each Purchaser's principal
office, insured to such Purchaser's satisfaction, the Purchased Securities sold
to such Purchaser hereunder and any securities delivered to such Purchaser in
exchange therefor or upon any exercise, conversion or substitution thereof~
(iii) the reasonable fees, expenses and disbursements of Xxxxxxx & Xxxxxx,
Purchasers' counsel, Xxxxxxxx Chance, Purchaser's European counsel and other
special counsel engaged by Purchaser in connection with the preparation,
administration or interpretation of this Agreement and the Related Agreements
and other agreements, documents and instruments mentioned herein or therein, the
Closing, any amendments, modifications, approvals, consents or waivers hereto,
thereto, hereunder or thereunder; (iv) the out-of-pocket fees, expenses and
costs incurred by the Purchasers in connection with the Purchasers' due
diligence investigation of the Company and its Subsidiaries, including the fees
and expenses of accountants, consultants and other professionals; and (v) all
Taxes (other than Taxes determined with respect to income and Taxes relating to
any transfer of the Purchased Securities to any Person other than to the
Company) including, without limitation, any recording fees, filing fees and
documentary stamp and similar Taxes at any time payable in respect of this
Agreement or any Related Agreement or the issuance of any of the Purchased
Securities and any securities issued in exchange therefor.
Section 6.2 Indemnification. The Company hereby further agrees to
---------------
indemnify, exonerate and hold each Purchaser and its (if applicable) general and
limited partners and their respective shareholders, officers, directors,
employees and agents free and harmless from and against any and all actions,
causes of action, suits, losses, liabilities, damages and expenses, including,
without limitation, reasonable attorneys' fees and disbursements, incurred in
any capacity by any of the indemnities as a result of or relating to (i) any
transaction financed or to be financed in whole or in part, directly or
indirectly, with proceeds from the sale of any of the Purchased Securities, (ii)
the execution, delivery, performance or enforcement of this Agreement, the
Related Agreements or any
12
agreement, document or instrument contemplated hereby or thereby (including,
without limitation, any failure by the Company to comply with any of the
covenants thereunder), (iii) any breach of any representation or warranty of the
Company in this Agreement or any Related Agreement, (iv) any violation of any
Environmental Laws with respect to conditions at the property now, heretofore or
hereafter owned or used by the Company or any of its Subsidiaries or the
operations conducted thereon, and (v) the investigation or remediation of
offsite locations at which the Company or any of its Subsidiaries or their
predecessors are alleged to have directly or indirectly disposed of Hazardous
Materials.
ARTICLE VII
NOTICES
-------
Any notices or other communications required to be given pursuant to
this Agreement shall be in writing and shall be deemed given: (i) upon delivery,
if by hand; (ii) three (3) Business Days after mailing, if sent by registered or
certified mail, postage prepaid, return receipt requested; (iii) one (1)
Business Day after mailing, if sent via overnight courier; or (iv) upon
transmission, if sent by telex or facsimile except that if such notice or other
communication is received by telex or facsimile after 5:00 p.m. on a Business
Day at the place of receipt, it shall be effective as of the following Business
Day. All notices and other communications hereunder shall be given as follows:
(a) If to the Company, to it at:
c/o Providence Equity Partners, Inc.
000 Xxxxx Xxxxxx
00 Xxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
(b) If to Providence Equity Partners L.P. or
Providence Equity Partners 11 L.P., to it at:
c/o Providence Equity Partners L.L.C.
000 Xxxxx Xxxxxx
00 Xxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxx Xxxxxx 00000
Attention: Xxxxx X. Xxxxxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
13
with a copy to:
Xxxxxxx & Xxxxxx
0000 Xxxxxxxx Xxxxx Xxxxx
Xxxxxxxxxx, Xxxxx Xxxxxx 00000
Attention: Xxxxx X. Xxxxxxx, Esq.
Facsimile: 000-000-0000
Telephone: 000-000-0000
(c) If to members of Management, to them at:
c/o Carrier One AG
Regus Building
Stockerhof
Xxxxxxxxx Xxxxxxx 00 X
0000 Xxxxxx, Xxxxxxxxxxx
Any party may change its address for receiving notice by written notice given to
the other names above in the manner provided above.
ARTICLE VIII
AMENDMENTS, WAIVERS AND ASSIGNMENT
----------------------------------
No modification to or amendment of any provision of this Agreement
shall be effective against the Company or any Purchaser unless such modification
or amendment is approved in writing by the Majority Purchasers and the Company.
No waiver of the rights and obligations hereunder of any party hereto shall be
effective unless such waiver is in writing and duly executed and delivered by
(a) the Majority Purchasers (in the event such waiver is sought by the Company),
or (b) the Company (in the event such waiver is sought by any Purchaser). The
failure of any party hereto to enforce any of provision of this Agreement shall
in no way be construed as a waiver of such provision and shall not affect the
right of such party thereafter to enforce each and every provision of this
Agreement in accordance with its terms. Any amendment or waiver effected in
accordance with this Article VIII shall be binding upon the Company and each
------------
holder of any Purchased Security sold pursuant to this Agreement. The Company
acknowledges and agrees that any Purchaser which is not an individual, upon the
approval of the Majority Purchasers, shall have the right to assign its rights
and obligations hereunder to one or more institutional or venture capital
investors and shall be released from its commitments hereunder to the extent
assigned; provided that Providence Equity Partners L.P. and its affiliates shall
retain sufficient Purchased Securities to be the Majority Purchasers.
14
ARTICLE IX
GOVERNING LAW
-------------
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF DELAWARE WITHOUT GIVING EFFECT TO ANY CHOICE OR
CONFLICT OF LAW PROVISION OR RULE THAT WOULD CAUSE THE APPLICATION OF THE
SUBSTANTIVE LAWS OF ANY OTHER STATE, AND SHALL BIND AND INURE TO THE BENEFIT OF
THE PARTIES HERETO AND THEIR RESPECTIVE SUCCESSORS AND ASSIGNS.
ARTICLE X
ENTIRE AGREEMENT; COUNTERPARTS; SECTION HEADINGS
------------------------------------------------
This Agreement, the Purchased Securities and the Related Agreements set
forth the entire understanding of the parties hereto with respect to the
transactions contemplated hereby and supersede any prior written or oral
understandings with respect thereto. This Agreement may be executed
simultaneously in one or more counterparts thereof, each of which shall be
deemed an original but all of which together shall constitute one and the same
instrument. The headings in this Agreement are for convenience of reference only
and shall not alter or otherwise affect the meaning hereof.
ARTICLE XI
WAIVER OF JURY TRIAL WAIVER OF JURY TRIAL
-----------------------------------------
The parties hereto each hereby knowingly, voluntarily and intentionally
waive any rights to have a trial by jury in respect of an litigation (whether as
claim, counter-claim, affirmative defense of otherwise) in connection with or in
any way related to this Agreement.
If the foregoing corresponds with your understanding of our agreement,
kindly sign this letter and the accompanying copies thereof in the appropriate
space below.
Very truly yours,
CARRIER One, LLC
By:_________________________________
Name: Xxxxx X. Xxxxxxx
Title: Chairman
15
Accepted and agreed to:
PROVIDENCE EQUITY PARTNERS L.P.
By:______________________
Name: Xxxxx X. Xxxxxxx
Title: Managing Director
PROVIDENCE EQUITY PARTNERS II L.P.
By: Providence Equity Partners L.L.C.,
its general partner
By:______________________
Name: Xxxxx X. Xxxxxxx
Title: Managing Director
_________________________
Stig Johansson
_________________________
Xxxxxxx Xxxxx
_________________________
Xxxxxx X. Xxxxx
_________________________
Kees Van Ophem
_________________________
Xxxx Xxxxxx
[Signature page to Securities Purchase Agreement]
16
AMENDMENT NO. 1
TO
SECURITIES PURCHASE AGREEMENT
AND
SECURITYHOLDERS' AGREEMENT
This Amendment No. 1, dated as of April 1, 1998, is entered into by and
among Carrier One, LLC, a limited liability company formed under the laws of
Delaware (the "Company"), and the Persons listed on the signature pages hereto
(said Amendment being referred to as "this Amendment"). Capitalized terms used
in this Amendment and not otherwise defined herein shall have the meanings
ascribed thereto in the "Securities Purchase Agreement" (as defined below) and
the "Securityholders' Agreement" (as defined below) as amended hereby.
WITNESSETH:
WHEREAS, the Company, Providence Equity Partners L.P. ("PEP"), Providence
Equity Partners II L.P. (PEP II"), Stig Johansson, Xxxxxxx Xxxxx, Xxxxxx X.
Xxxxx, Xxxx Van Ophem and Xxxx Xxxxxx are parties to the Securities Purchase
Agreement, dated as of March 4, 1998 (the "Securities Purchase Agreement");
WHEREAS, the Company, Providence Equity Partners L.P. ("PEP"), Providence
Equity Partners II L.P. ("PEP II"), Stig Johansson, Xxxxxxx Xxxxx, Xxxxxx X.
Xxxxx, Xxxx Van Ophem and Xxxx Xxxxxx are parties to the Securityholders'
Agreement, dated as of March 4, 1998 (the "Securityholders' Agreement");
WHEREAS, the Company and the Majority Purchasers have agreed to amend the
Securities Purchase Agreement and Securityholders' Agreement as provided herein;
NOW, THEREFORE, in consideration of the terms and conditions set forth
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, the parties
hereto hereby agree as follows:
SECTION 1. Amendment to Securities Purchase Agreement. Effective as of the
------------------------------------------
date hereof, the Securities Purchase Agreement is hereby amended as follows:
1.1 Xxxxx Xxxxxxx ("Xxxxxxx") and Xxxxxx Xxxxx ("Xxxxx") are hereby added
as additional Purchasers and agree to be bound by all of the terms and
conditions of the Securities Purchase Agreement and this Amendment and the
Company and the Majority Purchasers hereto consent to Xxxxxxx and Gross being
added as additional Purchasers.
1.2 Schedule 2.1 to the Securities Purchase Agreement is hereby deleted in
------------
its entirety and the revised Schedule 2.1, attached to this Amendment as Exhibit
------------ -------
A, is substituted therefor.
-
SECTION 2. Amendment to Securityholders' Agreement. Effective as of the
---------------------------------------
date hereof, the Securityholders' Agreement is hereby amended as follows:
2.1 Xxxxxxx and Xxxxx are hereby added as Securityholders, Management and
Management Holders and agree to be bound by all of the terms and conditions of
the Securityholders' and this Amendment and the Company and the Majority
Purchasers hereto consent to Xxxxxxx and Gross being added as Securityholders,
Management and Management Holders.
SECTION 3. Representations and Warranties.
------------------------------
3.1 The Company hereby represents and warrants that (i) it has full power
and authority to execute and deliver this Amendment and to perform its
obligations hereunder, (ii) it has taken all action necessary for the execution
and delivery by it of this Amendment and the performance by it of its
obligations hereunder, and (iii) this Amendment constitutes its valid and
binding obligation enforceable against it in accordance with its terms except to
the extent enforceability may be subject to bankruptcy, insolvency, moratorium
and other similar laws affecting the rights of creditors generally or the
application of principles of equity, whether in an action at law or proceeding
in equity.
SECTION 4. Reference to and Effect Upon the Securities Purchase Agreement
--------------------------------------------------------------
and Securityholders' Agreement.
------------------------------
4.1 Except as specifically amended above, the Securities Purchase
Agreement and Securityholders' Agreement shall remain in full force and effect
and are hereby ratified and confirmed.
4.2 The execution, delivery and effectiveness of this Amendment shall not
operate as a waiver of any right, power or remedy of any Purchaser or
Securityholder under the Securities Purchase Agreement and Securityholders'
Agreement, nor constitute an amendment of any provision of the Securities
Purchase Agreement or Securityholders' Agreement, except as specifically set
forth herein. Upon the effectiveness of this Amendment (i) each reference in the
Securities Purchase Agreement and the Securityholders' Agreement to "this
Agreement, "hereunder", "hereof', "herein" or words of similar import shall mean
and be a reference to the Securities Purchase Agreement or Securityholders'
Agreement, as the case may be, as amended hereby.
SECTION 5. Governing Law. This Amendment shall be governed by and construed
-------------
under the laws of Delaware as such laws are applied to contracts made and to be
fully performed entirely within that state between residents of that state.
SECTION 6. Section Titles. The section titles contained in this Amendment
--------------
are and shall be without substance, meaning or content of any kind whatsoever
and are not a part of the agreement between the parties hereto.
-2-
SECTION 7. Counterparts. This Amendment may be executed in any number of
------------
counterparts, each of which when so executed shall be deemed an original but all
such counterparts shall constitute one and the same instrument.
[Remainder of page intentionally left blank]
-3-
IN WITNESS WHEREOF, this Amendment has been duly executed and delivered by
the parties hereto as of the day and year first above written.
CARRIER ONE, LLC
By:_____________________________________
Name: Xxxxx X. Xxxxxxx
Title: Chairman
PROVIDENCE EQUITY PARTNERS L.P.,
By Providence Equity Partners L.L.C.,
its general partner
By:_____________________________________
Name: Xxxxx X. Xxxxxxx
Title: Managing Director
PROVIDENCE EQUITY PARTNERS II L.P.
By Providence Equity Partners L.L.C.,
its general partner
By:_____________________________________
Name: Xxxxx X. Xxxxxxx
Title: Managing Director
________________________________________
Xxxxx Xxxxxxx
________________________________________
Xxxxxx Xxxxx
[Signature page to Amendment No. 1 to Securities Purchase Agreement and
Securityholders' Agreement]
-4-
AMENDMENT NO. 2
TO
SECURITIES PURCHASE AGREEMENT
AND
SECURITYHOLDERS' AGREEMENT
This Amendment No. 2, dated as of May 29 , 1998, is entered into by and
among Carrier One, LLC, a limited liability company formed under the laws of
Delaware (the "Company"), and the Person listed on the signature pages hereto
(said Amendment being referred to as "this Amendment"). Capitalized terms used
in this Amendment and not otherwise defined herein shall have the meanings
ascribed thereto in the "Securities Purchase Agreement" (as defined below) and
the "Securityholders' Agreement" (as defined below) as amended hereby.
WITNESSETH:
WHEREAS, the Company, Providence Equity Partners L.P. ("PEP"), Providence
Equity Partners II L.P. (PEP II"), Stig Johansson, Xxxxxxx Xxxxx, Xxxxxx X.
Xxxxx, Xxxx Van Ophem, Xxxx Xxxxxx, Xxxxx Xxxxxxx and Xxxxxx Xxxxx are parties
to the Securities Purchase Agreement dated as of March 4, 1998 as amended by
Amendment No. 1 to Securities Purchase Agreement and Securityholders Agreement
dated April 1, 1998 (the "Securities Purchase Agreement");
WHEREAS, the Company, Providence Equity Partners L.P. ("PEP"), Providence
Equity Partners II L.P. ("PEP II"), Stig Johansson, Xxxxxxx Xxxxx, Xxxxxx X.
Xxxxx, Xxxx Van Ophem, Xxxx Xxxxxx, Xxxxx Xxxxxxx and Xxxxxx Xxxxx are parties
to the Securityholders' Agreement dated as of March 4, 1998 as amended by
Amendment No. 1 to Securities Purchase Agreement and Securityholders Agreement
dated April 1, 1998 (the "Securityholders' Agreement");
WHEREAS, the Company and the Majority Purchasers have agreed to amend the
Securities Purchase Agreement and Securityholders' Agreement as provided herein;
NOW, THEREFORE, in consideration of the terms and conditions set forth
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, the parties
hereto hereby agree as follows:
SECTION 1. Amendment to Securities Purchase Agreement. Effective as of the
------------------------------------------
date hereof, the Securities Purchase Agreement is hereby amended as follows:
1.1 Xxxxxx Xxxxxxx ("Poulter") is hereby added as and additional Purchaser
and agree to be bound by all of the terms and conditions of the Securities
Purchase Agreement and this Amendment and the Company and the Majority
Purchasers hereto consent to Poulter being added as an additional Purchaser.
1.2 Schedule 2.1 to the Securities Purchase Agreement is hereby deleted in
------------
its entirety and the revised Schedule 2.1, attached to this Amendment as Exhibit
------------ -------
A, is substituted therefor.
-
SECTION 2. Amendment to Securityholders' Agreement. Effective as of the
---------------------------------------
date hereof, the Securityholders' Agreement is hereby amended as follows:
2.1 Poulter is hereby added as a Securityholder, Management and Management
Holder and agrees to be bound by all of the terms and conditions of the
Securityholders' Agreement and this Amendment and the Company and the Majority
Purchasers hereto consent to Poulter being added as a Securityholder, Management
and Management Holder.
SECTION 3. Representations and Warranties.
------------------------------
3.1 The Company hereby represents and warrants that (i) it has full power
and authority to execute and deliver this Amendment and to perform its
obligations hereunder, (ii) it has taken all action necessary for the execution
and delivery by it of this Amendment and the performance by it of its
obligations hereunder, and (iii) this Amendment constitutes its valid and
binding obligation enforceable against it in accordance with its terms except to
the extent enforceability may be subject to bankruptcy, insolvency, moratorium
and other similar laws affecting the rights of creditors generally or the
application of principles of equity, whether in an action at law or proceeding
in equity:
SECTION 4. Reference to and Effect Upon the Securities Purchase Agreement
--------------------------------------------------------------
and Securityholders' Agreement.
------------------------------
4.1 Except as specifically amended above, the Securities Purchase
Agreement and Securityholders' Agreement shall remain in full force and effect
and are hereby ratified and confirmed.
4.2 The execution, delivery and effectiveness of this Amendment shall not
operate as a waiver of any right, power or remedy of any Purchaser or
Securityholder under the Securities Purchase Agreement and Securityholders'
Agreement, nor constitute an amendment of any provision of the Securities
Purchase Agreement or Securityholders' Agreement, except as specifically set
forth herein. Upon the effectiveness of this Amendment (i) each reference in the
Securities Purchase Agreement and the Securityholders' Agreement to "this
Agreement", "hereunder", "hereof," "herein" or words of similar import shall
mean and be a reference to the Securities Purchase Agreement or Securityholders'
Agreement, as the case may be, as amended hereby.
SECTION 5. Governing Law. This Amendment shall be governed by and
-------------
construed under the laws of Delaware as such laws are applied to contracts made
and to be fully performed entirely within that state between residents of that
state.
-2-
SECTION 6. Section Titles. The section titles contained in this Amendment
--------------
are and shall be without substance, meaning or content of any kind whatsoever
and are not a part of the agreement between the parties hereto.
SECTION 7. Counterparts. This Amendment may be executed in any number of
------------
counterparts, each of which when so executed shall be deemed an original but all
such counterparts shall constitute one and the same instrument.
[Remainder of page intentionally left blank]
-3-
AMENDMENT NO. 3
TO
SECURITIES PURCHASE AGREEMENT
This Amendment No. 3, dated as of June 30, 1998. is entered into by and
among Carrier One, LLC, a limited liability company formed under the laws of
Delaware (the "Company"), and the Persons listed on the signature pages hereto
(said Amendment being referred to as "this Amendment"). Capitalized terms used
in this Amendment and not otherwise defined herein shall have the meanings
ascribed thereto in the "Securities Purchase Agreement" (as defined below).
WITNESSETH:
WHEREAS, the Company, Providence Equity Partners L.P. ("PEP"), Providence
Equity Partners II L.P. ("PEP 11"), Stig Johansson, Xxxxxxx Xxxxx, Xxxxxx X.
Xxxxx, Xxxx Van Ophem, Xxxx Xxxxxx, Xxxxx Xxxxxxx. Xxxxxx Xxxxx and Xxxxxx
Xxxxxxx are parties to that certain Securities Purchase Agreement, dated as of
March 4, 1998 as amended by Amendment No. I to Securities Purchase Agreement and
Securityholders' Agreement dated as of April 1, 1998 and as further amended by
Amendment No. 2 to Securities Purchase Agreement and Securityholders' Agreement
dated as of May 29, 1998 (as the same may be further amended in accordance with
its terms, the "Securities Purchase Agreement");
WHEREAS. the Company and the Majority Purchasers have agreed to amend the
Securities Purchase Agreement as provided herein;
NOW, THEREFORE, in consideration of the terms and conditions set forth
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, the parties
hereto hereby agree as follows:
SECTION 1. Amendment to Securities Purchase Agreement. Effective as of the
------------------------------------------
date hereof, the Securities Purchase Agreement is hereby amended as follows:
1.1 Primus Capital Fund IV Limited Partnership ("PCF") and Primus
Executive Fund Limited Partnership ("PEF") are hereby added as additional
Purchasers as of the date hereof and agree to be bound by all of the terms and
conditions of the Securities Purchase Agreement and this Amendment and the
Company and the Majority Purchasers hereby consent to PCF and PEF being added as
additional Purchasers.
1.2 Schedule 2.1 to the Securities Purchase Agreement is hereby deleted in
------------
its entirety and the revised Schedule 2.4, attached to this Amendment as Exhibit
------------ -------
A, is substituted therefor.
-
1.3 The following defined terms set forth in Section 1.1 of the Securities
Purchase Agreement are modified and amended to read as follows:
Affiliate. The term "Affiliate" shall mean any Person directly or
---------
indirectly controlling, controlled by or under direct or indirect common control
with the Company (or other specified Person) and shall include (a) any Person
who is a manager, officer, director or beneficial owner of at least 10% of the
then Equity Securities (on a fully diluted basis) of the Company (or other
specified Person) and Family Members of any such Person, (b) any Person of which
the Company (or other specified Person) or an Affiliate (as defined in clause
(a) above) of the Company (or other specified Person) shall, directly or
indirectly, either beneficially own at least 10% of the then outstanding Equity
Securities or constitute at least a 10% equity participant, and (c) in the case
of a specified Person who is an individual, Family Members of such Person.
Business Day. The term "Business Day" shall mean any day other than
------------
Saturday, Sunday, a federal holiday or other day on which commercial banks in
the State of Rhode Island or in Cleveland, Ohio are required or permitted to
close by law.
Management. The term "Management" shall mean Stig Johansson, Joachiin
----------
Xxxxx, Xxxxxx X. Xxxxx, Xxxx Van Qphern, Xxxx Xxxxxx, Xxxxx Xxxxxxx, Xxxxxx
Xxxxx and Xxxxxx Xxxxxxx.
Primus. The term "Primus" means PCF and PEF.
------
Providence. The term "Providence" means Providence Equity Partners L.P. and
----------
Providence Equity Partners II L.P.
Purchased Securities. The term "Purchased Securities" shall mean the Class
--------------------
A Units being purchased by the Purchasers (including without limitation Primus)
pursuant to Section 2.1 of this Agreement, the capital stock issued or issuable
or otherwise received by the Purchasers and/or the holders of their Equity
Securities in connection with the transactions contemplated by Section 4 of the
Securityholders' Agreement and any Units, capital stock or other securities of
the Company issued or issuable upon an exchange, conversion, reorganization,
reclassification, recapitalization. merger, consolidation or other similar
business transaction involving the Company, its Subsidiaries or otherwise.
1.4 Sections 2.3(a) and (b) of the Securities Purchase Agreement are
-----------------------
amended in their
entirety to read as follows:
"(a) Prior to the date of this Amendment, each Purchaser other than PCF
and PEF has purchased that number of Purchased Securities set opposite such
Purchaser's name on Schedule 2.1 under the heading "Number of Purchased
------------
Securities Owned As of June 30, 1998." On the date hereof PCF and PEE shall
purchase, at the Per Unit Price, that number of Purchased Securities as is set
opposite its name on Schedule 2.1 under the heading "Number of Purchased
------------
Securities to Be Purchased On June 30, 1998", such that, after giving effect to
such purchase, PCF and PEF will own, in the aggregate, that number of Purchased
Securities as is equal to one-third the number of Purchased Securities then
owned by Providence.
-2-
At the Subsequent Closings held after June 30, 1998, subject to the terms
and conditions set forth herein, the Company shall sell to each Purchaser, and
each Purchaser severally agrees to purchase from the Company, at the Per Unit
Price an aggregate of up to that number of Purchased Securities indicated on
Schedule 2.1 under the heading "Maximum Number of Purchased Securities to he
------------
Purchased at Subsequent Closings after June 30, 1998" (collectively', the
"Additional Purchased Securities"). The maximum number of Additional Purchased
Securities shall aggregate the maximum number of Class A Units to be purchased
by all Purchasers as reflected on Schedule 2.1 less the aggregate number of
Class A Units purchased at the Initial Closing and Subsequent Closings held
prior to June 30, 1998.
(b) The Company may, upon at least thirty (30) days prior written notice to
each Purchaser given by the Company's Board of Directors (the "Call Notice"),
designate a date (which shall be a Business Day) for the closing (a "Subsequent
Closing") of the purchase by the Purchasers of Additional Purchased Securities
(each a "Subsequent Closing Date"), which Call Notice shall specify the
aggregate number of Additional Purchased Securities to be purchased by the
Purchasers on such Subsequent Closing Date. The determination of whether to
make a Call Notice shall be in the sole and absolute discretion of the Board of
Directors. No Call Notices shall be given after March 31, 2002 without the
written approval of the Majority Purchasers and, if Primus holds any Class A
Units, the written approval of Primus. Notwithstanding the foregoing. the
Company' shall be obligated to cause one or more Call Notices to be made to
assure that the Company and its Subsidiaries have sufficient funds to pay the
amounts owed to Management under the Employment Agreements from the date hereof
to March 1, 1999 (the "Management Compensation Calls"'). Subject to the
provisions of this Section 2.3, at each Subsequent Closing the Purchasers shall
purchase the Additional Purchased Securities specified in the applicable Call
Notice pro rata in proportion to the number of Purchased Securities held by each
Purchaser on June 30, 1998 after giving effect to the purchases of Purchased
Securities by PCF and PEF on June 30, 1998; provided, however, (A) no Purchaser
shall be obligated to purchase more than that number of Purchased Securities as
is set opposite such Purchaser's name on Schedule 2.1 under the heading "Maximum
------------
Total Number of Purchased Securities to be Purchased", (B) Management shall
purchase Additional Purchased Securities in the ratio provided for in Section
3.1 of the LLC Agreement and (C) Primus' obligation to purchase more than an
aggregate of 10 million Class A Units is subject to the provisions of Section
2.3(d) hereof. Each Subsequent Closing will take place at the offices of
Xxxxxxx & Xxxxxx, LLP, Xxx XxxxXxxxxx Xxxxx, Xxxxxxxxxx, Xxxxx Xxxxxx 00000 at
10:00 a.m. on the date specified in the Call Notice or at such other time, date
and place as the Company and the Majority Purchasers may agree upon."
1.5 Section 2.3 of the Securities Purchase Agreement is amended by adding
the following subparagraph (d):
"(d) On the earlier of (such earlier date being the "Election Date") (i)
the date Primus receives a Call Notice which would obligate it to purchase Class
A Units bringing the aggregate number of Class A Units purchased by Primus
pursuant to this Agreement above 10 million and (ii) the date Primus receives
written notice from Providence that Providence has made a firm
-3-
commitment (which commitment shall be considered "firm" even if subject to
customary conditions) to an unaffiliated third party, or to the Company for the
benefit of an unaffiliated third party, to purchase a number of Class A Units
that would result in Providence having purchased more than 30 million Class A
Units pursuant to this Agreement (the "Commitment Notice"), Primus shall have a
one time election (the "Election") to (A) reduce the maximum number of Class A
Units to be purchased by Primus under this Agreement from 15 million Class A
Units to any amount which is not less than 10 million Class A Units (the
"Adjusted Primus Commitment") and/or (B) assign to one or more other private
equity funds controlled by a majority of the current stockholders of Primus
Venture Partners IV. Inc. (the "Permitted Assignees") its rights and obligations
to purchase any amount of Class A Units up to that number of Class A Units as is
equal to 15 million Class A Units less the Adjusted Primus Commitment. If Primus
fails to make a timely election, Primus shall cease to have the right to reduce
its commitment to purchase 15 million Class A Units under this Agreement. Primus
shall make its Election by giving written notice thereof to Providence and the
Company within 15 days after the Election Date (the "Election Notice"). Subject
to the provisions of the next paragraph, Primus' failure to give a timely
Election Notice shall be deemed a waiver of its rights under this Section
2.3(d). Primus' right to assign its rights and obligations to Permitted
Assignees shall be conditioned upon the Permitted Assignees becoming parties to
this Agreement and the Related Agreements to which Primus is then a party.
In the event Providence does not purchase Additional Purchased Securities
pursuant to the Call Notice referred to in clause (1) of the preceding paragraph
or Providence is released from its commitment referred to in clause (ii) above
or such commitment is terminated or expires, Primus will have the right to
revoke its Election and again have the right to make an Election in accordance
with the provisions of the preceding paragraph.
To the extent that the maximum number of Class A Units to be purchased by
Primus and its Permitted Assignees pursuant to this Agreement is reduced below
15 million Class A Units. the maximum commitment of Providence shall be
increased on a dollar for dollar basis."
1.6 Article VII of the Securities Purchase Agreement is amended by adding
the following paragraph immediately prior to the last sentence of such Article.
(d) If to PCF or PEF, to them at:
Primus Venture Partners IV, Inc.
0000 Xxxxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxx Xxxxxxx, Xxxx 00000
Attention: Xxxxxxxx X. Xxxx
Facsimile: 000-000-0000
Telephone: 000-000-0000
-4-
with a copy to:
Xxxxxxxx & Xxxxx
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxx X. Xxxx
Facsimile: 000-000-0000
Telephone: 000-000-0000
1.7 Article VIII of the Securities Purchase Agreement is amended by adding
the following sentence after the first sentence of such Article:
"No modification to or amendment of this Agreement shall materially
and disproportionately affect any Purchaser without the approval or consent of
the Purchaser so affected and for so long as Primus owns any Class A Units no
modification or amendment to Section 2.3(b), (c) or (d) or this Article VIII
shall be made without the written consent of Primus."
1.8 Article VIII of the Securities Purchase Agreement is amended by
amending the proviso in the last sentence thereof to read as follows:
"; provided that Providence and any private equity fund controlled
directly or indirectly by a majority of the current managing directors of
Providence's general partner, shall retain sufficient Purchased Securities
to be the Majority Purchaser."
SECTION 2. Representations and Warranties.
------------------------------
2.1 The Company hereby represents and warrants to each Purchaser, and each
Purchaser represents and warrants to the Company and the other Purchasers that
(I) it has full power and authority to execute and deliver this Amendment and to
perform its obligations hereunder, (ii) it has taken all action necessary for
the execution and delivery by it of this Amendment and the performance by it of
its obligations hereunder, and (iii) this Amendment constitutes its valid and
binding obligation enforceable against it in accordance with its terms except to
the extent enforceability may be subject to bankruptcy, insolvency, moratorium
and other similar laws affecting the rights of creditors generally or the
application of principles of equity, whether in an action at law or proceeding
in equity.
SECTION 3. Reference to and Effect Upon the Securities Purchase Agreement.
--------------------------------------------------------------
3.1 Except as specifically amended above, the Securities Purchase
Agreement shall remain in full force and effect and is hereby ratified and
confirmed.
3.2 The execution, delivery and effectiveness of this Amendment shall not
operate as a waiver of any right, power or remedy of any Purchaser under the
Securities Purchase Agreement, nor constitute an amendment of any provision of
the Securities Purchase Agreement, except as
SECTION 4. Expenses. The Company hereby agrees to pay all reasonable fees,
--------
costs and expenses incurred by Primus in connection with the transactions
hereunder, including without limitation (i) the cost and expenses of preparing
this Amendment, Amendment No. 3 to the Securityholders' Agreement and Amendment
No. 1 to the Limited Liability Company Agreement (together, the "Primus
Amendments"); (ii) the reasonable fees, expenses and disbursements of Xxxxxxxx &
Xxxxx, Primus' counsel, in connection with the Primus Amendments; (iii) out-of-
pocket fees, expenses and costs incurred by Primus in connection with their due
diligence investigation of the Company and its Subsidiaries; and (iv) all fees
including, without limitation, any recording fees, filing fees and documentary
stamp and similar taxes, relating to the Primus Amendments.
SECTION 5. Governing Law. This Amendment shall be governed by and
--------------
construed under the laws of Delaware as such laws are applied to contracts made
and to be fully performed entirely within that state between residents of that
state.
SECTION 6. Section Titles. The section titles contained in this Amendment
--------------
are and shall be without substance, meaning or content of any kind whatsoever
and are not a part of the agreement between the parties hereto.
SECTION 7. Counterparts. This Amendment may be executed in any number of
------------
counterparts, each of which when so executed shall be deemed an original hut all
such counterparts shall constitute one and the same instrument.
IN WITNESS WHEREOF. this Amendment has been duly executed and delivered by
the parties hereto as of the day and year first above written.
CARRIER ONE, LLC
By:________________________________
Name: Xxxxx X. Xxxxxxx
Title: Chairman
[Signature page to Amendment No. 3 to Securities Purchase Agreement]
-6-
PROVIDENCE EQUITY PARTNERS L.P.
By Providence Equity Partners L.L.C.,
its general partner
By:____________________________________
Name: Xxxxx X. Xxxxxxx
Title: Managing Director
PROVIDENCE EQUITY PARTNERS II L.P.,
By Providence Equity Partners L.L.C.,
its general partner
By:____________________________________
Name: Xxxxx X. Xxxxxxx
Title: Managing Director
_______________________________________
Stig Johansson
_______________________________________
Xxxxxxx Xxxxx
_______________________________________
Xxxxxx X. Xxxxx
_______________________________________
Kees Van Ophem
_______________________________________
Xxxx Xxxxxx
_______________________________________
Xxxxx Xxxxxxx
_______________________________________
Xxxxxx Xxxxx
_______________________________________
Xxxxxx Xxxxxxx
[Signature page to Amendment No. 3 to Purchase Agreement]
-7-
PRIMUS CAPITAL FUND IV
LIMITED PARTNERSHIP
By: Primus Venture Partners IV Limited Partnership
Its: General Partner
By: Primus Venture Partners IV, Inc.
Its: General Partner
By:_______________________________________________
Name: Xxxxxxxx X. Xxxx
Title: Executive Vice President
PRIMUS EXECUTIVE FUND
LIMITED PARTNERSHIP
By: Primus Venture Partners IV Limited Partnership
Its: General Partner
By: Primus Venture Partners IV, Inc.
Its: General Partner
By:_______________________________________________
Name: Xxxxxxxx X. Xxxx
Title: Executive Vice President
[Signature page to Amendment No. 3 to Securities Purchase Agreement]
-8-
