EXHIBIT 10.43
EXECUTION COPY
PURCHASE AND SALE AGREEMENT
dated as of
July 26, 2002
by and between
THE ▇▇▇▇▇▇▇▇ COMPANIES, INC.
and
LEUCADIA NATIONAL CORPORATION
Page
TABLE OF CONTENTS
ARTICLE I DEFINITIONS AND INTERPRETATION
Section 1.01. Definitions 4
Section 1.02. Interpretation 9
ARTICLE II SALE OF CLAIMS 10
Section 2.01. Sale of the Claims and the WCG Note 10
Section 2.02. Excluded Claims 10
Section 2.03. Closing Payment 11
Section 2.04. Closing 11
Section 2.05. Deliveries by Seller 11
Section 2.06. Deliveries by Purchaser 11
Section 2.07. Purchase Price Allocation 11
ARTICLE III REPRESENTATIONS AND WARRANTIES 12
Section 3.01. Representations of Seller 12
Section 3.02. Representations of Purchaser 13
ARTICLE IV COVENANTS AND AGREEMENTS 14
Section 4.01. February 23, 2002 Letter 14
Section 4.02. Communications Investment 14
Section 4.03. No Shop 14
Section 4.04. Impairment 15
Section 4.05. Purchaser Support of Plan and TWC Settlement Agreement 15
Section 4.06. Seller Support of Plan 15
Section 4.07. Voting 16
Section 4.08. Seller Rights 16
Section 4.09. Non-assumption of Liabilities 16
Section 4.10. Condition of Claims and WCG Note 16
Section 4.11. Make-Whole Provision 16
Section 4.12. HSR Act 17
Section 4.13. Covenant to Satisfy Conditions 17
Section 4.14. Further Assurances 17
ARTICLE V CONDITIONS PRECEDENT 17
Section 5.01. Conditions to Purchaser's Obligation to Effect the Closing 17
Section 5.02. Conditions to Seller's Obligation to Effect the Closing 18
ARTICLE VI TERMINATION 19
Section 6.01. Termination 19
Section 6.02. Effect of Termination 20
Section 6.03. Liquidated Damages 20
ARTICLE VII MISCELLANEOUS 20
Section 7.01. Expenses 20
Section 7.02. Extension; Waiver 20
2
Page
Section 7.03. Transfer Taxes 20
Section 7.04. Notices 21
Section 7.05. Entire Agreement; Amendment 22
Section 7.06. Governing Law 22
Section 7.07. Jurisdiction 22
Section 7.08. Counterparts 22
Section 7.09. Severability 22
Section 7.10. Headings 22
Section 7.11. Assignment 22
Section 7.12. Successors and Assigns 23
Section 7.13. No Third-Party Beneficiaries 23
Section 7.14. Publicity 23
Schedules
Schedule 2.01(a)(i) ADP Claims
Schedule 2.02(a) Services Agreements
Exhibits
Exhibit A Plan
Exhibit B Form of Claims Assignment
Exhibit C Investment Agreement
Exhibit D TWC Settlement Agreement
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PURCHASE AND SALE AGREEMENT
This
PURCHASE AND SALE AGREEMENT, dated as of July 26, 2002,
by and between THE ▇▇▇▇▇▇▇▇ COMPANIES. INC., a Delaware corporation ("Seller")
and LEUCADIA NATIONAL CORPORATION, a
New York corporation ("Purchaser").
WITNESSETH:
WHEREAS, Seller owns certain claims against ▇▇▇▇▇▇▇▇
Communications Group, Inc., a Delaware corporation ("Communications") and
certain of its affiliates (collectively, "WCG");
WHEREAS, Seller, in its capacity as the agent of the Indenture
Trustee (as defined below) pursuant to Section 9.04 of the Trust Note Indenture
(as defined below) has the right and ability to direct the sale of the WCG Note
(as defined below) at the highest reasonably available market price (on an arm's
length basis);
WHEREAS, Seller has determined after due inquiry that the
portion of the Purchase Price (as defined below) allocated to the WCG Note
pursuant to this Agreement is the highest reasonably available market price (on
an arm's length basis) for the WCG Note;
WHEREAS, Communications and its subsidiary, CG Austria. Inc.,
a Delaware corporation (collectively, the "Debtors") are debtors in possession,
having filed voluntary petitions on April 22, 2002, for relief pursuant to
chapter 11 of title 11 of the United States Code, 11 U.S.C. Sections 101-1330
(as amended, the "Bankruptcy Code"), whose cases are pending in the United
States Bankruptcy Court for the Southern District of
New York (the "Bankruptcy
Court") and procedurally consolidated under Case No. 02-11957 (the "Bankruptcy
Case"):
WHEREAS, Seller desires to sell to Purchaser, and Purchaser
desires to purchase from Seller, the Claims (as defined below) and the WCG Note,
in the manner and subject to the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing premises and
the representations, warranties, covenants and agreements contained herein, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, and intending to be legally bound hereby, the parties
hereto hereby agree as follows:
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.01. DEFINITIONS. For all purposes of this Agreement, except
as otherwise expressly provided or unless the context clearly requires
otherwise, the following capitalized terms shall have the following meanings:
"ADP Claims" has the meaning set forth in Section 2.01(a)(i).
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"Affiliate" shall mean, with respect to any Person, any other
Person which, directly or indirectly, through one or more intermediaries,
controls, or is controlled by, or is under common control with, such Person
provided that, for the purposes of this definition, "control" (including with
correlative meanings, the terms "controlled by" and "under common control
with"), as used with respect to any Person, shall mean the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of such Person, whether through the ownership of voting securities
or partnership interests, by contract or otherwise.
"Agreement" shall mean this
Purchase and Sale Agreement,
together with the Schedules and Exhibits hereto, as amended, supplemented or
otherwise modified from time to time,
"Applicable Law" shall mean any applicable law, regulation,
rule, order, judgment or decree.
"April Agreement" shall mean the agreement dated as of April
19, 2002 by and among Debtors, WCL, certain Subsidiaries of WCG, certain
Bondholders and certain Lenders, as amended, supplemented or otherwise modified
from time to time.
"Asset Defeasance Program" shall mean the transactions
pursuant to which WCL leased certain property from State Street Bank and Trust
Company of Connecticut, National Association, as trustee, as set forth in (i)
the Amended and Restated Participation Agreement, dated as of September 2, 1998,
among ▇▇▇▇▇▇▇▇ Communications, Inc., State Street Bank and Trust Company of
Connecticut. National Association. as trustee and various other parties named
therein, and (ii) the Operative Documents (as defined therein), as amended,
supplemented or otherwise modified from time to time.
"Bank Agent" shall mean Bank of America, N.A., as agent under
the WCG Bank Facility.
"Bankruptcy Case" has the meaning Set forth in the recitals
hereof.
"Bankruptcy Code" has the meaning set forth in the recitals
hereof
"Bankruptcy Court" has the meaning set forth in the recitals
hereof
"Bankruptcy Rules" shall mean the Federal Rules of Bankruptcy
Procedure, as the same are applicable to the Bankruptcy Case.
"Bondholders" shall mean the holders of the Senior Redeemable
Notes.
"Building Purchase" shall mean the purchase by WTC of all of
the Property for (i) Fifty Million Dollars ($50.000.000) in cash (subject to
adjustment as set forth in the agreements and documents evidencing the Building
Purchase), and (ii) the issuance by WTC and Communications (or, pursuant to the
terms of such agreement, Reorganized Communications), as makers, and WCL, as
guarantor, of a 10-year promissory note made payable to ▇▇▇▇▇▇▇▇ Headquarters
Building Company, a Delaware corporation, in the amount of One Hundred Million
Dollars ($100,000,000) (reduced by the amount realized from the disposition or
refinancing of the outstanding Aircraft Dry Leases, dated September 13, 2001, or
the aircraft covered thereby, as set forth in the agreements and documents
evidencing the Building Purchase) with interest at the rate of 7% per annum, and
principal to be amortized until maturity on the basis of a 30-year schedule, the
payment of which shall be secured by a first lien mortgage and security interest
in and to the Property.
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"Business Day" shall mean any day other than a Saturday,
Sunday or a day on which banks in
New York City are authorized or obligated by
law or executive order to close or are otherwise generally closed.
"Causes of Action" shall mean all rights, claims, causes of
action, defenses, demands, rights to recover damages and debts from third
parties, and rights to enforce against third parties obligations and liabilities
of any kind or nature under contract, at law or in equity, known or unknown,
contingent or mature, liquidated or unliquidated, and all remedies with respect
thereto.
"Claims" shall mean the ADP Claims and the Pre-Spin Services
Claims.
"Claims Assignment" shall mean the Assignment of Claims to be
executed by Seller with respect to the ADP Claims and the Pre-Spin Services
Claims in substantially the form attached hereto as Exhibit B.
"Claims Documents" shall mean all guarantees, security
agreements, mortgages, deeds of trust, letters of credit, reimbursement
agreements, waivers, supplements, modifications and amendments and all other
documents and agreements evidencing (i) the ADP Claims and (ii) the Pre-Spin
Services Claims.
"Claims Exchange Consideration" has the meaning set forth in
Section 4.11(a).
"Closing" has the meaning set forth in Section 2.04.
"Closing Date" has the meaning set forth in Section 2.04.
"Code" shall mean the Internal Revenue Code of 1986, as
amended.
"Committee" shall mean the Official Committee of Unsecured
Creditors appointed in the Bankruptcy Case.
"Communications" has the meaning set forth in the recitals
hereof.
"Communications Investment" shall mean the investment by
Purchaser of One Hundred Fifty Million Dollars ($150,000,000) in Communications
or Reorganized Communications pursuant to the Investment Agreement.
"Confidentiality Agreement" shall mean the Confidentiality
Agreement between Purchaser and Seller dated May 23, 2002, as amended,
supplemented or otherwise modified from time to time.
"Confirmation Order" has the meaning set forth in Section
5.01(g).
"Debtors" has the meaning set forth in the recitals hereof.
"Disclosure Statement" has the meaning set forth in Section
4.05(b).
"Excluded Claims" has the meaning set forth in Section 2.02.
"February 23 Agreement" has the meaning set forth in Section
4.01.
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"Final Order" shall mean (a) an order or judgment of the
Bankruptcy Court as to which the time to appeal, petition for certiorari, or
other proceedings for reargument or rehearing has expired and as to which no
appeal, petition for certiorari, or other proceedings for reargument or
rehearing shall then be pending or, (b) in the event that an appeal, petition
for certiorari, or for reargument or rehearing has been sought, such order of
the Bankruptcy Court shall have been affirmed by the highest court to which such
order was appealed or from which reargument or rehearing was sought, or
certiorari has been denied, and the time to take any further appeal, petition
for certiorari or other proceedings for reargument or rehearing shall have
expired; provided, that no order shall fail to be a Final Order solely because
of the possibility that a motion pursuant to Rule 60 of the Federal Rules of
Civil Procedure or Rule 7024 of the Bankruptcy Rules may be filed with respect
to such order.
"Governmental Entity" shall mean a court, arbitral tribunal,
administrative agency or commission or other governmental or other regulatory
authority or agency.
"HSR Act" shall mean the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust
Improvements Act of 1976, as amended.
"Indenture Trustee" shall mean ▇▇▇▇▇ Fargo, N.A., a national
banking association, as successor to United States Trust Company of
New York, a
New York banking corporation, as indenture trustee and securities intermediary
under the Trust Note Indenture.
"Investment Agreement" shall mean the investment agreement, of
even date herewith, by and among Purchaser, Communications and WCL, pursuant to
which Purchaser shall make the Communications Investment, a true and correct
copy of which is attached hereto as Exhibit C.
"Issuer" shall mean WCG Note Trust, a special purpose
statutory business trust created under the laws of the state of Delaware.
"Issuer Trustee" shall mean Wilmington Trust Company, in its
capacity as Issuer's trustee.
"Lenders" shall mean the lenders under the WCG Bank Facility.
"Note Documents" shall mean the WCG Note, the WCG Note
Indenture, the Trust Note Indenture and all guarantees, security agreements,
mortgages, deeds of trust, letters of credit, remarketing and reimbursement
agreements, waivers, supplements, modifications and amendments and all other
documents and agreements evidencing (i) the WCG Note. (ii) the WCG Note
Indenture and (iii) the Trust Note Indenture.
"Person" shall mean a natural person, partnership,
corporation, limited liability company, business trust, joint stock company,
trust, unincorporated association, joint venture, Governmental Entity or other
entity or organization.
"Plan" shall mean the First Amended Chapter 11 Plan Of
Reorganization With Respect To The Debtors, dated as of July 26, 2002, a true
and correct copy of which is attached hereto as Exhibit A, as it may be amended
or modified from time to time with the consent of Seller and Purchaser.
"Plan Effective Date" shall mean the date on which the Plan is
consummated and becomes effective and binding in all material respects.
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"Pre-Spin Services Agreement" shall mean the Administrative
Services Agreement by and between Seller and certain of its Subsidiaries on the
one hand, and Communications and certain of its Subsidiaries on the other hand,
dated September 30, 1999, as deferred pursuant to that certain letter agreement
dated April 23, 2001, and further deferred pursuant to that certain letter
agreement dated February 23, 2002.
"Pre-Spin Services Claims" has the meaning set forth in
Section 2.01(a)(ii).
"Property" shall mean all of the property covered by the
Master Lease Agreement, dated September 13, 2001 (including the building,
improvements, furniture and fixtures, and the parking garage, but excluding the
central plant.)
"Purchase Price" has the meaning set forth in Section 2.03.
"Purchaser" has the meaning set forth in the preamble hereof.
"Reorganized Communications" shall mean any successor to
Communications under the Plan.
"SBC" shall mean SBC Communications Inc., a Delaware
corporation.
"Seller" has the meaning set forth in the preamble hereof.
"Senior Redeemable Notes" shall mean Communications' (i)
10.875% fixed rate notes due October 1, 2009, (ii) 10.70% fixed rate notes due
October 7, 2007, (iii) 11.70% fixed rate notes due August 1,2008 and (iv)
11.875% fixed rate notes due August 1, 2010.
"Services Agreements" shall mean (i) the Amended and Restated
Administrative Services Agreement between Seller and certain of its Subsidiaries
on the one hand, and Communications and certain of its Subsidiaries on the other
hand, effective April 23, 2001, (ii) the Supplemental Terms and Conditions to
the Master Administrative Services Agreement between Seller and certain of its
Subsidiaries on the one hand, and Communications and certain of its Subsidiaries
on the other hand and (iii) the several related Service Level Agreements set
forth on Schedule 2.02(a).
"Subsidiary" shall mean, with respect to any Person, any
corporation or other organization, whether incorporated or unincorporated, of
which (a) at least a majority of the securities or other interests having by
their terms ordinary voting power to elect a majority of the Board of Directors
or others performing similar functions with respect to such corporation or other
organization is directly or indirectly owned or controlled by such Person or by
any one or more of its Subsidiaries, or by such Person and one or more of its
Subsidiaries or (b) such Person or any other Subsidiary of such Person is a
general partner (excluding any such partnership where such Person or any
Subsidiary of such party does not have a majority of the voting interest in such
partnership).
"Tax Sharing Agreement" shall mean the Tax Sharing Agreement
entered into as of September 30, 1999, by and between Seller and Communications,
as amended and restated as of April 23, 2001.
"Transactions" shall mean all the transactions provided for or
contemplated by this Agreement.
"Trust Note Indenture" shall mean the Indenture dated as of
March 28, 2001, among the
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Issuer, WCG Note Corp., Inc., a special purpose corporation organized under the
laws of the state of Delaware, as co-issuer of 8.25% Senior Secured Notes due
2004, and the Indenture Trustee.
"TWC Settlement Agreement" shall mean the agreement by and
among Seller, Debtors, the Committee and Purchaser compromising and settling
various disputes and issues between them and their respective Subsidiaries, a
true and correct copy of which is attached hereto as Exhibit D.
"TWC Settlement Order" shall mean the order of the Bankruptcy
Court, which may be the Confirmation Order, approving the TWC Settlement
Agreement, on terms that are acceptable to Purchaser and Seller.
"WCG" has the meaning set forth in the recitals hereof.
"WCG Bank Facility" shall mean the Amended and Restated Credit
Agreement dated as of September 8, 1999, as amended, among WCL, as borrower,
Communications, as guarantor, the Bank Agent, the Lenders, The Chase Manhattan
Bank, as syndication agent, ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. and ▇▇▇▇▇▇ Brothers, Inc.,
as joint lead arrangers and joint bookrunners with respect to the Incremental
Facility referred to therein, and ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc., ▇▇▇▇▇▇ Brothers.
Inc. and ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., Inc., as co-documentation agents.
"WCG Note" shall mean the $1.5 Billion 8.25% Senior Reset Note
due 2008 issued by Communications to the issuer pursuant to the WCG Note
Indenture and the Participation Agreement (as defined in the Trust Note
Indenture).
"WCG Note Indenture" shall mean the Indenture dated as of
March 28, ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Trust Company of
New
York, a
New York banking corporation, as trustee.
"WCL" has the meaning set forth in Section 2.01(a)(i).
"WTC" shall mean ▇▇▇▇▇▇▇▇ Technology Center, LLC, a Delaware
limited liability company.
Section 1.02. Interpretation. When a reference is made in this
Agreement to a section, article, paragraph, exhibit or schedule, such reference
shall be to a section, article, paragraph, exhibit or schedule of this Agreement
unless clearly indicated to the contrary.
(a) Whenever the words "include", "includes" or "including"
are used in this Agreement they shall be deemed to be followed by the
words "without limitation."
(b) The words "hereof", "herein" and "herewith" and words of
similar import shall, unless otherwise stated, be construed to refer to
this Agreement as a whole and not to any particular provision of this
Agreement.
(c) The meaning assigned to each term defined herein shall be
equally applicable to both the singular and the plural forms of such
term, and words denoting any gender shall include all genders. Where a
word or phrase is defined herein, each of its other grammatical forms
shall have a corresponding meaning.
(d) A reference to any party to this Agreement or any other
agreement or document shall include such party's predecessors,
successors and permitted assigns.
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(e) A reference to any legislation or to any provision of any
legislation shall include any amendment to, and any modification or
re-enactment thereof, any legislative provision substituted therefor
and all regulations and statutory instruments issued thereunder or
pursuant thereto.
(f) References to Dollars or $ are to United States Dollars.
ARTICLE II
SALE OF CLAIMS
Section 2.01. Sale of the Claims and the WCG Note. On the terms, and
subject to the conditions, set forth in this Agreement:
(a) Seller agrees to sell, assign, transfer and deliver to
Purchaser on the Closing Date and Purchaser agrees to purchase from
Seller on the Closing Date, all of Seller's right, title and interest
in and to the Claims against WCG identified as follows:
(i) All Causes of Action of Seller, together with all
collateral therefor and proceeds thereof, arising from
Seller's guaranty of the obligations of ▇▇▇▇▇▇▇▇
Communications, LLC, a Delaware limited liability company and
a wholly owned Subsidiary of Communications ("WCL"), under the
Asset Defeasance Program, the provision of other financial
accommodations in connection therewith and the payment of
WCL's obligations thereunder pursuant to the agreements set
forth on Schedule 2.01(a)(i) (the "ADP Claims"): and (ii) All
Causes of Action of Seller, together with all collateral
therefor and proceeds thereof, arising from the Pre-Spin
Services Agreement (the "Pre-Spin Services Claims").
(b) Seller, in its capacity as agent of the Indenture Trustee
under the Trust Note Indenture, agrees to sell, assign, transfer and
deliver to Purchaser on the Closing Date and Purchaser agrees to
purchase from Seller (in its capacity as agent of the Indenture Trustee
under the Trust Note Indenture) on the Closing Date, all of the
Issuer's right, title and interest in and to the WCG Note.
Section 2.02. Excluded Claims. It is expressly understood and agreed
that the Claims shall not include any other claims or assets, including, without
limitation, the Causes of Action of Seller and its Affiliates under the
following agreements (the "Excluded Claims"):
(a) the Services Agreements;
(b) the Tax Sharing Agreement;
(c) the Amended and Restated Employee Benefits Agreement with
WCG, dated April 23, 2001;
(d) the Trademark License Agreement and the Cross-License
Agreement, both effective as of April 23, 2001 between Seller and WCG;
and
(e) the Relocation Services Agreement with WCG, effective as
of January 2, 2002.
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Section 2.03. Closing Payment. In consideration for the purchase by
Purchaser of the Claims and the WCG Note, on the Closing Date Purchaser shall
pay to Seller (or such other party or parties as Seller shall direct) One
Hundred Eighty Million Dollars ($180,000,000) in the aggregate (the "Purchase
Price") in cash.
Section 2.04. Closing. The sales referred to in Section 2.01 (the
"Closing") shall take place at 10:00 A.M.,
New York time, at the offices of
White & Case LLP, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
simultaneously with the satisfaction or waiver of all of the conditions set
forth in Article V hereof, or at such other time and date as Seller and
Purchaser shall agree ("Closing Date").
Section 2.05. Deliveries by Seller. At the Closing, Seller shall
deliver or cause to be delivered to Purchaser (unless previously delivered), the
following:
(a) a duly executed Claims Assignment:
(b) the WCG Note, with an attached Transfer Notice in favor of
Purchaser duly executed by the Issuer Trustee on behalf of the Issuer;
and
(c) all other previously undelivered documents required by
this Agreement to be delivered by Seller to Purchaser at or prior to
the Closing in connection with the Transactions.
Section 2.06. Deliveries by Purchaser. At the Closing, Purchaser shall
deliver to Seller (unless previously delivered), the following:
(a) the Purchase Price by wire transfer of immediately
available funds to the account or accounts identified by Seller at
least two Business Days prior to the Closing Date;
(b) a duly executed Claims Assignment; and
(c) all other previously undelivered documents required by
this Agreement to be delivered by Purchaser to Seller at or prior to
the Closing in connection with the Transactions.
Section 2.07. Purchase Price Allocation. Seller and Purchaser agree to
allocate the Purchase Price to be paid for the Claims and the WCG Note as
follows:
(a) One Hundred Eleven Million Seven Hundred Seventy Five
Thousand Five Hundred Fifty Six Dollars and Seventy Three Cents
($111,775,556.73) for the WCG Note;
(b) Sixty Million Thirty Nine Thousand Six Hundred Fifty Five
Dollars and Eighty Cents ($60,039,655.80) for the ADP Claims; and
(c) Eight Million One Hundred Eighty Four Thousand Seven
Hundred Eighty Seven Dollars and Forty Seven Cents ($8,184,787.47) for
the Pre-Spin Services Claims.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.01. Representations of Seller. Seller represents and warrants
to Purchaser as follows:
(a) Seller is a corporation duly organized, validly existing
and in good standing under the laws of the state of Delaware;
(b) Seller has the requisite power and authority to execute
and deliver this Agreement and any other agreements or instruments
contemplated by this Agreement to be executed by it and to perform its
obligations hereunder and thereunder, including, without limitation, to
act as agent of the Indenture Trustee under the Trust Note Indenture
with respect to the sale of the WCG Note;
(c) This Agreement has been duly executed and delivered by
Seller and constitutes the valid and binding obligation of Seller, enforceable
against Seller in accordance with its terms, subject to the effects of
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium, and
other similar laws relating to or affecting creditors' rights generally, general
equitable principles (whether considered in a proceeding in equity or at law)
and an implied covenant of good faith and fair dealing;
(d) When executed and delivered as provided in this Agreement,
each other agreement and instrument contemplated hereby to be executed by Seller
will be a valid and binding obligation of Seller, enforceable against Seller in
accordance with its terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium, and other similar laws
relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing;
(e) None of the execution and delivery of this Agreement or the other
agreements and instruments contemplated by this Agreement to be executed by
Seller, the consummation by Seller of the Transactions or compliance by Seller
with any of the provisions hereof or thereof will (i) conflict with or
constitute a breach of or default under any of Seller's charter or bylaws, (ii)
result in a violation or breach of, or constitute (with or without notice or
lapse of time or both) a default (or give rise to any third-party right of
termination, cancellation, material modification or acceleration) under, any
note, loan agreement, bond, mortgage, indenture, license, contract, commitment,
arrangement, understanding, agreement or other instrument or obligation of any
kind (including any of the foregoing relating to the Claims or the WCG Note) to
which Seller is a party or by which Seller or any of its properties or assets
may be bound, (iii) violate any order, writ, injunction, decree, judgment,
statute, rule or regulation applicable to Seller or any of its properties or
assets or (iv) require any order, consent, approval or authorization of, or
notice to, or declaration, filing, application, qualification or registration
with, any Governmental Entity, except with respect to the foregoing clauses
(ii)-(iv), as would not, individually or in the aggregate, reasonably be
expected to have a material adverse effect on the ability of Seller to
consummate the Transactions;
(f) As of the Closing Date, and upon the assignment and assumption of
the Claims and the transfer of the WCG Note, (i) Seller will have transferred to
Purchaser all of Seller's right, title and interest in and to the Claims and
(ii) Seller, in its capacity as agent of the Indenture Trustee under the Trust
Note Indenture, will have transferred to Purchaser all of the Issuer's right,
title and interest in and to the WCG Note;
(g) As of April 22, 2002, (i) the ADP Claims had a nominal value of
Seven Hundred Fifty Three Million Eight Hundred Sixty Seven Thousand One Hundred
and Twenty Eight Dollars and Fifty Cents ($753,867,128.50), plus the right to
accrued and unpaid interest; (ii) the Pre-Spin Services Claims had a nominal
value of One Hundred Eight Million Two Hundred Fifty Thousand Dollars
($108,250,000), plus the right to accrued and unpaid interest; and (iii) the WCG
Note had a face value of One Billion Five Hundred Million Dollars
($1,500,000,000):
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(h) Correct and complete copies of all of the material Claims Documents
and material Note Documents have been delivered to Purchaser prior to the date
hereof;
(i) No broker, finder or other Person acting under Seller's authority
is entitled to any broker's commission or other fee in connection with the
Transactions for which Purchaser could be responsible; and
(j) Except for the representations and warranties contained in this
Section 3.01, neither Seller nor any other Person makes any other express or
implied representation or warranty to Purchaser.
Section 3.02. Representations of Purchaser. Purchaser hereby represents
and warrants to Seller as follows:
(a) Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the state of
New York;
(b) Purchaser has the requisite power and authority to execute
and deliver this Agreement and any other agreements or instruments
contemplated by this Agreement to be executed by Purchaser and to
perform its obligations hereunder and thereunder;
(c) This Agreement has been duly executed and delivered by
Purchaser and this Agreement constitutes the valid and binding
obligation of Purchaser, enforceable against Purchaser in accordance
with its terms subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar
laws relating to or affecting creditors' rights generally, general
equitable principles (whether considered in a proceeding in equity or
at law) and an implied covenant of good faith and fair dealing;
(d) When executed and delivered as provided in this Agreement,
each other agreement and instrument contemplated hereby to be executed
by Purchaser will be a valid and binding obligation of Purchaser,
enforceable against Purchaser in accordance with its terms, subject to
the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium, and other similar laws relating to or
affecting creditors' rights generally, general equitable principles
(whether considered in a proceeding in equity or at law) and an implied
covenant of good faith and fair dealing;
(e) None of the execution and delivery of this Agreement and
any other agreements or instruments contemplated by this Agreement to
be executed by Purchaser, nor the consummation by Purchaser of the
Transactions or compliance by Purchaser with any of the provisions
hereof or thereof will (i) conflict with or constitute a breach of or
default under any of its charter or bylaws. (ii) result in a violation
or breach of, or constitute (with or without notice or lapse of time or
both) a default (or give rise to any third party right of termination,
cancellation, material modification or acceleration) under, any note,
loan agreement, bond, mortgage, indenture, license, contract,
commitment, arrangement, understanding, agreement or other instrument
or obligation of any kind to which Purchaser is a party or by which
Purchaser or any of its properties or assets may be bound, (iii)
violate any order, writ, injunction, decree, judgment, statute, rule or
regulation application to Purchaser or any of its properties or assets
or (iv) except for applicable requirements of the HSR Act, require any
order, consent, approval or authorization of, or notice to, or
declaration, filing, application, qualification or registration with,
any Governmental Entity, except with respect to the foregoing clauses
(ii)-(iv) as would not, individually or in the aggregate, reasonably be
expected to have a material adverse effect on the ability of Purchaser
to consummate the Transactions;
13
(f) Purchaser (i) is a sophisticated Person with respect to
the purchase of the Claims and the WCG Note, (ii) is able to bear the
economic risk associated with the purchase of the Claims and the WCG
Note, (iii) has adequate information concerning the business and
financial condition of the Debtors and the status of the Bankruptcy
Case to make an informed decision regarding the purchase of the Claims
and the WCG Note, (iv) has such knowledge and experience, and has made
investments of a similar nature, so as to be aware of the risks and
uncertainties inherent in the purchase of rights and assumption of
liabilities of the type contemplated in this Agreement and (v) has
independently and without reliance upon Seller, and based on such
information as Purchaser has deemed appropriate, made its own analysis
and decision to enter into this Agreement, except that Purchaser has
relied upon Seller's express representations and warranties in this
Agreement. Purchaser acknowledges that Seller has not given Purchaser
any investment advice, credit information or opinion on whether the
purchase of the Claims and the WCG Note is prudent;
(g) No broker, finder or other Person acting under Purchaser's
authority is entitled to any broker's commission or other fee in
connection with the Transactions for which Seller could be responsible;
(h) Purchaser has and will have on the Closing Date sufficient
funds available to it to pay the Purchase Price and all contemplated
fees and expenses of Purchaser related to the Transactions; and
(i) Except for the representations and warranties contained in
this Section 3.02, neither Purchaser nor any other Person makes any
other express or implied representation or warranty to Seller.
Section 3.03. Survival. All the representations and warranties of
Seller and Purchaser set forth in this Article III shall survive the Closing.
ARTICLE IV
COVENANTS AND AGREEMENTS
Section 4.01. February 23. 2002 Letter. Purchaser hereby agrees to be
bound by Seller's obligations under the Letter Agreement dated February 23,
2002, between Seller and WCG (the "February 23 Agreement"), including, without
limitation, paragraphs 1 and 4(e) thereof, with respect to the Claims, the WCG
Note and the Excluded Claims.
Section 4.02. Communications Investment. Purchaser agrees to use its
commercially reasonable best efforts to satisfy the terms and conditions of the
Investment Agreement.
Section 4.03. No Shop. During the period from the date of this
Agreement to the earlier of (i) the Closing Date and (ii) the date this
Agreement is terminated, Seller and its Subsidiaries shall not, and shall use
their reasonable best efforts to cause each of their respective directors,
officers and agents (including, financial advisors) not to (i) directly or
indirectly, initiate or solicit proposals or offers from any Person, other than
Purchaser (and its Affiliates and representatives), relating to any acquisition
or purchase of all or a portion of the Claims or the WCG Note or (ii)
participate in any negotiations or furnish any information with respect to, or
facilitate any effort or attempt by any other Person to do or seek any of the
foregoing.
14
Section 4.04. Impairment. (a) Seller covenants and agrees that from and
after the date of this Agreement Seller shall not, and shall cause its
Affiliates not to, knowingly take any action or fail to take action that could
reasonably be expected to (i) impair materially the Claims or the WCG Note or
(ii) adversely affect in a material way the Plan; and
(b) Purchaser covenants and agrees that from and after the date of this
Agreement, Purchaser shall not, and shall cause its Affiliates not to, knowingly
take any action or fail to take action that could reasonably be expected to (i)
impair materially the Excluded Claims or (ii) adversely affect in a material way
the Plan.
Section 4.05. Purchaser Support of Plan and TWC Settlement Agreement.
(a) To the extent Purchaser is or becomes a creditor of the Debtors, or
otherwise has standing in the Bankruptcy Case, Purchaser shall (i) support and
not oppose, the Plan, (ii) use commercially reasonable efforts to obtain as
expeditiously as possible, the confirmation and consummation of the Plan and
(iii) support the approval by the Bankruptcy Court of the TWC Settlement
Agreement and use commercially reasonable efforts to obtain entry of the TWC
Settlement Order.
(b) Purchaser shall use commercially reasonable efforts to (1)
cause the Plan and a disclosure statement with respect to the Plan (the
"Disclosure Statement") to be filed with the Bankruptcy Court as expeditiously
as practicable, (2) seek to obtain entry of an order approving the Disclosure
Statement as containing "adequate information" as required by section 1125 of
the Bankruptcy Code as expeditiously as possible, (3) facilitate the
solicitation of votes on the Plan, (4) obtain entry of the Confirmation Order,
and (5) cause the Plan Effective Date to occur on or before February 28, 2003.
(c) Regardless of whether the Purchaser is a creditor of the
Debtors or is a proponent of the Plan, Purchaser shall not (1) object to the
Plan, (2) vote against the Plan, (3) take any action that would delay the
confirmation and consummation of the Plan, (4) solicit, encourage, entertain, or
engage in any inquiries, discussions, offers, proposals, or enter into any
agreements, arrangement or understandings, relating to any other chapter 11 plan
with respect to the Debtors or any transaction involving the Debtors or their
assets that is inconsistent with the Plan and the transactions contemplated
hereby, (5) consent to, support or participate in the formulation of any chapter
11 plan for the Debtors other than the Plan, (6) encourage or support in any
fashion any Person to vote against or object to the Plan, or (7) take any action
directly or indirectly for the purpose of delaying, preventing, frustrating or
impeding acceptance, confirmation and consummation of the Plan.
Section 4.06. Seller Support of Plan. (a) Seller shall support and not
oppose, the Plan, and shall be commercially reasonable efforts to obtain as
expeditiously as possible, the confirmation and consummation of the Plan.
(b) Seller shall not (1) object to the Plan, (2) vote against
the Plan, (3) take any action that would delay the confirmation and consummation
of the Plan, (4) solicit, encourage, entertain, or engage in any inquiries,
discussions, offers, proposals, or enter into any agreements, arrangement or
understandings, relating to any other chapter Il plan with respect to the
Debtors or any transaction involving the Debtors or their assets that is
inconsistent with the Plan and the transactions contemplated hereby, (5) consent
to, support or participate in the formulation of any chapter 11 plan for the
Debtors other than the Plan, (6) encourage or support in any fashion any Person
to vote against or object to the Plan, or (7) take any action directly or
indirectly for the purpose of delaying, preventing, frustrating or impeding
acceptance, confirmation and consummation of the Plan.
15
Section 4.07. Voting. Until the Closing Date, Seller shall have sole
authority to exercise all voting and other rights and remedies with respect to
the Claims, the WCG Note (in its capacity as agent of the Indenture Trustee
under the Trust Note Indenture) and the Plan, and Purchaser shall have no right
to act as agent for Seller in respect of any matter relating to the Claims, the
WCG Note or the Plan; provided, that Seller agrees not to exercise such voting
and other tights and remedies in a manner inconsistent with the terms of this
Agreement; and provided, further, that to the extent practicable, prior to
exercising any such voting or other rights or remedies, Seller shall notify
Purchaser of any such proposed exercise.
Section 4.08. Seller Rights. Except as specifically provided in this
Agreement, nothing shall restrict the right, power or ability of Seller to take
any action it deems necessary or appropriate to protect its interests,
including, without limitation, with respect to any Causes of Action that (i) WCG
or any other Person may have against Seller or any of its Affiliates, or (ii)
relate to the Claims or the WCG Note.
Section 4.09. Non-assumption of Liabilities. It is expressly agreed
that Purchaser is not assuming any of Seller's obligations or liabilities to WCG
as a result of the Transactions.
Section 4.10. Condition of Claims and WCG Note. PURCHASER AGREES THAT
THE CLAIMS AND THE WCG NOTE BEING SOLD HEREUNDER ARE BEING SOLD WITHOUT ANY
WARRANTY OR REPRESENTATION WHATSOEVER (EXPRESS OR IMPLIED), EXCEPT AS
SPECIFICALLY STATED HEREIN AND THAT, EXCEPT FOR SUCH REPRESENTATIONS AND
WARRANTIES, THE SALE OF THE CLAIMS BY SELLER AND OF THE WCG NOTE BY SELLER IN
ITS CAPACITY AS AGENT OF THE INDENTURE TRUSTEE UNDER THE TRUST NOTE INDENTURE TO
PURCHASER IS MADE ON AN "AS IS, WHERE IS" BASIS, WITH ALL DEFECTS AND
IMPAIRMENTS OF ANY KIND OR NATURE, WHETHER KNOWN OR UNKNOWN, MATURE OR LATENT,
WHICH MAY AFFECT THE AMOUNT, PRIORITY, VALIDITY, ENFORCEABILITY, ALLOWABILITY OR
RECOVERY OF SUCH CLAIMS OR THE WCG NOTE IN THE BANKRUPTCY CASE (INCLUDING,
WITHOUT LIMITATION, THE AMOUNT OF EQUITY RECEIVED UNDER THE PLAN) OR OTHERWISE;
SELLER MAKES NO REPRESENTATION OR WARRANTY OF ANY KIND, IN EITHER ITS INDIVIDUAL
CAPACITY OR ITS CAPACITY AS AGENT OF THE INDENTURE TRUSTEE UNDER THE TRUST NOTE
INDENTURE, REGARDING THE AMOUNT, VALIDITY, ENFORCEABILITY OR ALLOWABILITY OF THE
CLAIMS OR THE WCG NOTE, AND PURCHASER ASSUMES ALL RISKS WITH RESPECT THERETO
(AND SHALL HAVE NO RIGHT, CLAIM, CAUSE OF ACTION OR REMEDY AGAINST SELLER
THEREFOR).
Section 4.11. Make-Whole Provision (a) Purchaser hereby agrees that, if
within one year of the Closing Date, Purchaser or any of its Affiliates directly
or indirectly sells, exchanges or disposes of (or enters into an agreement or
agreements with respect thereto) the Claims and/or the WCG Note or any
consideration received in exchange therefor pursuant to a chapter 11 plan with
respect to Communications (including, without limitation, any equity or debt
security of any Person (the "Claims Exchange Consideration")), or receives a
dividend, payment or similar distribution from Communications, Reorganized
Communications, any of their respective Subsidiaries or any successors thereof
as a consequence of a sale of assets of, or transaction involving,
Communications, Reorganized Communications, any of their respective Subsidiaries
or any successors thereof (or enters into an agreement or agreements with
respect thereto) resulting in an aggregate payment to Purchaser and/or its
Affiliates of greater than One Hundred Eighty Million Dollars ($180,000,000) (it
being expressly agreed that Fifty Four and Fifty Four Hundredths Percent
(54.54%) of (i) the proceeds of each sale, exchange or other disposition by
Purchaser and/or any of its Affiliates of any equity or debt security of any
Person received by Purchaser and/or any of its Affiliates during such year in
conjunction with or pursuant to a
16
chapter 11 plan with respect to Communications and (ii) each dividend, payment
or similar distribution received by Purchaser from Communications, Reorganized
Communications, any of their respective Subsidiaries or any successors thereof
during such year as a consequence of a sale of assets of, or transaction
involving, Communications, Reorganized Communications or any of their respective
Subsidiaries or any successors thereof, shall be allocated to the Claims
Exchange Consideration for purposes of determining any payment(s) due Seller
under this Section 4.11), Purchaser shall, within three (3) Business Days of the
consummation of such transaction, pay to Seller in immediately available funds
(except as provided in Section 4.11(b)) to an account designated by Seller in
writing, an amount equal to the product of (x) Fifty Percent (50%) multiplied by
(y) the excess of the aggregate payment over One Hundred Eighty Million Dollars
($180,000,000); provided, that such payment shall be allocated pro rata among
the Claims and the WCG Note in proportion to their allocated portion of the
Purchase Price in Section 2.07; and, provided, further, that with respect to the
portion of such payment attributable to the WCG Note or any consideration
received in exchange therefor pursuant to a chapter 11 plan with respect to
Communications, Seller will receive such payment in its capacity as the agent of
the Indenture Trustee under the Trust Note Indenture. Purchaser agrees that it
will notify Seller in writing within three (3) Business Days of entering into a
transaction or agreement of the type set forth in this Section 4.11.
(b) In the event the consideration received or to be received by
Purchaser in a transaction of the type set forth in Section 4.11(a) is to be
paid in whole or in part other than in Dollars, for purposes of Section 4.11(a),
the value of such consideration shall be mutually agreed between Purchaser and
Seller. Notwithstanding anything in this Agreement to the contrary, in the event
Purchaser receives non-Dollar consideration in a transaction of the type set
forth in Section 4.11(a), unless otherwise agreed between Purchaser and Seller
in accordance with the previous sentence, any payment by Purchaser to Seller
under Section 4.11(a) shall be made pro rata (based on the amount of non-Dollar
consideration relative to the amount of Dollar consideration received by
Purchaser in such transaction(s)) in such non-Dollar consideration.
Section 4.12. HSR Act. Purchaser agrees to cause to be made all
appropriate filings under the HSR Act with respect to the Transactions as soon
as reasonably practicable after the date of this Agreement and to diligently
pursue termination of the waiting period under the HSR Act.
Section 4.13. Covenant to Satisfy Conditions. Each party hereto agrees
to use all commercially reasonable best efforts to insure that the conditions
set forth in Article V hereof are satisfied, insofar as such matters are within
the control of such party.
Section 4.14. Further Assurances. Each party shall execute and deliver
such other documents and instruments and take such further actions, as may be
reasonably required by the other party in order to consummate the Transactions
contemplated hereby.
ARTICLE V
CONDITIONS PRECEDENT
Section 5.01. Conditions to Purchaser's Obligation to Effect the
Closing. The obligation of Purchaser to consummate the Closing shall be subject
to the satisfaction on or prior to the Closing Date of each of the following
conditions, unless validly waived in writing by Purchaser:
(a) Representations and Warranties. All of the representations
and warranties of Seller set forth in this Agreement that are qualified
as to materiality shall be true and correct and any such
representations and warranties that are not so qualified shall be true
and correct in all
17
material respects, in each case as of the date hereof and as of the
Closing Date, other than representations and warranties that speak as
of a specific date or time (which need only be so true and correct as
of such date or time).
(b) Seller's Performance of Covenants. Seller shall not have
failed to perform in any material respect any obligation or to comply
in any material respect with any agreement or covenant of Seller to be
performed or complied with by it under this Agreement.
(c) Injunctions. On the Closing Date, there shall not be any
injunction, writ, preliminary restraining order or other order in
effect of any nature issued by a Governmental Entity of competent
jurisdiction that restrains, prohibits or limits, in whole or in
material part, the consummation of the Transactions.
(d) HSR Act. The applicable waiting period under the HSR Act
with respect to the Transactions shall have expired or been terminated.
(e) SBC Consent. SBC (on behalf of itself and its Affiliates)
shall have consented to (i) the April 23, 2001 transactions pursuant to
which the stock in WCG held by Seller was dividended to Seller's
shareholders and (ii) the transactions contemplated by the Plan and the
Investment Agreement, such consents to be in form and substance
reasonably satisfactory to Purchaser, with Purchaser's approval not to
be unreasonably withheld or delayed, provided, however, that this
condition may be satisfied as to any of clauses (1) or (ii) if
Purchaser seeks or directs Communications to seek and, subsequently, a
court of competent jurisdiction shall have entered an order reasonably
satisfactory to Purchaser providing that SBC does not have and will not
have a right to terminate the Master Alliance Agreement between SBC and
WCL, dated February 12, 1999 by reason of the transactions contemplated
by clauses (i) or (ii), as applicable.
(f) Closing Deliveries. Seller shall have made all closing
deliveries to Purchaser as set forth in Section 2.05.
(g) Confirmation of Plan. The Bankruptcy Court shall have
entered an order (the "Confirmation Order"), confirming the Plan, which
shall have become a Final Order, and the Plan shall have been
consummated and become effective and binding on WCG and all creditors,
interest holders and parties in interest.
The foregoing conditions are for the sole benefit of Purchaser and may be waived
by Purchaser, in whole or in part, at any time and from time to time in its sole
discretion.
Section 5.02. Conditions to Seller's Obligation to Effect the Closing.
The obligation of Seller to consummate the Closing shall be subject to the
satisfaction on or prior to the Closing Date of each of the following
conditions, unless waived in writing by Seller:
(a) Representations and Warranties. All of the representations
and warranties of Purchaser set forth in this Agreement that are
qualified as to materiality shall be true and correct and any such
representations and warranties that are not so qualified shall be true
and correct in all material respects, in each case as of the date
hereof and as of the Closing Date, other than representations and
warranties that speak as of a specific date or time (which need only be
so true and correct as of such date or time).
(b) Purchaser's Performance of Covenants. Purchaser shall not
have failed to perform in any material respect any obligation or to
comply in any material respect with any agreement or covenant to be
performed or complied with by it under this Agreement.
18
(c) Injunctions. On the Closing Date, there shall not be any
injunction, writ, preliminary restraining order or other order in
effect of any nature issued by a Governmental Entity of competent
jurisdiction that restrains, prohibits or limits, in whole or in
material part, the consummation of the Transactions.
(d) Communications Investment. Purchaser shall have
consummated the Communications Investment concurrently with the
Closing.
(e) Closing Deliveries. Purchaser shall have made all closing
deliveries to Seller as set forth in Section 2.06.
(f) Confirmation Order. The Bankruptcy Court shall have
entered the Confirmation Order (which shall be reasonably satisfactory
to Seller), which shall have become a Final Order, and the Plan (and
all of the transactions contemplated thereby) shall have been
consummated and become effective and binding on WCG and all creditors,
interest holders and parties in interest.
(g) Building Purchase. The Building Purchase shall have been
consummated or shall be consummated concurrently with the Closing.
(h) Settlement Order. The TWC Settlement Order shall have
become a Final Order and all of the transactions contemplated thereby
shall have been consummated.
The foregoing conditions are for the sole benefit of Seller and may be waived by
Seller, in whole or in part, at any time and from time to tune in its sole
discretion.
ARTICLE VI
TERMINATION
Section 6.01. Termination. This Agreement may be terminated or
abandoned at any time prior to the Closing Date:
(a) By the mutual written consent of Purchaser and Seller:
(b) By Purchaser or Seller if any Governmental Entity with
jurisdiction over the subject matter of this Agreement shall have
issued an order, decree or ruling or taken any other action
restraining, enjoining or otherwise prohibiting in whole or in material
part the consummation of the Transactions and such order, decree,
ruling or other action shall have become a Final Order;
(c) By Purchaser or Seller if the Bankruptcy Court denies
approval of the TWC Settlement Agreement, or, in. any event, if the TWC
Settlement Order is not entered by October 15, 2002;
(d) By Purchaser or Seller in the event of a material breach
of this Agreement by the other party, which breach shall be incapable
of being cured or, if capable of being cured, shall not have been cured
within thirty (30) days following receipt by the breaching party from
the other party of written notice of such breach (specifying in
reasonable detail the claimed breach and demand of its cure);
19
(e) By Seller in the event any of the conditions set forth in
Section 5.02 becomes incapable of being satisfied on or before February
28, 2003; and
(f) By Purchaser or Seller if the Closing has not occurred on
or before February 28, 2003; unless the failure of such consummation
shall be due to the failure of such party to comply in all material
respects with the representations, warranties, agreements and covenants
contained herein or to be performed by such party on or prior to
February 28, 2003.
Section 6.02. Effect of Termination. In the event of the termination or
abandonment of this Agreement by any party hereto pursuant to the terms of this
Agreement, written notice thereof shall forthwith be given to the other party
specifying the provision hereof pursuant to which such termination or
abandonment of this Agreement is made, and there shall be no liability or
obligation thereafter on the part of Purchaser or Seller except (A) as set forth
in Section 6.03, (B) for fraud and (C) for willful breach of this Agreement
prior to such termination or abandonment of the Transactions.
Section 6.03. Liquidated Damages. In the event of the termination by
Purchaser of this Agreement pursuant to Section 6.01(d) (provided that Purchaser
is not then in material breach of this Agreement), Seller shall, within three
(3) Business Days of such termination, pay to Purchaser in immediately available
funds to an account designated by Purchaser in writing Five Million Dollars
($5,000,000). The parties hereto expressly acknowledge and agree that, in light
of the difficulty of accurately determining actual damages with respect to the
foregoing upon any termination of this Agreement where a fee is or may become
payable in accordance with this Section 6.03, the right to payment: (i)
constitutes a reasonable estimate of the damages that will be suffered by reason
of any such proposed or actual termination of this Agreement, and (ii) shall be
in full and complete satisfaction of any and all damages arising from the
foregoing.
ARTICLE VII
MISCELLANEOUS
Section 7.01. Expenses. All costs and expenses incurred in connection
with this Agreement and the consummation of the Transactions shall be paid by
the party incurring such expenses, except as specifically provided to the
contrary in this Agreement.
Section 7.02. Extension: Waiver. At any time prior to the Closing, each
of the parties hereto may (i) extend the time for the performance of any of the
obligations or acts of any other party hereto, (ii) waive any inaccuracies in
the representations and warranties of any other party contained herein or in any
document delivered pursuant hereto, (iii) waive compliance with any of the
agreements of the other party contained herein, or (iv) waive any condition to
its obligations hereunder. Any agreement on the part of a party hereto to any
such extension or waiver shall be valid only if set forth in a written
instrument signed on behalf of such party.
Section 7.03. Transfer Taxes. In accordance with Section 1146(c) of the
Bankruptcy Code, the instruments transferring the Claims and the WCG Note to
Purchaser shall contain the following endorsement:
"Because this [instrument] has been authorized pursuant to
Order of the United States Bankruptcy Court for the Southern District of
New
York relating to a chapter 11 plan of ▇▇▇▇▇▇▇▇ Communications Group, Inc. and
the order of the ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, United
20
States Bankruptcy Judge, it is exempt from transfer taxes, stamp taxes or
similar taxes pursuant to 11 U.S.C. Section 1146(c)."
Section 7.04. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed given when mailed, delivered personally,
telecopied (which is confirmed) or sent by an overnight courier service, such as
Federal Express, to the parties at the following addresses (or at such other
address for a party as shall be specified by such party by like notice):
if to Purchaser to:
Leucadia National Corporation
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention:
Facsimile:
with a copy (which shall not constitute notice) to:
▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
if to Seller to:
The ▇▇▇▇▇▇▇▇ Companies, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇, Esq.
▇▇▇▇▇ ▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy (which shall not constitute notice) to:
White & Case LLP
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
and
White & Case LLP
First Union Financial Center
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
21
or to such other address, telecopier number or person's
attention as a party may from time to time designate in writing in accordance
with this Section. Each notice or other communication given to any party hereto
in accordance with the provisions of this Agreement shall be deemed to have been
received (a) on the Business Day it is sent, if sent by personal delivery or
telecopied, or (b) on the first Business Day after sending, if sent by overnight
delivery, properly addressed and prepaid or (c) upon receipt, if Sent by mail
(regular, certified or registered); provided, however, that notice of change of
address shall be effective only upon receipt. The parties agree that delivery of
process or other papers in connection with any action or proceeding in
connection with this Agreement in the manner provided in this Section 7.04, or
in such other manner as may be permitted by Applicable Law, shall be valid and
sufficient service thereof.
Section 7.05. Entire Agreement: Amendment. This Agreement, the
Confidentiality Agreement and other schedules and exhibits hereto constitute the
entire agreement and supersede all prior agreements and understandings, both
written and oral, among the parties with respect to the subject matter hereof
and thereof and supersede and cancel all prior agreements, negotiations,
correspondence, undertakings, understandings and communications of the parties,
oral and written, with respect to the subject matter hereof. This Agreement may
only be modified or amended by a written instrument executed by the parties
hereto.
Section 7.06. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York (without giving
effect to the provisions thereof relating to conflicts of law).
Section 7.07. Jurisdiction Purchaser and Seller each hereby irrevocably
and unconditionally submit to the nonexclusive jurisdiction of any New York
State court or Federal court of the United States of America sitting in New York
City, and any appellate court from any thereof, but solely in any action or
proceedings to enforce this Agreement. Each of the parties hereto agrees that a
final judgment in any such action or proceeding will be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.
Section 7.08. Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts
and by facsimile, with the same effect as if all parties had signed the same
document. All such counterparts are to be deemed an original, construed together
and constitute one and the same instrument.
Section 7.09. Severability. Any term or provision of this Agreement
that is invalid or unenforceable in any jurisdiction, will, as to that
jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the remaining terms
and provisions of this Agreement or affecting the validity or enforceability of
any of the terms or provisions of this Agreement in any other jurisdiction. If
any provision of this Agreement is so broad as to be unenforceable, the
provision will be interpreted to be only so broad as is enforceable.
Section 7.10. Headings. The headings of the paragraphs of this
Agreement are inserted for convenience only and not to affect the interpretation
hereof.
Section 7.11. Assignment. Neither this Agreement nor the rights or the
obligations of any party hereto are assignable in whole or in part (whether by
operation of law or otherwise), without the written consent of the other party
and any attempt to do so in contravention of this Section 7.11 will be void;
except that Purchaser may assign any or all of its rights (but not its
obligations) hereunder to any Affiliate of Purchaser; provided, that no such
assignment shall relieve Purchaser of its obligations hereunder.
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Section 7.12. Successors and Assigns. This Agreement, including the
representations, warranties and covenants contained in this Agreement, shall
inure to the benefit of, be binding upon and be enforceable by and against the
parties and their respective successors and permitted assigns.
Section 7.13. No Third-Party Beneficiaries. This Agreement is solely
for the benefit of the parties hereto, their respective successors and permitted
assigns, and the Persons identified as beneficiaries herein.
Section 7.14. Publicity. The parties agree that until the Plan
Effective Date, or the date the Transactions are terminated or abandoned
pursuant to Article VI, neither Seller nor Purchaser nor any of their respective
Affiliates, shall issue or cause the publication of any press release or other
public announcement with respect to this Agreement or the Transactions or the
Plan without prior consultation with the other(s), except as may be (a) required
by Applicable Law, which shall include such filings and/or statements as any
party shall determine to be necessary or advisable in its reasonable judgment in
order to comply with its obligations under the Securities Exchange Act of 1934,
as amended, or (b) appropriate to the Debtors' administration of the Bankruptcy
Case.
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IN WITNESS WHEREOF, Seller and Purchaser have executed this
Purchase
and Sale Agreement by heir duly authorized officers as of the date first set
forth above.
THE ▇▇▇▇▇▇▇▇ COMPANIES, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President - Finance,
Chief Financial Officer
LEUCADIA NATIONAL CORPORATION
BY:
---------------------------
Name:
Title:
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IN WITNESS WHEREOF, Seller and Purchaser have executed this
Purchase
and Sale Agreement by heir duly authorized officers as of the date first set
forth above.
THE ▇▇▇▇▇▇▇▇ COMPANIES, INC.
By:
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
LEUCADIA NATIONAL CORPORATION
BY: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Name:
Title: Vice-President
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