Exhibit 99.25
TERMINATION AGREEMENT
THIS TERMINATION AGREEMENT (this "Termination Agreement") is entered
into as of April 16, 2002, by and between McLeodUSA Incorporated, a
Delaware corporation (the "Company"), and the entities listed on the
signature page hereto under the caption "FL Entities" (collectively, the
"FL Entities").
WHEREAS, the Company and the FL Entities are parties to that certain
Exchange Agreement, dated as of September 30, 2001 (the "Exchange
Agreement") pursuant to which the FL Entities acquired shares of the
Company's Series D Preferred Stock, par value $.01 per share (the "Series D
Preferred"), and Series E Preferred Stock, par value $.01 per share
(collectively with the Series D Preferred, the "2001 Preferred");
WHEREAS, the Company and the FL Entities are parties to that certain
Registration Rights Agreement, dated as of September 30, 2001 (the
"Original Registration Rights Agreement");
WHEREAS, the Company, the purchaser parties thereto and the FL
Entities are parties to that certain Amended and Restated Purchase
Agreement, dated as of January 30, 2002 (the "Purchase Agreement"),
pursuant to which, among other things, the Company and the FL Entities
agreed that at the closing of the transactions contemplated by the
Restructuring, the Company and the FL Entities would enter into an
agreement terminating the Exchange Agreement and confirming that the
Original Registration Rights Agreement shall continue in full force and
effect in accordance with its terms except as modified herein;
WHEREAS, on January 31, 2002, the Company filed a plan of
reorganization (the "Plan"), pursuant to which, among other things, the FL
Entities will exchange their shares of 2001 Preferred for shares of the
Company's Class B Common Stock, par value $.01 per share, and the Company's
Class C Common Stock, par value $.0l per share, as part of a capital
restructuring of the Company provided for in the Plan (the
"Restructuring"); and
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements hereinafter set forth, and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the
parties hereto hereby agree as follows:
1. TERMINATION
The Exchange Agreement shall be terminated in its entirety upon
consummation of the Restructuring and shall thereafter be of no further
force and effect, except (i) for the reimbursement of any unreimbursed
expenses as provided in Section 4.6(c) of the Exchange Agreement and (ii)
as provided in Section 2 hereof.
2. REGISTRATION RIGHTS
The Parties agree and confirm that the Original Registration Rights
Agreement shall continue in full force and effect in accordance with its
terms, except that:
(i) the definition of Registrable Securities contained in the
Original Registration Rights Agreement is hereby deleted
in its entirety and replaced with the following
definition: "'Registrable Securities' means (i) any shares
of Common Stock owned by the Purchasers, (ii) any shares
of Common Stock issued or issuable upon the conversion,
exercise or exchange of any shares of Class B Common
Stock, Class C Common Stock or any other Common Stock
equivalents at any time held by the Purchasers, and (iii)
any shares of Common Stock issued with respect to the
Common Stock referred to in clauses (i) or (ii) by way of
a stock dividend, stock split or reverse stock split or in
connection with a combination of shares, recapitalization,
merger, consolidation or otherwise. For purposes of this
Agreement, a Purchaser shall be deemed to own Registrable
Securities whenever such Purchaser has the right to
acquire such Registrable Securities (upon conversion,
exercise or otherwise) and such Purchaser shall not be
required to convert or exercise such securities to
participate in any registered offering hereunder prior to
the closing of such offering. As to any particular
Registrable Securities, such securities shall cease to be
Registrable Securities (a) when a registration statement
with respect to the sale of such securities shall have
become effective under the Securities Act and such
securities shall have been disposed of in accordance with
such registration statement, (b) when such securities
shall have been otherwise transferred or disposed of and
new certificates for them not bearing a legend restricting
further transfer shall have been delivered by the Company
and subsequent transfer or distribution of them shall not
require registration of them under the Securities Act, or
(c) when such securities shall have been sold as permitted
by, and in compliance with, the Securities Act unless any
of the registration rights contained herein shall have
been assigned to the purchaser or other transferee of such
securities pursuant to Section 7 hereof.";
(ii) the first sentence of Section 2.1 (a) of the Original
Registration Rights Agreement is hereby amended to delete
the phrase: "At any time or from time to time that the
Purchasers are permitted to transfer Registrable
Securities under Section 4.12 of the Exchange Agreement";
(iii) the first sentence of Section 2.2(a) of the Original
Registration Rights Agreement is hereby amended to delete
the phrase: "and provided that the Purchasers are
permitted to transfer Registrable Securities under Section
4.12 of the Exchange Agreement";
(iv) the first sentence of Section 3 of the Original
Registration Rights Agreement is hereby amended to delete
the phrase: "Without limiting in any way the provisions of
Section 4.12 of the Exchange Agreement"; and
(v) Section 7 of the Original Registration Rights Agreement
shall be modified by deleting the third sentence thereof
and replacing it with the following sentence: "This
Agreement may not be assigned by any of the Purchasers,
without the prior written consent of the Company (which
consent shall not be unreasonably withheld); provided
however, the Purchasers may, at their election, at any
time or from time to time, assign their rights under this
Agreement, in whole or in part, to any Affiliates of the
Purchasers; provided further, however, that if any rights
under this Agreement shall have been assigned by any of
the Purchasers to an Affiliate, then any rights to
withdraw shares from inclusion in a registration statement
pursuant to Section 2 shall be made only by the Purchasers
for themselves and all such Affiliates."
3. MISCELLANEOUS
3.1 BINDING EFFECT
This Termination Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns.
3.2 GOVERNING LAW
THIS TERMINATION AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE WITHOUT GIVING EFFECT TO
THE PRINCIPLES OF CONFLICTS OF LAW.
3.3 SUBMISSION TO JURISDICTION
Each of the parties hereto hereby irrevocably and unconditionally
consents to submit to the exclusive jurisdiction of the courts of the State
of Delaware and of the United States of America in each case located in the
State of Delaware for any litigation arising out of or relating to this
Agreement and the transactions contemplated hereby (and agrees not to
commence any litigation relating thereto except in such courts), and
further agrees that service of any process, summons, notice or document by
U.S. registered mail to its respective address set forth in Section 3.5
shall be effective service of process for any litigation brought against it
in any such court. Each of the parties hereto hereby irrevocably and
unconditionally waives any objection to the laying of venue of any
litigation arising out of this Agreement or the transactions contemplated
hereby in the courts of the State of Delaware or of the United States of
America in each case located in the State of Delaware and hereby further
irrevocably and unconditionally waives and agrees not to plead or claim in
any such court that any such litigation brought in any such court has been
brought in an inconvenient forum.
3.4 WAIVER OF JURY TRIAL
THE COMPANY AND THE FL ENTITIES HEREBY WAIVE ANY RIGHT THEY MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY ACTION, PROCEEDING OR LITIGATION
DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS
TERMINATION AGREEMENT.
3.5 NOTICES
All notices, requests, consents and other communications hereunder to
any party hereto shall be deemed to be sufficient if contained in a written
instrument delivered in person or sent by telecopy, nationally recognized
overnight courier or first class registered or certified mail, return
receipt requested, postage prepaid, addressed to such party at the address
set forth below or such other address as may hereafter be designated in
writing by such party to the other parties:
(i) if to the Company, to:
McLeodUSA Incorporated
McLeodUSA Technology Park
0000 X Xxxxxx XX
XX Xxx 0000
Xxxxx Xxxxxx, Xxxx 00000-0000
Telecopy No.: (000) 000-0000
Attention: Xxxxxxx Rings, Esq.
Group Vice President and Chief Legal Officer
with a copy to (which shall not constitute notice):
Skadden, Arps, Slate, Xxxxxxx & Xxxx (Illinois)
000 Xxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Telecopy No.: (000) 000-0000
Attention: Xxxxx X. Xxxxx, Esq.
(ii) if to the FL Entities, to:
c/o Forstmann Little & Co.
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Telecopy No.: (000) 000-0000
Attention: Xxxxxx Xxxxxx
with a copy to:
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, XX 00000
Telecopy No.: (000) 000-0000
Attention: Xxxxx Xxxxxxx, Esq.
All such notices, requests, consents and other communications shall be
deemed to have been given or made if and when delivered personally or by
overnight courier to the parties at the above addresses or sent by
electronic transmission, with confirmation received, to the telecopy
numbers specified above (or at such other address or telecopy number for a
party as shall be specified by like notice).
3.6 EXECUTION
This Termination Agreement may be executed in any number of
counterparts, and each such counterpart hereof shall be deemed to be an
original instrument, but all such counterparts together shall constitute
but one agreement.
* * *
IN WITNESS WHEREOF, the parties hereto have duly executed and
delivered this Termination Agreement as of the date first above written.
FL ENTITIES
FORSTMANN LITTLE & CO. EQUITY PARTNERSHIP-V, L.P.
By: FLC XXX Partnership, L.P.
its general partner
By:/s/ Xxxxxx X. Xxxxxx
--------------------------------
Xxxxxx X. Xxxxxx,
a general partner
FORSTMANN LITTLE & CO. SUBORDINATED DEBT AND EQUITY
MANAGEMENT BUYOUT PARTNERSHIP-VI, L.P.
By: FLC XXIX Partnership, L.P.
its general partner
By:/s/ Xxxxxx X. Xxxxxx
--------------------------------
Xxxxxx X. Xxxxxx,
a general partner
FORSTMANN LITTLE & CO. SUBORDINATED DEBT AND EQUITY
MANAGEMENT BUYOUT PARTNERSHIP-VII, L.P.
By: FLC XXXIII Partnership, L.P.
its general partner
By:/s/ Xxxxxx X. Xxxxxx
--------------------------------
Xxxxxx X. Xxxxxx,
a general partner
MCLEODUSA INCORPORATED
By:/s/ Xxxxx X. Xxxxx
--------------------------------
Name: Xxxxx X. Xxxxx
Title: Chief Operating and
Financial Officer
