Exhibit 1.5
AMENDMENT NO. 1 TO THE
RIGHTS AGREEMENT
This Amendment to the Rights Agreement, dated as of July 5, 2002, is made
by and between Level 3 Communications, Inc., a Delaware corporation (the
"Company"), and ▇▇▇▇▇ Fargo Bank Minnesota, NA (formerly known as Norwest Bank
Minnesota, N.A.), a Delaware corporation (the "Rights Agent"), and amends the
Rights Agreement, dated as of May 29, 1998, between the Company and the Rights
Agent (the "Rights Agreement").
RECITALS
WHEREAS, the Company intends to enter into a Securities Purchase Agreement,
dated as of July 5, 2002 (the "Purchase Agreement"), with the institutional
investors indicated on Exhibit A thereto (the "Investors"), pursuant to which
the Investors will purchase $500,000,000 aggregate principal amount of the
Company's 9% Junior Convertible Subordinated Notes due 2012, the Board of
Directors of the Company having approved the Purchase Agreement and the
transactions contemplated therein; and
WHEREAS, pursuant to Section 26 of the Rights Agreement, the Board
Directors of the Company has determined that an amendment to the Rights
Agreement as set forth herein is necessary and desirable in connection with the
foregoing, and the Company and the Rights Agent desire to evidence such
amendment in writing.
NOW, THEREFORE, the Company and the Rights Agent agree as follows:
1. Amendment to Definition of "Acquiring Person". The definition of
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"Acquiring Person" in Section 1(a) of the Rights Agreement is hereby amended to
add the following sentences to the end of such definition:
"Notwithstanding the foregoing, Southeastern Asset Management, Inc., a
Tennessee corporation ("Southeastern"), Longleaf Partners Fund ("Longleaf"), a
series of Longleaf Partners Funds Trust, a Massachusetts business trust
("Longleaf Trust"), Longleaf Partners Small-Cap Fund, a series of Longleaf Trust
("Longleaf Small-Cap," and together with Southeastern and Longleaf, the
"Southeastern Entities"), and the Affiliates and Associates of any of the
Southeastern Entities shall not be deemed, individually or collectively, to be
an Acquiring Person by virtue of (A) the execution, delivery and performance of
the Securities Purchase Agreement, dated as of July 5, 2002 (the "Purchase
Agreement"), among the Company and the investors named therein or any of the
transactions contemplated therein, including the purchase by Longleaf and
Longleaf Small-Cap of the Company's 9% Junior Convertible Subordinated Notes due
2012 (the "Notes"), or (B) becoming the Beneficial Owner of any other shares of
Common Stock; so long as, in any such case, none of the Southeastern Entities,
their Affiliates or their Associates, individually or collectively, shall be the
Beneficial Owner of 30% or more of the shares of Common Stock then outstanding.
"Notwithstanding the foregoing, ▇▇▇▇ ▇▇▇▇▇, Inc. a Maryland corporation,
("▇▇▇▇ ▇▇▇▇▇"), ▇▇▇▇ ▇▇▇▇▇ Special Investment Trust, Inc. ("Special Investment
Trust"), ▇▇▇▇ ▇▇▇▇▇ Investment Trust, Inc. ("Investment Trust" and together with
▇▇▇▇ ▇▇▇▇▇ and Special Investment Trust, the "▇▇▇▇ ▇▇▇▇▇ Entities") and the
Affiliates and Associates of any of the ▇▇▇▇ ▇▇▇▇▇ Entities shall not be deemed,
individually or collectively, to be an Acquiring Person by virtue of (A) the
execution, delivery and
performance of the Securities Purchase Agreement, dated as of July 5, 2002 (the
"Purchase Agreement"), among the Company and the investors named therein or any
of the transactions contemplated therein, including the purchase by Special
Investment Trust and Investment Trust of the Notes, or (B) becoming the
Beneficial Owner of any other shares of Common Stock; so long as, in any such
case, none of the ▇▇▇▇ ▇▇▇▇▇ Entities, their Affiliates or their Associates,
individually or collectively, shall be the Beneficial Owner of 20% or more of
the shares of Common Stock then outstanding."
2. Amendment to Definition of "Distribution Date". The definition of
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"Distribution Date" in Section 1(o) of the Rights Agreement is hereby amended to
add the following sentence to the end of such definition:
"Notwithstanding anything in this Agreement to the contrary, a Distribution
Date shall not be deemed to have occurred as a result of (i) the execution of
the Purchase Agreement, (ii) the announcement of the Purchase Agreement or any
of the transactions contemplated in the Purchase Agreement or (iii) the
consummation of the transactions contemplated in the Purchase Agreement."
3. Amendment to Definition of "Stock Acquisition Date". The definition of
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"Stock Acquisition Date" in Section 1(kk) of the Rights Agreement is hereby
amended to add the following sentence to the end of such definition:
"Notwithstanding anything in this Agreement to the contrary, a Stock
Acquisition Date shall not be deemed to have occurred as the result of (i) the
execution of the Purchase Agreement, (ii) the announcement of the Purchase
Agreement or any of the transactions contemplated in the Purchase Agreement or
(iii) the consummation of the transactions contemplated in the Purchase
Agreement."
4. Amendment to Section 29. Section 29 of the Rights Agreement is hereby
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amended to add the following sentence at the end thereof:
"Nothing in this Agreement shall be construed to give any holder of Rights
or any other Person any legal or equitable rights, remedies or claims under this
Agreement by virtue of (i) the execution of the Purchase Agreement, (ii) the
announcement of the Purchase Agreement or any of the transactions contemplated
in the Purchase Agreement or (iii) the consummation of the transactions
contemplated in the Purchase Agreement."
5. Miscellaneous.
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(a) Except as otherwise expressly provided, or unless the context otherwise
requires, all capitalized terms used herein have the meanings assigned to them
in the Rights Agreement.
(b) Each party hereto waives any requirement under the Rights Agreement
that any additional notice be provided to it pertaining to the matters covered
by this Agreement.
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1067950.2
(c) This Amendment may be executed in any number of counterparts, each of
which shall be an original, but such counterparts shall together constitute but
one end and the same document.
(d) Except as expressly provided herein, the Rights Agreement is not being
amended, modified or supplemented in any respect, and it remains in full force
and effect.
(e) This Amendment shall be deemed to be a contract made under the laws of
the State of Delaware and for all purposes shall be governed by and construed in
accordance with the laws of such State applicable to contracts made and to be
performed entirely within such State.
(f) This Amendment shall be deemed effective as of the date first written
above, as if executed on such date.
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IN WITNESS WHEREOF, the parties have caused this Amendment to
the Rights Agreement to be duly executed as of the day and year first written
above.
▇▇▇▇▇ ▇ COMMUNICATIONS, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
▇▇▇▇▇ FARGO BANK MINNESOTA, NA
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President