EXHIBIT 99.3
ESCROW AGREEMENT
This Escrow Agreement is entered into as of the 15th day of October, 2002.
AMONG:
WILTEL COMMUNICATIONS GROUP, INC., a Nevada corporation
(HEREINAFTER referred to as the "Company"),
OF THE FIRST PART,
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THE ▇▇▇▇▇▇▇▇ COMPANIES, INC., a Delaware corporation
(HEREINAFTER referred to as "TWC"),
OF THE SECOND PART,
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LEUCADIA NATIONAL CORPORATION, a New York corporation
(HEREINAFTER referred to as "Leucadia"),
OF THE THIRD PART,
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THE BANK OF NEW YORK, a New York banking institution
(HEREINAFTER referred to as the "Escrow Agent"),
OF THE FOURTH PART
RECITALS
The parties hereto acknowledge the veracity of the following recitals:
A. On September 30, 2002, the United States Bankruptcy Court for the Southern
District of New York (the "Bankruptcy Court") entered an order confirming
▇▇▇▇▇▇▇▇ Communications Group, Inc.'s ("WCG") Second Amended Joint Chapter 11
Plan of Reorganization dated August 12, 2002 (as subsequently modified, the
"Plan").
B. WCG and Leucadia are parties to an Investment Agreement dated as of July 26,
2002, as amended on September 30, 2002 and October 15, 2002 (the "Investment
Agreement"), pursuant to which Leucadia will invest on the effective date of the
Plan (the "Effective Date") $150,000,000 (the "Company Purchase Price") in the
Company in exchange for 20.45% of the common stock (the "Common Stock") of the
Company.
C. Pursuant to the Plan, TWC and Leucadia are parties to a Purchase and Sale
Agreement dated as of July 26, 2002, as amended on October 15, 2002 (the "Claims
Purchase Agreement"), pursuant to which TWC will sell and assign to Leucadia on
the Effective Date certain claims against WCG (the "TWC Assigned Claims") for
the aggregate sum of $180,000,000 (the "TWC Purchase Price"). Pursuant to the
Plan, on the Effective Date, Leucadia will receive a distribution in
satisfaction of the TWC Assigned Claims in the amount of 24.55% of the Common
Stock, subject to reduction to 23.55% as provided in the Plan.
D. WCG, ▇▇▇▇▇▇▇▇ Communications, LLC ("WCL") and the Company have applied to the
Federal Communications Commission (the "FCC") for approval from the FCC to
transfer control of all of the Licenses (as defined below) to the Company in
connection with the consummation of the Plan and have received grants of special
temporary authority (collectively, "STAs") in connection therewith.
E. The Company, TWC and Leucadia have agreed that in connection with the receipt
of the STAs and the issuance of the Company Common Stock and the TWC Common
Stock, Leucadia will (i) pay $1,000 to the Company for the Company Common Stock
(as defined below), (ii) deposit the Company Letter of Credit (as defined below)
and the TWC Letter of Credit (as defined below) into escrow, and (iii) complete
the transactions contemplated by the Investment Agreement and the Claims
Purchase Agreement on the date hereof which is prior to the receipt of FCC
Approval (as defined below), which the parties hereto have acknowledged is good,
valid and sufficient consideration for the issuance of such Common Stock. The
Company, TWC and Leucadia have also agreed that in connection with the receipt
of the STAs, Leucadia will deposit into escrow (i) an irrevocable standby letter
of credit (the "Company Letter of Credit") with a face amount equal to
$151,000,000, (ii) an irrevocable standby letter of credit (the "TWC Letter of
Credit" and, together with the Company Letter of Credit, the "Letters of
Credit") with a face amount equal to $181,000,000, and (iii) the Director
Resignations (as defined below), pending receipt by the Company of FCC Approval
(as defined below). Each Letter of Credit will be issued for the sole benefit of
the Escrow Agent and have an expiration date of March 14, 2003. The issuing
bank's fee for the Company Letter of Credit is $302,000
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and the issuing bank's fee for the TWC Letter of Credit is $362,000, each of
which will be paid in advance by Leucadia.
F. The Company and TWC will deposit into escrow those executed agreements,
instruments, instructions and other documents relating to the transfer of
certain real property and other assets pursuant to the terms of the Real
Property Purchase and Sale Agreement dated as of July 26, 2002, as amended on
October 15, 2002, by and between ▇▇▇▇▇▇▇▇ Headquarters Building Company
("WHBC"), ▇▇▇▇▇▇▇▇ Technology Center, LLC ("WTC"), WCL, WCG, ▇▇▇▇▇▇▇▇ Aircraft
Leasing, LLC and WilTel Communications Group, Inc., which agreements,
instruments, instructions and documents are listed on Schedule B hereto
(collectively, the "Building Purchase Closing Documents").
G. In furtherance of all of the foregoing, the Company, TWC and Leucadia have
determined to execute this Escrow Agreement (as amended, supplemented or
otherwise modified from time to time in accordance herewith, the "Escrow
Agreement") the material terms of which have previously been approved by the
Bankruptcy Court pursuant to an Order dated September 30, 2002.
H. Pursuant to this Escrow Agreement, the Company, TWC and Leucadia have each
appointed the Representatives (as defined below) to represent them for all
purposes in connection with the Escrowed Property (as defined below) to be
deposited with the Escrow Agent and with this Escrow Agreement.
NOW, THEREFORE, in consideration of the covenants and agreements set
forth in this Escrow Agreement, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the undersigned
agree as follows:
1. INTERPRETATION
1.1 Definitions. For the purposes of this Escrow Agreement or any
notice or other communication required or permitted to be given hereunder, in
addition to terms defined elsewhere in this Agreement, the following words and
phrases will have the following meanings, respectively:
(a) "ADMINISTRATIVE AGENT" means Bank of America, N.A., in its
capacity as administrative agent under the WCL Credit
Documents (as defined in the Plan) or any successor
administrative agent.
(b) "AFFILIATE" of any Person means any other Person, that,
directly or indirectly through one or more intermediaries,
controls or is controlled by, or is under common control with,
such Person; and, for the purposes of this definition only,
"control" (including the terms "controlling", "controlled by"
and "under common control with") means the possession, direct
or indirect, of the power to direct or cause the direction of
the management, policies or activities of a Person whether
through the ownership of securities, by contract or agency or
otherwise; provided that as such term is used in this Escrow
Agreement Leucadia shall not be included as an Affiliate of
the Company.
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(c) "BUILDING PURCHASE ESCROWEE" means Lawyers Title Insurance
Corporation.
(d) "COMPANY BUILDING PURCHASE CLOSING DOCUMENTS" means those
agreements set forth on Schedule B under the heading "Company
Building Purchase Closing Documents."
(e) "COMPANY COMMON STOCK" means the 10,225,000 shares of Common
Stock issued to Leucadia pursuant to the Investment Agreement.
(f) "DIRECTOR RESIGNATIONS" means the resignations, effective on
the date on which the Escrow Agent releases and delivers the
Escrowed Property and other documents pursuant to Section 5.2
of this Escrow Agreement, of each of ▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ from the
Board of Directors of the Company, copies of which are
attached hereto as Exhibit C, and any additional resignations
delivered in accordance with Section 5.6 hereof.
(g) "ESCROWED PROPERTY" means the Letters of Credit, the Building
Purchase Closing Documents and the Director Resignations.
(h) "FCC APPROVAL" means any one of the following:
(i) the issuance of one or more written orders or public
notices by the FCC setting forth the FCC's action
approving, without a Materially Adverse FCC
Condition, the transfer of control of all of the
Licenses to the Company to which no objection was
filed with the FCC as to any of the applications for
FCC consent to the transfer of control prior to the
release of such orders or public notices, other than
an objection filed at the behest of Leucadia;
(ii) the issuance of one or more written orders or public
notices by the FCC setting forth the FCC's action
approving, without a Materially Adverse FCC
Condition, the transfer of control of all of the
Licenses to the Company to which one or more
objections were filed with the FCC as to any of the
applications for FCC consent to the transfer of
control prior to the release of such orders or public
notices, other than an objection filed at the behest
of Leucadia, but such approvals have nonetheless
become FCC Final Orders prior to February 28, 2003;
or
(iii) the issuance of one or more written orders or public
notices by the FCC setting forth the FCC's action
approving, without a Materially Adverse FCC
Condition, the transfer of control of all of the
Licenses to the Company, to which one or more
objections were filed with the FCC as to any of the
applications for FCC consent to the transfer of
control prior to the release of such orders or public
notices, other than at the behest of Leucadia, and
such approvals have not become FCC Final Orders but
each such objection has either been resolved to
Leucadia's reasonable
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satisfaction or Leucadia has waived the objection or
any resolution thereof, in either case by written
statement so stating.
(i) "FCC FINAL ORDERS" means that the FCC Approval is no longer
subject to administrative or judicial review, specifically,
that the time within which any party in interest other than
the FCC may seek administrative or judicial reconsideration or
review of the FCC Approval under the rules of the FCC has
expired and no petition for such reconsideration or review was
timely filed with the FCC or with the appropriate court, and
the time within which the FCC may review the FCC Approval on
its own motion has expired and the FCC has not undertaken such
review.
(j) "HSR ACT" means the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements
Act of 1976, as amended, and the rules and regulations
thereunder.
(k) "INDEPENDENT DIRECTOR" means an individual who is a member of
the Board of Directors of the Company who (a) is "independent"
of the Company within the meaning of (i) the rules of the New
York Stock Exchange or if the Company is listed or traded on
another stock exchange, the principal stock exchange on which
the Company's common stock is listed or traded and (ii)
applicable rules of the Securities and Exchange Commission, in
each case as may be in effect from time to time, (b) is not a
Related Investor Party pursuant to any of clauses (a) - (d) of
the definition of Related Investor Party, and (c) is not an
officer or employee of the Company or any of its Affiliates.
(l) "LICENSES" means those licenses issued by the FCC to WCL set
forth on the attached Schedule A.
(m) "LIMITED FCC APPROVAL" means the issuance of one or more
written orders or public notices by the FCC setting forth the
FCC's action approving, without a Materially Adverse FCC
Condition, the transfer of control of all of the Licenses to
the Company, to which one or more objections were filed with
the FCC as to any of the applications for FCC consent to the
transfer of control prior to the release of such orders or
public notices, other than at the behest of Leucadia, and such
approvals have not become Final FCC Orders.
(n) "MATERIALLY ADVERSE FCC CONDITION" means a condition imposed
by the FCC in connection with FCC Approval which is materially
adverse to either the Company or Leucadia, other than a
condition that includes an admonishment by the FCC against the
Company, a referral of the matter for further FCC enforcement
action against the Company and/or a monetary sanction imposed
by the FCC against the Company.
(o) "PERSON" means an individual, a corporation, a partnership, a
limited partnership, a limited liability company, an
association, a trust or other entity or organization,
including without limitation a government or political
subdivision or an agency or instrumentality thereof.
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(p) "PURCHASER DESIGNEE" means any person designated by Leucadia
for election to the Board of Directors of the Company in
accordance with Section 3.1 of the Stockholders Agreement.
(q) "RELATED INVESTOR PARTY" means any of the following: (a) an
individual who is not "independent" of Leucadia and its
Affiliates within the meaning of the rules of the New York
Stock Exchange and applicable rules of the Securities and
Exchange Commission, in each case as may be in effect from
time to time, (b) an individual who is an Affiliate of
Leucadia or an officer, director or employee of Leucadia
and/or its Affiliates, (c) an individual or entity that is the
beneficial owner of more than 10% of the voting power of
Leucadia and/or its Affiliates, (d) an individual or entity
that has any relationship of the type that would be required
to be disclosed by Leucadia and/or its Affiliates under Item
404(b) of Regulation S-K under the Securities Exchange Act of
1934 and the Securities Act of 1933 if Leucadia and/or its
Affiliates were the "registrant" and the individual was a
director or nominee for election as a director to the board of
directors of Leucadia and/or its Affiliates, and (e) any
Purchaser Designee that is not an Independent Director.
(r) "REPRESENTATIVE" means ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ for the Company, ▇▇▇▇
▇. ▇▇▇▇▇▇▇▇ for TWC and ▇▇▇▇▇▇ ▇. Orlando for Leucadia, or any
other person hereafter designated in a writing signed by
either the Company, TWC or Leucadia (as applicable) to act as
its "Representative" which writing shall be delivered to the
Escrow Agent and the other Representatives in accordance with
the notice provisions of this Escrow Agreement. The
Representative will at all times be an officer or member of
the Board of Directors of the respective entity who is duly
authorized to act in such capacity.
(s) "STOCKHOLDERS AGREEMENT" means the Stockholders Agreement
dated as of October 15, 2002 between Leucadia and the Company.
(t) "TWC BUILDING PURCHASE CLOSING DOCUMENTS" means those
agreements set forth on Schedule B under the heading "TWC
Building Purchase Closing Documents."
(u) "TWC COMMON STOCK" means the 11,775,000 shares of Common Stock
distributed to Leucadia in satisfaction of the TWC Assigned
Claims pursuant to the Plan.
2. EFFECTIVE DATE
Pursuant to the Plan, this Escrow Agreement is executed and delivered
contemporaneously with consummation of the Plan and shall become effective upon
the execution and delivery to the Escrow Agent of the Escrowed Property.
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3. ESCROW
Leucadia has delivered the Letters of Credit and the Director Resignations and
the Company and TWC have delivered the Building Purchase Closing Documents to
the Escrow Agent.
4. RELEASE OF ESCROWED PROPERTY UPON FCC APPROVAL
4.1 FCC Approval Notice. Immediately upon the Company's receipt of FCC
Approval or the written consent of Leucadia to release the Escrowed Property in
accordance with the terms of this Section 4, the Chief Executive Officer (the
"CEO") and the Chief Financial Officer (the "CFO") of the Company, solely at the
direction of a majority of the Independent Directors, shall deliver a notice
(the "FCC Approval Notice") in writing to the Escrow Agent, with a copy to each
of TWC, Leucadia and its FCC counsel, the Administrative Agent and the Building
Purchase Escrowee, (a) certifying that FCC Approval has been granted and the
basis on which FCC Approval has been provided (i.e.: which of clauses (h)(i),
(ii) or (iii) of Section 1.1 is applicable) or that Leucadia has consented in
writing to release the Escrowed Property, (b) certifying that the representation
and warranty of the Company set forth in Section 6 below is true and correct in
all respects as of the date of the FCC Approval Notice, and (c) directing the
Escrow Agent to release and deliver the Escrowed Property in accordance with
Section 4.2 below. The certifications in (a) and (b) of the previous sentence
shall be true and correct on the date such notice is provided. Upon receipt by
Leucadia of the FCC Approval Notice, Leucadia shall have two (2) business days
to deliver a written notice to the Escrow Agent, with a copy to each of the
Company, TWC and the Administrative Agent, objecting to the CEO's and CFO's
certification in the FCC Approval Notice (a "Certification Objection"). If
Leucadia delivers a timely Certification Objection, the Escrow Agent will act in
accordance with Section 7(j) hereof and bring an action in the Bankruptcy Court
for a determination of the respective rights of the parties with respect to the
Escrowed Property and, at such time as any Bankruptcy Court order for release of
the Escrowed Property has become final and non-appealable and the time for any
appeal has expired (a "Final Order"), the Escrow Agent shall deliver and release
the Escrowed Property in accordance with the order of such Bankruptcy Court or
any other court or tribunal which the Bankruptcy Court directs shall resolve the
dispute. If Leucadia (i) does not timely deliver a Certification Objection or
(ii) gives its written consent to the release of the Escrowed Property, then the
Escrow Agent will promptly deliver and release the Escrowed Property as provided
in Section 4.2 below.
4.2 Releases Upon FCC Approval Notice. Subject to the terms of Section
4.1, after the receipt of the FCC Approval Notice and the expiration of the two
(2) business day period referred to in Section 4.1 above without the receipt by
the Escrow Agent of a Certification Objection from Leucadia (or such shorter
period of time as Leucadia may consent to in writing) or upon an instruction
signed by all of the Representatives or a Final Order of the Bankruptcy Court
for the release of the Escrowed Property, the Escrow Agent shall:
(a) (i) submit a draw certificate and sight draft (in the form
attached to the Company Letter of Credit) and the original
Company Letter of Credit to the issuer of the Company Letter
of Credit (the "Company Issuing Bank"), with a copy to each of
the Company, TWC, Leucadia and the Administrative Agent, and
(ii) deliver and release the funds received from the Company
Issuing Bank to the Company via
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wire transfer to an account designated by the Company in
writing as soon as practicable after receipt thereof, which in
no event shall be later than one business day following such
receipt. The amount of the draw certificate and sight draft
shall be for the sum of (A) the Company Purchase Price plus
(B) if such drawing occurs more than 47 days after the
delivery of the Company Letter of Credit to the Escrow Agent,
an amount equal to $6,412 multiplied by the number of days
occurring during the period from the 48th day following such
delivery of the Company Letter of Credit to (but not
including) the business day immediately following the date of
the draw certificate;
(b) (i) submit a draw certificate and sight draft (in the form
attached to the TWC Letter of Credit) and the original TWC
Letter of Credit to the issuer of the TWC Letter of Credit
(the "TWC Issuing Bank"), with a copy to each of the Company,
TWC and Leucadia, and (ii) deliver and release the funds
received from the TWC Issuing Bank to TWC via wire transfer to
an account designated by TWC in writing as soon as practicable
after receipt thereof, which in no event shall be later than
one business day following such receipt. The amount of the
draw certificate and sight draft shall be for the sum of (A)
the TWC Purchase Price plus (B) if such drawing occurs more
than 47 days after the delivery of the TWC Letter of Credit to
the Escrow Agent, an amount equal to $7,694 multiplied by the
number of days occurring during the period from the 48th day
following such delivery of the TWC Letter of Credit to (but
not including) the business day immediately following the date
of the draw certificate;
(c) deliver the Building Purchase Closing Documents to the
Building Purchase Escrowee; and
(d) deliver the Director Resignations to Leucadia.
4.3 Vyvx Sale.
(a) Prior to the termination of this Escrow Agreement in
accordance with Section 9, if Limited FCC Approval has been
obtained, a majority of the six Independent Directors may
determine to sell the Company's emerging markets business unit
("Vyvx"), provided, however, that the Independent Directors
will first give Leucadia seven (7) days notice of its
intention to do so (the "Seven Day Notice Period"). If
Leucadia elects not to consent to the release of the Escrowed
Property in accordance with Section 4.1 and Limited FCC
Approval has been obtained, the Independent Directors may
proceed to sell Vyvx at any time after thirty (30) days after
the earlier of (i) the end of the Seven Day Notice Period or
(ii) delivery of notice by Leucadia to the Company that it
will not consent to the release of the Escrowed Property;
provided, however, that if after the Independent Directors
have begun the process of selling Vyvx but prior to a closing
thereof, the Escrowed Property is released pursuant to Section
4 hereof, then the decision to sell Vyvx shall be made by a
majority of all of the members of the Board of Directors of
the Company.
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(b) If Vyvx is sold pursuant to Section 4.3(a) and the Escrowed
Property has been released in accordance with Section 5
hereof, the Company may retain the proceeds of the Vyvx sale
and shall not be required to pay down any outstanding debt
owing to the Lenders (as defined in the Plan) as contemplated
by Section 2.9(d) of the Credit Agreement (as defined in the
Plan).
5. PROCEDURES ON UNWIND
5.1 Unwind. If the Escrowed Property has not otherwise been released
pursuant to Section 4 hereof prior to February 28, 2003 and the Company has not
delivered an FCC Approval Notice by February 28, 2003, then on February 28, 2003
or, if not practicable on such date, by the close of business on March 3, 2003,
as a condition to the Escrow Agent's delivery and release of the Escrowed
Property under Section 5.2 below and subject to Section 5.3, Leucadia shall (i)
surrender to the Escrow Agent the stock certificate(s) representing the Company
Common Stock (collectively, the "Company Stock Certificate"), together with an
executed stock power in blank, and shall surrender to the Escrow Agent the stock
certificate(s) representing the TWC Common Stock (collectively, the "TWC Common
Stock Certificate") together with an executed stock power in blank, and (ii)
deliver a notice in writing to the Escrow Agent, with a copy to the Company, TWC
and the Administrative Agent: (a) acknowledging that Leucadia has surrendered to
the Escrow Agent the Company Stock Certificate with an executed stock power in
blank and the TWC Stock Certificate with an executed stock power in blank; and
(b) directing the Escrow Agent to deliver and release the Escrowed Property in
accordance with Section 5.2 (the "Termination Notice"). The Company hereby
covenants and agrees to immediately notify TWC, Leucadia and the Administrative
Agent that it has received notice, either orally or in writing, that the
approval of the FCC for the transfer of control to the Company of any of the
Licenses has been denied. In such an event, Leucadia may deliver the Termination
Notice (which must be signed by all of the Representatives in order to be
effective) to the Escrow Agent prior to February 28, 2003.
5.2 Releases Upon Termination Notice. Subject to the terms of Section
5.1 hereof, upon receipt by the Escrow Agent of the Termination Notice, the
Company Stock Certificate and the TWC Stock Certificate, the Escrow Agent will
deliver and release (a) the Company Letter of Credit to the Company Issuing Bank
for cancellation (together with any certificate or other document required to
terminate such Letter of Credit), (b) the TWC Letter of Credit to the TWC
Issuing Bank for cancellation (together with any certificate or other document
required to terminate such Letter of Credit), (c) to the Company, the Company
Stock Certificate together with executed stock powers in blank for cancellation,
(d) to TWC or as directed by TWC, the TWC Stock Certificate together with the
executed stock powers in blank, (e) to the Company, the Building Purchase
Closing Documents and the Company Building Purchase Closing Documents for
cancellation, (f) to TWC, the TWC Building Purchase Closing Documents for
cancellation and (g) the Director Resignations to the Corporate Secretary of the
Company.
5.3 Extension Procedures. If the Escrowed Property has not otherwise
been released pursuant to Section 4 hereof prior to February 28, 2003 and the
Company has delivered an FCC Approval Notice by February 28, 2003, then the
Escrowed Property shall remain in escrow and the parties shall follow the
procedures outlined in Section 4.1 and 4.2 hereof; provided, however, that after
the delivery of a Certification Objection, if any, if the Bankruptcy Court
determines
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that FCC Approval has not been received, then Leucadia shall provide the items
described in Section 5.1 hereof and the Escrowed Property shall be released
pursuant to Section 5.2 hereof and the stock cancelled pursuant to Section 5.4
hereof.
5.4 Cancellation of Stock. If the Escrowed Property has not otherwise
been released pursuant to Section 4 hereof, for greater certainty, TWC, the
Company and Leucadia hereby acknowledge and agree that upon the earlier of (i)
the expiration of the Letters of Credit or (ii) the return of the Letters of
Credit for cancellation, if Leucadia shall not have previously delivered to the
Escrow Agent the Company Stock Certificate and the TWC Stock Certificate as
required by Section 5.1 hereof, the shares of capital stock represented by the
Company Stock Certificate shall be deemed to have been delivered to the Escrow
Agent and automatically shall be cancelled on the books and records of the
Company and the TWC Stock Certificate shall be deemed to have been surrendered
by Leucadia to the Company for re-registration of the TWC Common Stock in the
name of TWC, such TWC Stock Certificate automatically shall be cancelled on the
books and records of the Company, and the TWC Common Stock shall be
re-registered in the name of TWC and a new stock certificate representing the
TWC Common Stock issued in the name of TWC shall be delivered by the Company to
the Escrow Agent for release to TWC in accordance with Section 5.2 hereof.
5.5 No Waiver. Neither the expiration, termination or return of any
Letter of Credit nor the cancellation of the Company Stock Certificate or the
TWC Stock Certificate or other release of Escrowed Property pursuant to this
Section 5 shall in any way be deemed to be a waiver by any of the parties of any
claim they might have that the Escrowed Property should be or should have been,
pursuant to the terms of this Escrow Agreement, released and delivered pursuant
to Section 4.2.
5.6 Resignations of Any Successor Directors. Leucadia hereby covenants
and agrees that during the term of this Escrow Agreement upon the replacement of
any member of the Board of Directors designated by Leucadia pursuant to the
Stockholders Agreement, it will cause such replacement member to promptly
deliver to the Escrow Agent, to be held in escrow pursuant to the terms hereof,
his or her resignation, effective on the date on which the Escrow Agent delivers
and releases the Escrowed Property and other documents pursuant to Section 5.2
of this Escrow Agreement.
5.7 Further Procedures.
(a) The Company and Leucadia agree that Section 5.1(d) of the
Stockholders Agreement, Section 10(p) of the Registration
Rights Agreement dated as of October 15, 2002 between the
Company and Leucadia (the "Registration Rights Agreement"),
and Section 18(b) of the Stockholders Rights and Co-Sale
Agreement dated as of October 15, 2002 between the Company and
Leucadia (the "Stockholders Rights and Co-Sale Agreement")
shall not be amended without the prior written consent of TWC.
TWC shall not have any rights or obligations under the
Stockholders Agreement, the Registration Rights Agreement or
the Stockholders Rights and Co-Sale Agreement in the event the
TWC Common Stock is delivered or deemed delivered to TWC
pursuant to the terms of Section 5 hereof.
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(b) The parties hereby agree that the term "TWC Common Stock"
shall include any shares of Securities Holder Channeled Common
Stock (as defined below) issued or otherwise transferred to
Leucadia in accordance with the Plan following the date hereof
and prior to the date Leucadia is required to surrender the
TWC Stock Certificate with respect to the 11,775,000 shares of
Common Stock to the Escrow Agent pursuant to Section 5.1
hereof, if any. Leucadia hereby agrees that to the extent it
receives any shares of Securities Holder Channeled Common
Stock in accordance with the Plan following the date Leucadia
is required to surrender the TWC Stock Certificate to the
Escrow Agent pursuant to Section 5.1 hereof, if at all, it
shall deliver such shares to TWC and shall take all reasonably
necessary action to effect the transfer of such shares to TWC.
For purposes of this Section 5.7(b) the term "Securities
Holder Channeled Common Stock" shall mean any Common Stock
issued by the Company to WCG pursuant to the Plan in order to
satisfy Securities Holder Channeled Actions (as defined in the
Plan).
6. REPRESENTATION AND WARRANTY OF THE COMPANY
The Company hereby represents and warrants to Leucadia that the Licenses
constitute all of the FCC licenses held by the Company and its subsidiaries and
existing on the date of this Agreement that are used or useful in the business
of the Company and its subsidiaries as of the date hereof.
7. CONCERNING THE ESCROW AGENT
(a) The Company, TWC and Leucadia agree to indemnify, jointly and
severally, the Escrow Agent, and its officers, directors,
employees and agents, for, and to hold it and each of them
harmless against, any loss, liability or expense arising out
of or in connection with this Agreement and carrying out its
duties hereunder, including, without limitation, the cost and
expenses of defending itself against any claim of liability;
provided, however, that none of the Company, TWC or Leucadia
will be liable for indemnification or otherwise for any loss,
liability or expense to the extent arising out of the gross
negligence, willful misconduct or bad faith of the Escrow
Agent.
(b) The Escrow Agent shall exercise the same degree of care toward
the Escrowed Property as it exercises toward its own similar
property and shall not be held to any higher standard of care
under this Escrow Agreement, nor be deemed to owe any
fiduciary duty to the Company, TWC or Leucadia.
(c) The Escrow Agent may act upon any instrument or other writing
believed by it in good faith to be genuine and to have been
signed or presented by the proper Person, and shall not be
liable to any party hereto in connection with the performance
of its duties hereunder, except for its own gross negligence,
willful misconduct or bad faith. The duties of the Escrow
Agent shall be determined only with reference to this Escrow
Agreement and applicable laws and the Escrow Agent is not
charged with any knowledge of, or any duties or
responsibilities in connection with, any other document or
agreement. If in doubt as to its duties and
-11-
responsibilities hereunder, the Escrow Agent may consult with
counsel and shall be protected in any action taken or omitted
in good faith in reliance on the advice or opinion of such
counsel.
(d) The Escrow Agent may execute any of its powers or
responsibilities hereunder and exercise any rights hereunder
either directly or by or through its agents or attorneys.
(e) Nothing in this Escrow Agreement shall be deemed to impose
upon the Escrow Agent any duty to qualify to do business or to
act as agent or otherwise in any jurisdiction other than the
State of New York.
(f) The Escrow Agent shall not be responsible for and shall not be
under a duty to examine into or pass upon the validity,
binding effect, execution or sufficiency of this Escrow
Agreement, any agreement amendatory or supplemental hereto or
of any certificates, notices or other writings delivered to it
hereunder.
(g) The Escrow Agent makes no representation as to the validity,
value, genuineness or collectability of any security or other
document or instrument held by or delivered to it.
(h) The Escrow Agent shall not be called upon to advise any party
as to selling or retaining, or taking or refraining from
taking any action with respect to, any securities or other
property deposited hereunder.
(i) The Escrow Agent shall have the right at any time to resign
hereunder (subject to a successor agent becoming a party
hereto) by giving, at least thirty (30) days prior to the date
specified for such resignation to take effect, written notice
of its resignation to the Company, TWC, Leucadia and the
Administrative Agent at the addresses set forth herein, or at
such other addresses as the Company, TWC, Leucadia and the
Administrative Agent shall provide. Upon the effective date of
such resignation, all property then held by the Escrow Agent
hereunder shall be delivered by it to a successor escrow agent
selected by the Company, TWC and Leucadia. Such successor
escrow agent shall be a bank or trust company in good standing
organized and doing business under the laws of the United
States or any state thereof, subject to examination by state
or federal authorities, and having combined capital and
surplus of not less than $500,000,000 which is authorized
under the laws of its jurisdiction of incorporation to
exercise corporate trust powers. If no successor escrow agent
is appointed within thirty (30) days, the Escrow Agent may
apply to a court of competent jurisdiction for such
appointment, but shall remain Escrow Agent until a successor
agent shall become a party hereto.
(j) If the Escrow Agent should at any time be confronted with
inconsistent claims or demands to the Escrowed Property, the
Escrow Agent shall interplead the parties in the Bankruptcy
Court, and request that such court determine the respective
rights of the parties with respect to the Escrowed Property.
In the event the Escrow Agent no longer holds any Escrowed
Property, it shall be released from
-12-
any obligation or liability as a consequence of any such
claims or demands, other than those arising out of its gross
negligence or willful misconduct.
(k) In the event fund transfer instructions are given (other than
in writing at the time of the execution of the Agreement),
whether in writing, by telecopier or otherwise, the Escrow
Agent is authorized to seek confirmation of such instructions
by telephone call-back to the person or persons designated on
the call-back schedule attached hereto (the "Call-Back
Schedule"), and the Escrow Agent may rely upon the
confirmations of anyone purporting to be the person or persons
so designated. The persons and telephone numbers for
call-backs may be changed only in writing actually received
and acknowledged by the Escrow Agent. If the Escrow Agent is
unable to contact any of the authorized representatives
identified in the Call-Back Schedule, the Escrow Agent is
hereby authorized to seek confirmation of such instructions by
telephone call-back to any one or more of a party's executive
officers, ("Executive Officers"), which shall include the
titles of Chief Executive Officer, Executive Vice President,
General Counsel and Secretary, as the Escrow Agent may select.
Such "Executive Officer" shall deliver to the Escrow Agent a
fully executed incumbency certificate, and the Escrow Agent
may rely upon the confirmation of anyone purporting to be any
such officer. The Escrow Agent and the beneficiary's bank in
any funds transfer may rely solely upon any account numbers or
similar identifying numbers provided by the Company, TWC or
Leucadia to identify (i) the beneficiary, (ii) the
beneficiary's bank, or (iii) an intermediary bank. The Escrow
Agent may apply any of escrowed funds for any payment order it
executes using any such identifying number, even when its use
may result in a person other than the beneficiary being paid,
or the transfer of funds to a bank other than the
beneficiary's bank or an intermediary bank designated. The
parties to this Agreement acknowledge that such security
procedure is commercially reasonable.
(l) Any corporation into which the Escrow Agent in its individual
capacity may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Escrow Agent in its
individual capacity shall be a party, or any corporation to
which substantially all the corporate trust business of the
Escrow Agent in its individual capacity may be transferred,
shall be the Escrow Agent under this Escrow Agreement without
further act.
(m) Anything in this Escrow Agreement to the contrary
notwithstanding, in no event shall the Escrow Agent be liable
for special, indirect or consequential damage of any kind
whatsoever (including but not limited to lost profits), even
if the Escrow Agent has been advised for the likelihood for
such loss or damage and regardless of the form of action. The
parties hereto acknowledge that the foregoing indemnities
shall survive the resignation or removal of the Escrow Agent
or the termination of this Escrow Agreement.
-13-
(n) Distribution of the funds received under the Letters of Credit
shall not be subject to offset by the Escrow Agent for any
payment or other obligations of the Company, TWC or Leucadia
hereunder or otherwise, for any claim against any of the
Company, TWC or Leucadia or for any other reason whatsoever.
8. FEES
The fees of the Escrow Agent hereunder are as set forth on Schedule II attached
hereto, which fees shall be nonrefundable and paid in advance one-third each by
the Company, Leucadia and TWC. The Company, Leucadia and TWC also agree to pay
on demand one-third each of the costs and expenses of the Escrow Agent
(including the reasonable fees and expenses of counsel selected by the Escrow
Agent) incurred in connection with its duties hereunder.
9. TERMINATION
This Escrow Agreement will terminate upon the earlier of (a) the delivery of all
Escrowed Property to the appropriate parties in accordance with the terms hereof
or (b) the agreement in writing of each party hereto to terminate this
Agreement, with notice of such termination promptly provided to the
Administrative Agent.
10. GOVERNING LAW
This Agreement will be construed in accordance with, and governed by, the laws
of the State of New York.
11. JURISDICTION; CONSENT TO SERVICE OF PROCESS.
(a) Each of the Company, TWC and Leucadia (each a "Transaction
Party" and collectively the "Transaction Parties") hereby
irrevocably and unconditionally submits, for itself and its
property, to the exclusive jurisdiction of the Bankruptcy
Court, and any appellate court from any such court, in any
suit, action or proceeding arising out of or relating to this
Escrow Agreement or the transactions contemplated hereby, or
for recognition or enforcement of any judgment resulting from
any such suit, action or proceeding, and each party hereby
irrevocably and unconditionally agrees that all claims in
respect of any such suit, action or proceeding may be heard
and determined in the Bankruptcy Court.
(b) It will be a condition precedent to each Transaction Party's
right to bring any such suit, action or proceeding that such
suit, action or proceeding, in the first instance, be brought
in the Bankruptcy Court, and if each such court refuses to
accept jurisdiction with respect thereto, such suit, action or
proceeding may be brought in any other court with
jurisdiction.
(c) No Transaction Party may move to (i) transfer any such suit,
action or proceeding from the Bankruptcy Court to another
jurisdiction, (ii) consolidate any such suit, action or
proceeding brought in the Bankruptcy Court with a suit, action
or proceeding in another jurisdiction, or (iii) dismiss any
such suit, action or
-14-
proceeding brought in the Bankruptcy Court for the purpose of
bringing the same in another jurisdiction.
(d) Each Transaction Party hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively
do so, (i) any objection which it may now or hereafter have to
the laying of venue of any suit, action or proceeding arising
out of or relating to this Escrow Agreement in the Bankruptcy
Court, (ii) the defense of an inconvenient forum to the
maintenance of such suit, action or proceeding in any such
court, and (iii) the right to object, with respect to such
suit, action or proceeding, that such court does not have
jurisdiction over such party. Each Transaction Party
irrevocably consents to service of process in any manner
permitted by law.
12. WAIVER OF JURY TRIAL.
EACH OF THE TRANSACTION PARTIES HERETO IRREVOCABLY WAIVES ANY AND ALL RIGHT TO
TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM, WHETHER IN
CONTRACT OR TORT, AT LAW OR IN EQUITY, ARISING OUT OF OR IN ANY WAY RELATED TO
THIS ESCROW AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
13. AMENDMENT
No change in, amendment to or waivers of any provisions of this Escrow Agreement
will be valid unless set forth in writing and signed by all of the parties
hereto; provided, however, the Company shall only agree to change, amend or
waive any provision of this Escrow Agreement at the direction of a majority of
the Independent Directors; provided, further, that any change, amendment or
waiver of any provision relating to the delivery of the Director Resignations
into or out of escrow shall be at the direction of a majority of the Independent
Directors other than Purchaser Designees. Notice of such change, amendment or
waiver shall be promptly provided to the Administrative Agent.
14. CERTIFICATIONS AND OBJECTIONS
All certifications and objections to certifications to be delivered under this
Escrow Agreement will be delivered simultaneously to all parties to this Escrow
Agreement and the Administrative Agent pursuant to Section 18 below.
15. COUNTERPARTS
This Escrow Agreement may be executed in any number of counterparts, and all
such executed counterparts will together constitute one agreement. It will be
necessary to account for only one such fully executed counterpart in proving
this Escrow Agreement. A facsimile copy of a signature page shall be deemed to
be an original signature page.
-15-
16. SUCCESSORS, ASSIGNMENT
No party may assign this Escrow Agreement to any other Person without the prior
written consent of all of the other parties hereto, provided however, that
Leucadia may assign this Escrow Agreement in whole or in part to wholly owned
Affiliates that agree to be bound by the terms of this Escrow Agreement,
provided that Leucadia shall remain bound by the terms hereof. Notice of any
assignment permitted by the terms of this Agreement shall be provided promptly
to the Administrative Agent. This Escrow Agreement will inure to the benefit of
and be binding upon the parties hereto and their respective successors and
permitted assigns.
17. SEVERABILITY
If any provision of this Escrow Agreement is determined by a court of competent
jurisdiction to be invalid or unenforceable, the remainder of this Escrow
Agreement will nonetheless remain in full force and effect.
18. NOTICES
Any notices required, called for or to be sent under this Escrow Agreement will
be in writing and sent by a nationally recognized overnight courier service
properly marked for next business day delivery, by facsimile (with a copy to
follow by delivery by overnight courier service) or by hand delivery, at the
delivering party's expense, and addressed as follows:
To the Company:
WilTel Communications Group, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: P. ▇▇▇▇▇ ▇▇▇▇▇▇▇, Jr., Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
and
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
-16-
and
▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇, Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
To TWC:
The ▇▇▇▇▇▇▇▇ Companies, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
White & Case LLP
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇, Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
and
White & Case LLP
First Union Financial Center
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
To Leucadia
Leucadia National Corporation
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
-17-
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
and
Sidley ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇, LLP
▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
To the Escrow Agent:
The Bank of New York
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇
To the Administrative Agent:
Bank of America, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ III
with a copy to:
▇▇▇▇▇▇▇▇ Chance US LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
To the Building Purchase Escrowee:
Lawyers Title Insurance Company
c/o Guaranty Abstract Company
▇▇▇ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-18-
or such other address as any party provides to the others in writing during the
term hereof in accordance with this Section. Any notice so given will be deemed
delivered one (1) business day after deposit with such courier, in the case of
delivery by overnight courier, or as of the date so telecommunicated or
personally delivered.
19. COMPANY GOVERNANCE
Any action or decision not to act by the Company or the Company's Representative
with respect to its rights or obligations hereunder must be approved in writing
by a majority of the Independent Directors, including, without limitation, (i)
any action to obtain FCC Approval, (ii) any action to amend, waive or terminate
any provision of this Escrow Agreement and (iii) to change the Representative of
the Company. The Company shall take all such actions with respect to its rights
and obligations hereunder as approved in writing or otherwise by a majority of
the Independent Directors (and approval by a majority of all of the members of
the Board of Directors of the Company shall not be required therefor).
Notwithstanding the foregoing, any action or decision to act by the Company or
the Company's Representatives for the expenditure of any funds with respect to
the resolution of any objection to any written order or public notice by the FCC
setting forth the FCC's action approving, without any Materially Adverse FCC
Condition, the transfer of control of all of the Licenses to the Company shall
be made by a majority of all of the members of the Board of Directors of the
Company, provided, however, that a majority of the Independent Directors shall
approve (and approval by a majority of all of the members of the Board of
Directors of the Company shall not be required for) any action or decision to
act by the Company or the Company's Representatives with respect to the
expenditure of funds for the payment of the legal fees of the Company and for
other expenditures in connection with resolving any such objection that would
not be materially adverse to the Company. The Company will use its best efforts
to cause the Board of Directors to establish a committee of the Board of
Directors consisting of all of the Independent Directors (the "Independent
Director Committee"). The Company shall use its best efforts to cause the Board
of Directors to grant to such committee the authority to take any and all
actions required or allowed to be taken by Independent Directors hereunder,
including without limitation, the actions specified in Sections 13 and 19
hereof. All references herein to action required or allowed to be taken by
Independent Directors shall be deemed to be references to actions of the
Independent Director Committee. The provisions of this Section 19 will be
reflected in the Bylaws of the Company and such provisions in the Bylaws cannot
be amended without unanimous Board consent.
20. COVENANT NOT TO SELL STOCK.
Leucadia agrees that, prior to February 28, 2003, or, if later, the release of
the Escrowed Property pursuant to Section 5.3, it shall not transfer, sell,
assign, pledge, hypothecate or otherwise dispose of the Company Common Stock or
the TWC Common Stock, except to the Escrow Agent as specifically contemplated by
Section 5.1 hereof or to wholly owned Affiliates of Leucadia that agree to be
bound by the terms of this Agreement.
-19-
21. GOOD FAITH EFFORTS TO OBTAIN FCC APPROVAL
(a) Each of the Company, TWC and Leucadia agrees to use its good
faith efforts to take, or cause to be taken, all actions, and
to do, or cause to be done, and to assist and cooperate with
the other parties in doing, all things necessary, proper or
advisable to obtain FCC Approval as promptly as practicable.
(b) The Company agrees to provide Leucadia, TWC, the
Administrative Agent and their respective counsel with copies
of any correspondence the Company or its counsel may receive
from the FCC, its staff or any third party relating to any of
the Licenses promptly after the receipt of such
correspondence, and, prior to responding to or taking any
action in connection with such correspondence, shall provide
Leucadia and its counsel an opportunity to participate and
shall provide TWC and its counsel an opportunity to
participate provided that such participation is without delay,
in the response of the Company to such correspondence,
including by participating with the Company and its counsel in
any discussions with the FCC, its staff or any applicable
third party. The Company agrees to use its good faith efforts
to keep Leucadia, TWC and the Administrative Agent promptly
apprised of any material comments received from the FCC.
(c) The Company and TWC agree to take, or cause to be taken, all
actions, and to do, or cause to be done, and to assist and
cooperate with the other parties in doing, all things
necessary, proper or advisable to (a) no later than December
15, 2002 (unless otherwise agreed to in writing by the
Company, Leucadia and TWC), prepare and file all Notification
and Report Forms and any other information required under the
HSR Act and the Company will pay all of the filing fees in
connection therewith, and prepare and make any subsequent
filings required, with respect to the transfer and delivery of
the Company Common Stock to the Company and the TWC Common
Stock to TWC in accordance with Section 5.2 hereof (the
"Transfers"), if any, (b) cause the waiting period (and any
extension thereof) under the HSR Act, if any, applicable to
such Transfers to terminate prior to February 28, 2003, and
(c) to obtain by February 28, 2003, FCC and any other third
party consent required, if any, for the release and delivery
of the Escrowed Property, the Company Common Stock and the TWC
Common Stock in accordance with Section 5.2 hereof.
22. LEGEND
The Company Stock Certificate and the TWC Stock Certificate issued to Leucadia
shall bear a legend on the face thereof substantially to the following effect:
"THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE ARE
SUBJECT TO AN ESCROW AGREEMENT BETWEEN THE COMPANY, THE ▇▇▇▇▇▇▇▇
COMPANIES, INC., LEUCADIA NATIONAL CORPORATION AND THE BANK OF NEW
YORK, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY.
AMONG OTHER THINGS, THE ESCROW AGREEMENT PROVIDES FOR AUTOMATIC
CANCELLATION OF SUCH
-20-
SHARES OF STOCK IN CERTAIN CIRCUMSTANCES. NO TRANSFER, SALE,
ASSIGNMENT, PLEDGE, HYPOTHECATION OR OTHER DISPOSITION OF THE
SECURITIES REPRESENTED BY THIS CERTIFICATE MAY BE MADE EXCEPT IN
ACCORDANCE WITH THE PROVISIONS OF SUCH ESCROW AGREEMENT."
If the Escrowed Property is released pursuant to Section 4 hereof, then upon the
tendering by Leucadia to the Company of the Company Stock Certificate and the
TWC Stock Certificate, the Company shall reissue such certificates to Leucadia
without the legend required by this Section 22.
[remainder of page intentionally left blank]
-21-
IN WITNESS WHEREOF, the parties to this Agreement have caused this Agreement to
be duly executed by their respective authorized officers as of the day and year
first above written.
WILTEL COMMUNICATIONS
GROUP, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
THE ▇▇▇▇▇▇▇▇ COMPANIES, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President and
Chief Financial Officer
LEUCADIA NATIONAL CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ORLANDO
-----------------------------------------
Name: ▇▇▇▇▇▇ ▇. Orlando
Title: Vice President and CFO
THE BANK OF NEW YORK
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Assistant Vice President
-22-
SCHEDULE A
▇▇▇▇▇▇▇▇ COMMUNICATIONS, LLC AUTHORIZATIONS AND LICENSES
SECTION 214 AUTHORITY
1. ▇▇▇▇▇▇▇▇ Communications, LLC operates as a provider of
domestic telecommunications services pursuant to the blanket
Section 214 authority granted in Section 63.01(a) of the FCC's
Rules, 47 C.F.R. Section 63.01(a).
INTERNATIONAL SECTION 214 AUTHORITY
1. Overseas Carrier Section 214 Applications Actions Taken,
Report No.1-8235, 12 FCC Rcd 3771 (1997).
CABLE LANDING LICENSE AUTHORIZATION
1. Japan-U.S. Cable Network License and the China-U.S. Cable
Network License, Granted on October 6, 2000, File No. SCL-
T/C-20000510-00017 and SCL-ASG-20000929-00032.
EARTH STATION LICENSES
CALL SIGN LOCATION GRANT - EXPIRATION DATE
E920588 CO 01/29/1999 - 10/23/2002*
KA341 CO 10/30/1992 - 10/30/2002*
KA342 CO 10/30/1992 - 10/30/2002*
KA343 CO 05/14/1998 - 10/30/2002*
E5740 NJ 08/06/1999 - 05/31/2003
E940361 CO 04/10/1998 - 09/23/2004
E940448 CA 01/10/1998 - 10/07/2004
E4970 GA 09/22/1999 - 10/09/2004
E950360 CA 04/10/1998 - 08/11/2005
E950198 NJ 04/10/1998 - 09/29/2005
E950202 CA 03/23/2000 - 09/29/2005
E950200 NJ 08/06/1999 - 11/03/2005
E950372 NJ 04/10/1998 - 12/15/2005
E850041 GA 11/09/2000 - 01/10/2006
E950361 NJ 01/27/1999 - 01/19/2006
E960072 CO 04/10/1998 - 03/08/2006
E850042 NJ 08/06/1999 - 04/04/2006
E870824 CO 09/01/2000 - 03/27/2007
E870823 CO 07/24/1998 - 05/22/2007
E865124 OK 04/10/1998 - 07/10/2007
E970415 CA 02/28/2001 - 11/21/2007
E970447 GA 09/22/1999 - 01/23/2008
E980228 CA 04/19/2001 - 12/16/2008
E990351 CA 10/29/1999 - 10/29/2009
E990403 GA 09/28/2000 - 12/30/2009
E900015 CO 02/02/2000 - 02/02/2010
E860101 NJ 02/02/2000 - 02/23/2010
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E000016 NJ 03/15/2000 - 03/15/2010
E900432 CA 08/16/2000 - 08/10/2010
E900431 NY 08/23/2000 - 08/24/2010
E000489 NJ 10/11/2000 - 10/11/2010
E000358 GA 11/17/2000 - 11/17/2010
E000352 GA 01/03/2001 - 01/03/2011
E910367 GA 05/18/2001 - 06/14/2011
KB22 CA 10/01/2001 - 09/13/2011
E920098 IL 01/08/2002 - 01/17/2012
KA331 CA 08/06/1999 - 07/23/2017
*Renewal license was filed with the FCC on September 30, 2002.
MICROWAVE LICENSES
CALL SIGN LOCATION GRANT - EXPIRATION DATE TYPE
WNTQ351 CO 10/22/1998 - 01/14/2009 MG
WNTQ352 CO 10/22/1998 - 01/14/2009 MG
WNTQ353 CO 10/22/1998 - 01/14/2009 MG
WNTQ354 CO 10/22/1998 - 01/14/2009 MG
WNTQ355 CO 10/22/1998 - 01/14/2009 MG
WNTQ357 CO 10/22/1998 - 01/14/2009 MG
WNTQ358 CO 10/22/1998 - 01/14/2009 MG
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WNTQ359 CO 10/22/1998 - 01/14/2009 MG
WPOU639 CO 07/28/1999 - 07/28/2009 MG
WPOV252 CO 08/24/1999 - 08/24/2009 MG
WPOL527 CO 12/14/1999 - 12/14/2009 MG
WPOL592 GA 12/20/1999 - 12/20/2009 MG
WPOL728 CO 01/05/2000 - 01/05/2010 MG
WPOM433 CO 02/18/2000 - 02/18/2010 CF
WPJZ982 CA 12/12/2001 - 12/01/2011 IG
WPON426 CO 04/03/2000 - 04/03/2010 CT
WMQ353 CO 02/27/2001 - 02/01/2011 CF
WMQ354 CO 02/27/2001 - 02/01/2011 CF
WMQ838 CO 02/27/2001 - 02/01/2011 CF
WMQ839 CO 02/27/2001 - 02/01/2011 CF
WMR578 CO 02/27/2001 - 02/01/2011 CT
WLM388 GA 02/27/2001 - 02/01/2011 CF
WLN645 GA 02/27/2001 - 02/01/2011 CF
WLN646 GA 02/27/2001 - 02/01/2011 CF
WLN647 GA 02/27/2001 - 02/01/2011 CF
WLN649 GA 02/27/2001 - 02/01/2011 CF
WLN651 GA 02/27/2001 - 02/01/2011 CF
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WPNH929 GA 02/27/2001 - 02/01/2011 CF
WML462 OK 02/27/2001 - 02/01/2011 CF
CF = Point to Point Microwave
CT = Local Television Transmission
IG = Industrial / Business Pool, Conventional
MG = Microwave Industrial / Business Radio
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SCHEDULE B
TWC BUILDING PURCHASE CLOSING DOCUMENTS
1. Title Instruction Letter to Lawyers Title Insurance Company (escrow
instructions)
2. Special Warranty Deed by ▇▇▇▇▇▇▇▇ Headquarters Building Company, as
Grantor
3. Special Warranty ▇▇▇▇ of Sale and Assignment by ▇▇▇▇▇▇▇▇ Headquarters
Building Company
4. Secretary's Certificate of ▇▇▇▇▇▇▇▇ Headquarters Building Company
5. Indemnity Bond - The ▇▇▇▇▇▇▇▇ Companies, Inc.
6. Non-Foreign Entity Certification
7. Oklahoma Sales Tax Affidavit Regarding Personal Property
8. Gap Indemnity given by ▇▇▇▇▇▇▇▇ Headquarters Building Company to
Lawyers Title Insurance Corporation
9. Owner's and Contractors Affidavit and Agreement of ▇▇▇▇▇▇▇▇
Headquarters Building Company
10. Affidavit and Agreement by ▇▇▇▇▇▇▇▇ Headquarters Building Company
11. Non-Imputation Affidavit by ▇▇▇▇▇▇▇▇ Headquarters Building Company
12. Non-Imputation Affidavit by TWC
13. ALTA Survey
14. UCC Financing Statement Amendments to be filed in connection with
termination of ▇▇▇▇▇▇▇▇ Headquarters Building Company liens created
under Master Lease (3 documents)
15. Oklahoma Documentary Tax Affidavit by ▇▇▇▇▇▇▇▇ Headquarters Building
Company
16. Joint Letter requesting title insurance of $175,000,000
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17. Mortgage Tax Affidavit - ▇▇▇▇▇▇▇▇ Headquarters Building Company (First
Mortgage)
18. Side Letter Agreement
COMPANY BUILDING PURCHASE CLOSING DOCUMENTS
1. Short Term Note in the original principal amount of $44,800,000 and
having a stated face amount of $74,360,295.30
2. Long Term Note in the original principal amount of $100,000,000
3. Mortgage with Power of Sale, Security Agreement, Assignment of Leases,
Rents and Profits, Financing Statement and Fixture Filing made by
▇▇▇▇▇▇▇▇ Technology Center, LLC in favor of ▇▇▇▇▇▇▇▇ Headquarters
Building Company
4. UCC-1 Financing Statement naming CG Austria as debtor and ▇▇▇▇▇▇▇▇
Headquarters Building Company as secured party, to be filed in Delaware
in connection with the Pledge Agreement *
5. UCC-1 Financing Statement naming ▇▇▇▇▇▇▇▇ Technology Center, LLC as
debtor and ▇▇▇▇▇▇▇▇ Headquarters Building Company as secured party, to
be filed in Delaware in connection with Purchase Money Mortgage
6. Second Mortgage Assignment of Leases and Rents, Security Agreement,
Financing Statement and Fixture Filing
7. UCC-1 Financing Statement naming ▇▇▇▇▇▇▇▇ Technology Center, LLC as
debtor and Bank of America, N.A. as secured party, to be filed in
Oklahoma as a "fixture filing" in connection with the Second Mortgage
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8. Pledge Agreement made by CG Austria, Inc. in favor of ▇▇▇▇▇▇▇▇
Headquarters Building Company *
9. First Equitable Mortgage of Shares, made by CG Austria in favor of Bank
of America, N.A. as Administrative Agent *
10. Second Equitable Mortgage of Shares, made by CG Austria in favor of
▇▇▇▇▇▇▇▇ Headquarters Building Company *
11. Opinion of Australian Counsel (re: Second Equitable Mortgage of
Shares) *
12. Intercreditor and Subordination Agreement between ▇▇▇▇▇▇▇▇ Headquarters
Building Company and Bank of America, N.A. as Administrative Agent
(PowerTel Collateral) *
13. Intercreditor and Subordination Agreement between ▇▇▇▇▇▇▇▇ Headquarters
Building Company and Bank of America, N.A., as Administrative Agent
(Mortgaged Property)
14. Secretary's Certificate of WTC
15. Secretary's Certificate of WCL
16. Secretary's Certificate of Old WCG
17. Secretary's Certificate of New WCG
18. Secretary's Certificate of CG Austria
19. Secretary's Certificate of ▇▇▇▇▇▇▇▇ Aircraft
19A. Legal Opinion of ▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇ (re: authorization)
20. Legal Opinion of ▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇ (re: pledge)*
21. Legal Opinion of ▇▇▇▇▇ ▇▇▇▇▇▇▇ (Re: First Mortgage)
22. Legal Opinion of ▇▇▇▇▇ ▇▇▇▇▇▇▇ (Re: Second Mortgage)
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23. Legal Opinion of ▇▇▇▇▇ ▇▇▇▇▇▇ (Nevada local counsel) (Re: New WCG)
24. Gap Indemnity given by ▇▇▇▇▇▇▇▇ Technology Center, LLC to Lawyers Title
Insurance Corporation
25. Affidavit and Agreement by ▇▇▇▇▇▇▇▇ Technology Center, LLC
26. Purchaser's Affidavit and Agreement by purchaser ▇▇▇▇▇▇▇▇ Technology
Center, LLC
27. Letter of Commonwealth Land Title regarding Reinsurance
* To be delivered to the Escrow Agent on or prior to 5 p.m. EST on October 23,
2002, in accordance with the terms of Amendment No. 9 to the WCL Amended and
Restated Credit Agreement dated as of September 8, 1999 and the First Amendment
to Real Property Purchase and Sale Agreement dated as of October 15, 2002, among
TWC, WHBC, WTC, WCL, Communications, WilTel Communications Group, Inc., WAL and
▇▇▇▇▇▇▇▇ Aircraft, Inc.
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Call-Back Schedule
Telephone Number(s) for Call-backs and
Person(s) Designated to Confirm Funds Transfer Instructions
If to the Company: WilTel Communications Group, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Wire Instructions:
[To be supplied by the Company Representative]
Name and Telephone Number:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
If to TWC: The ▇▇▇▇▇▇▇▇ Companies, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Wire Instructions:
Bank One
Chicago, IL
ABA No. ▇▇▇▇▇▇▇▇▇
Account of The ▇▇▇▇▇▇▇▇ Companies, Inc.
Account No. 50-18285
Name and Telephone Number:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
If to Leucadia: Leucadia National Corporation
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Name and Telephone Number:
▇▇▇▇▇▇ ▇. Orlando
(▇▇▇) ▇▇▇-▇▇▇▇
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Schedule I
Funds should be wired to:
The Bank of New York
ABA # ▇▇▇▇▇▇▇▇▇
GLA/111565
For credit to account number 213845
N/O WCG/Leucadia Escrow
Schedule II
Escrow Agent Fees
$1,500 Acceptance Fee
$7,500 Annual Fee
EXHIBIT A
[Company Letter of Credit]
EXHIBIT B
[TWC Letter of Credit]
EXHIBIT C
[Director Resignations]
RESIGNATION
To: WilTel Communications Group, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Reference is made to the Escrow Agreement, dated as of October
15, 2002 (the "Escrow Agreement"), by and among WilTel Communications Group,
Inc. ("WilTel"), The ▇▇▇▇▇▇▇▇ Companies, Inc., Leucadia National Corporation and
The Bank of New York as Escrow Agent. Effective on the earlier of (i) the date
that the Escrow Agent (as defined in the Escrow Agreement) delivers and releases
the Escrowed Property (as defined in the Escrow Agreement) and other documents
pursuant to Section 5.2 of the Escrow Agreement and (ii) the cancellation of the
Company Stock Certificate and TWC Stock Certificate pursuant to Section 5.4 of
the Escrow Agreement, I hereby give irrevocable notice of my resignation as a
Director of WilTel, a Nevada corporation.
In the event that the Escrowed Property is released pursuant
to Section 4 of the Escrow Agreement, this resignation shall be void and be of
no further force and effect.
Dated as of October 15, 2002.
--------------------------
▇▇▇ ▇. ▇▇▇▇▇▇▇
RESIGNATION
To: WilTel Communications Group, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Reference is made to the Escrow Agreement, dated as of October
15, 2002 (the "Escrow Agreement"), by and among WilTel Communications Group,
Inc. ("WilTel"), The ▇▇▇▇▇▇▇▇ Companies, Inc., Leucadia National Corporation and
The Bank of New York as Escrow Agent. Effective on the earlier of (i) the date
that the Escrow Agent (as defined in the Escrow Agreement) delivers and releases
the Escrowed Property (as defined in the Escrow Agreement) and other documents
pursuant to Section 5.2 of the Escrow Agreement and (ii) the cancellation of the
Company Stock Certificate and TWC Stock Certificate pursuant to Section 5.4 of
the Escrow Agreement, I hereby give irrevocable notice of my resignation as a
Director of WilTel, a Nevada corporation.
In the event that the Escrowed Property is released pursuant
to Section 4 of the Escrow Agreement, this resignation shall be void and be of
no further force and effect.
Dated as of October 15, 2002.
--------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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RESIGNATION
To: WilTel Communications Group, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Reference is made to the Escrow Agreement, dated as of October
15, 2002 (the "Escrow Agreement"), by and among WilTel Communications Group,
Inc. ("WilTel"), The ▇▇▇▇▇▇▇▇ Companies, Inc., Leucadia National Corporation and
The Bank of New York as Escrow Agent. Effective on the earlier of (i) the date
that the Escrow Agent (as defined in the Escrow Agreement) delivers and releases
the Escrowed Property (as defined in the Escrow Agreement) and other documents
pursuant to Section 5.2 of the Escrow Agreement and (ii) the cancellation of the
Company Stock Certificate and TWC Stock Certificate pursuant to Section 5.4 of
the Escrow Agreement, I hereby give irrevocable notice of my resignation as a
Director of WilTel, a Nevada corporation.
In the event that the Escrowed Property is released pursuant
to Section 4 of the Escrow Agreement, this resignation shall be void and be of
no further force and effect.
Dated as of October 15, 2002.
--------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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RESIGNATION
To: WilTel Communications Group, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Reference is made to the Escrow Agreement, dated as of October
15, 2002 (the "Escrow Agreement"), by and among WilTel Communications Group,
Inc. ("WilTel"), The ▇▇▇▇▇▇▇▇ Companies, Inc., Leucadia National Corporation and
The Bank of New York as Escrow Agent. Effective on the earlier of (i) the date
that the Escrow Agent (as defined in the Escrow Agreement) delivers and releases
the Escrowed Property (as defined in the Escrow Agreement) and other documents
pursuant to Section 5.2 of the Escrow Agreement and (ii) the cancellation of the
Company Stock Certificate and TWC Stock Certificate pursuant to Section 5.4 of
the Escrow Agreement, I hereby give irrevocable notice of my resignation as a
Director of WilTel, a Nevada corporation.
In the event that the Escrowed Property is released pursuant
to Section 4 of the Escrow Agreement, this resignation shall void and be of no
further force and effect.
Dated as of October 15, 2002.
--------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇
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