Section 6.18. Merger Sub Approval and Merger Company Approval. Promptly following the execution of this Agreement, (a) Merger Company, acting in its capacity as the sole stockholder of Merger Sub, shall adopt this Agreement by written consent in accordance with the Certificate of Incorporation and Bylaws of Merger Sub and the DGCL, and T-Mobile shall deliver a copy of the corporate record evidencing such adoption to Sprint, and (b) T-Mobile, acting in its capacity as the sole member of Merger Company, shall adopt this Agreement by written consent in accordance with the limited liability company agreement of Merger Company and the DLLCA, and T-Mobile shall deliver a copy of the corporate record evidencing such adoption to Sprint.
Section 6.19. Termination of Certain Agreements. From and after (a) the date hereof and prior to the Effective Time, the parties shall reasonably cooperate in order to mutually agree as to which of the agreements or other arrangements set forth on Section 6.19 of the Sprint Disclosure Letter or Section 6.19(a) of the T-Mobile Disclosure Letter will be continued following, or terminated effective as of, the Effective Time, and shall take all such other actions as may be reasonably necessary or appropriate in order to effect such mutual agreement, and (b) the Effective Time through the six-month anniversary thereof, each of SoftBank and DT shall, and shall cause its affiliates to, execute all such agreements, documents and instruments, and take all such other actions as may be reasonably necessary or appropriate, in order to terminate any contracts or other arrangements (without any penalty, payment or other continuing obligation of T-Mobile or any of its subsidiaries under such contract or other arrangement, as a result of or relating to such termination or waiver, or otherwise (other than payment for amounts accrued for products or services rendered under such contract or other arrangement through the date of such termination set forth in such notice)) between or among SoftBank or any of its affiliates, or DT or any of its affiliates, as applicable (in each case other than T-Mobile and its subsidiaries), on the one hand, and T-Mobile or any of its subsidiaries (including Sprint or any of its subsidiaries), on the other hand, other than those set forth on Section 6.19 of the Sprint Disclosure Letter or on Section 6.19 of the T-Mobile Disclosure Letter, promptly following notice from T-Mobile to SoftBank or DT, as applicable, that it has elected to terminate such contract or other arrangement pursuant to this Section 6.19.
Section 6.20. FCC Auction Procedures. Sprint and T-Mobile hereby acknowledge that this Agreement is not intended to, and shall not be interpreted to, restrict the ability of either Sprint and its subsidiaries, or T-Mobile and its subsidiaries, from participating in any FCC auction that may occur after the date of this Agreement and prior to the Closing. In connection with the foregoing, (a) Sprint and T-Mobile shall not discuss or enter into any agreements related to bids, bidding strategies or post-auction market structure related to licenses being auctioned by the FCC and (b) not later than 30 days in advance of the applicable initial auction application deadline, the parties shall (i) distribute guidelines for compliance with the FCC’s Prohibited Communications rules to all individuals and consultants involved in the discussions with the other party regarding the transactions contemplated by this Agreement and (ii) implement safeguards mutually agreed upon by the parties, which may include assigning personnel or committees to monitor or evaluate proposed communications between the Parties regarding matters potentially falling under the FCC’s Prohibited Communications rules, firewalls and third-party nondisclosure agreements, remedial steps to be followed in the event of any such Prohibited Communication, and other reasonable and appropriate procedures implemented in consultation with outside counsel and intended to prevent communications concerning any FCC licenses to be auctioned, bids or bidding strategy between such parties.
ARTICLE VII
CONDITIONS PRECEDENT
Section 7.1. Conditions to Each Party’s Obligation to Effect the Merger Transactions. The respective obligations of each party to effect the Merger Transactions are subject to the satisfaction or waiver, in whole or in part (to the extent permitted by applicable Law), on or prior to the Closing Date of the following conditions:
(a) Stockholder Approvals. Each of the Sprint Stockholder Approval and the T-Mobile Stockholder Approval shall have been obtained.
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(b) Required Regulatory Consents. (i) The waiting period (and any extension thereof) applicable to the Merger Transactions under the HSR Act shall have been terminated or shall have expired and (ii) all consents required to be obtained from the FCC in connection with the transactions contemplated by this Agreement shall have been granted by the FCC.
(c) Other Governmental Consents. (i) All consents required to be obtained from any PUCs or similar state and foreign regulatory bodies in connection with the transactions contemplated by this Agreement shall have been obtained, (ii) all consents required to be obtained pursuant to any Antitrust Laws other than the HSR Act set forth on Section 7.1(c)(ii) of the T-Mobile Disclosure Letter in connection with the consummation of the transactions contemplated by this Agreement shall have been obtained, (iii) CFIUS shall have completed its review and, where applicable, investigation under Section 721 without unresolved national security concerns with respect to the transactions contemplated by this Agreement, and (iv) DSS shall have approved a plan to operate pursuant to a FOCI mitigation agreement those NISPOM covered activities of T-Mobile, Sprint and their respective subsidiaries that DSS determines are necessary to be operated pursuant to such an agreement, or shall have accepted a commitment from the parties to implement such FOCI mitigation agreement following the Closing.
(d) No Injunctions or Restraints. No court or other Governmental Entity of competent jurisdiction shall have entered, enacted, promulgated, enforced or issued any Law (whether temporary, preliminary or permanent) preventing the consummation of the Merger (a “Restraint”).
(e) Form S-4. The Form S-4 shall have become effective under the Securities Act prior to the mailing of the Consent Solicitation Statement by each of Sprint and T-Mobile to their respective stockholders, and no stop order or proceeding seeking a stop order shall be threatened by the SEC or shall have been initiated by the SEC.
(f) NASDAQ Listing. The shares of T-Mobile Common Stock issuable to the stockholders of Sprint as contemplated by Article III shall have been approved for listing on NASDAQ, subject to official notice of issuance.
(g) Ratings. On the Closing Date, T-Mobile USA, Inc., taking into account and after giving effect to the Merger and the other transactions contemplated by and relating to this Agreement, shall have at least two of the following three credit ratings: (i) a corporate family rating (CFR) of at least “Ba2” from Moody’s Investors Services, Inc., (ii) a long-term issuer credit rating of at least “BB” from Standard & Poor’s Financial Services LLC, and (iii) a long-term issuer credit rating of at least “BB” from Fitch, Inc., provided, however, that the foregoing condition in this Section 7.1(g) shall be deemed satisfied if, on the Closing Date (or, earlier, upon the date of issuance by T-Mobile USA, Inc. of debt securities in an amount sufficient to replace in full the commitments under the bridge facilities in the Commitment Letter), T-Mobile USA, Inc., taking into account and after giving effect to the Merger and the other transactions contemplated by and relating to this Agreement, shall have at least two of the following three public credit ratings on not less than $45,000,000,000 of secured debt: (i) a secured tranche rating of at least “Baa3” from Moody’s Investors Services, Inc., (ii) a secured tranche rating of at least “BBB-” from Standard & Poor’s Financial Services LLC, and (iii) a secured tranche rating at least “BBB-” from Fitch, Inc.; provided, further, that no party may rely on the failure of the condition set forth in this Section 7.1(g) to be satisfied if such failure was principally caused by such party’s material breach of any material provision of this Agreement or such party’s failure to act in good faith.
Section 7.2. Conditions to Obligations of T-Mobile, Merger Sub, Merger Company and the DT Parties. The obligations of T-Mobile, Merger Sub, Merger Company and the DT Parties to effect the Merger Transactions are further subject to the satisfaction or waiver, in whole or in part (to the extent permitted by applicable Law), of the following conditions:
(a) Representations and Warranties. (i) The representations and warranties of Sprint contained in the first sentence of Section 4.1(a), Section 4.1(b)(i), Section 4.1(c)(iii), Section 4.1(m), Section 4.1(t),
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Section 4.1(v) and Section 4.1(w) (without giving effect to any limitation as to “materiality,” “Material Adverse Effect” or any provisions relating to preventing or materially delaying the consummation of any of the transactions contemplated hereby set forth therein) shall be true and correct in all material respects as of the Closing Date as though made on the Closing Date (except to the extent such representations and warranties expressly relate to a specific date or the date of this Agreement, in which case such representations and warranties shall be true and correct in all material respects as of such date), (ii) the representations and warranties of Sprint contained in Section 4.1(c)(i) and Section 4.1(c)(ii) shall be true and correct as of the Closing Date as though made on the Closing Date (except to the extent such representations and warranties expressly relate to a specific date, in which case such representations and warranties shall be true and correct as of such date), except for any de minimis inaccuracies, (iii) the representations and warranties of Sprint contained in Section 4.1(g)(iii) shall be true and correct as of the Closing Date as though made on the Closing Date, (iv) the representations and warranties of Sprint contained in this Agreement (other than those contained in the sections set forth in the preceding clauses (i), (ii) and (iii)) (without giving effect to any limitation as to “materiality,” “Material Adverse Effect” or any provisions relating to preventing or materially delaying the consummation of any of the transactions contemplated hereby set forth therein) shall be true and correct as of the Closing Date as though made on the Closing Date (except to the extent such representations and warranties expressly relate to a specific date or the date of this Agreement, in which case such representations and warranties shall be true and correct as of such date), except where the failure to be so true and correct, individually or in the aggregate, does not have and would not reasonably be expected to have a Material Adverse Effect on Sprint, and (v) the representations and warranties of the SoftBank Parties contained in Section 4.3 (without giving effect to any limitation as to “materiality,” “Material Adverse Effect” or any provisions relating to preventing or materially delaying the consummation of any of the transactions contemplated hereby set forth therein) shall be true and correct in all material respects as of the Closing Date as though made on the Closing Date (except to the extent such representations and warranties expressly relate to a specific date or the date of this Agreement, in which case such representations and warranties shall be true and correct in all material respects as of such date); provided that the accuracy of the representations and warranties of the SoftBank US HoldCos shall only be a condition to the obligations of T-Mobile, Merger Sub, Merger Company and DT to effect the SoftBank US Mergers.
(b) Performance of Obligations. Each of Sprint and the SoftBank Parties shall have performed in all material respects all obligations required to be performed by it under this Agreement at or prior to the Closing Date.
(c) Officer’s Certificate. T-Mobile shall have received an officer’s certificate duly executed by the Chief Executive Officer or the Chief Financial Officer of Sprint to the effect that the conditions set forth in Section 7.2(a) and Section 7.2(b) have been satisfied.
(d) Other Agreements. SoftBank shall have duly executed and delivered (i) the Stockholders’ Agreement and (ii) the Voting and Proxy Agreement.
(e) Tax Opinion. Subject to the last sentence of Section 1.1, T-Mobile shall have received a written opinion of its Specified Counsel, in form and substance reasonably satisfactory to T-Mobile, dated as of the Closing Date, to the effect that, on the basis of facts, representations and assumptions set forth or referred to in such opinion, each of the SoftBank US Mergers will qualify as a “reorganization” within the meaning of Section 368(a) of the Code. In rendering such opinion, T-Mobile’s Specified Counsel shall be entitled to receive and rely upon representations and covenants contained in certificates of Starburst, Galaxy and T-Mobile substantially in the form of Exhibits A, B and C to the T-Mobile Disclosure Letter (the “Tax Certificates”).
Section 7.3. Conditions to Obligations of Sprint and the SoftBank Parties. The obligations of Sprint and the SoftBank Parties to effect the Merger Transactions are further subject to the satisfaction or waiver, in whole or in part (to the extent permitted by applicable Law), of the following conditions:
(a) Representations and Warranties. (i) The representations and warranties of T-Mobile, Merger Sub and Merger Company contained in the first sentence of Section 4.2(a), Section 4.2(b)(i), Section 4.2(c)(iii),
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Section 4.2(m), Section 4.2(t) and Section 4.2(v) (without giving effect to any limitation as to “materiality,” “Material Adverse Effect” or any provisions relating to preventing or materially delaying the consummation of any of the transactions contemplated hereby set forth therein) shall be true and correct in all material respects as of the Closing Date as though made on the Closing Date (except to the extent such representations and warranties expressly relate to a specific date or the date of this Agreement, in which case such representations and warranties shall be true and correct in all material respects as of such date), (ii) the representations and warranties of T-Mobile, Merger Sub and Merger Company contained in Section 4.2(c)(i) and Section 4.2(c)(ii) shall be true and correct as of the Closing Date as though made on the Closing Date (except to the extent such representations and warranties expressly relate to a specific date, in which case such representations and warranties shall be true and correct as of such date), except for any de minimis inaccuracies, (iii) the representations and warranties of T-Mobile, Merger Sub and Merger Company contained in Section 4.1(g)(iii) shall be true and correct as of the Closing Date as though made on the Closing Date, (iv) the representations and warranties of T-Mobile, Merger Sub and Merger Company contained in this Agreement (other than those contained in the sections set forth in the preceding clauses (i), (ii) and (iii)) (without giving effect to any limitation as to “materiality,” “Material Adverse Effect” or any provisions relating to preventing or materially delaying the consummation of any of the transactions contemplated hereby set forth therein) shall be true and correct as of the Closing Date as though made on the Closing Date (except to the extent such representations and warranties expressly relate to a specific date or the date of this Agreement, in which case such representations and warranties shall be true and correct as of such date), except where the failure to be so true and correct, individually or in the aggregate, does not have and would not reasonably be expected to have a Material Adverse Effect on T-Mobile, and (v) the representations and warranties of the DT Parties contained in Section 4.4 (without giving effect to any limitation as to “materiality,” “Material Adverse Effect” or any provisions relating to preventing or materially delaying the consummation of any of the transactions contemplated hereby set forth therein) shall be true and correct in all material respects as of the Closing Date as though made on the Closing Date (except to the extent such representations and warranties expressly relate to a specific date or the date of this Agreement, in which case such representations and warranties shall be true and correct in all material respects as of such date).
(b) Performance of Obligations. Each of T-Mobile, Merger Sub, Merger Company and the DT Parties shall have performed in all material respects all obligations required to be performed by it under this Agreement at or prior to the Closing Date.
(c) Officer’s Certificate. Sprint shall have received an officer’s certificate duly executed by the Chief Executive Officer or the Chief Financial Officer of T-Mobile to the effect that the conditions set forth in Section 7.3(a) and Section 7.3(b) have been satisfied.
(d) Other Agreements. T-Mobile and DT shall have duly executed and delivered (as applicable) (i) the Stockholders’ Agreement, (ii) the Voting and Proxy Agreement and (iii) the License Agreement Amendment.
(e) Tax Opinion. Subject to the last sentence of Section 1.1, Sprint shall have received a written opinion of its Specified Counsel, in form and substance reasonably satisfactory to Sprint (and, with respect to the opinion in clause (ii), T-Mobile), dated as of the Closing Date, to the effect that, on the basis of facts, representations and assumptions set forth or referred to in such opinion, (i) each of the SoftBank US Mergers will qualify as a “reorganization” within the meaning of Section 368(a) of the Code, and (ii) the Merger (or the Merger and the SoftBank US Mergers, taken together) will qualify as a “reorganization” within the meaning of Section 368(a) of the Code. T-Mobile shall be entitled to rely upon the opinion in clause (ii) as though T-Mobile were an addressee of such opinion. In rendering such opinion, Sprint’s Specified Counsel shall be entitled to receive and rely upon representations and covenants (x) with respect to the opinion in clause (i), contained in certificates of Starburst, Galaxy and T-Mobile substantially in the form of the Tax Certificates, and (y) with respect to the opinion in clause (ii), of T-Mobile and Sprint as reasonably requested by Sprint’s Specified Counsel for purposes of such opinion.
For the avoidance of doubt, this Section 7.3(e) may not be waived without the consent of the SoftBank Parties.
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ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
Section 8.1. Termination. This Agreement may be terminated at any time prior to the SoftBank US Mergers Effective Time, whether before or after the Sprint Stockholder Approval or the T-Mobile Stockholder Approval:
(a) by mutual written consent of Sprint and T-Mobile;
(b) by either Sprint or T-Mobile:
(i) if the Merger Transactions shall not have been consummated by the first anniversary of the date of this Agreement, or, if the Marketing Period has started and is in effect at such date, then the second business day following the end of the Marketing Period (but in no event shall such date be later than the 22nd business day following the first anniversary of the date of this Agreement) (the “Outside Date”); provided, that if the Closing shall not have occurred by the first anniversary of the date of this Agreement, but on that date, any of the conditions set forth in Section 7.1(b), Section 7.1(c) or Section 7.1(d) shall not be satisfied but all other conditions shall have been satisfied or waived (other than those that by their terms are to be satisfied at the Closing, provided that they would be satisfied if the Closing were to occur on such date), then either T-Mobile or Sprint may elect (by delivery of written notice to the other party at or prior to 11:59 p.m. New York City time on such first anniversary of the date of this Agreement) to extend the Outside Date to the fifteen-month anniversary of the date of this Agreement, or, if the Marketing Period has started and is in effect at such date, then the second business day following the end of the Marketing Period (but in no event shall such date be later than the 22nd business day following the fifteen-month anniversary of the date of this Agreement); provided, further, that, if after such extension, the Closing shall not have occurred by the fifteen-month anniversary of the date of this Agreement, but on that date, any of the conditions set forth in Section 7.1(b), Section 7.1(c) or Section 7.1(d) shall not be satisfied but all other conditions shall have been satisfied or waived (other than those that by their terms are to be satisfied at the Closing, provided that they would be satisfied if the Closing were to occur on such date), then either T-Mobile or Sprint may elect (by delivery of written notice to the other party at or prior to 11:59 p.m. New York City time on such extended date) to extend the Outside Date to the eighteen-month anniversary of the date of this Agreement, or, if the Marketing Period has started and is in effect at such date, then the second business day following the end of the Marketing Period (but in no event shall such date be later than the 22nd business day following the eighteen-month anniversary of the date of this Agreement); and in each such case, the Outside Date, as so extended, shall be the “Outside Date” for purposes of this Agreement; provided, further, that the right to terminate this Agreement pursuant to this Section 8.1(b)(i) shall not be available to Sprint, if Sprint’s or any SoftBank Party’s, or T-Mobile, if T-Mobile’s or any DT Party’s, material breach of its obligations under this Agreement, the SoftBank Support Agreement or the DT Support Agreement, as applicable, has been the principal cause of, or principally resulted in, the failure of the Merger to be consummated by such time;
(ii) if (A) any Restraint shall be in effect and shall have become final and nonappealable or (B) any authorization or consent from a Governmental Entity that must be obtained pursuant to Section 7.1(b) or Section 7.1(c): (I) has been denied and such denial has become final and nonappealable or (II) requires as a final and nonappealable condition to such authorization or consent that Sprint, T-Mobile, SoftBank or DT take any action that would or would reasonably be expected to result in a Regulatory Material Adverse Condition; provided, that the right to terminate this Agreement pursuant to this Section 8.1(b)(ii) shall not be available to Sprint, if Sprint’s or SoftBank’s, or T-Mobile, if T-Mobile’s or DT’s, material breach of its obligations under Section 6.3 has been the principal cause of, or principally resulted in, such Restraint or denial;
(c) by T-Mobile (provided, that T-Mobile is not then in material breach of any representation, warranty, covenant or other agreement contained in this Agreement), if Sprint shall have breached or failed to perform in any material respect any of its representations, warranties, covenants or other agreements contained in
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this Agreement, which breach or failure to perform (i) would give rise to the failure of a condition set forth in Section 7.2(a) or Section 7.2(b) and (ii) is incapable of being cured by Sprint or is not cured within sixty (60) days of written notice thereof;
(d) by Sprint (provided, that Sprint is not then in material breach of any representation, warranty, covenant or other agreement contained in this Agreement), if T-Mobile shall have breached or failed to perform in any material respect any of its representations, warranties, covenants or other agreements contained in this Agreement, which breach or failure to perform (i) would give rise to the failure of a condition set forth in Section 7.3(a) or Section 7.3(b) and (ii) is incapable of being cured by T-Mobile or is not cured within sixty (60) days of written notice thereof;
(e) by T-Mobile, if any of the SoftBank Parties or SoftBank UK HoldCo fail to execute and deliver to T-Mobile the SoftBank Support Agreement within one business day following the execution of this Agreement; and
(f) by Sprint, if either DT Party fail to execute and deliver to Sprint the DT Support Agreement within one business day following the execution of this Agreement.
Section 8.2. Effect of Termination.
(a) In the event of termination of this Agreement as provided in Section 8.1, and subject to the provisions of Section 10.1, this Agreement shall forthwith become void, and there shall be no liability or obligation on the part of any party hereto (or of any of its directors, officers, employees or Representatives), except (i) the provisions of this Section 8.2 (Effect of Termination), the last sentence of Section 6.2(b) (Access to Information; Confidentiality), Section 6.7 (Fees and Expenses), Section 6.17(e) (Financing Matters), Section 6.17(f) (Financing Matters), this Section 8.2 (Effect of Termination) and Article X (General Provisions) shall survive any such termination of this Agreement and remain in full force and effect and no such termination shall relieve either party from any liability or obligation under such provisions, and (ii) nothing contained herein shall relieve any party from liability for fraud or any Willful Breach of this Agreement, the Confidentiality Agreement or any other agreement contemplated hereby and delivered in connection herewith prior to the termination of this Agreement.
(b) In the event that (i) T-Mobile terminates this Agreement pursuant to Section 8.1(b)(i), (ii) at the time of such termination, all of the conditions set forth in Section 7.1 (other than the condition set forth in Section 7.1(g)) and all of the conditions set forth in Section 7.2 would be satisfied at the time of such termination if the Closing were held at the time of such termination, and (iii) Sprint has provided a written certification to T-Mobile that it stands ready, willing and able to consummate the Merger on the date required by Section 1.3 at the time of termination of this Agreement (a “Specified Termination”), then T-Mobile shall pay to Sprint, on the date of termination of this Agreement, an amount equal to $600,000,000 (the “Payment Amount”); provided, that notwithstanding the foregoing, T-Mobile shall have no obligation to pay the Payment Amount (in whole or in part) and may terminate this Agreement pursuant to Section 8.1(b)(i) without paying the Payment Amount if:
(i) on the date of termination of this Agreement pursuant to the Specified Termination, Sprint does not have the following three credit ratings: (A) a corporate family rating (CFR) of at least “B2” from Moody’s Investors Services, Inc., (B) a long-term issuer credit rating of at least “B” from Standard & Poor’s Financial Services LLC, and (C) a long-term issuer credit rating of at least “B+” from Fitch, Inc., unless Sprint does not have any such credit rating due to a change in credit ratings or credit outlook generally affecting the industry in which Sprint operates; or
(ii) Sprint or any of the SoftBank Parties has breached in any material respect any of its representations, warranties, covenants or agreements set forth in this Agreement and such breach has impacted any of the credit ratings described in clause (i) of this Section 8.2(b) or the ability of T-Mobile to obtain the credit ratings described in Section 7.1(g).
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(c) Sprint and the SoftBank Parties agree that in the event that the Payment Amount is paid to Sprint pursuant to Section 8.2(b), the payment of the Payment Amount shall be the sole and exclusive remedy of Sprint and the SoftBank Parties and their respective subsidiaries, stockholders, affiliates, officers, directors, employees and Representatives against T-Mobile, Merger Sub, Merger Company, DT, their respective affiliates and their and their respective affiliates’, stockholders, officers, directors, employees and Representatives, for, and in no event will Sprint or the SoftBank Parties seek to recover any other money damages or seek any other remedy based on a claim in law or equity with respect to, (I) any loss suffered as a result of the failure of the Merger Transactions to be consummated, (II) the termination of this Agreement, (III) any liabilities or obligations arising under this Agreement or (IV) any claims or actions arising out of or relating to this Agreement, and upon payment to Sprint of the Payment Amount, none of T-Mobile, Merger Sub, Merger Company, DT, their respective affiliates and their and their respective affiliates’, stockholders, officers, directors, employees and Representatives shall have any further liability or obligation to Sprint or the SoftBank Parties relating to or arising out of this Agreement, the Merger Transactions or the transactions contemplated hereby. All payments under Section 8.2(b) shall be made by wire transfer of immediately available funds to an account designated in writing by Sprint to T-Mobile.
Section 8.3. Amendment. Subject to compliance with applicable Law, this Agreement may be amended by the parties hereto at any time before or after the Sprint Stockholder Approval or the T-Mobile Stockholder Approval; provided, however, that any amendment of this Agreement that requires approval by the stockholders of Sprint or approval by the stockholders of T-Mobile under applicable Law shall be subject to such approval. This Agreement may not be amended except by an instrument in writing signed on behalf of each of the parties hereto and duly approved by the parties’ respective Boards of Directors (or comparable governing body) or a duly authorized committee thereof.
Section 8.4. Extension; Waiver. At any time prior to the Effective Time, a party hereto may, subject to the proviso of Section 8.3 (and for this purpose treating any waiver referred to below as an amendment), (a) extend the time for the performance of any of the obligations or other acts of the other parties, (b) waive any inaccuracies in the representations and warranties of the other parties contained in this Agreement or in any document delivered pursuant to this Agreement, (c) waive compliance by the other party with any of the agreements or conditions contained in this Agreement or (d) waive the satisfaction of any of the conditions contained in this Agreement, except in the case of each of (c) and (d) for any waiver that is prohibited by Law. No extension or waiver by Sprint or T-Mobile shall require the approval of the stockholders of Sprint or T-Mobile, respectively, unless such approval is required by applicable Law. Any agreement on the part of a party hereto to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such party. Any extension or waiver given in compliance with this Section 8.4 or failure to insist on strict compliance with an obligation, covenant, agreement or condition shall not operate as a waiver of, or estoppel with respect to, any subsequent or other failure.
ARTICLE IX
SOFTBANK INDEMNIFICATION
Section 9.1. SoftBank US Mergers Indemnification. Effective from and after the SoftBank US Mergers Effective Time, SoftBank shall indemnify DT, T-Mobile, their respective affiliates (including DT Holdco and the SoftBank Surviving Entity) and each of their and their respective affiliates’ Representatives, successors and assigns (each, an “Article IX Indemnitee”) against, and shall hold each of them harmless from, any claims, losses, costs, Taxes, liabilities, obligations and expenses (whether or not arising out of third-party claims), including interest, penalties, attorneys’ fees and all amounts paid in connection with the investigation, defense or settlement or other compromise of any of the foregoing (collectively, “Losses”) incurred or suffered by any such Article IX Indemnitee arising out of, attributable to or resulting from (a) any breach of, or inaccuracy in, any of the representations or warranties of the SoftBank US HoldCos contained in this Agreement or any Tax
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Certificate (in each case, without giving effect to any limitation as to materiality or knowledge set forth therein), (b) any breach or nonfulfillment of any of the covenants or agreements made or to be performed by any of the SoftBank US HoldCos pursuant to this Agreement, whether before, on or after the Effective Time, (c) any breach of a covenant or agreement made or to be performed by SoftBank or any of its Representatives or affiliates pursuant to Section 9.3, whether before, on or after the Effective Time, (d) any and all assets of any of the SoftBank US HoldCos, other than the Sprint Subject Shares, or (e) any and all liabilities of any of the SoftBank US HoldCos, other than Taxes of the SoftBank US HoldCos indemnified pursuant to Section 9.2.
Section 9.2. SoftBank Tax Indemnification. Effective from and after the SoftBank US Mergers Effective Time, SoftBank shall indemnify and hold harmless each Article IX Indemnitee from any and all Losses for or in connection with (a) Taxes imposed on or payable by any of the SoftBank US HoldCos or the SoftBank Surviving Entity for any Pre-Closing Tax Period, (b) Taxes arising from the failure of any of the SoftBank US Mergers to qualify as a “reorganization” within the meaning of Section 368(a) of the Code, except to the extent such failure is exclusively attributable to a breach by T-Mobile of any of the covenants contained in the Tax Certificates delivered by T-Mobile, (c) any Taxes of an Article IX Indemnitee that would not have arisen but for the SoftBank US Mergers, (d) Taxes required to be deducted or withheld from the Galaxy Merger Consideration, the Starburst Merger Consideration or any other amounts paid, issued or delivered pursuant to the SoftBank US Mergers, (e) amounts payable by any of the SoftBank US HoldCos pursuant to any Tax sharing, allocation or indemnification agreement entered into before the SoftBank US Mergers Effective Time, (f) any transfer, recording, documentary, sales, use, stamp, registration and similar Taxes (including any real estate transfer or similar Tax arising from any indirect transfer of property) and related fees incurred with respect to or arising from any of the SoftBank US Mergers, (g) Taxes for which any of the SoftBank US HoldCos (or any successor thereof) is liable (or that may be collected from any of the SoftBank US HoldCos by way of offset against a refund of Tax otherwise due to the SoftBank US HoldCos (or any successor thereof)) under Treasury Regulations Section 1.1502-6 (or any similar provision of state, local or foreign Law), as a successor or transferee or as a result of having been a member of any group prior to the SoftBank US Mergers Effective Time, (h) Taxes attributable to the inclusion of any item of income in, or the denial of any item of deduction from, taxable income for any Post-Closing Tax Period as a result of any (I) adjustment required with respect to any of the SoftBank US HoldCos by reason of a change in method of accounting for a Pre-Closing Tax Period under Section 481(c) of the Code (or any corresponding or similar provision of state, local or foreign Law), (II) “closing agreement” as described in Section 7121 of the Code (or any corresponding or similar provision of state, local or foreign Law) entered into by any of the SoftBank US HoldCos prior to the SoftBank US Mergers Effective Time or (III) installment sale by, or intercompany transaction (within the meaning of Treasury Regulations Section 1.1502-13) involving, any of the SoftBank US HoldCos entered into prior to the SoftBank US Mergers Effective Time, or (i) Taxes of SoftBank or any of its affiliates (other than the SoftBank US HoldCos, Sprint or Sprint’s subsidiaries) for any period. In determining the amount of Losses (including Taxes) indemnifiable by SoftBank under this Section 9.2, no Tax Attribute or Tax benefit (e.g., any correlative step-up in the tax basis of assets) of any Article IX Indemnitee shall be taken into account.
Section 9.3. Additional Agreements.
(a) An Article IX Indemnitee shall notify SoftBank of a third-party claim with respect to which indemnification may be sought under this Article IX reasonably promptly after receiving written notice thereof (provided, that the failure or delay to so notify SoftBank shall not affect any Article IX Indemnitee’s right to indemnification, or SoftBank’s indemnification obligations, under this Article IX, except to the extent SoftBank is materially prejudiced by such failure or delay). SoftBank shall have the right to assume control of the defense of any such third-party claim upon written notice to the Article IX Indemnitee within fifteen (15) days of receipt of the notice referred to in the preceding sentence, unless such third party claim involves an injunction or equitable relief, non-monetary claims, or criminal liability (in which case, the Article IX Indemnitee will have the right to take control and conduct the defense, compromise and settlement of such third-party claim (but such third-party claim shall not be compromised or settled without the written consent of SoftBank, which consent shall not be unreasonably withheld, conditioned or delayed); provided, that (i) as a condition precedent to
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SoftBank’s right to control such defense, it must first notify the Article IX Indemnitee in writing within such fifteen (15)-day period that SoftBank will indemnify the Article IX Indemnitee from and against the entirety of any Losses of Article IX Indemnitees may suffer resulting from, arising out of, relating to or caused by the third party claim in accordance with the terms of this Article IX and (ii) in no event shall SoftBank enter into any settlement or compromise or consent to the entry of any judgment with respect to such third party claim without the prior written consent of the Article IX Indemnitees (not to be unreasonably withheld, conditioned or delayed); and provided, further, that if SoftBank does not assume control of the defense of such third-party claim within such fifteen (15)-day period, then the Article IX Indemnitee shall have the exclusive right to control the defense thereof. SoftBank shall (and shall cause its affiliates to) cooperate with the Article IX Indemnitees with respect to any claim for indemnification under this Article IX, including making available all witnesses, information and materials in its possession or under its control relating thereto as are reasonably requested by an Article IX Indemnitee.
(b) If SoftBank (or an applicable withholding agent) is required by applicable Law to deduct or withhold any Tax from any payment required to be made pursuant to this Article IX, then the amount of the payment shall be increased as necessary so that after any such deduction or withholding (including any deductions or withholdings applicable to additional amounts payable under this provision) the applicable Article IX Indemnitee receives an amount equal to the amount it would have received had no such deduction or withholding been required.
(c) If an Article IX Indemnitee incurs or would incur any Tax liability arising from the receipt or accrual of any payment received or to be received pursuant to this Article IX, then the amount of the payment payable by SoftBank shall be increased as necessary so that after taking into account any such Tax liability (including any Tax liability arising from additional amounts payable under this provision, and disregarding any Tax Attributes of such Article IX Indemnitee) the Article IX Indemnitee receives an amount equal to the amount it would have received had no such Tax liability arisen. To the extent permitted by applicable Law, SoftBank and the applicable Article IX Indemnitee agree to treat, for applicable Tax purposes, any indemnification payment pursuant to this Article IX as an adjustment to the Starburst Merger Consideration or Galaxy Merger Consideration, as applicable.
(d) Any payment required to be made pursuant to this Article IX shall be made by wire transfer of immediately available funds to an account designated by the relevant Article IX Indemnitee within fifteen (15) business days after any of the Article IX Indemnitees makes written demand upon SoftBank, but (in the case of any payment for Taxes payable) no earlier than five (5) days prior to the date on which the relevant Taxes are required to be paid to the relevant Taxing Authority.
(e) SoftBank and T-Mobile shall reasonably cooperate, and shall cause their respective affiliates, officers, employees, agents, auditors and other Representatives to reasonably cooperate, in preparing and filing all Tax Returns and in connection with all disputes, audits and other proceedings relating to Taxes, in each case imposed on or with respect to the SoftBank US HoldCos or the SoftBank US Mergers, including by maintaining and making available to each other all records reasonably requested and making employees available on a mutually convenient basis to provide additional information or explanation of any material provided hereunder. SoftBank shall cause the SoftBank US HoldCos to be in possession, at the SoftBank US Mergers Effective Time, of all Tax Returns, schedules, work papers and all other material records and documents relating to Tax matters of the SoftBank US HoldCos for their respective Tax periods ending on or prior to, or including, the Closing Date.
(f) Any Article IX Indemnitee’s right to indemnification for Losses pursuant to this Article IX shall not be affected by any investigation conducted, or knowledge or information acquired or capable of being acquired, by such Article IX Indemnitee (or any Representative of such Article IX Indemnitee or its affiliates), whether before or after the date hereof or the Closing Date, of or with respect to the facts, events or conditions resulting in
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or giving rise to such Losses (including the breach of, or inaccuracy in, any representation or warranty, or the breach or nonfulfillment of any covenant, agreement or other provision giving rise to such Losses). The waiver of any condition based upon the accuracy of any representation or warranty, or the fulfillment of, or compliance with, any covenant or agreement, will not affect the right to, or amount of, indemnification under this Article IX.
(g) In the event that SoftBank or any of its respective successors or assigns (i) consolidates with or merges into any other person and is not the continuing or surviving corporation or surviving entity of such consolidation or merger or (ii) transfers or conveys all or substantially all of its properties and assets to any person, SoftBank shall cause proper provision to be made so that the successors and assigns of SoftBank assume the obligations set forth in this Article IX, and such successor, assignee or transferee, as the case may be, shall be deemed to have assumed the obligations of SoftBank set forth in this Article IX.
ARTICLE X
GENERAL PROVISIONS
Section 10.1. Nonsurvival of Representations and Warranties. Except as provided in the next sentence, none of the representations and warranties in this Agreement or in any instrument delivered pursuant to this Agreement shall survive the Effective Time. Notwithstanding anything in this Agreement to the contrary, the representations and warranties set forth in Section 4.3 (and, for the absence of doubt, any right to indemnification for breach thereof pursuant to Article IX) shall survive the Effective Time and shall terminate 90 days after the expiration of the applicable statute of limitations (or, provided that notice for indemnification is delivered prior to such date, until the matter specified in such notice is finally resolved). This Section 10.1 shall not limit Section 8.2 or any covenant or agreement of the parties that, by its terms, contemplates performance after the Effective Time.
Section 10.2. Notices. All notices, requests, claims, demands and other communications under this Agreement shall be in writing and shall be deemed given if delivered personally or delivered by electronic mail (which is confirmed) or sent by overnight courier (providing proof of delivery) to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):
(a) if to T-Mobile, to:
T-Mobile US, Inc.
12920 SE 38th Street
Bellevue, Washington 98006
Attention: Dave Miller
Email: dave.miller@t-mobile.com
with a copy (which shall not constitute notice) to:
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
Attention: Adam O. Emmerich
David K. Lam
Email: AOEmmerich@wlrk.com
DKLam@wlrk.com
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and with a copy (which shall not constitute notice) to, as counsel to the T-Mobile Independent Committee:
Latham & Watkins LLP
885 Third Avenue
New York, New York 10022
Attention: Charles K. Ruck
Email: Charles.Ruck@lw.com
and
Richards, Layton & Finger, P.A.
One Rodney Square
920 North King Street
Wilmington, Delaware 19801
Attention: Mark J. Gentile
Email: gentile@rlf.com
(b) if to the DT Parties, to:
Deutsche Telekom AG
Friedrich-Ebert-Allee 140
53113 Bonn
Germany
Attention: General Counsel
Email: Axel.luetzner@telekom.de
with a copy (which shall not constitute notice) to:
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
Attention: Adam O. Emmerich
David K. Lam
Email: AOEmmerich@wlrk.com
DKLam@wlrk.com
(c) if to Sprint, to:
Sprint Corporation
6200 Sprint Parkway
Overland Park, Kansas 66251
Attention: General Counsel
Email: office.chief.legal.officer@sprint.com
with a copy (which shall not constitute notice) to:
Morrison & Foerster LLP
425 Market Street
San Francisco, California 94105
Attention: Robert S. Townsend
Brandon C. Parris
Email: RTownsend@mofo.com
BParris@mofo.com
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and
Potter Anderson & Corroon LLP
1313 North Market Street
P.O. Box 951
Wilmington, Delaware 19899
Attention: Mark A. Morton
Pamela L. Millard
Email: mmorton@potteranderson.com
pmillard@potteranderson.com
and with a copy (which shall not constitute notice) to, as counsel to the Sprint Independent Committee:
Goodwin Procter LLP
100 Northern Avenue
Boston, Massachusetts 02210
Attention: Stuart M. Cable
Mark S. Opper
Email: scable@goodwinlaw.com
mopper@goodwinlaw.com
(d) if to the SoftBank Parties, to:
SoftBank Group Corp.
Tokyo Shiodome Bldg.
1-9-1 Higashi-shimbashi
Minato-ku, Tokyo 105-7303
Japan
Attention: Corporate Officer, Head of Legal Unit
Email: sbgrp-legalnotice@g.softbank.co.jp
with a copy (which shall not constitute notice) to:
Morrison & Foerster LLP
425 Market Street
San Francisco, California 94105
Attention: Robert S. Townsend
Brandon C. Parris
Email: RTownsend@mofo.com
BParris@mofo.com
and
Potter Anderson & Corroon LLP
1313 North Market Street
P.O. Box 951
Wilmington, Delaware 19899
Attention: Mark A. Morton
Pamela L. Millard
Email: mmorton@potteranderson.com
pmillard@potteranderson.com
Section 10.3. Definitions. For purposes of this Agreement:
“affiliate” means, with respect to any person, another person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with such first person, where “control”
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means the possession, directly or indirectly, of the power to direct or cause the direction of the management policies of a person, whether through the ownership of voting securities, by contract, as trustee or executor, or otherwise.
“Board of Directors” means, with respect to any person, the board of directors of such person.
“business day” means any day other than a Saturday, Sunday or federal holiday, or a day on which banks in New York, New York, Bonn, Germany, or Tokyo, Japan are authorized or obligated by law to close.
“Compliant” means, with respect to the Required Information, that: (a) such Required Information does not contain any untrue statement of a material fact regarding Sprint and its Subsidiaries, or omit to state any material fact regarding Sprint and its Subsidiaries necessary in order to make such Required Information not materially misleading in light of the circumstances under which such statements were made, (b) such Required Information complies in all material respects with all applicable requirements of Regulation S-K and Regulation S-X under the Securities Act for a registered public offering, and (c) the financial statements and other financial information included in such Required Information would not be deemed stale or otherwise be unusable under the rules and regulations promulgated by the SEC for registered debt offerings and are sufficient to permit Sprint and its Subsidiaries’ applicable independent accountants to issue comfort letters in connection with any Pre-Merger Financing Transaction, including as to customary negative assurances, in order to consummate any Pre-Merger Financing Transaction on any day during the Marketing Period, which such accountants have confirmed they are prepared to issue.
“Confidentiality Agreement” means the Agreement for Mutual Use and Non-Disclosure of Proprietary Information, effective as of August 8, 2013, by and among Sprint, SoftBank, DT and T-Mobile, as modified and supplemented by the Supplement to the Non-Disclosure Agreement, effective as of August 13, 2017, and the Addendum to Non-Disclosure Agreement, effective as of September 25, 2017, as it may be further amended or supplemented from time to time.
“contract” means any binding written contract, subcontract, lease, sublease, conditional sales contract, purchase order, sales order, license, indenture, note, bond, loan, arrangement, commitment, instrument, understanding, permit, concession, franchise, commitment, partnership, limited liability company or other agreement (excluding purchase orders not containing material contractual terms entered into in the ordinary course of business consistent with past practice).
“Controlled Group Liability” means any and all liabilities (a) under Title IV of ERISA, (b) under Section 302 of ERISA, (c) under Sections 412, 430 and 4971 of the Code, (d) as a result of a failure to comply with the continuation coverage requirements of Section 601 et seq. of ERISA and Section 4980B of the Code or (e) under corresponding or similar provisions of foreign laws.
“Environmental Claim” means any and all administrative, regulatory or judicial actions, suits, demands, demand letters, directives, claims, liens, investigations, proceedings, requests for information, orders or written notices of noncompliance or violation by any person or entity (including any Governmental Entity), alleging potential liability (including potential responsibility or liability for enforcement, investigatory costs, cleanup costs, governmental response costs, removal costs, remedial costs, natural resources damages, property damages, personal injuries or penalties) arising out of, based on or resulting from (a) the presence, release or threatened release into the environment of any Hazardous Materials, (b) circumstances forming the basis of any violation or alleged violation of any Environmental Law or (c) any and all claims by any third party seeking damages, contribution, indemnification, cost recovery, compensation or injunctive relief resulting from the presence, release or threatened release of any Hazardous Materials.
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“Environmental Laws” means any applicable Law relating to (a) the protection of the environment or natural resources (including air, water, soil and natural resources), (b) the use, storage, handling, release or disposal of any Hazardous Materials or waste or (c) as it relates to any of the foregoing, the protection of human health and safety.
“ERISA” means the United States Employee Retirement Income Security Act of 1974, as amended.
“ERISA Affiliate” means, with respect to any entity, trade or business, any other entity, trade or business that is a member of a group described in Section 414(b), (c), (m) or (o) of the Code or Section 4001(b)(1) of ERISA that includes the first entity, trade or business, or that is a member of the same “controlled group” as the first entity, trade or business pursuant to Section 4001(a)(14) of ERISA.
“FCC Licenses” means the Sprint FCC Licenses and the T-Mobile FCC Licenses.
“Financing Entities” shall have the meaning set forth in the definition of “Financing Parties”.
“Financing Parties” shall mean the entities that have committed to provide or otherwise entered into agreements in connection with the Financing, or to purchase securities from or place securities or arrange or provide loans for T-Mobile in lieu of the Financing under the Commitment Letter, in connection with the Merger, including the parties to the Commitment Letter and any joinder agreements or credit agreements relating thereto (the “Financing Entities”) and their respective affiliates and their and their respective affiliates’ officers, directors, employees, agents and representatives and their respective successors and assigns; provided that neither Parent nor any affiliate of Parent shall be a Financing Party.
“Galaxy RSUs” means restricted stock units granted by Galaxy to Ronald D. Fisher.
“Governmental Consents” means all notices, reports and other filings required to be made prior to the Closing by Sprint, T-Mobile or any of their respective affiliates with, and all consents, registrations, approvals, permits, clearances, licenses, certificates, waivers and authorizations required to be obtained prior to the Closing by Sprint, T-Mobile or any of their respective affiliates from, any Governmental Entity in connection with the execution and delivery of this Agreement and the consummation of the transactions contemplated by this Agreement.
“Government Bid” means any quotation, bid or proposal by Sprint or any of its subsidiaries, or T-Mobile or any of its subsidiaries, as applicable, that, if accepted or awarded, would result in a Government Contract.
“Government Contract” means any prime contract, subcontract, task order or delivery order that is (a) between Sprint or any of its subsidiaries, or T-Mobile or any of its subsidiaries, as applicable, and a Governmental Entity or (b) is entered into by Sprint or any of its subsidiaries, or T-Mobile or any of its subsidiaries, as applicable, as a subcontractor (at any tier) to provide supplies or services in connection with a contract between another entity and a Governmental Entity.
“Hazardous Materials” means any substance that is (a) listed, classified or regulated pursuant to any Environmental Law, (b) any petroleum product or by-product, asbestos-containing material, lead-containing paint or plumbing, polychlorinated biphenyls, mold, radioactive material or radon, and (c) any other substance which may be the subject of regulatory action by any Governmental Entity in connection with any Environmental Law.
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“Indebtedness” means (i) any indebtedness or other obligation for borrowed money, whether current, short-term or long-term and whether secured or unsecured, (ii) any indebtedness evidenced by a note, bond, debenture or other security (including any liability in respect of mandatorily redeemable or purchasable capital stock or securities convertible into capital stock) or similar instrument, (iii) any liabilities or obligations with respect to interest rate, currency or commodity swaps, collars, caps, hedging obligations or any similar contract designated to protect a person against fluctuations in interest rates, currency exchange rates or commodity prices, (iv) all liabilities in respect of any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which liabilities are required to be classified and accounted for under GAAP as capital leases, (v) any direct or contingent obligations under letters of credit, bankers’ acceptances, bank guarantees, surety bonds and similar instruments, each to the extent drawn upon and paid, (vi) any obligation to pay the deferred purchase price of property, services or equipment, and (vii) guarantees in respect of clauses (i) through (vi), including guarantees of another person’s Indebtedness or any obligation of another person which is secured by assets of Sprint or any of its subsidiaries or T-Mobile or any of its subsidiaries, as applicable.
“Intellectual Property” means, collectively, patents, trademarks, service marks, trade dress, logos, trade names, Internet domain names, designs, slogans and general intangibles of like nature, copyrights and all registrations, applications, reissuances, continuations, continuations-in-part, revisions, extensions, reexaminations and associated goodwill with respect to each of the foregoing, computer software (including source and object codes), rights in computer programs and computer databases and related data, technology, trade secrets, confidential business information (including confidential ideas, formulae, algorithms, models, methodologies, compositions, know-how, manufacturing and production processes and techniques, research and development information, drawings, designs, plans, proposals and technical data, financial, marketing and business data and pricing and cost information) and other intellectual property, industrial or similar proprietary rights (in whatever form or medium) recognized under any jurisdiction worldwide.
“IT Assets” means computers, software, firmware, middleware, servers, workstations, routers, hubs, switches, data communications lines and other information technology equipment.
“knowledge” means (i) with respect to Sprint or SoftBank, the actual knowledge of the persons listed on Section 10.3(a) or (b), respectively, of the Sprint Disclosure Letter, and (ii) with respect to T-Mobile or DT, the actual knowledge of the persons listed on Section 10.3(a) or (b), respectively, of the T-Mobile Disclosure Letter.
“Labor Agreement” means any collective bargaining agreements, union contract or similar agreement with a labor union or labor organization.
“Marketing Period” shall mean the first period of twenty (20) consecutive business days after the date hereof (a) throughout and at the end of which T-Mobile shall have the Required Information and (b) throughout and at the end of which the conditions set forth in Sections 7.1 and 7.2 (other than those conditions that by their terms are to be satisfied at the Closing) shall be satisfied. Notwithstanding anything in this definition of “Marketing Period” to the contrary, the Marketing Period shall not commence or be deemed to have commenced if, after the date hereof and prior to the completion of such twenty (20) consecutive business day period: (i) Sprint’s independent accountant shall have withdrawn its audit opinion with respect to Sprint’s most recent annual audited financial statements, in which case the Marketing Period shall not be deemed to commence unless and until, at the earliest, a new unqualified audit opinion is issued with respect to the consolidated financial statements of Sprint for the applicable periods by the independent accountant or another independent public accounting firm reasonably acceptable to T-Mobile, (ii) Sprint issues a public statement indicating its intent to restate any historical financial statements of Sprint or that any such restatement is under consideration or may be a possibility, in which case the Marketing Period shall not be deemed to commence unless and until, at the earliest, such restatement has been completed or Sprint has announced that it has concluded that no restatement shall be required in accordance with GAAP, (iii) any Required Information would not be Compliant at any time during such twenty (20) consecutive business day period, in which case the Marketing Period shall not be deemed to commence unless and until, at the earliest, the receipt by T-Mobile of Required Information that is Compliant, or (iv) Sprint shall have failed to file any report or other document required to be filed with the SEC
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by the date required under the Exchange Act containing any financial information that would be required to be contained therein in which case the Marketing Period will not be deemed to commence unless and until, at the earliest, such reports have been filed. Notwithstanding anything herein to the contrary, (s) May 28, 2018 shall be excluded as a business day for such purposes, (t) July 4, 2018 through July 6, 2018 shall each be excluded as a business day for such purposes, (u) November 22, 2018 through November 23, 2018 shall each be excluded as a business day for such purposes, (v) if such twenty (20) consecutive business day period has not ended on or prior to August 17, 2018, then such twenty (20) consecutive business day period shall not commence prior to September 4, 2018, (w) if such twenty (20) consecutive business day period has not ended on or prior to December 14, 2018, then such twenty (20) consecutive business day period shall not commence prior to January 2, 2019, (x) May 27, 2019 shall be excluded as a business day for such purposes, (y) July 4, 2019 through July 5, 2019 shall be excluded as a business day for such purposes and (z) if such twenty (20) consecutive business day period has not ended on or prior to August 16, 2019, then such twenty (20) consecutive business day period shall not commence prior to September 3, 2019.
“Material Adverse Effect” on Sprint or T-Mobile means any fact, circumstance, effect, change, event or development (each, an “Effect”) that has had, or would reasonably be expected to have, individually or in the aggregate with all other Effects, a material adverse effect on the business, assets, financial condition or results of operations of Sprint and its subsidiaries, or T-Mobile and its subsidiaries, as applicable, in each case taken as a whole, respectively, excluding any Effect to the extent that it results from or arises out of (A) general economic or political conditions or securities, credit, financial or other capital markets conditions in the United States or in any foreign jurisdiction, (B) any failure, in and of itself, by Sprint or T-Mobile to meet any internal or published projections, forecasts, estimates or predictions in respect of revenues, earnings or other financial or operating metrics for any period (it being understood that the facts or occurrences giving rise to or contributing to such failure may be deemed to constitute, or be taken into account in determining whether there has been or will be, a Material Adverse Effect on Sprint or T-Mobile, respectively, unless otherwise excluded in this definition of “Material Adverse Effect”), (C) the execution and delivery of this Agreement or the public announcement or pendency of the Merger Transactions or any of the other transactions contemplated by this Agreement, including any litigation resulting or arising therefrom or with respect thereto (except that this clause (C) shall not apply with respect to the representations or warranties in Section 4.1(b)(ii) and Section 4.1(b)(iii), in the case of Sprint, and Section 4.2(b)(ii) and Section 4.2(b)(iii), the case of T-Mobile), (D) any change, in and of itself, in the market price or trading volume of the securities of Sprint or T-Mobile, respectively (it being understood that the facts or occurrences giving rise to or contributing to such change may be deemed to constitute, or be taken into account in determining whether there has been or will be, a Material Adverse Effect on Sprint or T-Mobile, respectively, unless otherwise excluded in this definition of “Material Adverse Effect”), (E) any change after the date hereof in applicable Law, regulation or GAAP (or authoritative interpretation thereof), (F) geopolitical conditions, the outbreak or escalation of hostilities, any acts of war, sabotage or terrorism, or any escalation or worsening of any such acts of war, sabotage or terrorism, (G) any hurricane, tornado, flood, earthquake or other natural disaster, (H) any changes, including in credit ratings or credit outlook, generally affecting the industry in which Sprint or T-Mobile operates, or (I) any action taken by a party hereto pursuant to the express written direction of another party hereto, where the authority of the second party to direct the first party is granted by this Agreement; provided, that the exclusions in clauses (A), (E), (F), (G) and (H) shall not apply to the extent the Effects set forth therein have a disproportionate impact on Sprint and its subsidiaries, or T-Mobile and its subsidiaries, as applicable, relative to other participants in the industry in which Sprint and T-Mobile and their respective subsidiaries operate.
“Merger Transactions” means (a) if the Revised Structure Notice has not been delivered in accordance with Section 1.1, the Merger and the SoftBank US Mergers, and (b) if the Revised Structure Notice has been delivered in accordance with Section 1.1, the Merger.
“Multiemployer Plan” means any plan that is a multiemployer plan, as defined in Section 3(37) or 4001(a)(3) of ERISA.
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“Multiple Employer Plan” means any plan that has two or more contributing sponsors at least two of whom are not under common control, within the meaning of Section 4063 of ERISA.
“Permitted Liens” means all Liens specifically reflected, reserved against or disclosed in any Sprint Filed SEC Documents or T-Mobile Filed SEC Documents, as applicable, together with the following (without duplication): (a) Liens imposed by law, such as mechanics and materialmen Liens or other common law or statutory Liens arising or incurred in the ordinary course of business consistent with past practice and that are not material in amount or effect on the business of Sprint and its subsidiaries or T-Mobile and its subsidiaries, as applicable, in each case taken as a whole, (b) Liens for Taxes that are (x) not yet delinquent or (y) being contested in good faith by appropriate proceedings diligently conducted and for which adequate reserves have been established in accordance with GAAP in the Sprint Financial Statements or the T-Mobile Financial Statements, as applicable, (c) Liens securing judgments for the payment of money so long as such Liens are adequately bonded and any appropriate legal proceedings that may have been duly initiated for the review of such judgment have not been finally terminated or the period in which such proceedings may be initiated has not expired, (d) with respect to real property, minor encumbrances, easements or reservations of, or rights of others for, licenses, rights-of-way, sewers, electric lines, telegraph and telephone lines and other similar purposes (including, for the avoidance of doubt, operating agreements), matters disclosed by a current survey, or zoning or other restrictions as to the use of the affected real property, in each case that do not in the aggregate materially adversely affect the value of the property or materially impair its use for the purpose for which the property is currently being used, (e) with respect to leased property, all liens, charges and encumbrances existing on the date of the applicable lease, and all mortgages and deeds of trust now or hereafter placed on the leased property by the third-party landlord, (f) Liens arising from licenses of Intellectual Property to customers or suppliers in their capacities as such in the ordinary course of business consistent with past practice, and (g) Liens required under the Indebtedness of Sprint or its subsidiaries and T-Mobile or its subsidiaries, as applicable, in existence as of the date hereof and delivered or made available to T-Mobile or Sprint, respectively, prior to the date hereof, or incurred as expressly permitted under this Agreement, in each case as security for such Indebtedness.
“person” means a natural person, corporation, partnership, limited liability company, joint venture, association, trust, unincorporated organization or other entity.
“Personal Data” means any information about an individual that, alone or in combination with other information, could be used to identify such individual, including: (a) a natural person’s name, street address, telephone number, email address, photograph, social security number, social insurance number or tax identification number, driver’s license number, passport number, credit card number, bank information, customer or account number, biometric identifier or any other piece of information that allows the identification of, or contact with, a natural person, and (b) any (i) persistent identifier, such as IP address or machine I.D. associated with an individual, (ii) Protected Health Information (as such term is defined in the Health Insurance Portability and Accountability Act of 1996, as amended) or (iii) Nonpublic Personal Information (as such term is defined in the Gramm-Leach-Bliley Act, as amended). “Personal Data” also includes any information not listed above if such information is defined as “personal data,” “personally identifiable information,” “individually identifiable health information,” “protected health information,” or “personal information” under any applicable Law.
“Post-Closing Tax Period” means (i) any taxable period beginning after the Closing Date and (ii) the portion of any Straddle Period beginning immediately after the Closing Date and ending at the close of the last day of the Straddle Period.
“Pre-Closing Tax Period” means (i) any taxable period ending on or before the close of the Closing Date and (ii) the portion of any Straddle Period beginning on the first day of such Straddle Period and ending at the close of the Closing Date.
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“Required Information” means all financial statements, financial data, audit reports and other information regarding Sprint and its Subsidiaries which is:
(i) of the type required by Regulation S-X and Regulation S-K under the Securities Act for a registered public offering; or
(ii) of the type and form customarily included in prospectuses for registered debt securities under the Securities Act;
it being understood and agreed that such information shall not include pro forma financial information or projections, which shall be the responsibility of T-Mobile (without waiver of the obligations of Sprint under Section 5.16).
“SoftBank Sprint Warrant” means the Warrant to Purchase Shares of Common Stock of Sprint Corporation, dated July 10, 2013 and issued to Starburst.
“Specified Counsel” means (i) in the case of T-Mobile, Wachtell, Lipton, Rosen & Katz; provided that, if Wachtell, Lipton, Rosen & Katz is unable to deliver the opinion contemplated by Section 7.2(e), then T-Mobile shall use its reasonable best efforts to select another nationally recognized legal counsel reasonably satisfactory to T-Mobile to deliver the opinion contemplated by Section 7.2(e) (and, if T-Mobile selects such counsel, then such counsel shall be the Specified Counsel of T-Mobile for purposes of Section 7.2(e)), and (ii) in the case of Sprint, Morrison & Foerster LLP.
“Sprint Benefit Plan” means each employee or director benefit plan, arrangement or agreement, whether or not written, including any employee welfare benefit plan within the meaning of Section 3(1) of ERISA (whether or not such plan is subject to ERISA), any employee pension benefit plan within the meaning of Section 3(2) of ERISA (whether or not such plan is subject to ERISA) and any bonus, incentive, deferred compensation, vacation, stock purchase, stock or stock-based, severance, retention, employment, change of control or fringe benefit plan, program or agreement that is or has been sponsored, maintained or contributed to by Sprint or any of its subsidiaries or which Sprint or any of its subsidiaries is obligated to sponsor, maintain or contribute to, or with respect to which Sprint would reasonably be expected to have any liability, but excluding any Multiemployer Plan.
“Sprint Equity Plans” means the Sprint Amended and Restated 2015 Omnibus Incentive Plan, the Sprint 2007 Omnibus Incentive Plan, the Sprint 1997 Long-Term Incentive Plan and the Sprint ESPP.
“Sprint Option” means an option to purchase shares of Sprint Common Stock, other than an option pursuant to the Sprint ESPP.
“Sprint PSU Award” means an award of restricted stock units in respect of shares of Sprint Common Stock whose vesting is conditioned in whole or part on the satisfaction of performance criteria.
“Sprint RSU Award” means an award of restricted stock units in respect of shares of Sprint Common Stock whose vesting is not conditioned in any part on the satisfaction of performance criteria.
“Sprint Stockholder Approval” means the adoption of this Agreement by the affirmative vote of, or the execution and delivery to Sprint of a written consent by, the holders of a majority of the outstanding shares of Sprint Common Stock entitled to vote thereon.
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“Sprint TIA Award” means a Sprint PSU Award with performance vesting based on the volume-weighted average price of Sprint Common Stock.
“Sprint Warrants” means the Non-SoftBank Sprint Warrant and the SoftBank Sprint Warrant.
“Straddle Period” means any taxable period beginning on or before the Closing Date and ending after the Closing Date.
“subsidiary” means, with respect to any person, any person with respect to which such first person directly or indirectly owns or purports to own, beneficially or of record, (a) an amount of voting securities or other interests in such second person that is sufficient to enable such first person to elect at least a majority of the members of such second person’s board of directors or comparable governing body or (b) at least 50% of the outstanding equity, voting or financial interests in such second person.
“Tax Attribute” means a net operating loss, net capital loss, Tax credit, or any other Tax item that could reduce a Tax.
“Tax Return” means any return, declaration, statement, claim for refund, election, estimate, report, form and information return relating to Taxes filed or required to be filed with any Taxing Authority, including any schedules or amendments thereto.
“Taxes” means all taxes, charges, levies or other like assessments imposed by any Governmental Entity, including any income, gross receipts, license, severance, occupation, premium, environmental, customs, duties, profits, disability, alternative or add-on minimum, estimated, withholding, payroll, employment, unemployment insurance, social security (or similar), excise, sales, use, value-added, occupancy, franchise, real property, personal property, intangible property, business and occupation, mercantile, windfall profits, capital stock, stamp, transfer, workmen’s compensation or other taxes, charges, levies or other like assessments of any kind whatsoever, together with any interest, penalties, additions to tax or additional amounts imposed by any Governmental Entity, whether disputed or not.
“Taxing Authority” means any Governmental Entity responsible for the administration of Taxes.
“T-Mobile Benefit Plan” means each employee or director benefit plan, arrangement or agreement, whether or not written, including any employee welfare benefit plan within the meaning of Section 3(1) of ERISA (whether or not such plan is subject to ERISA), any employee pension benefit plan within the meaning of Section 3(2) of ERISA (whether or not such plan is subject to ERISA) and any bonus, incentive, deferred compensation, vacation, stock purchase, stock or stock-based, severance, retention, employment, change of control or fringe benefit plan, program or agreement that is or has been sponsored, maintained or contributed to by T-Mobile or any of its subsidiaries or which T-Mobile or any of its subsidiaries is obligated to sponsor, maintain or contribute to, or otherwise has any liability, but excluding any Multiemployer Plan.
“T-Mobile Charter Amendment” means the amendment and restatement of the T-Mobile Certificate of Incorporation in its entirety to be in the form attached hereto as Exhibit A.
“T-Mobile Charter Amendment Approval” means the approval of the T-Mobile Charter Amendment by the affirmative vote of the holders of, or the execution and delivery to T-Mobile of a written consent by, a majority of the outstanding shares of T-Mobile Common Stock entitled to vote thereon.
“T-Mobile Equity Award” means a T-Mobile Option, T-Mobile RSU Award or T-Mobile PSU Award.
“T-Mobile ESPP” means the T-Mobile 2014 Employee Stock Purchase Plan.
“T-Mobile Option” means an option to purchase shares of T-Mobile Common Stock, other than with respect to an option pursuant to the T-Mobile ESPP.
“T-Mobile PSU Award” means an award of restricted stock units in respect of shares of T-Mobile Common Stock whose vesting is conditioned in whole or part on the satisfaction of performance criteria.
“T-Mobile RSU Award” means an award of restricted stock units in respect of shares of T-Mobile Common Stock whose vesting is not conditioned in any part on the satisfaction of performance criteria.
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