EXHIBIT 4.1
$245,000,000
TSI MERGER SUB, INC.
TO BE MERGED WITH AND INTO
TSI TELECOMMUNICATION SERVICES INC.
12 3/4% SENIOR SUBORDINATED NOTES DUE 2009
PURCHASE AGREEMENT
February 5, 2002
▇▇▇▇▇▇ Brothers Inc.
▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
TSI Merger Sub, Inc. ("TSI MERGER"), a Delaware corporation which shall be
merged (the "MERGER") with and into TSI Telecommunication Services Inc., a
Delaware corporation (the "SURVIVING CORPORATION"; references to the "COMPANY"
refer to TSI Merger prior to the Merger and the Surviving Corporation
thereafter), proposes, upon the terms and considerations set forth herein, to
issue and sell to you, as the initial purchaser (the "INITIAL PURCHASER"),
$245,000,000 in aggregate principal amount of its 12 3/4% Senior Subordinated
Notes due 2009 (the "NOTES"). The Notes will (i) have terms and provisions which
are summarized in the Offering Memorandum (as defined below) dated as of the
date hereof and (ii) are to be issued pursuant to an Indenture (the "INDENTURE")
to be entered into between the Company, the Guarantors (as defined below), and
The Bank of New York, as trustee. The Company's obligations under the Notes,
including the due and punctual payment of interest on the Notes, will be
unconditionally guaranteed (the "GUARANTEE") by TSI Telecommunication Holdings,
Inc. ("TSI INC."), TSI Telecommunication Holdings, LLC ("TSI LLC"), TSI Finance
Inc., and each of the Company's current and future domestic subsidiaries,
including TSI Networks Inc. (each, a "GUARANTOR" and together, the
"GUARANTORS"). As used herein, the term "Notes" shall include the Guarantees
thereof by the Guarantors, unless the context otherwise requires. This is to
confirm the agreement concerning the purchase of the Notes from the Company by
the Initial Purchaser.
1. PRELIMINARY OFFERING MEMORANDUM AND OFFERING MEMORANDUM. The Notes will
be offered and sold to the Initial Purchaser without registration under the
Securities Act of 1933, as amended (the "ACT"), in reliance on an exemption
pursuant to Section 4(2) under the Act. The Company and the Guarantors have
prepared a preliminary offering memorandum, dated January 15, 2002 (the
"PRELIMINARY OFFERING MEMORANDUM"), and an offering memorandum, to be dated
February 5, 2002 (the "OFFERING MEMORANDUM"), setting forth information
regarding the
Company, the Guarantors, the Notes, the Guarantees, the Exchange Notes (as
defined herein) and the Exchange Guarantees (as defined herein). Any references
herein to the Preliminary Offering Memorandum or the Offering Memorandum shall
be deemed to include all amendments and supplements thereto. The Company and the
Guarantors hereby confirm that they have authorized the use of the Preliminary
Offering Memorandum and the Offering Memorandum in connection with the offering
and resale of the Notes by the Initial Purchaser.
It is understood and acknowledged that upon original issuance thereof, and
until such time as the same is no longer required under the applicable
requirements of the Act, the Notes (and all securities issued in exchange
therefor, in substitution thereof), shall bear the following legend (along with
such other legends as the Initial Purchaser and its counsel deem necessary):
"THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933 (THE "SECURITIES ACT") AND MAY NOT BE OFFERED,
SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)(1) TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A UNDER THE SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE
903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (3) PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE), (4) TO AN INSTITUTIONAL ACCREDITED INVESTOR IN A
TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR
(5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND
(B) IN ACCORDANCE WITH ALL APPLICABLE BLUE SKY LAWS OF THE STATES OF THE UNITED
STATES."
You have advised the Company that you will make offers (the "EXEMPT
RESALES") of the Notes purchased by you hereunder on the terms set forth in the
Offering Memorandum, as amended or supplemented, solely to (i) persons whom you
reasonably believe to be "qualified institutional buyers" as defined in Rule
144A under the Act ("QIBS") and (ii) outside the United States to certain
persons in offshore transactions in reliance on Regulation S under the Act
specified in clauses (i) and (ii) being referred to herein as the ("ELIGIBLE
PURCHASERS"). You will offer the Notes to Eligible Purchasers initially at a
price equal to 97.784% of the principal amount thereof. Such price may be
changed at any time without notice.
Holders (including subsequent transferees), of the Notes will have the
registration rights set forth in the registration rights agreement (the
"REGISTRATION RIGHTS AGREEMENT"), to be dated the Closing Date (as defined
herein), in substantially the form of Exhibit A hereto, for so long as such
Notes constitute "TRANSFER RESTRICTED SECURITIES" (as defined in the
Registration Rights Agreement). Pursuant to the Registration Rights Agreement,
the Company will agree to file with the Securities and Exchange Commission (the
"COMMISSION") under the circumstances set forth therein, a registration
statement under the Act (the "EXCHANGE OFFER REGISTRATION STATEMENT") relating
to the Company's 12 3/4% Exchange Notes (the "EXCHANGE NOTES") and the
Guarantor's
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Exchange Guarantees (the "EXCHANGE GUARANTEES") to be offered in exchange for
the Notes and the Guarantees, such portion of the offering is referred to as the
"EXCHANGE OFFER."
2. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY AND THE
GUARANTORS. The Company and each of the Guarantors, jointly and severally,
represents, warrants and agrees that:
(a) When the Notes are issued and delivered pursuant to this
Agreement, such Notes will not be of the same class as securities of the Company
that are listed on a national securities exchange registered under Section 6 of
the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT") or that are
quoted in a United States automated inter-dealer quotation system.
(b) Neither the Company nor any of its subsidiaries is, and after
giving effect to the offering and sale of the Notes and the application of the
net proceeds therefrom as described under the caption "Use of Proceeds" in the
Offering Memorandum, will be, an "investment company" or a company "controlled"
by an "investment company" within the meaning of the Investment Company Act of
1940, as amended and the rules and regulations of the Commission thereunder.
(c) The Company and each of the Guarantors has all requisite corporate
power and authority to enter into the Registration Rights Agreement. The
Registration Rights Agreement has been duly authorized by the Company and the
Guarantors and, when executed by the Company and the Guarantors in accordance
with the terms hereof and thereof, will be validly executed and delivered and
(assuming the due execution and delivery thereof by you), will be the legally
valid and binding obligation of the Company and the Guarantors in accordance
with the terms hereof and thereof, enforceable against the Company and the
Guarantors in accordance with its terms, except as such enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium and other similar
laws relating to or affecting creditor's rights generally, by general equitable
principles (regardless of whether such enforceability is considered in a
proceeding in equity or at law), and, as to rights of indemnification and
contribution, by principles of public policy.
(d) Assuming that your representations and warranties in Section 3(b)
are true, the purchase and resale of the Notes pursuant hereto (including
pursuant to the Exempt Resales), is exempt from the registration requirements of
the Act. No form of general solicitation or general advertising was used by the
Company, the Guarantors or any of their respective representatives (other than
you, as to whom the Company makes no representation), in connection with the
offer and sale of the Notes, including, but not limited to, articles, notices or
other communications published in any newspaper, magazine, or similar medium or
broadcast over television or radio or any seminar or meeting whose attendees
have been invited by any general solicitation or general advertising.
(e) Set forth on Exhibit B hereto is a list of each employee pension
or benefit plan with respect to which the Surviving Corporation or any
corporation considered an affiliate of the Surviving Corporation within the
meaning of Section 407(d)(7) of the Employee Retirement Income Security Act of
1974, as amended, including the regulations and published
3
interpretations thereunder ("ERISA"), (an "AFFILIATE") will be a party in
interest or disqualified person after the Merger.
(f) Each of the Preliminary Offering Memorandum and the Offering
Memorandum, as of its date, contains all the information specified in, and
meeting the requirements of, Rule 144A(d)(4) under the Act.
(g) The Preliminary Offering Memorandum and Offering Memorandum with
respect to the Notes have both been prepared by the Company and the Guarantors
for use by the Initial Purchaser in connection with the Exempt Resales. No order
or decree preventing the use of the Preliminary Offering Memorandum or the
Offering Memorandum, or any order asserting that the transactions contemplated
by this Agreement are subject to the registration requirements of the Act has
been issued and no proceeding for that purpose has commenced or is pending or,
to the knowledge of the Company or any of the Guarantors, is contemplated.
(h) The Preliminary Offering Memorandum and the Offering Memorandum as
of their respective dates and the Offering Memorandum as of the Closing Date (as
defined below), did not or will not at any time contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, except that this
representation and warranty does not apply to statements in or omissions from
the Preliminary Offering Memorandum and Offering Memorandum made in reliance
upon and in conformity with information relating to the Initial Purchaser
furnished to the Company in writing by or on behalf of the Initial Purchaser
expressly for use therein.
(i) The market-related and customer-related data and estimates
included under the captions "Summary" and "Business" in the Preliminary Offering
Memorandum and the Offering Memorandum are based on or derived from sources
which the Company believes to be reliable.
(j) Merger Sub, the Surviving Corporation and each Guarantor have been
duly incorporated or formed and are validly existing as corporations or limited
liability companies, as the case may be, in good standing under the laws of
their respective jurisdictions, are duly qualified to do business and are in
good standing as foreign corporations or limited liability companies, as the
case may be, in each jurisdiction in which their respective ownership or lease
of property or the conduct of their respective businesses requires such
qualification, except as would not, individually or in the aggregate, have a
materially adverse effect on the business, condition (financial or otherwise),
stockholders' equity, prospects or results of operations (a "MATERIAL ADVERSE
EFFECT") of the Merger Sub, the Surviving Corporation and each Guarantor, as the
case may be, and have all power and authority necessary to own or hold their
respective properties and to conduct the businesses in which they are engaged,
except where such failure to have such power and authority would not have a
Material Adverse Effect on the Merger Sub, the Surviving Corporation and each
Guarantor; and none of the subsidiaries of the Company is a "significant
subsidiary", as such term is defined in Rule 405 of the Rules and Regulations.
(k) The Surviving Corporation has an authorized capitalization as set
forth in the Offering Memorandum, and all of the issued shares of capital stock
of the Surviving
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Corporation have been duly and validly authorized and issued, are fully paid and
non-assessable; and all of the issued shares of capital stock of each subsidiary
of the Company have been duly and validly authorized and issued and are fully
paid and non-assessable and (except for directors' qualifying shares), are owned
directly or indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims except as otherwise disclosed in the Offering
Memorandum and except for such liens, encumbrances, equities or claims that
would not be reasonably expected to have a Material Adverse Effect on the
Surviving Corporation.
(l) The Indenture has been duly and validly authorized by the Company
and the Guarantors, and upon its execution and delivery and, assuming due
authorization, execution and delivery by the Trustee, will constitute the valid
and binding agreement of the Company and the Guarantors, enforceable against the
Company and the Guarantors in accordance with its terms, subject to the
qualification that the enforceability of the Company's and the Guarantors'
obligations thereunder may be limited by bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium, and other laws relating to or affecting
creditors' rights generally and by general equitable principles; no
qualification of the Indenture under the Trust Indenture Act of 1939 (the "1939
ACT") is required in connection with the offer and sale of the Notes
contemplated hereby or in connection with the Exempt Resales. The Indenture will
conform to the description thereof in the Offering Memorandum.
(m) The Notes have been duly and validly authorized by the Company and
when duly executed by the Company in accordance with the terms of the Indenture
and, assuming due authentication of the Notes by the Trustee, upon delivery to
the Initial Purchaser against payment therefor in accordance with the terms
hereof, will have been validly issued and delivered, and will constitute valid
and binding obligations of the Company entitled to the benefits of the
Indenture, enforceable against the Company in accordance with their terms,
subject to the qualification that the enforceability of the Company's
obligations thereunder may be limited by bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium, and other laws relating to or affecting
creditors' rights generally and by general equitable principles. The Notes will
conform to the description thereof in the Offering Memorandum.
(n) The Exchange Notes have been duly and validly authorized by the
Company and if and when duly issued and authenticated in accordance with the
terms of the Indenture and delivered in accordance with the Exchange Offer
provided for in the Registration Rights Agreement, will constitute valid and
binding obligations of the Company entitled to the benefits of the Indenture,
enforceable against the Company in accordance with their terms, subject to the
qualification that the enforceability of the Company's obligations thereunder
may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium, and other laws relating to or affecting creditors' rights generally
and by general equitable principles.
(o) The Guarantees have been duly and validly authorized by the
Guarantors and when duly executed and delivered by the Guarantors in accordance
with the terms of the Indenture and upon the due execution, authentication and
delivery of the Notes in accordance with the Indenture and the issuance of the
Notes in the sale to the Initial Purchaser contemplated by this Agreement, will
constitute valid and binding obligations of the Guarantors, enforceable against
the Guarantors in accordance with their terms, subject to the qualification that
the enforceability of the Guarantors' obligations thereunder may be limited by
bankruptcy,
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fraudulent conveyance, insolvency, reorganization, moratorium, and other laws
relating to or affecting creditors' rights generally and by general equitable
principles. The Guarantees will conform to the description thereof in the
Offering Memorandum.
(p) The Exchange Guarantees have been duly and validly authorized by
the Guarantors and if and when duly executed and delivered by the Guarantors in
accordance with the terms of the Indenture and upon the due execution and
authentication of the Exchange Notes in accordance with the Indenture and the
issuance and delivery of the Exchange Notes in the Exchange Offer contemplated
by the Registration Rights Agreement, will constitute valid and binding
obligations of the Guarantors, entitled to the benefits of the Indenture,
enforceable against the Guarantors in accordance with their terms, subject to
the qualification that the enforceability of the Guarantors' obligations
thereunder may be limited by bankruptcy, fraudulent conveyance, insolvency,
reorganization, moratorium, and other laws relating to or affecting creditors'
rights generally and by general equitable principles.
(q) This Agreement has been duly authorized, executed and delivered by
the Company and the Guarantors.
(r) The issue and sale of the Notes and the Guarantees and the
compliance by the Company and the Guarantors with all of the provisions of the
Notes, the Guarantees, the Exchange Notes, the Exchange Guarantees, the
Indenture, the Registration Rights Agreement and this Agreement and the
consummation of the transactions herein and therein contemplated will not
conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the Company, the
Guarantors or any of their respective subsidiaries is a party or by which the
Company, the Guarantors or any of their respective subsidiaries is bound or to
which any of the property or assets of the Company, the Guarantors or any of
their respective subsidiaries is subject except where such conflict, breach,
violation or default would not have a Material Adverse Effect on the Company,
each of the Guarantors and their respective subsidiaries, nor will such action
result in any violation of the provisions of the Certificate of Incorporation,
Certificate of Formation, partnership agreement or By-laws or other
organizational documents, as applicable, of the Company or any of the Guarantors
or any statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Company, the Guarantors or any of
their respective subsidiaries or any of their properties; and no consent,
approval, authorization, order, registration or qualification of or with any
such court or governmental agency or body is required for the issue and sale of
the Notes and the Guarantees or the consummation by the Company and the
Guarantors of the transactions contemplated by this Agreement, the Registration
Rights Agreement or the Indenture, except for the filing of a registration
statement by the Company with the Commission pursuant to the Act pursuant to the
Registration Right Agreement hereof and such consents, approvals,
authorizations, registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the purchase and distribution of
the Notes by the Initial Purchaser, except where such failure to have such
consents, approvals, authorizations, registrations or qualifications would not
have a Material Adverse Effect on the Company, each of the Guarantors and their
respective subsidiaries.
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(s) There are no contracts, agreements or understandings between the
Company and any person granting such person the right to require the Company to
file a registration statement under the Securities Act with respect to any
securities of the Company owned or to be owned by such person or to require the
Company to include such securities in the securities registered pursuant to
Registration Rights Agreement or in any securities being registered pursuant to
any other registration statement filed by the Company under the Securities Act.
(t) During the six-month period preceding the date of the Offering
Memorandum, none of the Company, the Guarantors or any other person acting on
behalf of the Company or any Guarantor has offered or sold to any person any
Notes or Guarantees, or any securities of the same or a similar class as the
Notes or Guarantees, other than Notes or Guarantees offered or sold to the
Initial Purchaser hereunder. The Company and the Guarantors will take reasonable
precautions designed to insure that any offer or sale, direct or indirect, in
the United States or to any U.S. person (as defined in Rule 902 under the
Securities Act), of any Notes or Guarantees or any substantially similar
security issued by the Company, within six months subsequent to the date on
which the distribution of the Notes and the Guarantees has been completed (as
notified to the Company by the Initial Purchaser), is made under restrictions
and other circumstances reasonably designed not to affect the status of the
offer and sale of the Notes and the Guarantees in the United States and to U.S.
persons contemplated by this Agreement as transactions exempt from the
registration provisions of the Securities Act; including any sales pursuant to
Rule 144A under, or Regulations D or S of, the Securities Act.
(u) Neither the Company, any Guarantor nor any of their respective
subsidiaries has sustained, since the date of the latest audited financial
statements included in the Offering Memorandum, any material loss or
interference with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Offering Memorandum; and, since such date, there has not
been any change in the capital stock or long-term debt of the Company, any
Guarantor or any of their respective subsidiaries or any material adverse
change, or any development involving a prospective material adverse change, in
or affecting the general affairs, management, financial position, stockholders'
equity or results of operations of the Company, any Guarantors and their
respective subsidiaries, otherwise than as set forth or contemplated in the
Offering Memorandum.
(v) The financial statements (including the related notes and
supporting schedules), included in the Offering Memorandum present fairly the
financial condition and results of operations of the entities purported to be
shown thereby, at the dates and for the periods indicated, and have been
prepared in conformity with generally accepted accounting principles applied on
a consistent basis throughout the periods involved.
(w) Ernst & Young, who have certified certain financial statements
included in the Offering Memorandum, whose report appears in the Offering
Memorandum and who have delivered the initial letter referred to in Section 7(e)
hereof, are independent public accountants as required by the Securities Act and
the Rules and Regulations.
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(x) The Company, the Guarantors and each of their respective
subsidiaries have good and marketable title in fee simple to all real property
and good and marketable title to all personal property owned by them, in each
case free and clear of all liens, encumbrances and defects except such as are
described in the Offering Memorandum or such as do not materially affect the
value of such property and do not materially interfere with the use made and
proposed to be made of such property by the Company, the Guarantors and their
respective subsidiaries; and all real property and buildings held under lease by
the Company, the Guarantors and their respective subsidiaries are held by them
under valid, subsisting and enforceable leases, with such exceptions as are not
material and do not interfere with the use made and proposed to be made of such
property and buildings by the Company, the Guarantors and their respective
subsidiaries.
(y) The Surviving Corporation and each of its subsidiaries carry, or
are covered by, insurance in such amounts and covering such risks as is adequate
for the conduct of their respective businesses and the value of their respective
properties and as is customary for companies engaged in similar businesses in
similar industries.
(z) The Company and each of its subsidiaries own or possess adequate
rights to use all material patents, patent applications, trademarks, service
marks, trade names, trademark registrations, service ▇▇▇▇ registrations,
copyrights and licenses necessary for the conduct of their respective businesses
and do not believe that the conduct of their respective businesses will conflict
with, and have not received any notice of any claim of conflict with, any such
rights of others.
(aa) There are no legal or governmental proceedings pending to which
the Company, the Guarantors or any of their respective subsidiaries is a party
or of which any property or assets of the Company, the Guarantors or any of
their respective subsidiaries is the subject which, if determined adversely to
the Company, the Guarantors or any of their respective subsidiaries, might have
a Material Adverse Effect on the Company, the Guarantors and their respective
subsidiaries; and to the best of the Company's and the Guarantors' knowledge, no
such proceedings are threatened or contemplated by governmental authorities or
threatened by others.
(ab) No relationship, direct or indirect, required to be described
under Item 404 of Regulation S-K, exists between or among the Company on the one
hand, and the directors, officers or stockholders of the Company on the other
hand, which is not described in the Offering Memorandum.
(ac) No labor disturbance by the employees of the Company exists or, to
the knowledge of the Company, is imminent which might be expected to have a
Material Adverse Effect on the Company and its subsidiaries.
(ad) The Company is in compliance in all material respects with all
presently applicable provisions of ERISA; no "reportable event" (as defined in
ERISA), has occurred with respect to any "pension plan" (as defined in ERISA),
for which the Company would have any liability; the Company has not incurred and
does not expect to incur liability under (i) Title IV of ERISA with respect to
termination of, or withdrawal from, any "pension plan" or (ii) Sections 412 or
4971 of the Internal Revenue Code of 1986, as amended, including the regulations
and
8
published interpretations thereunder (the "Code"); and each "pension plan" for
which the Company would have any liability that is intended to be qualified
under Section 401(a) of the Code is so qualified in all material respects and
nothing has occurred, whether by action or by failure to act, which would cause
the loss of such qualification.
(ae) The Company and the Guarantors have filed all federal, state and
local income and franchise tax returns required to be filed through the date
hereof and have paid all taxes due thereon, and no tax deficiency has been
determined adversely to the Company, the Guarantors or any of their respective
subsidiaries which has had (nor does the Company or the Guarantors have any
knowledge of any tax deficiency which, if determined adversely to the Company,
the Guarantors or any of their respective subsidiaries, might have a Material
Adverse Effect on the Company, the Guarantors and their respective subsidiaries.
(af) Since the date as of which information is given in the Preliminary
Offering Memorandum through the date hereof, and except as may otherwise be
disclosed or contemplated in the Offering Memorandum, neither the Company nor
the Guarantors have (i) issued or granted any securities, (ii) incurred any
liability or obligation, direct or contingent, other than liabilities and
obligations which were incurred in the ordinary course of business, (iii)
entered into any transaction not in the ordinary course of business or (iv)
declared or paid any dividend on its capital stock (other than dividends paid by
the Surviving Corporation prior to the Merger).
(ag) The Surviving Corporation and the Guarantors (i) make and keep
accurate books and records and (ii) maintain internal accounting controls which
provide reasonable assurance that (A) transactions are executed in accordance
with management's authorization, (B) transactions are recorded as necessary to
permit preparation of its financial statements and to maintain accountability
for its assets, (C) access to their respective assets is permitted only in
accordance with management's authorization and (D) the reported accountability
for their respective assets is compared with existing assets at reasonable
intervals.
(ah) Neither the Company, the Guarantors nor any of their respective
subsidiaries (i) is in violation of its charter or by-laws, (ii) is in default
in any respect, and no event has occurred which, with notice or lapse of time or
both, would constitute such a default, in the due performance or observance of
any term, covenant or condition contained in any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which it is a party or
by which it is bound or to which any of its properties or assets is subject or
(iii) is in violation in any respect of any law, ordinance, governmental rule,
regulation or court decree to which it or its property or assets may be subject
or has failed to obtain any license, permit, certificate, franchise or other
governmental authorization or permit necessary to the ownership of its property
or to the conduct of its business, except, with regard to (ii) and (iii) of this
paragraph, for such defaults, violations or failures that would not reasonably
be expected to have a Material Adverse Effect on the Company, the Guarantors or
any of their respective subsidiaries.
(ai) Neither the Company nor any of its subsidiaries, nor any director,
officer, agent, employee or other person associated with or acting on behalf of
the Company or any of its subsidiaries, has used any corporate funds for any
unlawful contribution, gift, entertainment or other unlawful expense relating to
political activity; made any direct or indirect unlawful
9
payment to any foreign or domestic government official or employee from
corporate funds; violated or is in violation of any provision of the Foreign
Corrupt Practices Act of 1977; or made any bribe, rebate, payoff, influence
payment, kickback or other unlawful payment.
(aj) There has been no storage, disposal, generation, manufacture,
refinement, transportation, handling or treatment of toxic wastes, medical
wastes, hazardous wastes or hazardous substances by the Company or any of its
subsidiaries (or, to the knowledge of the Company, any of their predecessors in
interest), at, upon or from any of the property now or previously owned or
leased by the Company or its subsidiaries in violation of any applicable law,
ordinance, rule, regulation, order, judgment, decree or permit or which would
require remedial action under any applicable law, ordinance, rule, regulation,
order, judgment, decree or permit, except for any violation or remedial action
which would not have, or could not be reasonably likely to have, singularly or
in the aggregate with all such violations and remedial actions, a Material
Adverse Effect on the Company and its subsidiaries; there has been no material
spill, discharge, leak, emission, injection, escape, dumping or release of any
kind onto such property or into the environment surrounding such property of any
toxic wastes, medical wastes, solid wastes, hazardous wastes or hazardous
substances due to or caused by the Company or any of its subsidiaries or with
respect to which the Company or any of its subsidiaries have knowledge, except
for any such spill, discharge, leak, emission, injection, escape, dumping or
release which would not have or would not be reasonably likely to have,
singularly or in the aggregate with all such spills, discharges, leaks,
emissions, injections, escapes, dumpings and releases, a Material Adverse Effect
on the Company and its subsidiaries; and the terms "hazardous wastes", "toxic
wastes", "hazardous substances" and "medical wastes" shall have the meanings
specified in any applicable local, state, federal and foreign laws or
regulations with respect to environmental protection.
(ak) None of the transactions contemplated by this Agreement
(including, without limitation, the use of the proceeds from the sale of the
Notes), will violate or result in a violation of Section 7 of the Exchange Act,
or any regulation promulgated thereunder, including, without limitation,
Regulations T, U, and X of the Board of Governors of the Federal Reserve System.
3. PURCHASE OF THE STOCK BY THE INITIAL PURCHASER, AGREEMENTS TO SELL,
PURCHASE AND RESELL
(a) The Company and the Guarantors hereby agree, on the basis of the
representations, warranties and agreements of the Initial Purchaser contained
herein and subject to all the terms and conditions set forth herein, to issue
and sell to the Initial Purchaser and, upon the basis of the representations,
warranties and agreements of the Company and the Guarantors herein contained and
subject to all the terms and conditions set forth herein, the Initial Purchaser
agrees to purchase from the Company, at a purchase price of 95.151% of the
principal amount thereof, all of the Notes. The Company and the Guarantors shall
not be obligated to deliver any of the securities to be delivered hereunder
except upon payment for all of the securities to be purchased as provided
herein.
(b) The Initial Purchaser hereby represents and warrants to the
Company and the Guarantors that it will offer the Notes for sale upon the terms
and conditions set forth in this
10
Agreement and in the Offering Memorandum. The Initial Purchaser hereby
represents and warrants to, and agrees with, the Company and the Guarantors that
it: (i) is a QIB with such knowledge and experience in financial and business
matters as are necessary in order to evaluate the merits and risks of an
investment in the Notes; (ii) is purchasing the Notes pursuant to a private sale
exempt from registration under the Act; (iii) in connection with the Exempt
Resales, will solicit offers to buy the Notes only from, and will offer to sell
the Notes only to, the Eligible Purchasers in accordance with this Agreement and
on the terms contemplated by the Offering Memorandum; and (iv) will not offer or
sell the Notes, nor has it offered or sold the Notes by, or otherwise engaged
in, any form of general solicitation or general advertising (within the meaning
of Regulation D; including, but not limited to, advertisements, articles,
notices or other communications published in any newspaper, magazine, or similar
medium or broadcast over television or radio, or any seminar or meeting whose
attendees have been invited by any general solicitation or general advertising),
in connection with the offering of the Notes. The Initial Purchaser has advised
the Company that it will offer the Notes to Eligible Purchasers at a price
initially equal to 97.784% of the principal amount thereof, plus accrued
interest, if any, from the date of issuance of the Notes. Such price may be
changed by the Initial Purchaser at any time thereafter without notice.
(c) The Initial Purchaser understands that the Company and the
Guarantors and, for purposes of the opinions to be delivered to the Initial
Purchaser pursuant to Sections 7(c) and 7(d) hereof, counsel to the Company and
counsel to the Initial Purchaser, will rely upon the accuracy and truth of the
foregoing representations, warranties and agreements and the Initial Purchaser
hereby consents to such reliance.
4. DELIVERY OF AND PAYMENT FOR THE STOCK. DELIVERY OF THE NOTES AND
PAYMENT THEREFOR. Delivery to the Initial Purchaser of and payment for the Notes
shall be made at the office of ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, 53rd at Third, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ (the "CLOSING LOCATION") at 9:00 A.M., New York City
time, on February 14, 2002 (the "CLOSING DATE"). Such delivery and payment shall
be referred to herein as the "CLOSING". The Closing Location and the Closing
Date may be varied by agreement between the Initial Purchaser and the Company. A
meeting will be held at the Closing Location on the New York Business Day next
preceding the Closing Date, at which meeting the final drafts of the documents
to be delivered will be available for review by the parties hereto. For the
purposes of this Section 4, "NEW YORK BUSINESS DAY" shall mean each Monday,
Tuesday, Wednesday, Thursday and Friday which is not a day on which banking
institutions in New York are generally authorized or obligated by law or
executive order to close.
The Notes to be purchased by the Initial Purchaser hereunder will be
represented by one or more definitive global Notes in book-entry form, which
will be deposited by or on behalf of the Company with The Depository Trust
Company ("DTC") or its designated custodian. The Company and the Guarantors will
deliver the Notes and the Guarantees to the Initial Purchaser, for the account
of the Initial Purchaser, against payment by or on behalf of the Initial
Purchaser of the purchase price therefor by wire transfer in immediately
available funds, by causing DTC to credit the Notes to the account of the
Initial Purchaser at DTC. The Company will cause the certificates representing
the Notes to be made available to the Initial Purchaser for checking at least 24
hours prior to the Closing Date at the office of DTC or its designated
custodian.
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5. AGREEMENTS OF THE COMPANY AND THE GUARANTORS. The Company and the
Guarantors, jointly and severally agree with the Initial Purchaser as follows:
(a) The Company and the Guarantors will furnish to the Initial
Purchaser, without charge, as of the date of the Offering Memorandum, such
number of copies of the Offering Memorandum as may then be amended or
supplemented as they may reasonably request.
(b) The Company and the Guarantors will not make any amendment or
supplement to the Preliminary Offering Memorandum or to the Offering Memorandum
of which the Initial Purchaser shall not previously have been advised or to
which they shall reasonably object after being so advised.
(c) Prior to the execution and delivery of this Agreement, the Company
and the Guarantors shall have delivered or will deliver to the Initial
Purchaser, without charge, in such quantities as the Initial Purchaser shall
have requested or may hereafter reasonably request, copies of the Preliminary
Offering Memorandum. The Company and each of the Guarantors consent to the use,
in accordance with the securities or Blue Sky laws of the jurisdictions in which
the Notes are offered by the Initial Purchaser and by dealers, prior to the date
of the Offering Memorandum, of each Preliminary Offering Memorandum so furnished
by the Company and the Guarantors. The Company and each of the Guarantors
consent to the use of the Offering Memorandum in accordance with the securities
or Blue Sky laws of the jurisdictions in which the Notes are offered by the
Initial Purchaser and by all dealers to whom Notes may be sold, in connection
with the offering and sale of the Notes.
(d) If, at any time prior to completion of the distribution of the
Notes by the Initial Purchaser to Eligible Purchasers, any event shall occur
that in the judgment of the Company, any of the Guarantors or in the opinion of
counsel for the Initial Purchaser should be set forth in the Offering Memorandum
in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it is necessary to supplement or
amend the Offering Memorandum in order to comply with any law, the Company and
the Guarantors will forthwith prepare an appropriate supplement or amendment
thereto, and will expeditiously furnish to the Initial Purchaser and dealers a
reasonable number of copies thereof.
(e) The Company and each of the Guarantors will cooperate with the
Initial Purchaser and with their counsel in connection with the qualification of
the Notes for offering and sale by the Initial Purchaser and by dealers under
the securities or Blue Sky laws of such jurisdictions as the Initial Purchaser
may designate and will file such consents to service of process or other
documents necessary or appropriate in order to effect such qualification;
PROVIDED, that in no event shall the Company or any of the Guarantors be
obligated to qualify to do business in any jurisdiction where it is not now so
qualified or to take any action which would subject it to service of process in
suits, other than those arising out of the offering or sale of the Notes, in any
jurisdiction where it is not now so subject.
(f) For a period of 180 days from the date of the Offering Memorandum,
the Company and the Guarantors will not to, directly or indirectly, sell, offer
to sell, contract to sell, grant any option to purchase, issue any instrument
convertible into or exchangeable for, or
12
otherwise transfer or dispose of (or enter into any transaction or device which
is designed to, or could be expected to, result in the disposition in the future
of), any debt securities of the Company, the Guarantors or any of their
respective subsidiaries in either the capital markets or the bank loan markets,
except (i) in exchange for the Exchange Notes in connection with the Exchange
Offer or (ii) with the prior consent of the Initial Purchaser.
(g) So long as any of the Notes are outstanding, the Company and the
Guarantors will furnish to the Initial Purchaser (i) as soon as available, a
copy of each report of the Company mailed to stockholders generally or filed
with any stock exchange or regulatory body and (ii) from time to time such other
information concerning the Company and/or the Guarantors as the Initial
Purchaser may reasonably request.
(h) If this Agreement shall terminate or shall be terminated after
execution and delivery pursuant to any provisions hereof (otherwise than by
notice given by the Initial Purchaser terminating this Agreement pursuant to
Section 9 hereof), or if this Agreement shall be terminated by the Initial
Purchaser because of any failure or refusal on the part of the Company or any of
the Guarantors to comply with the terms or fulfill any of the conditions of this
Agreement, the Company and the Guarantors agree to reimburse the Initial
Purchaser for all out-of-pocket expenses (including reasonable fees and expenses
of its counsel), reasonably incurred by it in connection herewith, but without
any further obligation on the part of the Company or any of the Guarantors for
loss of profits or otherwise. Notwithstanding the foregoing, the Company and the
Guarantors shall not be required to reimburse the Initial Purchaser if this
Agreement is terminated as a result of the conditions in Section 7(k) hereof not
being satisfied.
(i) The Company and the Guarantors will apply the net proceeds from
the sale of the Notes to be sold by the Company hereunder substantially in
accordance with the description set forth in the Offering Memorandum under the
caption "Use of Proceeds."
(j) Except as stated in this Agreement and in the Preliminary Offering
Memorandum and Offering Memorandum, neither the Company, the Guarantors nor any
of their respective affiliates have taken, nor will any of them take, directly
or indirectly, any action designed to or that might reasonably be expected to
cause or result in stabilization or manipulation of the price of any security of
the Company or any of the Guarantors to facilitate the sale or resale of the
Notes and the Guarantees. Except as permitted by the Act, the Company and the
Guarantors will not distribute any offering material in connection with the
Exempt Resales.
(k) The Company and the Guarantors will use their reasonable best
efforts to permit the Notes to be designated Private Offerings, Resales and
Trading through Automated Linkages ("PORTAL") Market(SM) securities in
accordance with the rules and regulations adopted by the National Association of
Securities Dealers, Inc. relating to trading in the PORTAL Market and to permit
the Notes to be eligible for clearance and settlement through DTC.
(l) From and after the Closing Date, so long as any of the Notes are
outstanding and are "restricted securities" within the meaning of the Rule
144(a)(3) under the Act or, if earlier, until three years after the Closing
Date, and during any period in which the Company is not subject to Section 13 or
15(d) of the Exchange Act, the Company and the
13
Guarantors will furnish to holders of the Notes and prospective purchasers of
Notes designated by such holders, upon request of such holders or such
prospective purchasers, the information required to be delivered pursuant to
Rule 144A(d)(4) under the Act to permit compliance with Rule 144A in connection
with resale of the Notes.
(m) During the period of two years after the Closing Date, the Company
and the Guarantors will not, and will not permit any of their "affiliates" (as
defined in Rule 144 under the Securities Act), to, resell any of the Notes which
constitute "restricted securities" under Rule 144 that have been reacquired by
any of them.
(n) The Company and the Guarantors have complied and will comply with
all provisions of Florida Statutes Section 517.075 relating to issuers doing
business with Cuba.
(o) The Company and the Guarantors agree not to sell, offer for sale
or solicit offers to buy or otherwise negotiate in respect of any security (as
defined in the Act), that would be integrated with the sale of the Notes in a
manner that would require the registration under the Act of the sale to the
Initial Purchaser or the Eligible Purchasers of the Notes.
(p) The Company and the Guarantors agree to comply with all the terms
and conditions of the Registration Rights Agreement and all agreements set forth
in the representation letters of the Company and the Guarantors to DTC relating
to the approval of the Notes by DTC for "book entry" transfer.
(q) The Company and the Guarantors agree that prior to any
registration of the Notes pursuant to the Registration Rights Agreement, or at
such earlier time as may be required, the Indenture shall be qualified under the
1939 Act and any necessary supplemental indentures will be entered into in
connection therewith.
(r) The Company and the Guarantors will not voluntarily claim, and
will resist actively all attempts to claim, the benefit of any usury laws
against holders of the Notes.
(s) The Company and the Guarantors will do and perform all things
required or necessary to be done and performed under this Agreement by them
prior to the Closing Date, and to satisfy all conditions precedent to the
Initial Purchaser's obligations hereunder to purchase the Notes.
(t) To take such steps as shall be necessary to ensure that neither
the Company nor any subsidiary shall become an "investment company" within the
meaning of such term under the Investment Company Act of 1940 and the rules and
regulations of the Commission thereunder.
6. EXPENSES. Each of the Company and the Guarantors, jointly and severally
agree, whether or not the transactions contemplated by this Agreement are
consummated or this Agreement becomes effective or is terminated, to pay all
costs, expenses, fees and taxes incident to and in connection with: (i) the
preparation, printing, filing and distribution of the Preliminary Offering
Memorandum and the Offering Memorandum (including, without limitation, financial
statements), and all amendments and supplements thereto (but not, however, legal
fees and expenses of your counsel incurred in connection therewith); (ii) the
preparation, printing
14
(including, without limitation, word processing and duplication costs), and
delivery of this Agreement, the Indenture, the Registration Rights Agreement,
all Blue Sky Memoranda and all other agreements, memoranda, correspondence and
other documents printed and delivered in connection therewith and with the
Exempt Resales (but not, however, legal fees and expenses of your counsel
incurred in connection with any of the foregoing other than fees of such counsel
plus reasonable disbursements incurred in connection with the preparation,
printing and delivery of such Blue Sky Memoranda); (iii) the issuance and
delivery by the Company of the Notes and by the Guarantors of the Guarantees;
(iv) the qualification of the Notes and the Exchange Notes for offer and sale
under the securities or Blue Sky laws of the several states (including, without
limitation, the reasonable fees and disbursements of your counsel relating to
such registration or qualification); (v) furnishing such copies of the
Preliminary Offering Memorandum and the Offering Memorandum, and all amendments
and supplements thereto, as may be reasonably requested for use in connection
with the Exempt Resales; (vi) the preparation of certificates for the Notes and
the Guarantees (including, without limitation, printing and engraving thereof);
(vii) the fees, disbursements and expenses and listing fees in connection with
the application for quotation of the Notes on PORTAL; (viii) all fees and
expenses (including fees and expenses of counsel), of the Company and the
Guarantors in connection with approval of the Notes by DTC for "book-entry"
transfer; (ix) any fees charged by securities rating services for rating the
Notes and the Exchange Notes; (x) the fees and expenses of the Trustee and any
agent of the Trustee in connection with the Indenture, the Notes and the
Exchange Notes; and (xi) the performance by the Company and the Guarantors of
their other obligations under this Agreement.
7. CONDITIONS OF INITIAL PURCHASER'S OBLIGATIONS. The obligations of the
Initial Purchaser hereunder are subject to the accuracy, when made and on the
Closing Date, of the representations and warranties of the Company contained
herein in all material respects, to the performance by the Company and the
Guarantors of their respective obligations hereunder in all material respects,
and to each of the following additional terms and conditions:
(a) The Initial Purchaser shall not have discovered and disclosed to
the Company on or prior to the Closing Date that the Offering Memorandum or any
amendment or supplement thereto contains an untrue statement of a fact which, in
the opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, is material or omits to state a fact which, in
the opinion of such counsel, is material and is required to be stated therein or
is necessary to make the statements therein not misleading.
(b) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the Indenture, the Notes,
the Guarantees, the Exchange Notes, the Exchange Guarantees, the Registration
Rights Agreement and the Offering Memorandum, and all other legal matters
relating to this Agreement and the transactions contemplated hereby shall be
reasonably satisfactory in all material respects to ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, and the
Company and the Guarantors shall have furnished to such counsel all documents
and information that they may reasonably request to enable them to pass upon
such matters.
(c) ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ shall have furnished to the Initial Purchaser its
written opinion, as counsel to the Company, addressed to the Initial Purchaser
and dated the Closing Date, substantially in the form of Exhibit C hereto.
15
(d) The Initial Purchaser shall have received from ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇,
counsel for the Initial Purchaser, such opinion or opinions, dated the Closing
Date, with respect to the issuance and sale of the Notes, the Offering
Memorandum and other related matters as the Initial Purchaser may reasonably
require, and the Company shall have furnished to such counsel such documents as
they reasonably request for the purpose of enabling them to pass upon such
matters.
(e) At the time of execution of this Agreement, the Initial Purchaser
shall have received from Ernst & Young a letter, in form and substance
satisfactory to the Initial Purchaser, addressed to the Initial Purchaser and
dated the date hereof (i) confirming that they are independent public
accountants within the meaning of the Securities Act and are in compliance with
the applicable requirements relating to the qualification of accountants under
Rule 2-01 of Regulation S-X of the Commission and (ii) stating, as of the date
hereof (or, with respect to matters involving changes or developments since the
respective dates as of which specified financial information is given in the
Offering Memorandum, as of a date not more than five days prior to the date
hereof), the conclusions and findings of such firm with respect to the financial
information and other matters ordinarily covered by accountants' "comfort
letters" to initial purchasers in connection with similar offerings.
(f) With respect to the letter of Ernst & Young referred to in the
preceding paragraph and delivered to the Initial Purchaser concurrently with the
execution of this Agreement (the "INITIAL LETTER"), the Company shall have
furnished to the Initial Purchaser a letter (the "BRING-DOWN LETTER"), of such
accountants, addressed to the Initial Purchaser and dated the Closing Date (i)
confirming that they are independent public accountants within the meaning of
the Securities Act and are in compliance with the applicable requirements
relating to the qualification of accountants under Rule 2-01 of Regulation S-X
of the Commission, (ii) stating, as of the date of the bring-down letter (or,
with respect to matters involving changes or developments since the respective
dates as of which specified financial information is given in the Offering
Memorandum, as of a date not more than five days prior to the date of the
bring-down letter), the conclusions and findings of such firm with respect to
the financial information and other matters covered by the initial letter and
(iii) confirming in all material respects the conclusions and findings set forth
in the initial letter.
(g) Neither the Company, any Guarantor nor any of their respective
subsidiaries shall have sustained, since the date of the latest audited
financial statements included in the Offering Memorandum, any material loss or
interference with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Offering Memorandum; and, since such date, there shall not
have been any change in the capital stock or long-term debt of the Company, any
Guarantor or any of their respective subsidiaries or any material adverse
change, or any development involving a prospective material adverse change, in
or affecting the general affairs, management, financial position, stockholders'
equity or results of operations of the Company, any Guarantors and their
respective subsidiaries, otherwise than as set forth or contemplated in the
Offering Memorandum.
16
(h) The Company and each Guarantor shall have furnished or caused to
be furnished to you on the Closing Date certificates of officers of the Company
and each Guarantor satisfactory to you as to the accuracy of the representations
and warranties of the Company and each Guarantor herein at and as of the Closing
Date, as to the performance by the Company and each Guarantor of all of its
obligations hereunder to be performed at or prior to the Closing Date and as to
such other matters as you may reasonably request.
(i) The Company shall have furnished or caused to be furnished to you
on the Closing Date a certificate of an officer of the Company satisfactory to
you as to the authorization, execution and delivery of each of the agreements
listed in the Offering Memorandum in the section entitled "Certain Relationships
and Related Party Transactions." Such certificate shall also have execution
copies of all such agreements attached to it.
(j) The Merger shall be consummated promptly after the Closing.
(k) Verizon Information Services Inc. (i) shall have amended the
Acquisition Agreement (along with the other signatories thereto) in a form
satisfactory to the Initial Purchaser such that an additional $25 million in
cash will be on the Company's balance sheet on the Closing Date with the net
effect that the total financing needed to consummate the Acquisition will be
reduced by $25 million and (ii) shall have committed to fund and shall have
funded $75 million in aggregate principal amount of the Senior Term Loans under
the Credit Facilities. The terms "Acquisition Agreement," "Acquisition," "Senior
Term Loans" and "Credit Facilities" will have the meanings assigned to them in
the Amended and Restated Commitment Letter dated February 5, 2002 among ▇▇▇▇▇▇
Commercial Paper Inc., the Initial Purchaser, TSI Telecommunication Holdings,
Inc., GTCR Fund VII, L.P., TSI Telecommunication Holdings, LLC and the Company.
Additionally, the obligations of the Company and the Guarantors under this
Agreement are subject to the accuracy, when made and on the Closing Date, of
this Section 7(k).
(l) GTCR Capital Partners, L.P. ("Capital Partners") shall have
purchased $30 million in aggregate principal amount of the Notes from the
Initial Purchaser at the purchase price set forth on the cover of the Offering
Memorandum and shall have agreed not to, directly or indirectly, sell, offer to
sell, contract to sell, grant any option to purchase, issue any instrument
convertible into or exchangeable for, or otherwise transfer or dispose of (or
enter into any transaction or device which is designed to, or could be expected
to, result in the disposition in the future of), any of the Notes (or any
interest therein) purchased by Capital Partners for a period of 180 days from
the date of the Offering Memorandum except (i) in exchange for the Exchange
Notes in connection with the Exchange Offer or (ii) with the prior consent of
the Initial Purchaser. The Notes purchased by Capital Partners will have the
same CUSIP number as all of the other Notes issued pursuant to this Agreement.
(m) Subsequent to the execution and delivery of this Agreement (i) no
downgrading shall have occurred in the rating accorded the Company's debt
securities by any "nationally recognized statistical rating organization", as
that term is defined by the Commission for purposes of Rule 436(g)(2) of the
Rules and Regulations and (ii) no such organization shall have publicly
announced that it has under surveillance or review, with possible negative
implications, its rating of any of the Company's debt securities.
17
(n) Subsequent to the execution and delivery of this Agreement there
shall not have occurred any of the following: (i) trading in securities
generally on the New York Stock Exchange or the American Stock Exchange or in
the over-the-counter market, or trading in any securities of the Company on any
exchange or in the over-the-counter market, shall have been suspended or minimum
prices shall have been established on any such exchange or such market by the
Commission, by such exchange or by any other regulatory body or governmental
authority having jurisdiction; (ii) a banking moratorium shall have been
declared by Federal or state authorities; (iii) the United States shall have
become engaged in hostilities, there shall have been an escalation in
hostilities involving the United States or there shall have been a declaration
of a national emergency or war by the United States; or (iv) there shall have
occurred such a material adverse change in general economic, political or
financial conditions (or the effect of international conditions on the financial
markets in the United States shall be such), as to make it, in the judgment of
the Initial Purchaser, impracticable or inadvisable to proceed with the public
offering or delivery of the Notes being delivered on the Closing Date on the
terms and in the manner contemplated in the Offering Memorandum.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇.
8. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company and each Guarantor, jointly and severally, shall
indemnify and hold harmless the Initial Purchaser, its officers, directors and
employees and each person, if any, who controls the Initial Purchaser within the
meaning of the Securities Act, from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof (including, but
not limited to, any loss, claim, damage, liability or action relating to
purchases and sales of Notes), to which the Initial Purchaser, officer,
director, employee or controlling person may become subject, under the
Securities Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, (i) any untrue statement or alleged
untrue statement of a material fact contained (A) in any Preliminary Offering
Memorandum or the Offering Memorandum or in any amendment or supplement thereto
or (B) in any blue sky application or other document prepared or executed by the
Company (or based upon any written information furnished by the Company),
specifically for the purpose of qualifying any or all of the Notes under the
securities laws of any state or other jurisdiction (any such application,
document or information being hereinafter called a "BLUE SKY APPLICATION"), (ii)
the omission or alleged omission to state in any Preliminary Offering Memorandum
or the Offering Memorandum, or in any amendment or supplement thereto, or in any
Blue Sky Application any material fact required to be stated therein or
necessary to make the statements therein not misleading or (iii) any act or
failure to act or any alleged act or failure to act by the Initial Purchaser in
connection with, or relating in any manner to, the Notes or the offering
contemplated hereby, and which is included as part of or referred to in any
loss, claim, damage, liability or action arising out of or based upon matters
covered by clause (i) or (ii) above (PROVIDED that the Company and the
Guarantors shall not be liable under this clause (iii) to the extent that it is
determined in a final judgment by a court of competent jurisdiction that such
loss, claim, damage, liability or action resulted directly from any such acts or
failures to act undertaken or omitted to be taken by the Initial Purchaser
through its gross negligence or willful
18
misconduct), and shall reimburse the Initial Purchaser and each such officer,
director, employee or controlling person promptly upon demand for any legal or
other expenses reasonably incurred by the Initial Purchaser, officer, director,
employee or controlling person in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or action as
such expenses are incurred; PROVIDED, HOWEVER, that the Company and the
Guarantors shall not be liable in any such case to the extent that any such
loss, claim, damage, liability or action arises out of, or is based upon, any
untrue statement or alleged untrue statement or omission or alleged omission
made in any Preliminary Offering Memorandum or the Offering Memorandum, or in
any such amendment or supplement, or in any Blue Sky Application, in reliance
upon and in conformity with written information concerning the Initial Purchaser
furnished to the Company through the Initial Purchaser by or on behalf of the
Initial Purchaser specifically for inclusion therein; PROVIDED FURTHER, that the
Company and the Guarantors shall not be liable to the Initial Purchaser or any
of its officers, directors and employees or any person controlling the Initial
Purchaser with respect to any such untrue statement or omission made in any
Preliminary Offering Memorandum existing as of the date hereof that is corrected
in the Offering Memorandum existing as of its date (i) the person asserting any
such loss, claim, damage, liability, or action purchased the Notes from the
Initial Purchaser in reliance upon any Preliminary Offering Memorandum existing
as of the date hereof but was not delivered or sent a copy of the Offering
Memorandum existing as of its date, if required by law, at or prior to the
written confirmation of the sale of such Notes to such person, unless such
failure to deliver or send the Offering Memorandum was a result of noncompliance
by the Company and the Guarantors with Section 5(a) of this Agreement and (ii)
it shall have been determined that the Initial Purchaser, and each such officer,
director, employee and controlling person, if any, would not have incurred such
loss, claim, damage liability or action had the Offering Memorandum been
delivered or sent. The foregoing indemnity agreement is in addition to any
liability which the Company or the Guarantors may otherwise have to the Initial
Purchaser or to any officer, director, employee or controlling person of that
Guarantors.
(b) The Initial Purchaser shall indemnify and hold harmless the
Company and each Guarantor, their respective officers and employees, each of
their respective directors, and each person, if any, who controls the Company
and each Guarantor within the meaning of the Securities Act, from and against
any loss, claim, damage or liability, joint or several, or any action in respect
thereof, to which the Company or any Guarantor or any such director, officer or
controlling person may become subject, under the Securities Act or otherwise,
insofar as such loss, claim, damage, liability or action arises out of, or is
based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained (A) in any Preliminary Offering Memorandum or the Offering
Memorandum or in any amendment or supplement thereto, or (B) in any Blue Sky
Application or (ii) the omission or alleged omission to state in any Offering
Memorandum or the Offering Memorandum, or in any amendment or supplement
thereto, or in any Blue Sky Application any material fact required to be stated
therein or necessary to make the statements therein not misleading, but in each
case only to the extent that the untrue statement or alleged untrue statement or
omission or alleged omission was made in reliance upon and in conformity with
written information concerning the Initial Purchaser furnished to the Company by
or on behalf of the Initial Purchaser specifically for inclusion therein, and
shall reimburse the Company or any Guarantor and any such director, officer or
controlling person for any legal or other expenses reasonably incurred by the
Company or any Guarantor or any such director, officer or controlling person in
connection with investigating or defending or preparing to defend
19
against any such loss, claim, damage, liability or action as such expenses are
incurred. The foregoing indemnity agreement is in addition to any liability
which the Initial Purchaser may otherwise have to the Company and each Guarantor
or any such director, officer, employee or controlling person.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party in
writing of the claim or the commencement of that action; PROVIDED, HOWEVER, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 8 except to the extent it has
been materially prejudiced by such failure and, PROVIDED, FURTHER, that the
failure to notify the indemnifying party shall not relieve it from any liability
which it may have to an indemnified party otherwise than under this Section 8.
If any such claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly with
any other similarly notified indemnifying party, to assume the defense thereof
with counsel reasonably satisfactory to the indemnified party. After notice from
the indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; PROVIDED, HOWEVER, that
the Initial Purchaser shall have the right to employ counsel to represent
jointly the Initial Purchaser and its officers, employees and controlling
persons who may be subject to liability arising out of any claim in respect of
which indemnity may be sought by the Initial Purchaser against the Company or
the Guarantors under this Section 8 if, in the reasonable judgment of the
Initial Purchaser, it is advisable for the Initial Purchaser and those officers,
employees and controlling persons to be jointly represented by separate counsel,
and in that event the fees and expenses of such separate counsel shall be paid
by the Company or the Guarantors. No indemnifying party shall (i) without the
prior written consent of the indemnified parties (which consent shall not be
unreasonably withheld), settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action), unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding, or (ii) be liable for any
settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with the consent of
the indemnifying party or if there be a final judgment of the plaintiff in any
such action, the indemnifying party agrees to indemnify and hold harmless any
indemnified party from and against any loss or liability by reason of such
settlement or judgment.
(d) If the indemnification provided for in this Section 8 shall for
any reason be unavailable to or insufficient to hold harmless an indemnified
party under Section 8(a) or 8(b) in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to therein, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be
20
appropriate to reflect the relative benefits received by the Company, the
Guarantors on the one hand and the Initial Purchaser on the other from the
offering of the Notes or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company, the Guarantors, on the one hand and the Initial
Purchaser on the other with respect to the statements or omissions which
resulted in such loss, claim, damage or liability, or action in respect thereof,
as well as any other relevant equitable considerations. The relative benefits
received by the Company, the Guarantors, on the one hand and the Initial
Purchaser on the other with respect to such offering shall be deemed to be in
the same proportion as the total net proceeds from the offering of the Notes
purchased under this Agreement (before deducting expenses), received by the
Company, the Guarantors on the one hand, and the total underwriting discounts
and commissions received by the Initial Purchaser with respect to the Notes
purchased under this Agreement, on the other hand, bear to the total gross
proceeds from the offering of the Notes under this Agreement, in each case as
set forth in the table on the cover page of the Offering Memorandum. The
relative fault shall be determined by reference to whether the untrue or alleged
untrue statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company, the Guarantors or
the Initial Purchaser, the intent of the parties and their relative knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company, the Guarantors, and the Initial Purchaser agree that it
would not be just and equitable if contributions pursuant to this Section were
to be determined by pro rata allocation, or by any other method of allocation
which does not take into account the equitable considerations referred to
herein. The amount paid or payable by an indemnified party as a result of the
loss, claim, damage or liability, or action in respect thereof, referred to
above in this Section 8 shall be deemed to include, for purposes of this Section
8(d), any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 8(d), the Initial Purchaser shall
not be required to contribute any amount in excess of the amount by which the
total price at which the Notes underwritten by it and distributed to the public
was offered to the public exceeds the amount of any damages which the Initial
Purchaser has otherwise paid or become liable to pay by reason of any untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act), shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Initial Purchaser's obligations
to contribute as provided in this Section 8(d) are several in proportion to
their respective underwriting obligations and not joint.
(e) The Initial Purchaser confirms and the Company acknowledges that
the statements with respect to the public offering of the Notes by the Initial
Purchaser set forth in the second to last paragraph on the front cover of the
Offering Memorandum and in the section entitled "Plan of Distribution" in the
Offering Memorandum are correct and constitute the only information concerning
the Initial Purchaser furnished in writing to the Company by or on behalf of the
Initial Purchaser specifically for inclusion in the Offering Memorandum.
9. TERMINATION. The obligations of the Initial Purchaser hereunder may be
terminated by the Initial Purchaser by notice given to and received by the
Company prior to the delivery of and payment for the Notes if, prior to that
time, any of the events described in Section
21
7(k), shall have occurred or if the Initial Purchaser shall decline to purchase
the Notes for any reason permitted under this Agreement.
10. REIMBURSEMENT OF INITIAL PURCHASER'S EXPENSES. If the Company shall
fail to tender the Notes for delivery to the Initial Purchaser by reason of any
failure, refusal or inability on the part of the Company to perform any
agreement on its part to be performed, or because any other condition of the
obligations hereunder required to be fulfilled by the Company is not fulfilled
(other than those in Section 7(k)), the Company will reimburse the Initial
Purchaser for all reasonable out-of-pocket expenses (including fees and
disbursements of counsel), incurred by the Initial Purchaser in connection with
this Agreement and the proposed purchase of the Notes, and upon demand the
Company shall promptly pay the full amount thereof to the Initial Purchaser.
11. NOTICES, ETC. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the Initial Purchaser, shall be delivered or sent by mail,
telex or facsimile transmission to ▇▇▇▇▇▇ Brothers Inc., ▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇ (Fax: (▇▇▇) ▇▇▇-▇▇▇▇), with a
copy, in the case of any notice pursuant to Section 8(c), to the Director of
Litigation, Office of the General Counsel, ▇▇▇▇▇▇ Brothers Inc., ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇;
(b) if to the Company or to the Guarantors, shall be delivered or sent
by mail, telex or facsimile transmission to the address of the Company set forth
in the Offering Memorandum, Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇, Jr. (Fax: (▇▇▇) ▇▇▇-▇▇▇▇).
12. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement shall inure to
the benefit of and be binding upon the Initial Purchaser, the Company, and their
respective successors. This Agreement and the terms and provisions hereof are
for the sole benefit of only those persons, except that (a) the representations,
warranties, indemnities and agreements of the Company contained in this
Agreement shall also be deemed to be for the benefit of the person or persons,
if any, who controls the Initial Purchaser within the meaning of Section 15 of
the Securities Act and (b) the indemnity agreement of the Initial Purchaser
contained in Section 8(b) of this Agreement shall be deemed to be for the
benefit of directors of the Company, officers of the Company and any person
controlling the Company within the meaning of Section 15 of the Securities Act.
Nothing in this Agreement is intended or shall be construed to give any person,
other than the persons referred to in this Section 12, any legal or equitable
right, remedy or claim under or in respect of this Agreement or any provision
contained herein.
13. SURVIVAL. The respective indemnities, representations, warranties and
agreements of the Company, the Guarantors and the Initial Purchaser contained in
this Agreement or made by or on behalf on them, respectively, pursuant to this
Agreement, shall survive the delivery of and payment for the Notes and shall
remain in full force and effect, regardless of any investigation made by or on
behalf of any of them or any person controlling any of them.
14. DEFINITION OF THE TERMS "BUSINESS DAY" AND "SUBSIDIARY". For purposes
of this Agreement, (a) "business day" means any day on which the New York Stock
Exchange, Inc. is
22
open for trading and (b) "subsidiary" has the meaning set forth in Rule 405 of
the Rules and Regulations.
15. EFFECT ON INTERIM LOAN COMMITMENT. Upon execution of this Agreement,
▇▇▇▇▇▇ Brothers (as defined below) and LCPI (as defined below) shall be released
from all of their respective obligations under the Amended and Restated
Commitment Letter, dated as of January 14, 2002, among ▇▇▇▇▇▇ Brothers Inc.
("▇▇▇▇▇▇ BROTHERS"), ▇▇▇▇▇▇ Commercial Paper Inc. ("LCPI"), TSI LLC, TSI Inc.,
the Company and GTCR Fund VII, L.P. with respect to certain proposed financing
for the acquisition of TSI Telecommunication Services Inc. (together with all
Exhibits and Annexes thereto, the "COMMITMENT LETTER") with respect to the
Interim Loans (as defined in the Commitment Letter).
16. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF NEW YORK.
17. COUNTERPARTS. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
18. HEADINGS. The headings herein are inserted for convenience of reference
only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
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If the foregoing correctly sets forth the agreement among the Company,
the Guarantors, and the Initial Purchaser, please indicate your acceptance in
the space provided for that purpose below.
Very truly yours,
TSI MERGER SUB, INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
TSI TELECOMMUNICATION HOLDINGS, INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
TSI TELECOMMUNICATION HOLDINGS, LLC
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
TSI NETWORKS INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
▇▇▇▇▇▇ BROTHERS INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ III
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ III
Title: Managing Director
24
TSI FINANCE INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
25