EXCHANGE AGREEMENT
Exhibit
10.1
EXCHANGE
AGREEMENT (the “Agreement”), dated as of July 8, 2006, among ALLTEL Corporation,
a Delaware corporation (“ALLTEL”), X.X. Xxxxxx Securities Inc. and Xxxxxxx
Lynch, Pierce, Xxxxxx & Xxxxx Inc. (collectively, the “Investment Banks”),
and, solely with respect to Sections 2, 5, 6, 7, 8, 9 and 10 hereof, Alltel
Holding Corp., a Delaware corporation (“Spinco”).
WHEREAS,
pursuant to a Distribution Agreement dated as of December 8, 2005 between ALLTEL
and Spinco (the “Distribution Agreement”), Spinco has agreed to issue to ALLTEL,
in connection with ALLTEL’s contribution of assets and liabilities to Spinco,
$1,746,000,000 aggregate principal amount of 8⅝% senior notes due 2016 (“Spinco
Securities”);
WHEREAS,
ALLTEL desires to exchange such Spinco Securities for all or a portion of the
certain debt obligations of ALLTEL described on Schedule I ("ALLTEL Debt
Obligations") held by the Investment Banks; and the Investment Banks desire
to
exchange ALLTEL Debt Obligations for such Spinco Securities; and
WHEREAS,
on June 28, 2006, the Investment Banks and Spinco entered into a Purchase
Agreement (the “Purchase Agreement”) with X.X. Xxxxxx Securities Inc.
and
Xxxxxxx
Lynch, Pierce, Xxxxxx & Xxxxx Inc., as representatives of the initial
purchasers named therein (the “Initial Purchasers”), in connection with the sale
pursuant to Rule 144A and Regulation S under the Securities Act of 1933, as
amended, of the Spinco Securities and certain other debt securities of Spinco,
and in connection therewith Spinco will enter into a Registration Rights
Agreement with the Initial Purchasers relating to the grant by Spinco of
registration rights with respect to the Spinco Securities.
NOW
THEREFORE, in consideration of the representations, warranties and agreements
contained in this Agreement, the parties agree as follows:
1. The
Exchange.
(a)
Subject to the terms and conditions and in reliance upon the representations
and
warranties in this Agreement, at the Closing (as defined below):
(i) ALLTEL
will transfer and deliver to the Investment Banks, and the Investment Banks
will
accept, the Spinco Securities in equal amounts; and
(ii) the
Investment Banks will transfer and deliver to ALLTEL, and ALLTEL will
accept
from the
Investment Banks,
ALLTEL
Debt Obligations
with
a
fair market value as of the Closing, as mutually agreed to by ALLTEL and the
Investment
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Banks
(taking into account the factors that would be relevant
in determining fair market value, including but not limited to (A) interest
rates; (B) the
credit
risk of ALLTEL; and (C) the aggregate principal amount
of
each series of ALLTEL Debt Obligations being so exchanged relative to the total
amount
of
each applicable series of such ALLTEL Debt Obligations
outstanding, in each case as of Closing), equal to $1,673,365,133.15
(the
“Exchange
ALLTEL Debt Obligations”).
(b) The
exchange of the Spinco Securities for the Exchange ALLTEL Debt Obligations
(the
“Closing”) shall occur at the office of Xxxxx Xxxx &
Xxxxxxxx,
000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx (or at such other location or locations
as may be agreed upon by the Investment Banks and ALLTEL), at
the
time
and on the date of the closing of the transactions contemplated by the Agreement
and Plan of Merger (the “Merger Agreement”) dated as of December
8,
2005
among Alltel, Spinco and Valor Communications Group, Inc. subject to
satisfaction (or waiver) of the conditions set forth in Section 4
of this
Agreement;
provided
that the
exchange shall not occur prior to July 17, 2006 (the “Closing Date”). At the
Closing, the Investment Banks shall deliver to ALLTEL (or a
custodian
on ALLTEL’s behalf, as directed) their respective holdings of the Exchange
ALLTEL Debt Obligations, and ALLTEL shall deliver to the Investment
Banks
the
Spinco Securities.
(c) As
used
in this Agreement, the term “Business Day” shall mean those days on which both
the New York Stock Exchange and banking
institutions
located in New York City are open for trading or banking, as the case may be,
in
the ordinary course of business.
2. Assignment
of Rights by ALLTEL.
Effective as of the Closing, ALLTEL hereby assigns to the Investment Banks
all
of its rights arising out of or in respect of the Spinco Securities, and Spinco
hereby consents to such assignment.
3. Representations
and Warranties.
(a)
ALLTEL
hereby represents and warrants to the Investment Banks that:
(i) ALLTEL
is
a corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware. ALLTEL has all
requisite
corporate power and authority to enter into this Agreement and to perform its
obligations hereunder. This Agreement has been duly
executed
and delivered by ALLTEL and constitutes a legal, valid and binding obligation
of
ALLTEL, enforceable against ALLTEL in accordance with
its
terms,
except as enforceability may be limited by applicable bankruptcy, insolvency
or
similar laws affecting the
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enforcement
of creditors’ rights generally
or by equitable principles relating to enforceability.
(ii) No
consent, approval, license, permit, order or authorization of, or registration,
declaration or filing with, any Federal, state, local or foreign
government
or
any court of competent jurisdiction, administrative agency or commission or
other governmental authority or instrumentality, domestic
or foreign (a “Governmental Entity”) or nongovernmental third party is
required to be obtained or made by or with respect to ALLTEL or any of its
subsidiaries,
including Spinco, in connection with the execution, delivery and performance
of
this Agreement except as have been previously obtained
or
made.
(iii) Neither
the exchange of the Spinco Securities nor the consummation of any other of
the
transactions herein contemplated nor the fulfillment
of the terms hereof will result in a breach of any of the terms and
provisions of, or constitute a default under, any indenture, mortgage, deed
of
trust or
other
agreement or instrument to which ALLTEL or any of its subsidiaries, including
Spinco, is a party or by which it is bound, or ALLTEL’s
Amended
and Restated Certificate of Incorporation or Bylaws, or any order, rule or
regulation applicable to ALLTEL or any of its subsidiaries,
including
Spinco, of any Governmental Entity having jurisdiction over ALLTEL or any of
its
subsidiaries, including Spinco, or their respective
properties.
(iv) Prior
to
the Closing, ALLTEL will have good and valid title to the Spinco Securities,
free and clear of any liens, claims,
encumbrances,
security
interests, options, charges or restrictions of any kind (collectively, “Liens”).
Upon delivery of the Spinco Securities by ALLTEL to the
Investment
Banks at the Closing in exchange for the Exchange ALLTEL Debt Obligations,
the
Investment Banks will acquire good and valid title to
such
Spinco Securities, free and clear of any Liens.
(v) When
the
Spinco Securities are issued by Spinco to ALLTEL and when they are transferred
to the Investment Banks at the Closing in
exchange
for the Exchange ALLTEL Debt Obligations, the Spinco Securities will (A) have
been duly and validly authorized and issued, (B) constitute
valid
and
legally binding obligations of Spinco enforceable against Spinco in accordance
with their terms, except as enforceability may be limited by
applicable
bankruptcy, insolvency or similar laws affecting the enforcement of creditors’
rights generally or by equitable principles relating to
enforceability,
and (C) be entitled to the benefits of the indenture governing the Spinco
Securities.
(vi) ALLTEL
has made its own independent inquiry as to the legal, tax and accounting aspects
of the transactions contemplated by this
Agreement
and any related transactions, and ALLTEL has not relied on
3
the
Investment Banks, the Investment Banks’ legal counsel or other advisors for
legal, tax or accounting advice in connection with the transactions
contemplated
by this Agreement or any related transactions.
(b) Each
of
the Investment Banks hereby severally as to itself and not jointly represents
and warrants to ALLTEL that:
(i) Such
Investment Bank is a corporation duly organized, validly existing and in good
standing under the laws of the state of its incorporation.
Such
Investment Bank has all requisite corporate power and authority to enter into
this Agreement and to perform its obligations hereunder. This
Agreement
has been duly executed and delivered by such Investment Bank and constitutes
its
legal, valid and binding obligation, enforceable against
it
in
accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency
or
similar laws affecting the enforcement
of
creditors’ rights generally or by equitable principles relating to
enforceability.
(ii) No
consent, approval, license, permit, order or authorization of, or registration,
declaration or filing with, any Governmental Entity or
nongovernmental
third party is required to be obtained or made by or with respect to such
Investment Bank in connection with the execution,
delivery
and performance of this Agreement except as have been previously obtained or
made.
(iii) Neither
the exchange of the Exchange ALLTEL Debt Obligations nor the consummation of
any
other of the transactions herein
contemplated
nor the fulfillment of the terms hereof will result in a breach of any of the
terms and provisions of, or constitute a default under, any
indenture,
mortgage, deed of trust or other agreement or instrument to which such
Investment Bank is a party or by which it is bound, or such
Investment
Banks’ charter or other organizational documents, or any order, rule or
regulation applicable to it of any Governmental Entity having
jurisdiction
over it or its properties.
(iv) Such
Investment Bank has good and valid title to the Exchange ALLTEL Debt Obligations
to be exchanged by it pursuant to this
Agreement,
free and clear of any Liens. Upon delivery of such Exchange ALLTEL Debt
Obligations by such Investment Bank to ALLTEL at the
Closing
in exchange for the Spinco Securities, ALLTEL will acquire good and valid title
to such Exchange ALLTEL Debt Obligations, free and clear
of
any
Liens.
(v) Such
Investment Bank has made its own independent inquiry as to the legal, tax and
accounting aspects of the transactions contemplated
by
this
Agreement and any related transactions, and it has not relied on ALLTEL,
ALLTEL’s legal counsel or ALLTEL’s other advisors for legal,
4
tax
or
accounting advice in connection with the transactions contemplated by this
Agreement or any related transactions.
4. Conditions.
(a) The
obligations of the Investment Banks to exchange the Exchange ALLTEL Debt
Obligations for the Spinco Securities at the Closing
shall
be subject to the satisfaction (or waiver by the Investment Banks) of the
following conditions:
(i) ALLTEL
shall have furnished to the Investment Banks an opinion of Skadden, Arps, Slate,
Xxxxxxx & Xxxx LLP dated the Closing
Date, to the effect as agreed upon between ALLTEL and the Investment
Banks.
(ii) No
statute, rule, regulation, executive order, decree, temporary restraining order,
preliminary or permanent injunction or other order
enacted, entered, promulgated, enforced or issued by any Governmental Entity
or
other legal restraint or prohibition shall be in effect preventing
the consummation of the transactions contemplated hereunder.
(iii) The
representations and warranties of ALLTEL in this Agreement shall be true and
correct in all material respects on and as of the
Closing
Date, with the same effect as if made on the Closing Date, and ALLTEL shall
have
complied with all the agreements
to be
performed or
satisfied
at or prior to the Closing Date, and ALLTEL shall have furnished to the
Investment Banks a certificate of ALLTEL, in form reasonably
satisfactory
to the Investment Banks signed by a Vice President or Treasurer of ALLTEL,
dated
the Closing Date, to the foregoing effects.
(iv) The
private letter ruling ALLTEL received from the Internal Revenue Service on
April
7, 2006 (as the same may be supplemented
from
time
to time prior to the Closing Date) shall continue to be valid as of the Closing
Date.
(v) The
Purchase Agreement shall remain in full force and effect, and all of the
conditions to the obligations of the Initial Purchasers
to
purchase and pay for the Spinco Securities as set forth in the Purchase
Agreement shall have been satisfied.
In
case
any of such conditions shall not have been fulfilled by July 31, 2006, or if
the
Merger Agreement, the Distribution Agreement or the Purchase Agreement shall
have
been
terminated in accordance with their terms, this Agreement may be terminated
by
the Investment Banks by delivering written notice of termination to ALLTEL.
Any
such
termination shall be without liability
5
of
any
party to any other party except to the extent provided in the Purchase
Agreement.
(b) The
obligations of ALLTEL to exchange the Spinco Securities for the Exchange ALLTEL
Debt Obligations at the Closing shall be subject
to
the
satisfaction (or waiver by ALLTEL) of the following conditions:
(i) The
Investment Banks shall have furnished to ALLTEL an opinion of Xxxxx Xxxx &
Xxxxxxxx, counsel for the Investment Banks,
dated
the
Closing Date, to the effect as agreed upon between ALLTEL and the Investment
Banks.
(ii) The
representations and warranties of the Investment Banks in this Agreement shall
be true and correct in all material respects on
and
as of
the Closing Date, with the same effect as if made on the Closing Date, and
the
Investment Banks shall have complied with all the
agreements
to be
performed or satisfied at or prior to the Closing Date, and the Investment
Banks
shall have furnished to ALLTEL a certificate of
each
of
the Investment Banks, in form reasonably satisfactory to ALLTEL signed by an
officer of such Investment Bank, dated the Closing Date,
to
the
foregoing effects.
In
case
any of such conditions shall not have been fulfilled by July 31, 2006, or if
the
Merger Agreement, the Distribution Agreement or the Purchase Agreement shall
have
been
terminated in accordance with their terms, this Agreement may be terminated
by
ALLTEL by delivering written notice of termination to the Investment Banks. Any
such
termination shall be without liability of any party to any other party except
to
the extent provided in the Purchase Agreement.
5. Relationship
of Parties.
All
acquisitions of the Exchange ALLTEL Debt Obligations by the Investment Banks,
all exchanges of the Exchange ALLTEL Debt Obligations for the Spinco Securities
by the Investment Banks pursuant to this Agreement, any resales by the
Investment Banks of the Spinco Securities and all other acts or omissions of
the
Investment Banks in connection with this Agreement, are for the Investment
Banks’ own account and not for the account of ALLTEL. No principal-agent
relationship is, or is intended to be created between ALLTEL and the Investment
Banks, by any of the provisions of this Agreement. Each of ALLTEL and Spinco
acknowledges and agrees that the Investment Banks are acting solely in the
capacity of an arm’s length contractual counterparty to ALLTEL and Spinco with
respect to the transactions contemplated hereby (including in connection with
determining the terms of the offering under the Purchase Agreement) and not
as a
financial advisor or a fiduciary to, or an agent of, ALLTEL, Spinco or any
other
person.
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6. Survival
of Provisions.
The
respective agreements, representations, warranties and other statements of
ALLTEL and of the Investment Banks and agreements of Spinco set forth in or
made
pursuant to this Agreement will remain in full force and effect, regardless
of
any investigation made by or on behalf of the Investment Banks, ALLTEL, Spinco
or any of their respective officers and will survive the exchange of the
Exchange ALLTEL Debt Obligations for the Spinco Securities.
7. Notices.
All
notices or other communications under this Agreement shall be in writing and
shall be deemed to be duly given as of the date delivered, mailed or
transmitted, and shall be effective upon receipt, if delivered personally,
mailed by registered or certified mail (postage prepaid, return receipt
requested) or delivered by a nationally recognized courier service to the
parties at the following address or sent by electronic transmission to the
telecopier numbers specified below:
If
to the
Investment Banks,
to:
Xxxxxxx
Xxxxx & Co.
4
World
Financial
Xxx
Xxxx,
XX 00000
Attention:
Liability Management
Desk
Fax:
(000) 000-0000
and
X.X. Xxxxxx Securities Inc.
000
Xxxx
Xxxxxx
Xxx
Xxxx,
XX 00000-0000
Attention:
Liability Management
Desk
Fax:
(000)
000-0000
If
to
ALLTEL,
to:
ALLTEL
Corporation
Xxx Xxxxxx Xxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: General Counsel
Fax: (000)
000-0000
If
to Spinco, to:
|
Alltel Holding Corporation
|
0000 Xxxxxx Xxxxxx Xxxx
|
Xxxxxx Xxxx, XX 00000
Attention: General Counsel
Fax: (000) 000-0000
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8. Successors.
This
Agreement will inure to the benefit of and be binding upon the parties hereto
and their respective successors and no other person will have any right or
obligation hereunder.
9. Applicable
Law.
This
Agreement shall be governed by and construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
entirely within such State, without regard to the conflicts of law principles
of
such State.
10. Counterparts.
This
Agreement may be signed in one or more counterparts, each of which shall
constitute an original and all of which together shall constitute one and the
same agreement.
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IN
WITNESS WHEREOF, the
parties have caused this Agreement to be duly executed as of the date first
written above.
ALLTEL
CORPORATION
|
|
By:
|
/s/ Xxxxx X. Xxxx |
Name: Xxxxx
X. Xxxx
|
|
Title: President and CEO
|
X.X.
XXXXXX SECURITIES INC.
|
|
By:
|
/s/ Akis Psarris |
Name: Akis
Psarris
|
|
Title: Managing
Director
|
XXXXXXX
LYNCH, PIERCE, XXXXXX & XXXXX, INC.
|
|
By:
|
/s/ Xxxxx X. Xxxxxxx |
Name: Xxxxx
X. Xxxxxxx
|
|
Title: Managing
Director
|
As
to Sections 2, 5,
6, 7, 8, 9 and
10
only:
ALLTEL
HOLDING CORP.
|
|
By:
|
/s/ Xxxxxxx X. Xxxxxxx |
Name: Xxxxxxx
X. Xxxxxxx
|
|
Title: President
and CEO
|
9
SCHEDULE
I
ALLTEL
Debt Obligations
Security
|
Principal
Amount
|
Commercial
Paper
|
$1,000,000,000
|
4.656%
Notes due 2007
|
$686,557,000
|
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