Exhibit 2.1
EXCHANGE
AGREEMENT
This Exchange Agreement
(the “ Agreement ”), dated as of
January 31, 2007, is made by and among:
(a) The undersigned
holders (each, a “ Consenting Noteholder ” and
collectively the “ Consenting Noteholders ”) of
certain 9 3 / 8 % Senior Subordinated Notes
due 2011 (the “ 9 3 / 8 % Notes ”) and/or 8
3 / 4 % Senior Subordinated Notes due
2011 (the “ 8 3 / 4 % Notes ” and together with the
9 3
/ 8 % Notes, the “
Notes ”), in each case issued by SunCom Wireless, Inc.
(f/k/a Triton PCS, Inc.) (“ Wireless
”); and
(b) SunCom Wireless
Holdings, Inc. (“ Holdings ”), the indirect
parent of Wireless, Wireless and SunCom Wireless Investment Company
LLC (“ Investco ”), the direct subsidiary of
Holdings and direct parent of Wireless (each of the foregoing,
together with the Consenting Noteholders, a “ Party
”, and collectively, the “ Parties
”).
RECITALS
WHEREAS
, Holdings, through its
subsidiaries, is a leading provider of wireless communications
services in the southeastern United States and in certain
territories of the United States;
WHEREAS
, Investco, upon
consultation with Holdings, has determined to effect a
recapitalization concerning or impacting, inter
alia , the Notes in accordance with the terms of this
Agreement (the “ Recapitalization ”);
WHEREAS
, the Parties intend to
implement the Recapitalization through an equity-for-debt exchange
(the “ Exchange ”) and consent to amendment of
the indentures governing the Notes (the “ Amendments
”);
WHEREAS
, to effect the
Exchange, Holdings shall contribute shares of its Class A
common stock, $.01 par value (the “ Class A
Stock ”) to Investco, and Investco shall deliver such
Class A Stock to the Consenting Noteholders in exchange for
their Relevant Interests;
WHEREAS
, Holdings shall submit
the Exchange and the Merger Agreement (as defined herein) to the
vote of the holders of its Class A Stock for approval (the
“ Shareholder Vote ”);
WHEREAS
, certain of the
holders of the Notes and Holdings, Investco and Wireless have
engaged in good faith negotiations with the objective of reaching
an agreement with regard to restructuring the outstanding
indebtedness and liabilities of, and equity interests in, Holdings
and its subsidiaries in accordance with the terms set forth in this
Agreement;
WHEREAS
, each of the Parties
has reviewed, or has had the opportunity to review, this Agreement
with the assistance of professional legal and financial advisors of
its own choosing;
WHEREAS
, concurrently with the
execution and delivery of this Agreement, Holdings and SunCom
Merger Corp., a wholly-owned subsidiary of Holdings (“
Merger Sub ”), have entered into an Agreement and Plan
of Merger (the “ Merger Agreement ”) pursuant to
which, immediately prior to the Exchange, Merger Sub will be merged
with and into Holdings (the “ Merger ”) for the
purpose of (i) effecting the conversion of each outstanding
share of Class A Stock into 0.1 share of Class A
Stock, (ii) effecting certain amendments to the certificate of
incorporation of Holdings and (iii) granting certain
additional rights to the holders of Class A Stock of Holdings
immediately prior to the Merger;
WHEREAS
, each Consenting
Noteholder desires to agree to support and implement the
Recapitalization and, to the extent it owns any Class A Stock,
to vote to adopt the Merger Agreement and to vote to approve the
Exchange, and Holdings and Investco desire to obtain the commitment
of the Consenting Noteholders to take such action, in each case
subject to the terms and conditions set forth
herein; and
WHEREAS
, concurrently with the
execution and delivery of this Agreement, certain holders of the
Class A Stock, following the conversion of shares of
Class B common stock, par value $0.01 per share, of
Holdings (“ Class B Stock ”), held by
certain of such holders to Class A Stock, have executed a
Voting and Lock-up Agreement with certain of the Consenting
Noteholders whereby such holders of Class A Stock have agreed,
among other things, to vote to adopt the Merger Agreement, to vote
to approve the Exchange, and to otherwise support and implement the
Recapitalization.
NOW,
THEREFORE ,
in consideration of the foregoing and the promises, mutual
covenants and agreements set forth herein and for other good and
valuable consideration, the Parties agree as follows:
Section 1.
Certain Definitions.
For purposes of this
Agreement, the term:
“ Acquisition
Proposal ” shall mean any proposal, offer or inquiry from
a third party for or with respect to the acquisition, directly or
indirectly, of beneficial ownership (as defined under
Rule 13(d) of the Exchange Act) of assets, securities or
ownership interests of or in Holdings, Wireless or Investco or any
of their subsidiaries representing 50% or more of the consolidated
assets of Holdings and its subsidiaries taken as a whole, or of an
equity interest representing a 50% or greater economic interest in
Holdings and its subsidiaries taken as whole, pursuant to a merger,
consolidation or other business combination, sale of shares of
capital stock, sale of assets, share exchange, liquidation,
dissolution, recapitalization, tender offer, exchange offer or
similar transaction with respect to Holdings, Investco, Wireless or
any of their subsidiaries, including without limitation, a Sale
Transaction.
“ Action
” shall mean any action, order, writ, injunction, judgment or
decree outstanding or claim, suit, litigation, proceeding,
arbitration, audit or investigation by or before any Governmental
Entity or any other Person.
“ Agreement
” shall have the meaning ascribed thereto in the
Preamble.
“
Amendments ” shall have the meaning ascribed thereto
in the Recitals.
“ Assets
” shall mean, with respect to any Person, any land,
buildings, improvements, leasehold improvements, Fixtures and
Equipment and any other assets, real or personal, tangible or
intangible, owned or leased by such Person or any of its
subsidiaries.
“ Beneficial
Owner ” or “ Beneficial Ownership ”
with respect to any securities means having “beneficial
ownership” of such securities (as determined pursuant to
Rule 13d-3 under the Exchange Act).
“ Board
” means the board of directors of Holdings.
“ Break-Up
Fee ” shall have the meaning ascribed thereto in
Section 11.2(b).
“ Chase Release
Parties ” shall have the meaning ascribed thereto in
Section 8.2(d).
“ Class A
Stock” shall have the meaning ascribed thereto in the
Recitals.
“ Class B
Stock ” shall have the meaning ascribed thereto in the
Recitals.
“ Closing
” shall have the meaning ascribed thereto in
Section 2.2(a).
“ Closing
Date ” means the date the Closing occurs.
“ Common
Stock ” shall mean the Class A Stock and the
Class B Stock together.
“ Company SEC
Reports ” shall have the meaning ascribed thereto in
Section 5(b)(i).
“ Consenting
Noteholder ” shall have the meaning ascribed thereto in
the Preamble.
“ Continuing
Directors ” shall have the meaning ascribed thereto in
Section 9.1.
“ Designated
Defaults ” shall mean any default arising from failure to
perform or comply with Sections 4.01, 4.04, 4.05, 4.06, 4.14,
4.15, 4.16, 4.17, 4.18, 4.20 and 5.01 of the Indenture, dated as of
January 19, 2001, as supplemented by the Supplemental
Indenture, dated as of November 18, 2004 and the Second
Supplemental Indenture, dated as of January 27, 2005 and of
the Indenture, dated as of November 14, 2001, as supplemented
by the Supplemental Indenture, dated as of November 18, 2004
and the Supplemental Indenture, dated as of January 27,
2005.
“ D&O
Insurance ” shall have the meaning ascribed thereto in
Section 8.2(b).
“ 8
3
/
4
% Notes ” shall have the meaning
ascribed thereto in the Preamble.
“ Exchange
” shall have the meaning ascribed thereto in the
Recitals.
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“ Exchange
Act ” shall have the meaning ascribed thereto in
Section 5(b)(i).
“ Exchange
Consideration ” shall have the meaning ascribed thereto
in Section 2.1.
“ Expenses
” shall have the meaning ascribed thereto in
Section 11.2(a).
“ FCC
Approval ” shall have the meaning ascribed thereto in
Section 8.5(b).
“ Fixtures and
Equipment ” shall mean, with respect to any Person, all
of the furniture, fixtures, furnishings, machinery and equipment
owned or leased by such Person and located in, at or upon the
Assets of such Person.
“ GAAP
” shall have the meaning ascribed thereto in
Section 5(b)(ii).
“ Governmental
Entities ” shall mean all courts, regulatory or
administrative agencies, commissions or other governmental
authorities, bodies or instrumentalities with jurisdiction,
including for the avoidance of doubt any self regulatory
organizations.
“ Holdings
” shall have the meaning ascribed thereto in the
Preamble.
“ HSR Act
” shall have the meaning ascribed thereto in
Section 6.2.
“
Indemnitees ” shall have the meaning ascribed thereto
in Section 8.2(a).
“ Investco
” shall have the meaning ascribed thereto in the
Preamble.
“ Lien
” shall mean any claim, lien, pledge, option, right of first
refusal, charge, security interest, deed of trust, mortgage,
restriction, hypothecation or encumbrance.
“ Material
Adverse Effect ” shall mean an event or condition that
has had or reasonably could have a material adverse effect on the
business, assets or financial performance of Holdings and its
consolidated subsidiaries, taken as a whole, other than any effect
resulting from (i) conditions, developments or circumstances
(including, without limitation, economic, political or regulatory
conditions, federal or state governmental actions, proposed or
enacted legislation or proposed or enacted regulations) that are
applicable to the wireless communications industry in general or
that adversely affect the markets in which Holdings and its
subsidiaries operate generally or affect industries related to the
telecommunications business generally (including, without
limitation, the introduction of any technological changes in the
telecommunications industry), (ii) any change in the United
States or foreign economies or securities or financial markets in
general, (iii) any action taken by Holdings, Investco,
Wireless or the Consenting Noteholders in furtherance of the
transactions contemplated hereby and consistent with the terms of
this Agreement, (iv) the public announcement of the Exchange,
the consummation of the transactions contemplated hereby, or the
public announcement of the New Board’s intention to pursue
strategic alternatives, including a Sale Transaction, or
(v) changes in the nature of competition affecting the
business of Holdings and its subsidiaries, taken as a whole
(including, without limitation, competition resulting from the
introduction of any new technological changes in the
telecommunications industry).
“ Material
Contract ” shall have the meaning ascribed thereto in
Section 7.2(c).
“ Materials
” shall have the meaning ascribed thereto in
Section 9.2.
“ Merger
” shall have the meaning ascribed thereto in the
Recitals.
“ Merger
Agreement ” shall have the meaning ascribed thereto in
the Recitals.
“ Merger
Sub ” shall have the meaning ascribed thereto in the
Recitals.
“ New Board
” shall have the meaning ascribed thereto in
Section 9.1.
“ New
Investment Bank ” shall have the meaning ascribed thereto
in Section 9.2.
“ 9
3
/
8
% Notes ” shall have the meaning
ascribed thereto in the Preamble.
“ Notes
” shall have the meaning ascribed thereto in the
Preamble.
“ Party
” shall have the meaning ascribed thereto in the
Preamble.
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“ Person
” shall mean any individual, corporation, partnership,
limited liability company, joint venture, real estate investment
trust, other organization (whether incorporated or unincorporated),
governmental agency or instrumentality, or any other legal
entity.
“ Potential
Purchasers ” shall have the meaning ascribed thereto in
Section 9.2.
“ PPM
” shall have the meaning ascribed thereto in
Section 4(d).
“ Proxy
Statement ” shall have the meaning ascribed thereto in
Section 7.1(b).
“
Recapitalization ” shall have the meaning ascribed
thereto in the Recitals.
“
Recapitalization Document ” shall have the meaning
ascribed thereto in Section 3.1(a)(i).
“ Relevant
Interests ” shall have the meaning ascribed thereto in
Section 4(a).
“ Requisite
Noteholders ” means Consenting Noteholders representing
at least 85% in aggregate principal amount of all outstanding Notes
subject to the Agreement.
“ Restricted
Period ” shall have the meaning ascribed thereto in
Section 3.2.
“ Sale
Transaction ” shall have the meaning ascribed thereto in
Section 9.2.
“ SEC
” shall have the meaning ascribed thereto in
Section 3.1(a)(ii).
“ Securities
Act ” shall have the meaning ascribed thereto in
Section 4(d).
“ Shareholder
Vote ” shall have the meaning ascribed thereto in the
Recitals.
“ Stockholders
Meeting ” shall have the meaning ascribed thereto in
Section 7.1(b).
“ SunCom
Release Parties ” shall have the meaning ascribed thereto
in Section 8.2(d).
“ Superior
Proposal ” shall mean an Acquisition Proposal that the
Board determines in good faith (after consultation with the New
Investment Bank or, if the New Investment Bank shall not have been
appointed or shall no longer be serving as financial advisor to
Holdings, another financial advisor of national reputation, and in
light of all relevant circumstances, including all the terms and
conditions of such proposal and the Exchange) to be more favorable
to Holdings’ stockholders than consummating the
Exchange.
“ Transfer
” shall have the meaning ascribed thereto in
Section 3.2.
“ Unsolicited
Proposals ” shall have the meaning ascribed thereto in
Section 9.2.
“ Voting and
Lock-Up Agreement ” shall have the meaning ascribed
thereto in the Recitals.
“ Wireless
” shall have the meaning ascribed thereto in the
Preamble.
Section 2.
Exchange.
2.1. Exchange.
Subject to the terms and
conditions of this Agreement, at the Closing, each Consenting
Noteholder will exchange its Relevant Interests, by transferring
the applicable Notes to Investco pursuant to Section 2.2, for
the number of shares of Class A Stock specified opposite such
Consenting Noteholder’s name on Schedule I hereto (the
“ Exchange Consideration ”), which Schedule
shall be updated as necessary prior to Closing to reflect any
acquisitions or dispositions of Relevant Interests pursuant to the
provisions of Sections 3.2, 3.3 and 4(b) and which reflects an
exchange ratio of 71.113944 shares of Class A Stock for
each $1,000 principal amount of Notes. The terms of the
Class A Stock shall be as set forth in the certificate of
incorporation of Holdings as it will be amended in the Merger (as
defined herein). In lieu of any fractional shares of Class A
Stock to be issued to the Consenting Noteholders as Exchange
Consideration, each Consenting Noteholder shall be entitled to
receive cash from Investco equal to the product obtained by
multiplying (A) the fractional share interest to which such
Consenting Noteholder (after taking into account all shares of
Class A Stock to be received by such Consenting Noteholder)
would otherwise be entitled to receive by (B) (i) if the
Class A Stock is listed on the New York Stock
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Exchange, the per share closing
price of the Class A Stock on the Closing Date as listed on
the New York Stock Exchange (as reported by The Wall Street
Journal (Northeast edition), or, if not reported thereby, as
reported by any other authoritative source) or (ii) if the
Class A Stock is not listed on the New York Stock Exchange,
the per share closing price of the Class A Stock on the
Closing Date as listed on the over-the-counter bulletin board or
other exchange or quotation system on which the Class A Stock
is traded at such time.
2.2. Delivery and
Payment.
(a) The closing of
the Exchange (the “ Closing ”) will occur at the
offices of Wachtell, Lipton, Rosen & Katz,
51 W. 52nd St., New York, New York 10019 or at such
place or places as mutually may be agreed upon by the Parties, at
10:00 A.M., New York City time, as promptly as practicable but
in no event later than the third (3rd) business day after the
satisfaction or (to the extent permitted by applicable law) waiver
of all of the conditions (other than those conditions that by their
nature are to be satisfied at Closing, but subject to the
fulfillment or waiver of those conditions) set forth in
Section 10.
(b) Delivery of the
Notes at the Closing will be made to Investco by or on behalf of
the Consenting Noteholders and Investco shall deliver to the
Consenting Noteholders Class A Stock representing the Exchange
Consideration (which Class A Stock shall be delivered by
Holdings to Investco immediately prior to the Closing). Delivery of
the Notes will be made through the facilities of The Depository
Trust Company. At closing, each Consenting Noteholder shall also
deliver to Investco a letter of transmittal in customary form
transferring the Notes to Investco (which letter of transmittal
shall also include information as to the tax basis of the
Consenting Noteholder in the Notes being transferred).
2.3. Exit
Consent.
Each of the Consenting
Noteholders who validly Exchanges its Notes pursuant to this
Agreement will be deemed, by tendering its Notes for exchange, to
have delivered a consent to the adoption of the Amendments, in
substantially the form attached as Exhibit A hereto,
effective immediately prior to the Closing. The Consenting
Noteholders, with the cooperation of the other Parties hereto,
shall instruct the Depository Trust Company, as record holder of
the Notes, as necessary to effect such consent under the indentures
governing the Notes prior to the Closing.
2.4. Form of Exchange
Consideration.
There will be placed on the
certificates for the shares of Class A Stock issued as
Exchange Consideration a legend stating in substance:
THE SECURITIES REPRESENTED BY THIS
CERTIFICATE WERE ISSUED IN A TRANSACTION THAT WAS NOT REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER THE
SECURITIES LAWS OF ANY STATE AND MAY NOT BE TRANSFERRED, SOLD OR
OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SAID
ACT AND APPLICABLE STATE SECURITIES LAWS.
2.5. Taxes.
Holdings, Investco and
Wireless will be responsible for all sales and similar transfer
taxes which may be due by the Consenting Noteholders as a result of
the Exchange as set forth in this Section 2 except to the
extent that such taxes are imposed because Notes are held other
than in the name of the registered holder.
Section 3.
Lock-Up of Consenting Noteholders.
3.1. Support of
Recapitalization.
(a) Each of the
Consenting Noteholders, as long as each such Consenting Noteholder
remains the legal owner, Beneficial Owner and/or the duly
authorized investment adviser or manager with respect to any
Notes
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and/or Common Stock, agrees that,
so long as this Agreement shall be in full force and effect and
shall not have been validly terminated pursuant to Section 11
hereof, it will:
(i) from and after
the date hereof not directly or indirectly seek, solicit, support,
formulate or encourage any other plan, sale, proposal or offer of
reorganization, merger, restructuring or recapitalization of
Holdings and/or its subsidiaries that could reasonably be expected
to prevent, delay or impede the Recapitalization of Holdings and
its subsidiaries as contemplated herein or in any other document
prepared, executed or filed in connection with implementation of
the Recapitalization, including, without limitation, the Merger
Agreement (hereinafter, each a “ Recapitalization
Document ”);
(ii) agree to
permit disclosure in any filings by Holdings or Wireless with the
Securities and Exchange Commission (the “ SEC ”)
of the substance of this Agreement and the aggregate (but not the
respective) Notes and the aggregate (but not the respective) Common
Stock held by all Consenting Noteholders; provided
that Holdings and Wireless shall not disclose the amount
of the Notes or Common Stock held by any individual Consenting
Noteholder, except as may be otherwise required by applicable law;
and provided further that the
Consenting Noteholders and their advisors will have the right to
review and comment upon any such disclosure prior to any filing
with the SEC; and
(iii) appear, by
proxy or in person, at the Stockholders Meeting or otherwise cause
its Class A Stock to be counted as present thereat for
purposes of calculating a quorum and respond to any other request
by Holdings for written consent, if any, and, unless otherwise
expressly consented to in writing by Holdings, in its sole
discretion, vote, or cause to be voted, all such Consenting
Noteholder’s Class A Stock Beneficially Owned by such
Consenting Noteholder as of the relevant time (A) in favor of
the Exchange and the transactions contemplated thereby, including
the issuance of the shares of Class A Stock, through Investco,
to the Consenting Noteholders in exchange for the Notes held by
such Consenting Noteholders (B) in favor of the adoption of
the Merger Agreement and the approval of the transactions
contemplated thereby, including the Merger, (C) against any
proposal made in opposition to, or in competition or inconsistent
with, the Recapitalization and the Recapitalization Documents,
including the adoption thereof or the consummation thereof,
(D) against any extraordinary dividend, distribution or
recapitalization by Holdings or change in the capital structure of
Holdings (other than pursuant to or as explicitly permitted by the
Recapitalization Documents) and (E) against any action or
agreement that would reasonably be expected to result in any
condition to the consummation of any Recapitalization Document not
being fulfilled. Each Consenting Noteholder hereby revokes any and
all previous proxies granted with respect to its Class A
Stock. By entering into this Agreement, each Consenting Noteholder
hereby grants a proxy appointing Holdings, with full power of
substitution, as such Consenting Noteholder’s
attorney-in-fact and proxy, for and in such Consenting
Noteholder’s name, to be counted as present and to vote or
otherwise to act on behalf of such Consenting Noteholder with
respect to its Class A Stock in the manner contemplated by
this Section 3.1(a)(iii) as such proxy or it substitutes
shall, in Holdings’ sole discretion, deem proper with respect
to its Class A Stock. The proxy granted by each Consenting
Noteholder pursuant to this Section 3.1(a)(iii) is, subject to
the penultimate sentence of this Section 3.1(a)(iii),
irrevocable and is coupled with an interest and is granted in order
to secure such Consenting Noteholder’s performance under this
Agreement and also in consideration of the Holdings and Investco
entering into this Agreement. If any Consenting Noteholder fails
for any reason to be counted as present or to vote such Consenting
Noteholder’s Class A Stock in accordance with the
requirements of this Section 3.1(a)(iii) (or anticipatorily
breaches such section), then Holdings shall have the right to cause
to be present or vote such Consenting Noteholder’s
Class A Stock in accordance with the provisions of this
Section 3.1(a)(iii). The proxy granted by each Consenting
Noteholder shall be automatically revoked upon termination of this
Agreement in accordance with its terms. Each Stockholder agrees,
from the date hereof until the valid termination of this Agreement
in accordance with Section 11, not to attempt to revoke
(subject to the preceding sentence), frustrate the exercise of, or
challenge the validity of, the irrevocable proxy granted pursuant
to this Section 3.1(a)(iii).
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(b) Each of
Holdings, Investco, Wireless and each Consenting Noteholder (so
long as it is a holder of any Note or share of Common Stock)
further agrees that, so long as this Agreement shall be in full
force and effect and shall not have been validly terminated
pursuant to Section 11 hereof, it shall not:
(i) object to, or
otherwise commence any proceeding opposing, any of the terms of
this Agreement or any Recapitalization Documents;
(ii) take any
action which is inconsistent with, or that would delay approval or
confirmation of any of the Exchange, the Merger Agreement, the
Amendments or any of the other Recapitalization
Documents; or
(iii) in its
capacity as the holder of any Notes, initiate any Action with
respect to its rights under such Notes or the applicable indentures
governing such notes, except for any claims for any Designated
Defaults.
3.2. Transfer of Claims,
Interests and Securities.
Each of the Consenting
Noteholders hereby agrees, for the period beginning on the date of
this Agreement and ending on the earlier of (i) the date of
the Closing and (ii) the date of the termination of this
Agreement pursuant to Section 11(such period, the “
Restricted Period ”), that it shall not sell, assign,
transfer, hypothecate or otherwise dispose of, directly or
indirectly (each such transfer, a “ Transfer ”),
all or any of its Notes or Common Stock (or any right related
thereto, including any voting or consent rights associated with
such Notes and/or Common Stock), unless the
transferee thereof agrees in writing, on terms substantially
similar to those set forth in Exhibit B hereto, to
assume and be bound by this Agreement, and to assume the rights and
obligations of a Consenting Noteholder under this Agreement and
delivers such writing to each of Holdings, Investco and counsel to
the Consenting Noteholders at or prior to the time of the relevant
Transfer (each such transferee becoming, upon the Transfer, a
Consenting Noteholder hereunder). Holdings and Investco shall
promptly acknowledge any such Transfer in writing, and provide a
copy of that acknowledgement to the transferor. By its
acknowledgement of the relevant Transfer, each of Holdings and
Investco shall be deemed to have acknowledged that its obligations
to the Consenting Noteholders hereunder shall be deemed to
constitute obligations in favor of the relevant transferee as a
Consenting Noteholder hereunder. Any sale, transfer or assignment
of any Note or share of Common Stock that does not comply with the
procedure set forth in the first sentence of this Section 3.2
shall be deemed void ab initio . Each
Consenting Noteholder further agrees to authorize and hereby
authorizes Holdings and its subsidiaries to effect a stop transfer
order with respect to all of the Notes and Common Stock owned by
such Consenting Noteholder and agrees that an appropriate legend
may be placed on the Notes and Common Stock with respect to the
transfer restrictions set forth in this Section 3.2 and that
such Consenting Noteholder will submit such Notes and certificates
for Common Stock to Holdings for the inclusion of such
legend.
3.3. Further Acquisition
of Notes and Equity Interests.
This Agreement shall in
no way be construed to preclude any Consenting Noteholder or any of
its respective subsidiaries from acquiring additional Notes and/or
Common Stock; provided , however , that
any such additional Notes or Common Stock acquired by a Consenting
Noteholder or any subsidiary thereof shall automatically be deemed
to be subject to the terms of this Agreement; and provided
further that each such Consenting Noteholder agrees that it
shall not create any subsidiary or other affiliated entity for the
sole purpose of acquiring any Notes or shares of Common Stock. Upon
the request of Holdings and Investco, each Consenting Noteholder
shall, in writing and within five (5) business days, provide
an accurate and current list of all Notes and Common Stock that it
and any affiliate holds at that time, provided that
the individual holdings of any Consenting Noteholder and its
affiliates shall be kept confidential and not disclosed by Holdings
or Investco, subject to applicable law.
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Section 4.
Representations of Consenting Noteholders.
Each of the Consenting
Noteholders, severally for itself, represents and warrants to
Holdings and Investco, as of the date hereof and as of the Closing,
as follows, all of which are continuing representations and
warranties:
(a) Such Consenting
Noteholder is the legal owner, Beneficial Owner and/or the
investment advisor or manager for the legal or Beneficial Owner of
the Notes set forth on Schedule I hereto (to be updated as
necessary at the Closing) (collectively, the “ Relevant
Interests ”). Such Consenting Noteholder will convey good
and valid title to the Relevant Interests, free and clear of any
Liens.
(b) There are no
Notes of which such Consenting Noteholder is the legal owner,
Beneficial Owner and/or investment advisor or manager for such
legal or Beneficial Owner which are not part of its Relevant
Interests other than Notes in which such Consenting Noteholder
holds an interest pursuant to or subject to a contract with an
unaffiliated third party which third party has failed to deliver
title to, or return possession of, such Notes to such Consenting
Noteholder in accordance with such contract (“ Undelivered
Interests ”); provided , however, that such
Undelivered Interests shall automatically become Relevant Interests
upon the receipt of title, or, as the case may be, possession, by
such Consenting Noteholder.
(c) Such Consenting
Noteholder has full power to vote and/or dispose of the aggregate
principal amount of the Relevant Interests.
(d) Such Consenting
Noteholder is an “accredited investor” under
Regulation D under the Securities Act of 1933, as amended (the
“Securities Act”). Such Consenting Noteholder is
acquiring the Class A Stock for his, her or its own account, for
investment purposes only and not with a view to the distribution of
the Class A Stock, except in compliance with the Securities
Act and applicable state securities laws. Such Consenting
Noteholder has such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and
risks of his, her or its prospective investment in the Class A
Stock and is able, without materially impairing his, her or its
financial condition, to hold the Class A Stock for an
indefinite period of time and to suffer a complete loss on such
investment. Such Consenting Noteholder has received and reviewed
the confidential private placement memorandum (the “
PPM ”) which outlines the contemplated structure of
the Exchange and includes applicable disclosures relating to an
investment in the Class A Stock, and has had the opportunity
to ask questions of the management of Holdings and its subsidiaries
to the extent necessary to evaluate an investment in the
Class A Stock.
Section 5.
Representations of Holdings, Investco and
Wireless.
Each of Holdings,
Wireless and Investco represents and warrants to the Consenting
Noteholders, as of the date hereof and as of the Closing, as
follows, all of which are continuing representations and
warranties:
(a) All shares of
Class A Stock subject to issuance as specified in
Section 2.1 hereof will be duly authorized upon consummation
of the Merger and, upon issuance on the terms and conditions
specified in the instruments pursuant to which they are issuable,
will be validly issued, fully paid and nonassessable.
(b) (i) Each
of Holdings and Wireless has filed with the SEC all reports,
schedules, statements and other documents required to be filed by
it with the SEC pursuant to the Exchange Act of 1934, as amended
(the “Exchange Act”) since December 31, 2003
(collectively, the “ Company SEC Reports ”). As
of their respective dates, the Company SEC Reports and any
registration statements, reports, forms, proxy or information
statements and other documents filed by Holdings and Wireless with
the SEC pursuant to the Exchange Act after the date of this
Agreement (i) complied, or, with respect to those not yet
filed, will comply, in all material respects with the applicable
requirements of the Exchange Act, and (ii) did not, or, with
respect to those not yet filed, will not, contain any untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
made therein, in the light of the circumstances under which they
were made, not misleading. Investco is not currently subject to the
reporting requirements of Section 13 and Section 15(d) of
the Exchange Act.
(ii) Each of the
most recent audited and unaudited consolidated balance sheets
included in or incorporated by reference into the Company SEC
Reports (including the related notes and schedules)
8
fairly presents, in all material
respects, the consolidated financial position of Holdings and
Wireless and their consolidated subsidiaries as of its date, and
each of the most recent audited and unaudited consolidated
statements of income, stockholders’ equity and cash flows of
Holdings and Wireless included in or incorporated by reference into
the Company SEC Reports (including any related notes and schedules)
fairly presents, in all material respects, the results of
operations, stockholders’ equity and cash flows, as the case
may be, of Holdings and Wireless and their subsidiaries for the
periods set forth therein (subject, in the case of unaudited
statements, to normal year-end audit adjustments), in each case in
accordance with U.S. generally accepted accounting principals
(“GAAP”) consistently applied during the periods
involved, except as may be noted therein and, in the case of
unaudited quarterly financial statements, as permitted by
Form 10-Q under the Exchange Act.
(iii) Except as set
forth in the Company SEC Reports, neither Holdings, Wireless nor
any of their subsidiaries has any liabilities or obligations of any
nature (whether accrued, absolute, contingent or otherwise) that
would be required to be reflected on, or reserved against in, a
balance sheet of Holdings or Wireless or in the notes thereto
prepared in accordance with GAAP consistently applied, except for
(i) liabilities or obligations that were so reserved on, or
reflected in (including the notes to), the consolidated balance
sheet of Holdings or Wireless, as applicable, as of
September 30, 2006, (ii) liabilities or obligations
arising in the ordinary course of business (including trade
indebtedness) on or after September 30, 2006 and prior to the
date hereof, and (iii) other liabilities or obligations which
would not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.
(iv) Holdings
represents that there are not any outstanding options or warrants
for the purchase of any class of its equity.
(c) Holdings,
Wireless and Investco and each of their subsidiaries is in
compliance with all foreign, federal, state and local laws and
regulations applicable to their operations or with respect to which
compliance is a condition of engaging in the business thereof,
except to the extent that failure to comply would not, individually
or in the aggregate, reasonably be expected to have a Material
Adverse Effect. Neither Holdings, Wireless, Investco nor any of
their subsidiaries has received any written notice since
January 1, 2003, or has knowledge, after due inquiry, of any
written notice received by it at any time, asserting a failure, or
possible failure, to comply with any such law or regulation, the
subject of which written notice has not been resolved as required
thereby or otherwise to the reasonable satisfaction of the party
sending the notice, except for such failures as would not,
individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. Except for circumstances that,
individually or in the aggregate, would not constitute a Material
Adverse Effect, Holdings, Wireless and Investco have all permits,
licenses, franchises, certificates, orders and approvals of, and
have made all filings, applications and registrations with,
Governmental Entities that are required in order to permit
Holdings, Wireless and Investco to carry on their respective
businesses as currently conducted.
(d) Except as set
forth in Company SEC Reports filed prior to the date of this
Agreement, there is no Action (i) instituted,
(ii) pending and served upon Holdings, Wireless, Investco or
any of their subsidiaries, or (iii) to the knowledge, after
due inquiry, of Holdings, Wireless and Investco, pending and not
served upon Holdings, Wireless, Investco or any of their
subsidiaries, or overtly threatened, in each case against Holdings,
Wireless, Investco or any of their subsidiaries or any of their
respective Assets which, individually or in the aggregate, directly
or indirectly, would reasonably be expected to have a Material
Adverse Effect, nor is there any outstanding judgment, decree or
injunction, in each case against Holdings, Wireless, Investco, any
of their subsidiaries or any of their respective Assets or any
statute, rule or order of any Governmental Entity applicable to
Holdings, Wireless, Investco or any of their subsidiaries which,
individually or in the aggregate, would reasonably be expected to
have a Material Adverse Effect.
(e) Each of
Holdings, Wireless and Investco has filed all tax returns required
to be filed and paid all taxes shown thereon to be due, including
any interest and penalties, or provided adequate reserves for the
payment thereof, except for those being contested in good faith and
which are listed on Schedule 5(e) hereto or to the extent that
failure to so file or pay would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect.
9
(f) Assuming the
exchange of, and only of, all Relevant Interests held by the
Consenting Noteholders as of the date of this Agreement and
reflected on Schedule I hereto, immediately after the
Exchange, each of the Consenting Noteholders or their successors
and assigns will hold a ratable share of 87.00481% of the Common
Stock on a fully diluted basis (assuming the issuance of all of the
Class A Stock identified on Schedule 7.2), such ratable
share to be determined based on the fraction equal to the face
amount of such Consenting Noteholder’s Relevant Interests
divided by the total face amount of the outstanding Relevant
Interests owned by all of the Consenting Noteholders.
Section 6.
Mutual Representations and Warranties.
Each Party makes the
following representations and warranties to each of the other
Parties, all of which are continuing representations and
warranties:
6.1. Enforceability.
This Agreement is a
legal, valid, and binding obligation of the Party, enforceable
against it in accordance with its terms, except as enforcement may
be limited by bankruptcy, insolvency, fraudulent transfer,
moratorium and other similar laws of general
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