-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, DZeIOXJSZZEv9cCRMq8//47kFJWc84S4XezsPWw6zxH16DHSyyyfAYVQ7OjAipf6 WcF4ID/HKZgM5FkDeJ4ZRA== 0000950123-04-009520.txt : 20040810 0000950123-04-009520.hdr.sgml : 20040810 20040810150418 ACCESSION NUMBER: 0000950123-04-009520 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20040810 GROUP MEMBERS: ACF INDUSTRIES HOLDINGS CORP. GROUP MEMBERS: BUFFALO INVESTORS CORP. GROUP MEMBERS: CARDIFF HOLDING LLC GROUP MEMBERS: HIGHCREST INVESTORS CORP. GROUP MEMBERS: STARFIRE HOLDING CORPORATION GROUP MEMBERS: TRAMORE LLC SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: XO COMMUNICATIONS INC CENTRAL INDEX KEY: 0001111634 STANDARD INDUSTRIAL CLASSIFICATION: TELEPHONE COMMUNICATIONS (NO RADIO TELEPHONE) [4813] IRS NUMBER: 541983517 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-59237 FILM NUMBER: 04964311 BUSINESS ADDRESS: STREET 1: 11111 SUNSNET HILLS ROAD CITY: RESTON STATE: VA ZIP: 22102 BUSINESS PHONE: 7035472000 MAIL ADDRESS: STREET 1: 11111 SUNSET HILLS ROAD CITY: RESTON STATE: VA ZIP: 20190 FORMER COMPANY: FORMER CONFORMED NAME: NEXTLINK COMMUNICATIONS INC/NEW DATE OF NAME CHANGE: 20000622 FORMER COMPANY: FORMER CONFORMED NAME: NM ACQUISITION CORP DATE OF NAME CHANGE: 20000411 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: ICAHN CARL C ET AL CENTRAL INDEX KEY: 0000921669 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: C/O ICAHN ASSOCIATES CORP STREET 2: 767 FIFTH AVE #4700 CITY: NEW YORK STATE: NY ZIP: 10153 BUSINESS PHONE: 2127024300 MAIL ADDRESS: STREET 1: C/O ICAHN ASSOCIATES CORP STREET 2: 767 FIFTH AVE #4700 CITY: NEW YORK STATE: NY ZIP: 10153 SC 13D/A 1 y00104sc13dza.txt AMENDMENT NO. 4 TO SCHEDULE 13D UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D (Amendment No. 4) Under the Securities Exchange Act of 1934 XO Communications, Inc. (Name of Issuer) Common Stock, par value $.01 per share (Title of Class of Securities) 983764838 (CUSIP Number) Marc Weitzen, Esq. Icahn Associates Corp. 767 Fifth Avenue, 47th Floor New York, New York 10153 (212) 702-4388 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) August 6, 2004 (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), Rule 13d-1(f) or Rule 13d-1(g), check the following box / /. NOTE: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent. *The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). SCHEDULE 13D CUSIP No. 983764838 1 NAME OF REPORTING PERSON Carl C. Icahn S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) // (b) // 3 SEC USE ONLY 4 SOURCE OF FUNDS AF 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) /X/ 6 CITIZENSHIP OR PLACE OF ORGANIZATION United States of America NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH: 7 SOLE VOTING POWER 8 SHARED VOTING POWER 140,036,224 9 SOLE DISPOSITIVE POWER 10 SHARED DISPOSITIVE POWER 140,036,224 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 140,036,224 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* // 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 60.7% 14 TYPE OF REPORTING PERSON* IN SCHEDULE 13D CUSIP No. 983764838 1 NAME OF REPORTING PERSON Tramore LLC S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) // (b) // 3 SEC USE ONLY 4 SOURCE OF FUNDS WC 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) // 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH: 7 SOLE VOTING POWER 2,597,403 8 SHARED VOTING POWER 9 SOLE DISPOSITIVE POWER 2,597,403 10 SHARED DISPOSITIVE POWER 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,597,403 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* // 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 1.4% 14 TYPE OF REPORTING PERSON* CO SCHEDULE 13D CUSIP No. 983764838 1 NAME OF REPORTING PERSON Cardiff Holding LLC S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) // (b) // 3 SEC USE ONLY 4 SOURCE OF FUNDS WC 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) // 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH: 7 SOLE VOTING POWER 137,438,822 8 SHARED VOTING POWER 9 SOLE DISPOSITIVE POWER 137,438,822 10 SHARED DISPOSITIVE POWER 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 137,438,822 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* // 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 60.3% 14 TYPE OF REPORTING PERSON* CO SCHEDULE 13D CUSIP No. 983764838 1 NAME OF REPORTING PERSON ACF Industries Holding Corp. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) // (b) // 3 SEC USE ONLY 4 SOURCE OF FUNDS AF 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) // 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH: 7 SOLE VOTING POWER 8 SHARED VOTING POWER 137,438,822 9 SOLE DISPOSITIVE POWER 10 SHARED DISPOSITIVE POWER 137,438,822 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 137,438,822 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* // 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 60.3% 14 TYPE OF REPORTING PERSON* CO SCHEDULE 13D CUSIP No. 983764838 1 NAME OF REPORTING PERSON Highcrest Investors Corp. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) // (b) // 3 SEC USE ONLY 4 SOURCE OF FUNDS AF 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) // 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH: 7 SOLE VOTING POWER 8 SHARED VOTING POWER 137,438,822 9 SOLE DISPOSITIVE POWER 10 SHARED DISPOSITIVE POWER 137,438,822 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 137,438,822 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* // 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 60.3% 14 TYPE OF REPORTING PERSON* CO SCHEDULE 13D CUSIP No. 983764838 1 NAME OF REPORTING PERSON Buffalo Investors Corp. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) // (b) // 3 SEC USE ONLY 4 SOURCE OF FUNDS AF 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) // 6 CITIZENSHIP OR PLACE OF ORGANIZATION New York NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH: 7 SOLE VOTING POWER 8 SHARED VOTING POWER 137,438,822 9 SOLE DISPOSITIVE POWER 10 SHARED DISPOSITIVE POWER 137,438,822 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 137,438,822 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* // 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 60.3% 14 TYPE OF REPORTING PERSON* CO SCHEDULE 13D CUSIP No. 983764838 1 NAME OF REPORTING PERSON Starfire Holding Corporation S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) // (b) // 3 SEC USE ONLY 4 SOURCE OF FUNDS AF 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) // 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH: 7 SOLE VOTING POWER 8 SHARED VOTING POWER 137,438,822 9 SOLE DISPOSITIVE POWER 10 SHARED DISPOSITIVE POWER 137,438,822 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 137,438,822 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* // 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 60.3% 14 TYPE OF REPORTING PERSON* CO Item 1. Security and Issuer This statement constitutes Amendment No. 4 to the Schedule 13D, and Amendments No. 1, No. 2 and No. 3 thereto, previously filed. Item 2. Identity and Background The persons filing this statement are Cardiff Holding LLC, a Delaware limited liability company ("Cardiff"), Tramore LLC, a Delaware limited liability company ("Tramore"), ACF Industries Holding Corp., a Delaware corporation ("ACF Holding"), Highcrest Investors Corp., a Delaware corporation ("Highcrest"), Buffalo Investors Corp., a New York corporation ("Buffalo"), Starfire Holding Corporation, a Delaware corporation ("Starfire", and together with Cardiff, Tramore, ACF Holding, Highcrest and Buffalo, the "Icahn Entities"), and Carl C. Icahn, a citizen of the United States of America, all having as their principal business address 767 Fifth Avenue, 47th Floor, New York, New York 10153. Each of Starfire and Tramore is wholly-owned by Mr. Icahn. Buffalo is wholly-owned by Starfire. Highcrest is approximately 99% owned by Buffalo. ACF Holding is wholly-owned by Highcrest. Cardiff is wholly-owned by ACF Holding. Mr. Icahn is (i) chairman and sole director of Starfire and (ii) chairman and a director of each of Highcrest and ACF Holding. As a result of Mr. Icahn's ownership of and position(s) with Starfire, Buffalo, Highcrest, ACF Holding and Cardiff, Mr. Icahn is in a position to directly and indirectly determine the investment and voting decisions made by the Icahn Entities. Each of Cardiff and Tramore is principally engaged in the business of investing in and holding securities of the Issuer. Mr. Icahn's principal occupation is acting as President and a director of Starfire, and as the Chairman of the Board and a director of various of Starfire's subsidiaries. Starfire, Buffalo, Highcrest and ACF Holding are primarily engaged in the business of investing in and holding securities of various entities. Except as described on Exhibit C, neither Starfire, Buffalo, Highcrest, ACF Holding, Cardiff, Tramore or Mr. Icahn, nor any director, member or executive officer of any of the Icahn Entities, has during the past five years been (i) convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. The name, citizenship, present principal occupation or employment and business address of each director and executive officer of Starfire, Buffalo, Highcrest, ACF Holding and Cardiff are set forth in Exhibit B attached hereto. Item 3. Source and Amount of Funds or Other Consideration Item 3 is hereby amended by the addition of the following: On August 6, 2004, Cardiff and Tramore purchased 3,560,000 and 240,000 shares of 6% Convertible Preferred Stock ("Convertible Preferred Shares") of the Issuer at a purchase price of $50 per share. Item 5. Interest in Securities of the Issuer (a) As of the close of business on August 6, 2004 Registrants may be deemed to beneficially own in the aggregate 140,036,224 Shares constituting approximately 60.7% of the outstanding Shares (based upon (i) the 181,933,085 Shares stated to be issued and outstanding by Issuer, (ii) the 7,504,819 Shares issuable upon exercise of the Warrants beneficially held by Registrants and (iii) the 41,125,541 Shares issuable upon conversion of the 3,800,000 Convertible Preferred Shares beneficially held by Registrants. ACF Holding may, by virtue of its ownership of 100% of the interest in Cardiff, be deemed to beneficially own the securities as to which Cardiff possesses direct beneficial ownership. ACF Holding disclaims beneficial ownership of such securities for all other purposes. Highcrest may, by virtue of its ownership of 100% of the interest in ACF Holding, be deemed to beneficially own the securities as to which ACF Holding possesses indirect beneficial ownership. Highcrest disclaims beneficial ownership of such securities for all other purposes. Buffalo may, by virtue of its ownership of approximately 99% of the interest in Highcrest, be deemed to beneficially own the securities as to which Highcrest possesses indirect beneficial ownership. Buffalo disclaims beneficial ownership of such securities for all other purposes. Starfire may, by virtue of its ownership of 100% of the interest in Buffalo, be deemed to beneficially own the securities as to which Buffalo possesses indirect beneficial ownership. Starfire disclaims beneficial ownership of such securities for all other purposes. Mr. Icahn may, by virtue of his ownership of 100% of the interest in each of Starfire and Tramore, be deemed to beneficially own the securities as to which each of Starfire and Tramore possesses indirect beneficial ownership. Mr. Icahn disclaims beneficial ownership of such securities for all other purposes. (b) Cardiff has the sole power to vote or to direct the vote and to dispose or direct the disposition of 137,438,822 Shares. ACF Holding, Highcrest, Buffalo, Starfire and Mr. Icahn may, by virtue of its or his ownership interest in Cardiff, ACF Holding, Highcrest, Buffalo and Starfire, respectively, be deemed to share with Cardiff the power to vote or to direct the vote and to dispose or to direct the disposition of the 137,438,822 Shares. Tramore has the sole power to vote or to direct the vote and to dispose or direct the disposition of 2,597,403 Shares. Mr. Icahn may, by virtue of his ownership interest in Tramore, be deemed to share with Tramore the power to vote or to direct the vote and to dispose or to direct the disposition of the 2,597,403 Shares. (c) The only transactions effected within the past 60 days in the Shares are set forth in Item 3 hereof. (d) Not applicable. (e) Not applicable. Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer Item 6 is hereby amended by addition of the following: Cardiff and Tramore are parties to a Stock Purchase Agreement with the Issuer pursuant to which Cardiff and Tramore purchased the Convertible Preferred Shares identified in Item 3 hereof. In connection therewith, Issuer granted to Cardiff and Tramore certain rights to have registered with the Securities and Exchange Commission the Convertible Preferred Shares and the common stock of Issuer into which the Convertible Preferred Shares are converted. Item 7. Material to be Filed as Exhibits Exhibit F Joint Filing Agreement Among Registrants Exhibit G Stock Purchase Agreement among Issuer and Purchasers party thereto Exhibit H Registration Rights Agreement among Issuer and Purchasers of Convertible Preferred Shares [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] SIGNATURES After reasonable inquiry and to the best of the knowledge and belief of each of the undersigned, each of the undersigned certifies that the information set forth in this statement on Schedule 13D concerning the common stock, par value $.01 per share, of XO Communications, Inc., a Delaware corporation, is true, complete and correct. Dated: as of August 9, 2004. /s/ Carl C. Icahn ------------------------------------- Carl C. Icahn, Individually Tramore LLC /s/ Edward E. Mattner ------------------------------------- By: Edward E. Mattner Title: Authorized Signatory Cardiff Holding LLC By: ACF Industries Holding Corp., its sole member /s/ Robert J. Mitchell ------------------------------------- By: Robert J. Mitchell Title: President and Treasurer [Signature page to Amendment No. 4 to Schedule 13D - XO Communications ] ACF Industries Holding Corp. /s/ Robert J. Mitchell ------------------------------------- By: Robert J. Mitchell Title: President and Treasurer Highcrest Investors Corp. /s/ Robert J. Mitchell ------------------------------------- By: Robert J. Mitchell Title: Assistant Secretary Buffalo Investors Corp. /s/ Edward E. Mattner ------------------------------------- By: Edward E. Mattner Title: President and Treasurer Starfire Holding Corporation /s/ Robert J. Mitchell ------------------------------------- By: Robert J. Mitchell Title: Authorized Signatory [Signature page to Amendment No. 4 to Schedule 13D - XO Communications ] EX-99.F 2 y00104exv99wf.txt JOINT FILING AGREEMENT EXHIBIT F Joint Filing Agreement In accordance with Rule 13d-1(k)(1) under the Securities Exchange Act of 1934, as amended, the persons named below agree to the joint filing on behalf of each of them of a statement on Schedule 13D (including amendments thereto) with respect to the common stock, par value $.01 per share, of XO Communications, Inc., a Delaware corporation, and further agree that this Joint Filing Agreement be included as an Exhibit to such joint filings. In evidence thereof, the undersigned, being duly authorized, hereby execute this Agreement as of this 9th day of August 2004. /s/ Carl C. Icahn ------------------------------------- Carl C. Icahn, Individually Tramore LLC /s/ Edward E. Mattner ------------------------------------- By: Edward E. Mattner Title: Authorized Signatory Cardiff Holding LLC By: ACF Industries Holding Corp., its sole member /s/ Robert J. Mitchell ------------------------------------- By: Robert J. Mitchell Title: President and Treasurer [Joint Filing Agreement re Amendment No. 4 to Schedule 13D for XO Communications, Inc.] ACF Industries Holding Corp. /s/ Robert J. Mitchell ------------------------------------- By: Robert J. Mitchell Title: President and Treasurer Highcrest Investors Corp. /s/ Robert J. Mitchell ------------------------------------- By: Robert J. Mitchell Title: Assistant Secretary Buffalo Investors Corp. /s/ Edward E. Mattner ------------------------------------- By: Edward E. Mattner Title: President and Treasurer Starfire Holding Corporation /s/ Robert J. Mitchell ------------------------------------- By: Robert J. Mitchell Title: Authorized Signatory [Joint Filing Agreement re Amendment No. 4 to Schedule 13D for XO Communications, Inc.] EX-99.G 3 y00104exv99wg.txt STOCK PURCHASE AGREEMENT XO COMMUNICATIONS, INC. STOCK PURCHASE AGREEMENT 6.00% Convertible Preferred Stock Dated as of August 5, 2004 . . . TABLE OF CONTENTS
Page ---- 1. ISSUANCE AND SALE OF PREFERRED STOCK......................................................... 1 1.1. Issuance, Purchase and Sale......................................................... 1 1.2. Closing............................................................................. 1 1.3. Capitalized Terms................................................................... 2 2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY................................................ 2 2.1. Organization, Qualification, Authorization.......................................... 2 2.2. Disclosure; Financial Statements; Material Adverse Effect........................... 2 2.3. Incorporation and Good Standing of Subsidiaries..................................... 3 2.4. Compliance with Laws, Other Instruments, Etc........................................ 3 2.5. Governmental Authorizations, Etc.................................................... 4 2.6. Litigation; Observance of Statutes, Regulations and Orders.......................... 4 2.7. Taxes............................................................................... 4 2.8. Title to Properties................................................................. 4 2.9. Investment Company Act and Holding Company Status, Etc.............................. 5 2.10. Offering of Preferred Shares........................................................ 5 3. REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS............................................. 5 4. CONDITIONS OF CLOSING........................................................................ 7 4.1. Conditions to Obligations of the Purchasers......................................... 7 4.2. Conditions to Obligations of the Company............................................ 8 5. DEFINITIONS.................................................................................. 8 5.1. Definitions......................................................................... 8 6. MISCELLANEOUS................................................................................ 10 6.1. Survival of Provisions.............................................................. 10 6.2. Successors and Assigns; No Third-Party Beneficiaries................................ 10 6.3. Investment Bankers, Financial Advisors, Brokers and Finders......................... 10 6.4. Fees and Expenses................................................................... 11 6.5. Notices............................................................................. 11 6.6. Entire Agreement.................................................................... 12 6.7. Waivers and Amendments.............................................................. 12 6.8. Governing Law....................................................................... 12 6.9. Severability........................................................................ 12 6.10. Titles and Headings................................................................. 12 6.11. Signatures and Counterparts......................................................... 12 6.12. Enforcement of the Agreement........................................................ 13
EXHIBIT 4.1.2(d) -- Form of Registration Rights Agreement EXHIBIT 4.1(e) -- Form of Certificate of Designation EXHIBIT 4.1(g) -- Form of Opinion of Willkie Farr & Gallagher LLP (ii) STOCK PURCHASE AGREEMENT THIS STOCK PURCHASE AGREEMENT (this "AGREEMENT") dated as of August 5, 2004 by and between XO COMMUNICATIONS, INC., a Delaware corporation (the "COMPANY") and the entities listed on the signature pages hereto under the caption "Purchasers" (each such entity, a "PURCHASER" and collectively, the "PURCHASERS"). W I T N E S S E T H: WHEREAS, upon the terms and subject to the conditions set forth in this Agreement, the Company wishes to sell to the Purchasers and the Purchasers wish to purchase from the Company an aggregate of 4,000,000 shares of the Company's 6% Class A Convertible Preferred Stock (the "CONVERTIBLE PREFERRED STOCK"); and WHEREAS, the Purchasers and the Company desire to provide for the purchase and sale of the Convertible Preferred Stock and to establish certain rights and obligations in connection therewith. NOW, THEREFORE, in consideration of the premises and the mutual representations, warranties, covenants and agreements set forth in this Agreement, the parties hereto agree as follows: 1. ISSUANCE AND SALE OF PREFERRED STOCK. 1.1. ISSUANCE, PURCHASE AND SALE. Upon the terms and subject to the conditions set forth herein, at the Closing (as defined below) the Company shall sell to the Purchasers and the Purchasers shall purchase from the Company the Convertible Preferred Stock for an aggregate purchase price of $200,000,000 in cash (the "PURCHASE PRICE"). The number of shares of Convertible Preferred Stock being acquired by each Purchaser, and the portion of the Purchase Price payable therefor is set forth under such Purchaser's name on the signature page hereto; provided, that the Purchasers shall have the right at any time prior to the Closing by delivering written notice to the Company to reallocate among the Purchasers the Convertible Preferred Stock to be purchased by each Purchaser so long as such reallocation does not change the total number of Convertible Preferred Stock being acquired hereunder or the Purchase Price. 1.2. CLOSING (a) The closing of the purchase and sale of the Convertible Preferred Stock hereunder (the "CLOSING") shall take place on August 5, 2004 at the offices of Willkie Farr & Gallagher LLP, New York, New York 10019 at 11:00 a.m., subject to the prior satisfaction or waiver of the conditions set forth in Section 4 (other than those conditions that by their nature are to be satisfied at the Closing, but subject to the satisfaction or waiver of those conditions), or at such other place, time and/or date as shall be mutually agreed by the Company and the Purchasers (the date of the Closing, the "CLOSING DATE"). (b) At the Closing, the Company shall deliver to each Purchaser certificates representing the Convertible Preferred Stock being purchased by such Purchaser, each registered in the name of such Purchaser or its nominee or designee in such amounts as such Purchaser shall specify to the Company prior to the Closing. Delivery of such certificates shall be made against receipt by the Company of the portion of the Purchase Price payable therefor, which shall be paid by wire transfer to an account designated at least three business days prior to the Closing Date by the Company. 1.3. CAPITALIZED TERMS Certain capitalized and other terms used in this Agreement are defined in Section 6. 2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents and warrants as hereinafter set forth. Unless the context otherwise requires, all representations and warranties set forth herein shall be deemed to be given after giving effect to the sale of Convertible Preferred Stock on the Closing Date. 2.1. ORGANIZATION, QUALIFICATION, AUTHORIZATION. (A) The Company is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Delaware and has the corporate power and authority to own or hold under lease the property it purports to own or hold under lease, to transact the business it transacts, to execute and deliver this Agreement and the other Transaction Documents to which the Company is a party and to perform the provisions hereof and thereof. The Company is duly qualified as a foreign corporation and is in good standing in each jurisdiction in which the character of the properties owned or held under lease by it or the nature of the business transacted by it requires such qualification, except where the failure to be so qualified individually and in the aggregate could not reasonably be expected to have a Material Adverse Effect. (B) The execution, delivery and performance of this Agreement and the other Transaction Documents to which the Company is a party have been duly authorized by all necessary corporate action on the part of the Company. This Agreement is and the other Transaction Documents to which the Company is a party when executed and delivered by the Company will be, legal, valid and binding obligations of the Company enforceable against the Company in accordance with their respective terms, except as enforceability may be limited by bankruptcy, insolvency or other similar laws relating to or affecting the enforcement of creditors' rights generally and by general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law). 2.2. DISCLOSURE; FINANCIAL STATEMENTS; MATERIAL ADVERSE EFFECT. The Company has timely filed all proxy statements, reports and other documents required to be filed by it under the Exchange Act through the date hereof and made available to the Purchasers complete copies of all annual reports, quarterly reports, proxy statements and other reports filed by the Company under the Exchange Act through the date hereof, each as filed - 2 - with the SEC (collectively, the "SEC REPORTS"). Each SEC Report was, on the date of its filing, in compliance in all material respects with the requirements of its respective report form and the Exchange Act and did not, on the date of filing, 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 therein, in the light of the circumstances under which they were made, not misleading. The consolidated financial statements of the Company (including any related schedules and/or notes) included in the SEC Reports, have been prepared in accordance with GAAP consistently followed throughout the periods involved (except as may be indicated in the notes thereto) and fairly present, in all material respects, in accordance with GAAP the consolidated financial condition, results of operations, cash flows and changes in stockholders' equity of the Company and the Subsidiaries as of the respective dates thereof and for the respective periods then ended (in each case subject, as to interim statements, to the absence of footnotes and as permitted by Form 10-Q and subject to changes resulting from year-end adjustments, none of which are material in amount or effect). 2.3. INCORPORATION AND GOOD STANDING OF SUBSIDIARIES. As of the Closing Date each Subsidiary shall be duly organized, validly existing and in good standing (to the extent such concepts are recognized in such jurisdictions) under the laws of the jurisdiction of its organization and is duly qualified as a foreign corporation and is in good standing in each jurisdiction in which the character of the properties owned or held under lease by it or nature of the business transacted by it requires such qualification, except where the failure to be so qualified individually and in the aggregate could not reasonably be expected to have a Material Adverse Effect. Each Subsidiary has the corporate power and authority to own or hold under lease the property it purports to own or hold under lease and to transact the business it transacts. 2.4. COMPLIANCE WITH LAWS, OTHER INSTRUMENTS, ETC. The execution, delivery and performance by the Company of this Agreement and the other Transaction Documents to which it is a party will not: (A) conflict with the Certificate of Incorporation or by-laws (or comparable organizational document) of the Company or any Subsidiary; (B) result in any breach of, or constitute a default under, or result in the creation of any lien in respect of any property of the Company or any Subsidiary under, any indenture, mortgage, deed of trust, bank loan or credit agreement, or any other material agreement or instrument to which the Company or any Subsidiary is a party or by which their respective properties may be bound or affected; or (C) conflict with or result in a breach of any of the terms, conditions or provisions of any Order of any court, arbitrator or Governmental Body applicable to the Company or any Subsidiary or violate any provision of any law, statute, rule or regulation of any Governmental Body applicable to the Company or any Subsidiary, except, in the case of clause (B) and (C) above, as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. As used in this Agreement, the term "GOVERNMENTAL BODY" includes any federal, state, municipal or other governmental department, commission, board, bureau, agency or - 3 - instrumentality, domestic or foreign; and the term "ORDER" includes any written order, writ, injunction, decree, judgment, award, penalty, determination, direction or demand. 2.5. GOVERNMENTAL AUTHORIZATIONS, ETC. No consent, approval or authorization of, or registration or filing with, any Governmental Body is required to be obtained by the Company in connection with the performance of this Agreement and the other Transaction Documents except for the filings of the Certificate of Designation with the Secretary of State of the State of Delaware or any required filing under the Exchange Act or the Securities Act and as otherwise contemplated herein or therein. 2.6. LITIGATION; OBSERVANCE OF STATUTES, REGULATIONS AND ORDERS. Except as disclosed in the SEC Reports, there are no actions, suits or proceedings (including counterclaims) pending or, to the knowledge of the Company, threatened against the Company or any Subsidiary or any property of the Company or any Subsidiary, in any court or before any arbitrator of any kind or before or by any Governmental Body, except actions, suits or proceedings which in the aggregate could not be reasonably expected to have a Material Adverse Effect. Neither the Company nor any Subsidiary is in default under any Order of any court, arbitrator or Governmental Body or is in violation of any statute, rule or regulation of any Governmental Body, except for possible defaults or violations which, in the aggregate, could not be reasonably expected to have a Material Adverse Effect. 2.7. TAXES. The Company and its Subsidiaries have filed all tax returns in all jurisdictions in which such returns are required to have been filed by them and have paid all taxes, assessments, fees and governmental charges due and payable with respect to such returns to the extent the same have become due and payable and before they have become delinquent, other than those being contested in good faith by appropriate means and with respect to which the Company or a Subsidiary, as the case may be, has set aside on its books adequate reserves in conformity with GAAP or nonpayment of which could not be reasonably expected to have a Material Adverse Effect. 2.8. TITLE TO PROPERTIES. The Company and each Subsidiary has good and marketable title to their respective real properties reflected in the most recent audited consolidated balance sheet included in the SEC Reports, or purported to have been acquired by the Company or such Subsidiary after the date of said balance sheet (other than properties and assets disposed of in the ordinary course of business). - 4 - 2.9. INVESTMENT COMPANY ACT AND HOLDING COMPANY STATUS, ETC. Neither the Company nor any Subsidiary is subject to regulation under the Investment Company Act of 1940, as amended, the Public Utility Holding Company Act of 1935, as amended, or the Federal Power Act, as amended. Offering of Preferred Shares Neither the Company nor any Person acting on its behalf has taken or will take any action (including, without limitation, any offering of any securities of the Company under circumstances which would require, under the Securities Act, the integration of such offering with the offering and sale of the Convertible Preferred Shares) which might reasonably be expected to subject the offering, issuance or sale of the Convertible Preferred Shares to the registration requirements of Section 5 of the Securities Act. 3. REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS. Each Purchaser hereby represents and warrants to the Company, severally and not jointly, as of the date hereof and as of the Closing, as follows: (a) Acquisition for Investment. Such Purchaser is acquiring the Convertible Preferred Stock, for its own account, for investment and not with a view to the distribution thereof within the meaning of the Securities Act. (b) Restricted Securities. Such Purchaser understands that (i) the Convertible Preferred Stock and the Shares have not been registered under the Securities Act or any state securities laws by reason of their issuance by the Company in a transaction exempt from the registration requirements thereof and (ii) the Convertible Preferred Stock and any Shares issued upon conversion thereof may not be sold or otherwise disposed of unless such sale or disposition is registered under the Securities Act and applicable state securities laws or such sale or other disposition is exempt from registration thereunder. (c) Accredited Investor. Such Purchaser is an "accredited investor" (as defined in Rule 501(a) under the Securities Act). Such Purchaser has sufficient knowledge and experience in financial and business matters so as to be capable of evaluating the merits and risks of its investment in the Convertible Preferred Stock and is capable of bearing the economic risks of such investment. (d) Organization. Such Purchaser is a duly organized, validly existing and in good standing under the laws of its organization and has the requisite power and authority to carry on its business as it is now being conducted. (e) Due Authorization. Such Purchaser has all right, power and authority to enter into this Agreement and the other Transaction Documents to which it is a party and to consummate the transactions contemplated hereby and thereby. The execution and delivery by such Purchaser of this Agreement and the other Transaction Documents to which it is a party and the consummation by such Purchaser of the transactions contemplated hereby and thereby (a) are within the power and authority of such Purchaser and (b) have been duly authorized by all -5- necessary action on the part of such Purchaser. This Agreement constitutes, and each of the other Transaction Documents to which it is a party will constitute upon execution and delivery by such Purchaser, a valid and binding agreement of such Purchaser enforceable against such Purchaser in accordance with their respective terms, except as such enforcement is limited by bankruptcy, insolvency and other similar laws affecting the enforcement of creditors' rights generally and for limitations imposed by general principles of equity. (f) Consents, No Violations. Neither the execution, delivery or performance by such Purchaser of this Agreement and the other Transaction Documents to which it is a party nor the consummation of the transactions contemplated hereby or thereby will (a) conflict with, or result in a breach or a violation of, any provision of the organizational documents of such Purchaser; (b) constitute, with or without notice or the passage of time or both, a breach, violation or default, create a lien, or give rise to any right of termination, modification, cancellation, prepayment, suspension, limitation, revocation or acceleration, under (i) any applicable law, or (ii) any credit agreement, indenture or other instrument or agreement relating to indebtedness of such Purchaser, or to which such Purchaser or any of its assets or properties is subject, except, with respect to the matters set forth in clause (ii), for breaches, violations, defaults, liens, or rights of termination, modification, cancellation, prepayment, suspension, limitation, revocation or acceleration, which, individually or in the aggregate, would not have a material adverse effect on the ability of such Purchaser to consummate the transactions contemplated hereby; or (c) except for any required filing under the Exchange Act or the Securities Act, require any consent, approval or authorization of, notification to, filing with, or exemption or waiver by, any Governmental Body or any other Person on the part of the Purchaser. (g) Litigation. There is no litigation pending or, to the knowledge of such Purchaser, threatened against such Purchaser or any of its Affiliates or involving any of its properties or assets by or before any court, arbitrator or other Governmental Body which in any manner challenges or seeks to prevent, enjoin, alter or materially delay the transactions contemplated by this Agreement. (i) General. Such Purchaser understands that the Convertible Preferred Stock is being offered and sold in reliance on a transactional exemption from the registration requirements of federal and state securities laws and the Company is relying upon the truth and accuracy of the representations, warranties, agreements, acknowledgments and understandings of such Purchaser set forth herein in order to determine the applicability of such exemptions and the suitability of such Purchaser to acquire the Securities. Such Purchaser understands that no United States federal or state agency or any government or governmental agency has passed upon or made any recommendation or endorsement of the Securities. (j) General Solicitation. Such Purchaser is not purchasing the Convertible Preferred Stock as a result of any advertisement, article, notice or other communication regarding the Convertible Preferred Stock published in any newspaper, magazine or similar media or broadcast over television or radio or presented at any seminar or any other general solicitation or general advertisement. -6- (k) Patriot Act. If such Purchaser is an individual, such Purchaser certifies that he or she is not nor to his or her knowledge has been designated, a "suspected terrorist" as defined in Executive Order 13224. If such Purchaser is a corporation, trust, partnership, limited liability company or other organization, such Purchaser certifies that, to the best of such Purchaser's knowledge, such Purchaser has not been designated, and, to the knowledge of the Purchaser after due inquiry, is not owned or controlled, by a "suspected terrorist" as defined in Executive Order 13224. Such Purchaser hereby acknowledges that the Company seeks to comply with all applicable laws concerning money laundering and related activities. In furtherance of those efforts, such Purchaser hereby represents, warrants and agrees that: (i) to its knowledge after due inquiry, none of the cash or property that such Purchaser will pay or will contribute to the Company has been or shall be derived from, or related to, any activity that is deemed criminal under United States law; and (ii) to its knowledge, no contribution or payment by such Purchaser to the Company, to the extent that they are within such Purchaser's control shall cause the Company to be in violation of the United States Bank Secrecy Act, the United States International Money Laundering Control Act of 1986 or the United States International Money Laundering Abatement and Anti-Terrorist Financing Act of 2001. Such Purchaser understands and agrees that if at any time while such Purchaser holds any of the Convertible Preferred Stock or the Shares it is discovered that any of the foregoing representations are incorrect, it shall promptly notify the Company. 4. CONDITIONS OF CLOSING. 4.1. CONDITIONS TO OBLIGATIONS OF THE PURCHASERS. The obligations of the Purchasers to consummate the transactions contemplated by this Agreement are subject to fulfillment or waiver, at or before the Closing Date, of the following conditions: (a) The representations and warranties made by the Company in this Agreement shall be true on and as of the Closing Date as if made on and as of the Closing Date; (b) The Company shall have performed all agreements to be performed by it under this Agreement on or before the Closing Date; (c) The Company shall have delivered to Purchasers an officer's certificate, dated the Closing Date, certifying to the satisfaction of the conditions set forth in clauses (a) and (b) of this Section 4.1; (d) The Company shall have executed and delivered a Registration Rights Agreement in the form of Exhibit 4.1(d) hereto (the "REGISTRATION RIGHTS AGREEMENT"), and the Registration Rights Agreement shall be in full force and effect; (e) The Company shall have shall have been duly filed a Certificate of Designation in the form of Exhibit 4.1(e) (the "CERTIFICATE OF DESIGNATION") with the Secretary of State of the State of Delaware in accordance with the laws of the State of Delaware and the Certificate of Designation shall be in full force and effect; (f) The Shares shall have been duly authorized and reserved for issuance; -7- (g) The Purchasers shall have received an opinion of Willkie Farr & Gallagher LLP, outside counsel to the Company, with respect to the due incorporation, due authorization, validity of the Convertible Preferred Stock, securities act exemption and the valid and binding nature of this Agreement, the Registration Rights Agreement and the Certificate of Designation substantially in the form attached hereto as Exhibit 4.1(g); and 4.2. CONDITIONS TO OBLIGATIONS OF THE COMPANY. The obligations of the Company to consummate the transactions contemplated by this Agreement are subject to fulfillment or waiver, at or before the Closing Date, of the following conditions: (a) The representations and warranties made by the Purchasers in this Agreement shall be true on and as of the Closing Date as if made on and as of the Closing Date; (b) Each Purchaser shall have performed all agreements to be performed by it under this Agreement on or before the Closing Date; (c) Each Purchaser have delivered to the Company an officer's certificate, dated the Closing Date, certifying to the satisfaction of the conditions set forth in clauses (a) and (b) of this Section 4.2; and (d) Each Purchaser shall have executed and delivered the Registration Rights Agreement, and the Registration Rights Agreement shall be in full force and effect. (e) The Purchase Price shall have been paid to the Company by wire transfer of immediately available funds to the account as specified in writing by the Company. 5. DEFINITIONS. 5.1. DEFINITIONS. Except as otherwise specified or as the context may otherwise require, the following terms shall have the respective meanings set forth below whenever used in this Agreement and shall include the singular as well as the plural: "AFFILIATE" of any specified Person means any other Person which directly or indirectly through one or more intermediaries controls, or is controlled by, or is under common control with, such Person. "AGREEMENT" has the meaning specified in the recitals hereto. "BOARD OF DIRECTORS" means the Board of Directors of the Company or any committee of directors lawfully exercising the relevant powers of said Board or Directors. "CERTIFICATE OF DESIGNATION" has the meaning specified in Section 4.1. "CLOSING" has the meaning specified in Section 1.2. -8- "CLOSING DATE" has the meaning specified in Section 1.2. "COMMON STOCK" means the Common Stock, par value $0.01 per share, of the Company. "CONTROL" when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms "controlling" and "controlled" have meanings correlative to the foregoing. "CONVERTIBLE PREFERRED STOCK" has the meaning specified in the recitals hereto. "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended from time to time. "GAAP" means generally accepted accounting principles from time to time in the United States. "GOVERNMENTAL BODY" has the meaning specified in Section 2.4. "MATERIAL ADVERSE EFFECT" means a material adverse effect on (i) the business, operations, properties, assets or condition (financial or otherwise) of the Company and its Subsidiaries taken as a whole; (ii) the ability of the Company to fully and timely perform its obligations under this Agreement or the Registration Rights Agreement; or (iii) the legality, validity, binding effect or enforceability against the Company of this Agreement or the Registration Rights Agreement. "ORDER" has the meaning specified in Section 2.4. "PERSON" or "PERSON" means and includes an individual, a partnership, a joint venture, a corporation, a limited liability company, a trust, an association, a joint-stock company, an unincorporated organization and a government or any department or agency thereof. "PURCHASE PRICE" has the meaning specified in Section 1.1. "PURCHASER" has the meaning specified in the recitals hereto. "REGISTRATION RIGHTS AGREEMENT" has the meaning specified in Section 4.1. "SEC REPORTS" has the meaning specific in Section 2.2. "SECURITIES ACT" means the Securities Act of 1933, as amended. "SHARES" means the shares of the Company's Common Stock issuable upon conversion of the Convertible Preferred Stock. "SUBSIDIARY" of any Person means any corporation or other entity a majority of the total combined voting power of all classes of Voting Stock of which shall, at the time as of which any determination is being made, be owned by such Person and/or one or more of its -9- Subsidiaries. Except as otherwise expressly indicated herein, references to Subsidiaries shall mean Subsidiaries of the Company. "TRANSACTION DOCUMENTS" means this Agreement and the Registration Rights Agreement. "VOTING STOCK" means, with respect to any Person, any shares of stock or other equity interests of any class or classes of such Person whose holders are entitled under ordinary circumstances (irrespective of whether at the time stock or other equity interests of any other class or classes shall have or might have voting power by reason of the happening of any contingency) to vote for the election of a majority of the directors, managers, trustees or other governing body of such Person. 6. MISCELLANEOUS 6.1. SURVIVAL OF PROVISIONS. The parties hereto agree that the representations and warranties contained in this Agreement shall not survive the Closing hereunder, and neither of the parties nor any of their respective officers, directors, representatives, employees, advisors or agents shall have any liability to the other after the Closing for any breach thereof. The parties hereto agree that only the covenants contained in this Agreement to be performed at or after the Closing Date shall survive the Closing hereunder, and each party hereto shall be liable to the other after the Closing Date for any breach thereof. 6.2. SUCCESSORS AND ASSIGNS; NO THIRD-PARTY BENEFICIARIES. This Agreement shall inure to the benefit of, and be binding upon, the parties hereto and their respective successors and assigns; provided, however, that no party hereto shall assign or delegate any of the obligations created under this Agreement without the prior written consent of the other parties hereto. 6.3. INVESTMENT BANKERS, FINANCIAL ADVISORS, BROKERS AND FINDERS. (a) The Company represents and warrants to the Purchasers that the Company has not employed the services of a broker or finder in connection with this Agreement or any of the transactions contemplated hereby. The Company shall indemnify and agree to defend and hold the Purchasers harmless against and in respect of all claims, losses, liabilities and expenses which may be asserted against the Purchasers (or any Affiliate of the Purchasers by any broker or other person who claims to be entitled to an investment banker's, financial advisor's, broker's, finder's or similar fee or commission in respect of the execution of this Agreement or the consummation of the transactions contemplated hereby, by reason of their acting at the request of the Company. (b) Each Purchaser represents and warrants to the Company that it has not employed the services of an investment banker, financial advisor, broker or finder in connection with this Agreement or any of the transactions contemplated hereby. The Purchasers shall, jointly and severally, indemnify and agrees to save and hold each of the Company harmless -10- against and in respect of all claims, losses, liabilities, fees, costs and expenses which may be asserted against them by any broker or other person who claims to be entitled to an investment banker's, financial advisor's, broker's, finder's or similar fee or commission in respect of the execution of this Agreement or the consummation of the transactions contemplated hereby, by reason of their acting at the request of the Purchasers. 6.4. FEES AND EXPENSES. Except as otherwise expressly provided in this Agreement, all legal, accounting and other fees, costs and expenses of the Company incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such fees, costs or expenses. 6.5. NOTICES. All notices and other communications given or made pursuant hereto shall be in writing and shall be deemed to have been duly given or made if delivered personally or sent by registered or certified mail (postage prepaid, return receipt requested) to the parties at the following addresses: (a) If to the Purchasers, to: Cardiff Holdings LLC and Tramore LLC, c/o Icahn Associates Corp. 767 Fifth Avenue New York, NY 10153 R2 Investments, LDC c/o Amalgamated Gadget, L.P., as Investment Manager 301 Commerce, Suite 2975 Fort Worth. TX 76102 [] (b) If to the Company, to: XO Communications, Inc. 11111 Sunset Hills Road Reston, VA 20190 Attn: General Counsel or to such other persons or at such other addresses as shall be furnished by either party by like notice to the other, and such notice or communication shall be deemed to have been given or made as of the date so delivered or mailed. No change in any of such addresses shall be effective insofar as notices under this Section 6.5 are concerned unless such changed address is located in the United States of America and notice of such change shall have been given to such other party hereto as provided in this Section 6.5. -11- 6.6. ENTIRE AGREEMENT. This Agreement and the exhibits and schedules hereto, represent the entire agreement and understanding of the parties with reference to the transactions set forth herein and no representations or warranties have been made in connection with this Agreement other than those expressly set forth herein or in the exhibits, schedules, certificates and other documents delivered in accordance herewith. This Agreement supersedes all prior negotiations, discussions, correspondence, communications, understandings and agreements between the parties relating to the subject matter of this Agreement and all prior drafts of this Agreement, all of which are merged into this Agreement. No prior drafts of this Agreement and no words or phrases from any such prior drafts shall be admissible into evidence in any action or suit involving this Agreement. 6.7. WAIVERS AND AMENDMENTS. This Agreement may be amended, waived, modified or supplemented only by a written instrument executed by the parties hereto. The waiver by any party hereto of a breach of any provision of this Agreement shall not operate or be construed as a waiver of any subsequent breach, whether or not similar, unless such waiver specifically states that it is to be construed as a continuing waiver. 6.8. GOVERNING LAW. This Agreement shall be governed by and interpreted and enforced in accordance with the laws of the State of New York. 6.9. SEVERABILITY. This Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the validity or enforceability of this Agreement or of any other term or provision hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible and be valid and enforceable. 6.10. TITLES AND HEADINGS. The Section headings and any table of contents contained in this Agreement are solely for convenience of reference and shall not affect the meaning or interpretation of this Agreement or of any term or provision hereof. 6.11. SIGNATURES AND COUNTERPARTS. Facsimile transmission of any signed original document and/or retransmission of any signed facsimile transmission shall be the same as delivery of an original. At the request of either party, the parties will confirm facsimile transmission by signing a duplicate original document. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which together shall be considered one and the same agreement. -12- 6.12. ENFORCEMENT OF THE AGREEMENT. The parties hereto agree that irreparable damage would occur if any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereto, this being in addition to any other remedy to which they are entitled at law or in equity. -13- IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and year first above written. XO COMMUNICATIONS, INC. By: /s/ William Garrahan ------------------------------ Name: William Garrahan Title: Senior Vice President and Acting Chief Financial Officer PURCHASERS CARDIFF HOLDING LLC By: ACF Industries Holding Corp., its member By: /s/ Robert J. Mitchell ------------------------------- Name: Robert J. Mitchell Title: President and Treasurer Number of Shares Acquired: 3,560,000 Purchase Price of Such Shares: $178,000,000.00 TRAMORE LLC By: /s/ Edward E. Mattner ------------------------------- Name: Edward E. Mattner Title: Authorized Signatory Number of Shares Acquired: 240,000 Purchase Price of Such Shares: $12,000,000.00 R(2) INVESTMENTS, LDC By: Amalgamated Gadget, L.P., as its Investment Manager By: Scepter Holdings, Inc., its General Partner By: /s/ Rob McCormick --------------------------------- Name: Rob McCormick Title: Vice President Number of Shares Acquired: 200,000 Purchase Price of Such Shares: $10,000,000.00 EXHIBIT 4.1(d) Form of Registration Rights Agreement EXHIBIT 4.1(e) Form of Certificate of Designation EXHIBIT 4.1(g) Form of Willkie Farr & Gallagher LLP EX-99.H 4 y00104exv99wh.txt REGISTRATION RIGHTS AGREEMENT REGISTRATION RIGHTS AGREEMENT dated as of August 5, 2004 between XO COMMUNICATIONS, INC., a Delaware corporation (the "COMPANY"), and the entities listed on the signature pages hereto under the caption "Purchasers" (each a "PURCHASER" and, collectively, the "PURCHASERS"). Pursuant to the Stock Purchase Agreement dated as of August 5, 2004 (the "STOCK PURCHASE AGREEMENT") by and between the Company and the Purchasers, the Purchasers will acquire on the Closing Date an aggregate of 4,000,000 shares of the Company's 6% Series A Convertible Preferred Stock (the "CONVERTIBLE PREFERRED STOCK"). It is a condition precedent to the consummation of the transactions contemplated by the Stock Purchase Agreement that the Company and the Purchasers enter into this Agreement to provide for the rights of the Purchasers with respect to the registration of the shares of Convertible Preferred Stock held by the Purchasers and the shares of Common Stock issuable upon conversion of the Convertible Preferred Shares. Accordingly, the parties hereto agree as follows: SECTION 1. Definitions. As used herein, unless the context otherwise requires, the following terms have the following respective meanings: "CLOSING DATE" is defined in the Stock Purchase Agreement. "COMMISSION" means the Securities and Exchange Commission or any other Federal agency at the time administering the Securities Act. "COMMON STOCK" means the Common Stock, par value $0.01 per share, of the Company. "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time. "ICAHN FAMILY" means and includes: (i) Carl C. Icahn, his spouse, and his children; (ii) the current and former spouses of any person described in clause (i) of this definition; and (iii) the ancestors, siblings and descendants, whether by blood, marriage or adoption, of any person described in clause (i) or (ii) of this definition. "PERMITTED HOLDER" means and includes: (i) any member of the Icahn Family; (ii) any conservatorship, custodianship, or decedent's estate of any member of the Icahn Family, (iii) any trust established for the benefit of, among others, any Person described in clause (i) or (ii) of this definition; and (iv)any corporation, limited liability company, partnership, or other entity, the controlling equity interests in which are held by or for the benefit of any one or more persons described in clause (i), (ii), or (iii) of this definition; and (v) any foundation or charitable organization established by a member of the Icahn Family, and having at least one director, trustee, or member who is a member of the Icahn Family. "PERSON" means a corporation, an association, a partnership, an organization, a business, a trust, an individual, or any other entity or organization, including a government or political subdivision or an instrumentality or agency thereof. "REGISTRABLE SECURITIES" means (i) the shares of Convertible Preferred Stock, (ii) any shares of Common Stock issued or issuable upon the conversion of any Convertible Preferred Shares held by the Purchasers, and (iii) any shares of Common Stock issued with respect to the Convertible Preferred Stock or the Common Stock referred to in clauses (i) and (ii) by way of a stock dividend, stock split or reverse stock split or in connection with a combination of shares, recapitalization, merger, consolidation or otherwise. As to any particular Registrable Securities, such securities shall cease to be Registrable Securities (a) when a registration statement with respect to the sale of such securities shall have become effective under the Securities Act and such securities shall have been disposed of in accordance with such registration statement, (b) when such securities shall have been otherwise transferred, new certificates for them not bearing a legend restricting further transfer shall have been delivered by the Company and subsequent public distribution of them shall not require registration of them under the Securities Act, (c) when such securities are eligible for sale under clause (k) of Rule 144 of the Securities Act or any successor provision, or (d) when such securities shall have been sold as permitted by, and in compliance with, the Securities Act. "REGISTRATION EXPENSES" means all expenses incident to the registration and disposition of the Registrable Securities pursuant to Section 2 hereof, including, without limitation, all registration, filing and applicable national securities exchange fees, all fees and expenses of complying with state securities or blue sky laws (including fees and disbursements of counsel to the underwriters or the Purchasers in connection with "blue sky" qualification of the Registrable Securities and determination of their eligibility for investment under the laws of the various jurisdictions), all word processing, duplicating and printing expenses, all messenger and delivery expenses, the fees and disbursements of counsel for the Company and of its independent public accountants, including the expenses of "cold comfort" letters or any special audits required by, or incident to, such registration, all fees and disbursements of underwriters (other than underwriting discounts and commissions), all transfer taxes, and all fees and expenses of counsel to the Purchasers; provided, however, that Registration Expenses shall exclude, and the Purchasers shall pay, underwriting discounts and commissions in respect of the Registrable Securities being registered. "SECURITIES ACT" means the Securities Act of 1933, as amended, and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time. SECTION 2. Registration Under Securities Act, etc. 2.1 Registration . (a) Effect the Registration. The Company shall, if requested to do so by any holder of shares of Convertible Preferred Stock, file for the registration under the Securities Act -2- of all or part of the Registrable Securities as hereinafter provided. The Company shall use its reasonable best efforts to effect the registration under the Securities Act (including by means of a shelf registration pursuant to Rule 415 under the Securities Act if the Company is then eligible to use such a registration) of the Registrable Securities as expeditiously as possible (but in any event within 180 days of such request). The Company shall notify the other holders of shares of Convertible Preferred Stock of any request for registration under this Section 2.1(a) within 10 days of receipt of such request and offer to register such Registrable Securities of such other holders in such registration. (b) Registration of Other Securities. If the Company shall effect the registration pursuant to this Section 2.1 in connection with an underwritten offering by the Purchasers of Registrable Securities, no securities other than Registrable Securities shall be included among the securities covered by such registration if such Registrable Securities included in the registration pursuant to this Section 2.1, together with other securities requested to be included in such registration, would result in a request by the managing underwriters for a reduction in the number of such Registrable Securities and other securities to be underwritten. If the managing underwriters so request, then the Company will be required to include in such registration only the amount of Registrable Securities and other securities which it is so advised can be included in such registration. In such event, securities shall be registered, in the following priority: (A) the Registrable Securities, (B) the securities proposed to be included by the Company, and then (C) any other securities of the Company requested to be included in such registration by any other holder having the right to include securities on a pro rata basis in accordance with the number of securities proposed to be included by the other stockholders with such rights. (c) Registration Statement Form. Registration under this Section 2.1 shall be on such appropriate registration form of the Commission as, subject to clause (a) above, shall be selected by the Company and as shall be reasonably acceptable to the Purchasers. The Company agrees to include in any such registration statement all information which, in the opinion of counsel to the Purchasers and counsel to the Company, is necessary or desirable to be included therein. (d) Expenses. The Company shall pay all Registration Expenses in connection with registration pursuant to this Section 2.1. (e) Effective Registration Statement. Registration pursuant to this Section 2.1 shall not be deemed to have been effected (i) if after it has become effective, such registration is interfered with by any stop order, injunction or other order or requirement of the Commission or other governmental agency or court for any reason not attributable to the Purchasers and has not thereafter become effective, or (ii) if the conditions to closing specified in the underwriting agreement, if any, entered into in connection with such registration are not satisfied or waived. (f) Selection of Underwriters. The underwriters of each underwritten offering of the Registrable Securities so to be registered shall be selected by the Purchasers, subject to the Company's approval, which approval shall not be unreasonably withheld. -3- (g) Shelf Registration. If the Company effects a registration of Registrable Securities by means of shelf registration pursuant to Rule 415 under the Securities Act (a "SHELF REGISTRATION STATEMENT"), in addition to the other requirements contained herein, the Company shall, at its cost, use its reasonable best efforts to keep the Shelf Registration Statement continuously effective in order to permit the prospectus forming part thereof to be usable by the Purchasers until such time as all the Registrable Securities covered by the Shelf Registration Statement have been sold pursuant to the Shelf Registration Statement or cease to be outstanding (the "EFFECTIVENESS PERIOD"); provided, however, that the Effectiveness Period in respect of the Shelf Registration Statement shall be extended to the extent required to permit dealers to comply with the applicable prospectus delivery requirements under the Securities Act and as otherwise provided herein. (h) Availability. The registration rights set forth in this Agreement shall not be available to any holder of shares of Convertible Preferred Stock (other than a Permitted Holder, each a "THIRD-PARTY HOLDER") (i) until after the first anniversary of the purchase by such Third-Party Holder of suchshares of Convertible Preferred Stock, (ii) if in the opinion of counsel to the Company, all of the Registrable Securities then owned by such Third-Party Holder could be sold in any 6-month period pursuant to Rule 144 under the Securities Act (without giving effect to the provisions of Rule 144(k)) or (iii) if all of the Registrable Securities held by such Third-Party Holder have been sold in a registration pursuant to the Securities Act or pursuant to said Rule 144. (i) Delay. If at the time of any request to register Registrable Securities, the Company is engaged or has fixed plans to engage within thirty (30) days of the time of the request an acquisition, financing or other significant transaction which, in the good faith determination of the Board of Directors of the Company, would be adversely affected by the requested registration to the material detriment of the Company, the Company may, at its option, direct that such request be delayed for a period not in excess of one month from the date of the determination by the Board of Directors. The right to delay a request of registration may be exercised by the Company not more than once in any one-year period. 2.2 Registration Procedures. In connection with the registration of any Registrable Securities under the Securities Act as provided in Sections 2.1 hereof, the Company shall as expeditiously as possible: (a) prepare and file with the Commission the requisite registration statement to effect such registration (and shall include all financial statements required by the Commission to be filed therewith) and thereafter use its reasonable best efforts to cause such registration statement to become effective; provided, however, that before filing such registration statement (including all exhibits) or any amendment or supplement thereto or comparable statements under securities or blue sky laws of any jurisdiction, the Company shall as promptly as practicable furnish such documents to the Purchasers and each underwriter, if any, participating in the offering of the Registrable Securities and their respective counsel, which documents will be subject to the review and comments of the Purchasers, each underwriter and their respective counsel; -4- (b) notify the Purchasers of the Commission's requests for amending or supplementing the registration statement and the prospectus, and prepare and file with the Commission such amendments and supplements to such registration statement and the prospectus used in connection therewith as may be necessary to keep such registration statement effective and to comply with the provisions of the Securities Act with respect to the disposition of all Registrable Securities covered by such registration statement for such period as shall be required for the disposition of all of such Registrable Securities in accordance with the intended method of distribution thereof; provided, that except with respect to any such registration statement filed pursuant to Rule 415 under the Securities Act, such period need not exceed 365 days; (c) furnish, without charge, to the Purchasers and each underwriter such number of conformed copies of such registration statement and of each such amendment and supplement thereto (in each case including all exhibits), such number of copies of the prospectus contained in such registration statement (including each preliminary prospectus and any summary prospectus) and any other prospectus filed under Rule 424 under the Securities Act, in conformity with the requirements of the Securities Act, and such other documents, as the Purchasers and such underwriters may reasonably request; (d) use its reasonable best efforts (i) to register or qualify all Registrable Securities and other securities covered by such registration statement under such securities or blue sky laws of such States of the United States of America where an exemption is not available and as the Purchasers or any managing underwriter shall reasonably request, (ii) to keep such registration or qualification in effect for so long as such registration statement remains in effect, and (iii) to take any other action which may be reasonably necessary or advisable to enable the Purchasers to consummate the disposition in such jurisdictions of the securities to be sold by the Purchasers, except that the Company shall not for any such purpose be required to qualify generally to do business as a foreign corporation in any jurisdiction wherein it would not but for the requirements of this subsection (d) be obligated to be so qualified or to consent to general service of process in any such jurisdiction; (e) use its reasonable best efforts to cause all Registrable Securities covered by such registration statement to be registered with or approved by such other federal or state governmental agencies or authorities as may be necessary in the opinion of counsel to the Company and counsel to the Purchasers to consummate the disposition of such Registrable Securities; (f) furnish to the Purchasers and each underwriter, if any, participating in the offering of the securities covered by such registration statement, a signed counterpart of (i) an opinion of counsel for the Company, and (ii) a "comfort" letter signed by the independent public accountants who have certified the Company's or any other entity's financial statements included or incorporated by reference in such registration statement, covering substantially the same matters with respect to such registration statement (and the prospectus included therein) and, in the case of the accountants' comfort letter, with respect to events subsequent to the date of such financial statements, as are customarily covered in opinions of issuer's counsel and in accountants' comfort letters delivered to the -5- underwriters in underwritten public offerings of securities (and dated the dates such opinions and comfort letters are customarily dated) and, in the case of the legal opinion, such other legal matters; (g) promptly notify the Purchasers and each managing underwriter, if any, participating in the offering of the securities covered by such registration statement (i) when such registration statement, any pre-effective amendment, the prospectus or any prospectus supplement related thereto or post-effective amendment to such registration statement has been filed, and, with respect to such registration statement or any post-effective amendment, when the same has become effective; (ii) of any request by the Commission for amendments or supplements to such registration statement or the prospectus related thereto or for additional information; (iii) of the issuance by the Commission of any stop order suspending the effectiveness of such registration statement or the initiation of any proceedings for that purpose; (iv) of the receipt by the Company of any notification with respect to the suspension of the qualification of any of the Registrable Securities for sale under the securities or blue sky laws of any jurisdiction or the initiation of any proceeding for such purpose; (v) at any time when a prospectus relating thereto is required to be delivered under the Securities Act, upon discovery that, or upon the happening of any event as a result of which, the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading, in the light of the circumstances under which they were made, and in the case of this clause (v), at the request of the Purchasers promptly prepare and furnish to the Purchasers and each managing underwriter, if any, participating in the offering of the Registrable Securities, a reasonable number of copies of a supplement to or an amendment of such prospectus as may be necessary so that, as thereafter delivered to the purchasers of such securities, such prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances under which they were made; and (vi) at any time when the representations and warranties of the Company contemplated by Section 2.3 hereof cease to be true and correct; (h) otherwise comply with all applicable rules and regulations of the Commission, and make available to its security holders, as soon as reasonably practicable, an earnings statement covering the period of at least twelve months beginning with the first full calendar month after the effective date of such registration statement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158 promulgated thereunder, and promptly furnish to the Purchasers a copy of any amendment or supplement to such registration statement or prospectus; (i) provide and cause to be maintained a transfer agent and registrar (which, in each case, may be the Company) for all Registrable Securities covered by such registration statement from and after a date not later than the effective date of such registration; -6- (j) deliver promptly to counsel to the Purchasers and each underwriter, if any, participating in the offering of the Registrable Securities, copies of all correspondence between the Commission and the Company, its counsel or auditors and all memoranda relating to discussions with the Commission or its staff with respect to such registration statement; (k) use its reasonable best efforts to obtain the withdrawal of any order suspending the effectiveness of the registration statement; (l) provide a CUSIP number for all Registrable Securities, no later than the effective date of the registration statement; and (m) in connection with any underwritten public offering, make available its senior executive officers, directors and chairman and otherwise provide reasonable assistance to the underwriters (taking into account the needs of the Company's business) in their marketing of Registrable Securities. The Purchasers will furnish to the Company such information regarding the Purchasers and the distribution of the Registrable Securities as the Company may from time to time reasonably request in writing. The Purchasers agree that upon receipt of any notice from the Company of the happening of any event of the kind described in paragraph (g)(iii) or (v) of this Section 2.2, the Purchasers will, to the extent appropriate, discontinue their disposition of Registrable Securities pursuant to the registration statement relating to such Registrable Securities until, in the case of paragraph (g)(v) of this Section 2.2, their receipt of the copies of the supplemented or amended prospectus contemplated by paragraph (g)(v) of this Section 2.2 and, if so directed by the Company, will deliver to the Company (at the Company's expense) all copies, other than permanent file copies, then in their possession, of the prospectus relating to such Registrable Securities current at the time of receipt of such notice. If the disposition by the Purchasers of their securities is discontinued pursuant to the foregoing sentence, the Company shall extend the period of effectiveness of the registration statement by the number of days during the period from and including the date of the giving of notice to and including the date when the Purchasers shall have received copies of the supplemented or amended prospectus contemplated by paragraph (g)(v) of this Section 2.2; and, if the Company shall not so extend such period, the Purchasers' request pursuant to which such registration statement was filed shall not be counted for purposes of the requests for registration to which the Purchasers are entitled pursuant to Section 2.1 hereof. 2.3 Requested Underwritten Offerings. If requested by the underwriters for any underwritten offering by the Purchasers pursuant to the registration under Section 2.1, the Company shall enter into a customary underwriting agreement (in the form of underwriting agreement used at such time by the managing underwriter(s)) with a managing underwriter or underwriters selected by the Purchasers. Such underwriting agreement shall be satisfactory in form and substance to the Purchasers and shall contain such representations and warranties by, and such other agreements on the part of, the Company and such other terms as are generally prevailing in agreements of the managing underwriter(s), including, without limitation, their -7- customary provisions relating to indemnification and contribution. The Purchasers shall be party to such underwriting agreement and may, at their option, require that any or all of the representations and warranties by, and the other agreements on the part of, the Company to and for the benefit of such underwriters shall also be made to and for the benefit of the Purchasers and that any or all of the conditions precedent to the obligations of such underwriters under such underwriting agreement be conditions precedent to the obligations of the Purchasers. 2.4 Preparation; Reasonable Investigation. In connection with the preparation and filing of each registration statement under the Securities Act pursuant to this Agreement, the Company will give the Purchasers, their underwriters, if any, and their respective counsel, accountants and other representatives and agents the opportunity to participate in the preparation of such registration statement, each prospectus included therein or filed with the Commission, and each amendment thereof or supplement thereto, and give each of them such access to its books and records and such opportunities to discuss the business of the Company with its officers and employees and the independent public accountants who have certified its financial statements, and supply all other information reasonably requested by each of them, as shall be necessary or appropriate, in the opinion of the Purchasers and such underwriters' respective counsel, to conduct a reasonable investigation within the meaning of the Securities Act. 2.5 Unlegended Certificates. In connection with the offering of any Registrable Securities registered pursuant to this Section 2, the Company shall (i) facilitate the timely preparation and delivery to the Purchasers and the underwriters, if any, participating in such offering, of unlegended certificates representing ownership of such Registrable Securities being sold in such denominations and registered in such names as requested by the Purchasers or such underwriters and (ii) instruct any transfer agent and registrar of such Registrable Securities to release any stop transfer orders with respect to any such Registrable Securities. 2.6 No Required Sale. Nothing in this Agreement shall be deemed to create an independent obligation on the part of the Purchasers to sell any Registrable Securities pursuant to any effective registration statement. 2.7 Market Stand-off. Each Third-Party Holder agrees that it will not sell or otherwise transfer or dispose of any Registrable Securities held by such Third-Party Holder during any period which the Company determines in its good faith judgment that the filing of a registration statement under Section 2 or the use of any related prospectus would require the disclosure of material information that the Company has a bona fide business purpose for preserving as confidential or the disclosure of which would impede the Company's ability to consummate a significant transaction, and that the Company is not otherwise required by applicable securities laws or regulations to disclose, upon written notice of such determination by the Company, until the date upon which the Company notifies such Third-Party Holder in writing that suspension of such rights for the grounds set forth in this Section 2.7 is no longer necessary. The Company agrees to give such notice as promptly as practicable following the date that such suspension of rights is no longer necessary. 3. Rule 144. The Company shall take all actions reasonably necessary to enable holders of Registrable Securities to sell such securities without registration under the Securities Act within the limitation of the exemptions provided by (i) Rule 144, or (ii) any -8- similar rule or regulation hereafter adopted by the Commission including, without limiting the generality of the foregoing, filing on a timely basis all reports required to be filed by the Exchange Act. Upon the request of the Purchasers, the Company will deliver to such holder a written statement as to whether it has complied with such requirements. 4. Amendments and Waivers. This Agreement may be amended, modified or supplemented only by written agreement of the party against whom enforcement of such amendment, modification or supplement is sought. 5. Notice. All notices and other communications hereunder shall be in writing and, unless otherwise provided herein, shall be deemed to have been given when received by the party to whom such notice is to be given at its address set forth below, or such other address for the party as shall be specified by notice given pursuant hereto: (a) If to the Purchasers, to: Cardiff Holdings LLC and Tramore LLC, c/o Icahn Associates Corp. 767 Fifth Avenue New York, NY 10153 R(2) Investments, LDC c/o Amalgamated Gadget, L.P., as Investment Manager 301 Commerce, Suite 2975 Fort Worth. TX 76102 (b) If to the Company, to it at: XO Communications, Inc. 11111 Sunset Hills Road Reston, VA 20190 Attn: General Counsel 6. Assignment; Third Party Beneficiaries. This Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and their respective successors and permitted assigns. This Agreement may not be assigned by the Company, without the prior written consent of the Purchasers. The Purchasers may, at their election, at any time or from time to time, assign their rights under this Agreement, in whole or in part, to any Affiliate (as defined in the Stock Purchase Agreement) or any purchaser or other transferee of shares of Common Stock held by them. 7. Remedies. The parties hereto agree that money damages or other remedy at law would not be sufficient or adequate remedy for any breach or violation of, or a default under, this Agreement by them and that, in addition to all other remedies available to them, each of them shall be entitled to an injunction restraining such breach, violation or default or threatened breach, violation or default and to any other equitable relief, including without limitation specific -9- performance, without bond or other security being required. In any action or proceeding brought to enforce any provision of this Agreement (including the indemnification provisions thereof), the successful party shall be entitled to recover reasonable attorneys' fees in addition to its costs and expenses and any other available remedy. 8. No Inconsistent Agreements. The Company will not, on or after the date of this Agreement, enter into any agreement with respect to its securities which is inconsistent with the rights granted to the Purchasers in this Agreement or otherwise conflicts with the provisions hereof. The Company further represents and warrants that the rights granted to the Purchasers hereunder do not in any way conflict with and are not inconsistent with any other agreements to which the Company is a party or by which it is bound. 9. Descriptive Headings. The descriptive headings of the several sections and paragraphs of this Agreement are inserted for reference only and shall not control or otherwise affect the meaning hereof. 10. Governing Law. This Agreement shall be construed and enforced in accordance with, and the rights and obligations of the parties hereto shall be governed by, the laws of the State of New York, without giving effect to the conflicts of law principles thereof. Each of the parties hereto hereby irrevocably and unconditionally consents to submit to the exclusive jurisdiction of the courts of the State of New York and the United States of America located in the County of New York for any action or proceeding arising out of or relating to this Agreement and the transactions contemplated hereby (and agrees not to commence any action or proceeding relating thereto except in such courts), and further agrees that service of any process, summons, notice or document by U.S. registered mail to its respective address set forth in Section 5 hereof shall be effective service of process for any action or proceeding brought against it in any such court. Each of the parties hereto hereby irrevocably and unconditionally waives any objection to the laying of venue of any action or proceeding arising out of this Agreement or the transactions contemplated hereby in the courts of the State of New York or the United States of America located in the County of New York, and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such action or proceeding brought in any such court has been brought in an inconvenient forum. 11. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, but all such counterparts shall together constitute one and the same instrument. 12. Invalidity of Provision. The invalidity or unenforceability of any provision of this Agreement in any jurisdiction shall not affect the validity or enforceability of the remainder of this Agreement in that jurisdiction or the validity or enforceability of this Agreement, including that provision, in any other jurisdiction. If any restriction or provision of this Agreement is held unreasonable, unlawful or unenforceable in any respect, such restriction or provision shall be interpreted, revised or applied in a manner that renders it lawful and enforceable to the fullest extent possible under law. 13. Further Assurances. Each party hereto shall do and perform or cause to be done and performed all further acts and things and shall execute and deliver all other agreements, -10- certificates, instruments, and documents as any other party hereto reasonably may request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby. 14. Entire Agreement; Effectiveness. This Agreement constitutes the entire agreement, and supersedes all prior agreements and understandings, oral and written, between the parties hereto with respect to the subject matter hereof. -11- IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and delivered by their respective officers thereunto duly authorized. XO COMMUNICATIONS, INC. By: /s/ William Garrahan ------------------------------- Name: William Garrahan Title: Senior Vice President and Acting Chief Financial Officer PURCHASERS CARDIFF HOLDING LLC By: /s/ Robert J. Mitchell --------------------------------- Name: Robert J. Mitchell Title: President and Treasurer TRAMORE LLC By: /s/ Edward E. Mattner --------------------------------- Name: Edward E. Mattner Title: Authorized Signatory R(2) INVESTMENTS, LDC By: Amalgamated Gadget, L.P., as its Investment Manager By: Scepter Holdings, Inc., its General Partner By:/s/ Robert McCormick ------------------------------ Name: Robert McCormick Title: Vice President -----END PRIVACY-ENHANCED MESSAGE-----