-----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, UIqw+k2OB640xFWSjVgRdNA4xKics09jKYZ2C+LBhzUiweOTrsyqHzIolap5x2gc ZCLCrsiCz+RQrK5NzuFbhQ== 0001010192-01-000047.txt : 20010322 0001010192-01-000047.hdr.sgml : 20010322 ACCESSION NUMBER: 0001010192-01-000047 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 20010321 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: I LINK INC CENTRAL INDEX KEY: 0000849145 STANDARD INDUSTRIAL CLASSIFICATION: TELEGRAPH & OTHER MESSAGE COMMUNICATIONS [4822] IRS NUMBER: 592291344 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: SEC FILE NUMBER: 005-40638 FILM NUMBER: 1574039 BUSINESS ADDRESS: STREET 1: 13751 S WADSWORTH PK DR SUITE 200 STREET 2: STE 200 CITY: DRAPER STATE: UT ZIP: 84020 BUSINESS PHONE: 8015765000 MAIL ADDRESS: STREET 1: 13751 S WADSWORTH PK DR STREET 2: STE 200 CITY: DRAPER STATE: UT ZIP: 84020 FORMER COMPANY: FORMER CONFORMED NAME: MEDCROSS INC DATE OF NAME CHANGE: 19920703 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: WINTER HARBOR LLC CENTRAL INDEX KEY: 0001059564 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 522092242 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: C/O FIRST MEDIA LP STREET 2: 11400 SKIPWITH LANE CITY: POTOMAC STATE: MD ZIP: 20854 BUSINESS PHONE: 3019832425 MAIL ADDRESS: STREET 1: C/O FIRST MEDIA LP STREET 2: 11400 SKIPWITH LANE CITY: POTOMAC STATE: MD ZIP: 20854 SC 13D/A 1 0001.txt SC 13D/A UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D/A Under the Securities Exchange Act of 1934 (Amendment No. 6) I-Link Incorporated (formerly Medcross, Inc.) -------------------------------------------------- (Name of Issuer) Common Stock, $.007 par value ---------------------------------------------------------------------- (Title of Class of Securities) 449927-10-2 --------------------------------------------------- (CUSIP Number) Ralph W. Hardy, Jr. Winter Harbor, L.L.C. 11400 Skipwith Lane, Potomac, Maryland 20854 (301) 983-2424 ------------------------------------------------------ (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) March 1, 2001 ---------------------------------------------------- (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 which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ]. 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 (the "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). - -------------------------------------------------- --------------------------- ----------------------------------------------- CUSIP No. 449927-10-2 13D Page 2 of 9 Pages - - - -------------------------------------------------- --------------------------- ----------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON Winter Harbor, L.L.C. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON - -------------------- ---------------------------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) _____ (b) X --- - -------------------- ---------------------------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------- ---------------------------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* OO - -------------------- ---------------------------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 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 7 SOLE VOTING POWER Shares 0 Beneficially Owned by Each Reporting Person With - ---------------------------- -------- ----------------------------------------------------------------------------------------- - ---------------------------- -------- ----------------------------------------------------------------------------------------- 8 SHARED VOTING POWER 5,000,000 - ---------------------------- -------- ----------------------------------------------------------------------------------------- - ---------------------------- -------- ----------------------------------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 0 - ---------------------------- -------- ----------------------------------------------------------------------------------------- - ---------------------------- -------- ----------------------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 5,000,000 - ---------------------------- -------- ----------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 5,000,000 - -------------------- ---------------------------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* _____ - -------------------- ---------------------------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 5.3%1 - -------------------- ---------------------------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* OO - -------------------- ---------------------------------------------------------------------------------------------------------- 1 Based on the share number (95,111,785 shares) reported in the current report on Form 8-K filed by I-Link Incorporated with the Securities and Exchange Commission on March 16, 2001. -2- - -------------------------------------------------- --------------------------- ----------------------------------------------- CUSIP No. 449927-10-2 13D Page 3 of 9 Pages - - - -------------------------------------------------- --------------------------- ----------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON First Media, L.P. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON - -------------------- ---------------------------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) _____ (b) X ---- - -------------------- ---------------------------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 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 7 SOLE VOTING POWER Shares 0 Beneficially Owned by Each Reporting Person With - ---------------------------- -------- ----------------------------------------------------------------------------------------- - ---------------------------- -------- ----------------------------------------------------------------------------------------- 8 SHARED VOTING POWER 5,000,000 - ---------------------------- -------- ----------------------------------------------------------------------------------------- - ---------------------------- -------- ----------------------------------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER - ---------------------------- -------- ----------------------------------------------------------------------------------------- - ---------------------------- -------- ----------------------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 5,000,000 - ---------------------------- -------- ----------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 5,000,000 - -------------------- ---------------------------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* _____ - -------------------- ---------------------------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 5.3%1 - -------------------- ---------------------------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* PN - -------------------- ---------------------------------------------------------------------------------------------------------- 1 Based on the share number (95,111,785 shares) reported in the current report on Form 8-K filed by I-Link Incorporated with the Securities and Exchange Commission on March 16, 2001. -3- SCHEDULE 13D - -------------------------------------------------- --------------------------- ----------------------------------------------- CUSIP No. 449927-10-2 13D Page 4 of 9 Pages - - - -------------------------------------------------- --------------------------- ----------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON First Media 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) X ---- - -------------------- ---------------------------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 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 7 SOLE VOTING POWER Shares 0 Beneficially Owned by Each Reporting Person With - ---------------------------- -------- ----------------------------------------------------------------------------------------- - ---------------------------- -------- ----------------------------------------------------------------------------------------- 8 SHARED VOTING POWER 5,000,000 - ---------------------------- -------- ----------------------------------------------------------------------------------------- - ---------------------------- -------- ----------------------------------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 0 - ---------------------------- -------- ----------------------------------------------------------------------------------------- - ---------------------------- -------- ----------------------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 5,000,000 - ---------------------------- -------- ----------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 5,000,000 - -------------------- ---------------------------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* _____ - -------------------- ---------------------------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 5.3%1 - -------------------- ---------------------------------------------------------------------------------------------------------- - -------------------- ---------------------------------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* CO - -------------------- ---------------------------------------------------------------------------------------------------------- 1 Based on the share number (95,111,785 shares) reported in the current report on Form 8-K filed by I-Link Incorporated with the Securities and Exchange Commission on March 16, 2001.
-4- Item 1. Security and Issuer This statement is filed pursuant to Rule 13d-2(a) with respect to the shares of common stock, $.007 par value (the "Common Stock"), of I-Link Incorporated (formerly Medcross, Inc.), a Florida corporation (the "Issuer" or "I-Link"), beneficially owned by the Reporting Persons specified herein, and amends and supplements the Schedule 13D filed April 14, 1998, Schedule 13D/A (Amendment No. 1) filed January 28, 1999, Schedule 13D/A (Amendment No. 2) filed October 20, 2000, Schedule 13D/A (Amendment No. 3) filed November 1, 2000, Schedule 13D/A (Amendment No. 4) filed January 5, 2001 and Schedule 13D/A (Amendment No. 5) filed January 19, 2001 (collectively, the "Schedule 13D"). Except as set forth herein, the Schedule 13D is unmodified. All share numbers contained herein are based on the number of outstanding shares (95,111,785 shares) reported in the Issuer's current report on Form 8-K filed on March 16, 2001. Item 3. Source and Amount of Funds or Other Consideration Item 3 of the Schedule 13D, as amended to date, is hereby incorporated by this reference and further amended and supplemented by adding the following at the end thereof: In exchange for all warrants to purchase Common Stock held by Winter Harbor, including warrants to purchase equity securities of the Issuer to be issued by the Issuer upon Winter Harbor's conversion of all convertible debt issued by the Issuer and beneficially owned by Winter Harbor convertible into 4,122 shares of Series M Preferred Stock of the Issuer, Winter Harbor received from the Issuer 5,000,000 shares of Common Stock pursuant to the Warrant Exchange Agreement dated as of March 1, 2001, by and between Winter Harbor and the Issuer (the "Warrant Exchange Agreement"). Winter Harbor also sold to Counsel Communications LLC ("Counsel Communications") all shares of Series M Preferred Stock of the Issuer and Series N Preferred Stock of the Issuer, including the 4,122 shares of Series M Preferred Stock of the Issuer issued upon Winter Harbor's conversion of all convertible debt issued by the Issuer and beneficially owned by Winter Harbor, for an aggregate purchase price of $5,000,000, pursuant to the Securities Purchase Agreement, dated as of March 1, 2001, by and between Winter Harbor and Counsel Communications (the "Counsel Securities Purchase Agreement"). Item 4. Purpose of the Transaction Item 4 of the Schedule 13D, as amended to date, is hereby incorporated by this reference and further amended and supplemented by adding the following at the end thereof: On March 1, 2001, Winter Harbor entered into the following transactions to exchange and dispose of substantially all of its interests in the Issuer. The Warrant Exchange Agreement Pursuant to the Warrant Exchange Agreement, Winter Harbor (i) converted the promissory notes issued by the Issuer in the aggregate principal amount of $7,768,000 (the "Promissory Notes") into 4,122 shares of Series M Preferred Stock of the Issuer, and (ii) exchanged with the Issuer all warrants to purchase Common Stock that were held by Winter Harbor (collectively, the "Warrants") for 5,000,000 shares of Common Stock (the "Issued Securities"). -5- The Counsel Securities Purchase Agreement Pursuant to the Counsel Securities Purchase Agreement, Winter Harbor sold to Counsel Communications the following securities beneficially owned by Winter Harbor (collectively, the "Owned Securities"), for an aggregate purchase price of $5,000,000: (a) 4,400 shares of Series M Preferred Stock of the Issuer and all accrued dividends thereon; (b) 14,404 shares Series N Preferred Stock of the Issuer; and (c) 4,122 shares of Series M Preferred Stock of the Issuer issued upon conversion of the Promissory Notes. In connection with the Counsel Securities Purchase Agreement, Winter Harbor and Counsel Communications will enter into an Escrow Agreement, by and among Winter Harbor, Counsel Communications and Union Bank of California, N.A., as escrow agent (the "Escrow Agreement"), pursuant to which Winter Harbor will deposit into escrow (i) the Issued Securities, and (ii) the $5,000,000 aggregate purchase price received from the sale of the Owned Securities. All indemnifiable losses properly due to Counsel Communications or its respective directors, officers, employees, agents, successors, assigns and their affiliates (collectively, the "Purchaser Indemnified Parties") under the Counsel Securities Purchase Agreement are to be first satisfied by transferring to Counsel Communications or the applicable Purchaser Indemnified Party a number of Issued Securities determined by dividing the applicable loss by the then current market price (as calculated by the average closing price for the Common Stock for the most recent ten (10) days upon which such securities traded). A copy of the form of Escrow Agreement is filed with this Amendment as an exhibit. In connection with the transactions contemplated by the Warrant Exchange Agreement and the Counsel Securities Purchase Agreement, the Issuer (on behalf of itself and its officers, directors, agents, employees, subsidiaries, parent entities, affiliates, and each of their respective officers, directors, agents and employees, collectively, the "Covenanting Parties") and Winter Harbor (on behalf of itself and its officers, directors, agents, employees, parent entities, direct and indirect shareholders and partners and each of their respective officers, directors, agents and employees, collectively, the "Beneficiaries") entered into a Covenant Not to Sue (the "Covenant"), a copy of which is filed with this Amendment. The Issued Securities received by Winter Harbor in exchange for the Warrants are not registered under the Securities Act. For a period of 18 months following the release of the Issued Securities from escrow pursuant to the Escrow Agreement, Winter Harbor has the right to demand the Issuer, at its expense, to register the Issued Securities pursuant to a shelf registration statement, which shall remain effective for 12 months. The summary descriptions of certain provisions of the Warrant Exchange Agreement, the Counsel Securities Purchase Agreement, the Escrow Agreement and the Covenant contained in this Amendment do not purport to be complete and are qualified in their entirety by reference to the text of such documents, which have been filed as Exhibits to this document. Winter Harbor acquired the Issued Securities for investment purposes. The Reporting Persons have no present plans, agreements, understandings or other arrangements to sell, assign or otherwise or dispose of all or any part of the Issued Securities. The Reporting Persons intend to continuously review the investment in the Issuer, and may in the future determine to (i) acquire additional securities of the Issuer, through open market purchases, private agreements or otherwise, (ii) dispose of all or a portion of the securities beneficially owned, or (iii) take any other available course of action which could involve one or more types of transactions or have one or more of the results described in this paragraph. Notwithstanding anything contained herein, the Reporting Persons reserve the right to change their intentions with respect to any or all of such matters. In reaching any decision as to their course of action (as well as to the specific elements thereof), the Reporting Persons currently expect that they would take into consideration a variety of factors, including, but not limited to, the Issuer's business and prospects, other developments concerning the Issuer and the Internet industry generally, other business opportunities available to Winter Harbor, other developments with respect to the businesses of the Reporting Persons, and general economic conditions and money and stock market conditions, including the market price of the Common Stock. -6- Item 5. Interest in Securities of the Issuer (a) Winter Harbor beneficially owns 5,000,000 shares of the Common Stock representing 5.3% of the shares of Common Stock outstanding based on the number of outstanding shares of Common Stock (95,111,785 shares) as reported in the current report on Form 8-K filed by the Issuer on March 16, 2001. (b) First Media Corporation, as the sole general partner of First Media, L.P., which in turn is the single member of Winter Harbor, controls the power to vote or dispose of the Common Stock. (c) The transactions under the Warrant Exchange Agreement, the Counsel Securities Purchase Agreement and the Covenant as described in Item 4 above were consummated on March 1, 2001. (d) None. (e) Not applicable. Neither the filing of this Amendment nor any of its contents shall be deemed to constitute an admission that Winter Harbor, First Media, L.P., and First Media Corporation are members of a "group" for purposes of Rule 13d-5, or that such group exists. Each of Winter Harbor, First Media, L.P. and First Media Corporation expressly disclaims the existence of, or membership in, any such "group." Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer Except as described in the Schedule 13D, neither Winter Harbor, First Media, L.P., nor First Media Corporation has any contracts, arrangements, understandings or relationships with respect to the securities of the Issuer. Item 7. Material to be Filed as Exhibits The exhibits filed with or incorporated in the Schedule 13D are hereby incorporated by this reference and Item 7 of the Schedule 13D is further amended and supplemented by adding the following material to be filed as exhibits hereto: 4.20 Warrant Exchange Agreement, dated as of March 1, 2001, by and between Winter Harbor and the Issuer. 4.21 Securities Purchase Agreement, dated as of March 1, 2001, by and among Winter Harbor and Counsel Communications. 4.22 Form of Escrow Agreement, by and among Winter Harbor, Counsel Communications and Union Bank of California, N.A., as escrow agent. 4.23 Covenant Not To Sue, dated as of March 1, 2001, by and between the Issuer (on behalf of itself and its officers, directors, agents, employees, subsidiaries, parent entities, affiliates, and each of their respective officers, directors, agents and employees) and Winter Harbor (on behalf of itself and its officers, directors, agents, employees, parent entities, direct and indirect shareholders and partners and each of their respective officers, directors, agents and employees). -7- SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. WINTER HARBOR, L.L.C. By: First Media, L.P., its sole Member By: First Media Corporation, its sole General Partner March 20, 2001 By: /s/ Ralph W. Hardy, Jr. - --------------------------- --------------------------------- Date Ralph W. Hardy, Jr. Secretary FIRST MEDIA, L.P. By: First Media Corporation, its sole General Partner March 20, 2001 By: /s/ Ralph W. Hardy, Jr. - --------------------------- --------------------------------- Date Ralph W. Hardy, Jr. Secretary First Media Corporation March 20, 2001 By: /s/ Ralph W. Hardy, Jr. - --------------------------- --------------------------------- Date Ralph W. Hardy, Jr. Secretary EX-4.20 2 0002.txt WARRANT AGREEMENT Exhibit 4.20 WARRANT EXCHANGE AGREEMENT This WARRANT EXCHANGE AGREEMENT, dated as of March 1, 2001 (this "Agreement"), by and between WINTER HARBOR, LLC, a Delaware limited liability company (the "Holder" or "Winter Harbor") and I-LINK, INCORPORATED, a Florida corporation (the "Company"). W I T N E S S E T H: WHEREAS, Holder proposes to transfer to the Company and the Company proposes to acquire from Holder all of the warrants to purchase equity securities of the Company beneficially owned by Holder; and NOW, THEREFORE, in consideration of the premises and the mutual covenants and agreements hereinafter contained, the parties hereby agree as follows: ARTICLE I. AUTHORIZATION AND EXCHANGE OF THE OWNED SECURITIES 1.1 Exchange of Owned Securities. Upon the terms and subject to the conditions contained herein, at the Closing (as hereinafter defined), the Holder shall assign, transfer, convey and deliver to the Company, and the Company shall be obligated to acquire from the Holder on the terms described herein, the "Owned Securities," as that term is defined in Section 6.1 hereof. ARTICLE II. CONSIDERATION AND CLOSING 2.1 Consideration. The aggregate consideration for the Owned Securities to be purchased at the Closing shall be 5,000,000 shares of common stock of the Company (the "Consideration" or the "Company Stock"). 2.2 Closing Date. The closing of the acquisition of the Owned Securities provided for in Section 1.1 hereof (the "Closing") shall take place at 3:30 p.m. Eastern Standard Time on March 1, 2001 at the offices of the Company on the date hereof. ARTICLE III. REPRESENTATIONS OF HOLDER Holder, subject to the provisions of Section 3.9, represents and warrants to the Company as follows: 3.1 Organization and Authority. Holder is a limited liability company duly organized, validly existing, and in good standing under the laws of the State of Delaware. 3.2 Authorization and Binding Obligation. Holder has full power and authority to execute and deliver this Agreement and the assignment described in Section 5.1 (this Agreement, together with the assignment being hereinafter referred to, collectively, as the "Holder Documents"), and to consummate the transactions contemplated hereby and thereby. The execution, delivery and performance by the Holder of this Agreement and each other Holder Document have been duly authorized by all necessary action on behalf of the Holder. This Agreement has been, and each other Holder Documents will be at or prior to the Closing, duly executed and delivered by the Holder and (assuming the due authorization, execution and delivery by the other parties hereto and thereto) this Agreement constitutes, and each Holder Document when so executed and delivered will constitute, legal, valid and binding obligations of the Holder, enforceable against the Holder in accordance with their respective terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors' rights and remedies generally, and subject, as to enforceability, to general principles of equity, including principles of commercial reasonableness, good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity). 3.3 Ownership of Owned Securities. Except as otherwise provided in this Agreement, Holder owns of record and beneficially the Owned Securities listed as owned by it on Exhibit A, free and clear of any lien, pledge, or other security interest or encumbrance (other than any restrictions under securities laws and restrictions under this Agreement and the I-Link Shareholders Agreement and other than those arising out of the Red Cube AG Claims or the Red Cube AG Securities Purchase Agreement (as hereinafter defined). Holder is not a party to any option, warrant, purchase right, or other contract or commitment that requires Holder to sell, transfer, or otherwise dispose of any Owned Securities (other than this Agreement and the I-Link Shareholders Agreement and other than those arising out of the Red Cube AG Claims or the Red Cube AG Securities Purchase Agreement), and, following Closing, the Company will have all rights to title to the Owned Securities being acquired. 3.4 Absence of Conflicting Agreements; Consents. To the knowledge of Holder the execution, delivery, and performance by Holder of this Agreement and the documents contemplated hereby (with or without the giving of notice, the lapse of time, or both): (a) do not require the consent of any third party; (b) will not conflict with any provision of the limited liability company agreement or certificate of formation of Holder, each as currently in effect; (c) will not conflict with, result in a breach of, or constitute a default under any permit, authorization, consent or approval of, any court, arbitrational tribunal, administrative agency or commission or other governmental or regulatory authority or agency; and (d) will not conflict with, constitute grounds for termination of, result in a breach of, constitute a default under, or accelerate or permit the acceleration of any performance required by the terms of any agreement, instrument, license, or permit to which Holder is a party or by which Holder may be bound. 3.5 Investment. Holder is acquiring the Consideration for its own account for investment and not with a view to, or for sale in connection with, any distribution thereof, nor with any present intention of distributing the same; and, except as contemplated by this Agreement or the Securities Purchase Agreement by and between Holder and Counsel Communications, LLC, Holder has no present or contemplated agreement, undertaking, arrangement, obligation, indebtedness or commitment providing for the disposition thereof. Holder is an "accredited investor" as defined in Rule 501(a) under the Securities Act of 1933, as amended (the "Securities Act"). 3.6 Experience. Holder has made detailed inquiries concerning the Company, its business and its personnel; the officers of the Company have made available to such Holder any and all written information which it has requested and have answered to such Holder's satisfaction all inquiries made by such Holder; and such Holder has sufficient knowledge and experience in finance and business that 2 it is capable of evaluating the risks and merits of its investment in the Company and such Holder is able financially to bear the risks thereof. Holder understands that unless the offer and sale of the Consideration are registered pursuant to the Securities Act, or an exemption from registration is available, Holder will not be able to sell the Consideration.. Except as required by Section 6.5, Holder understands that the Company has no present intention of registering the Consideration. 3.7 Investment Representations. Holder understands that the offer and sale of the Consideration has not been registered under the Securities Act. Holder also understands that the Consideration is being offered and sold pursuant to an exemption from registration pursuant to the Securities Act. 3.8 Litigation. Other than any legal proceeding with Red Cube International AG ("Red Cube AG"), there are no legal proceedings pending or, to the knowledge of the Company, threatened that are reasonably likely to prohibit or restrain the ability of the Company to enter into this Agreement or consummate the transactions contemplated hereby. Nothing in this Agreement shall be construed to assign, affect, or release any claim, right of recovery or amounts due to the Company from Red Cube AG, KPR Finanz-Und Verwlatungs AG ("KPR") or any of their respective parent entities, subsidiaries, affiliates, officers, directors, shareholders, agents or employees or any person or entity acting in concert therewith (the "Red Cube Affiliates"). Winter Harbor shall, at the Company's sole expense, render all reasonable assistance in the prosecution of any claims by the Company against Red Cube AG, KPR or the Red Cube AG Affiliates. 3.9 Exclusion. The Company has been apprised of that certain Securities Purchase Agreement by and among the Holder, KPR and Red Cube, dated August 30, 2000 (as amended, the "Red Cube AG Securities Purchase Agreement"), the Holder's termination thereof and Red Cube and KPR's allegation regarding their purported rights to the Covered Securities pursuant thereto. No representation, warranty or statement, express or implied, made by or on behalf of the Holder shall be deemed to be false or misleading or shall form the basis of any claim against the Holder, its directors, officers, agents or shareholders as a result of any claim of any kind or nature made by or on behalf of Red Cube, KPR or their respective Affiliates, officers, directors, agents, employees, creditors or shareholders (a "Red Cube Claim"). ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF THE COMPANY The Company hereby represents and warrants to Holder that: 4.1 Authorization of Agreement. The Company has full power and authority to execute and deliver this Agreement and each other agreement, document, instrument or certificate contemplated by this Agreement or to be executed by the Company in connection with the consummation of the transactions contemplated hereby and thereby (this Agreement, together with such other agreements, documents, instruments and certificates being hereinafter referred to, collectively, as the "Company Documents"), and to consummate the transactions contemplated hereby and thereby. The execution, delivery and performance by the Company of this Agreement and each other Company Document have been duly authorized by all necessary action on behalf of the Company. This Agreement has been, and each other Company Documents will be at or prior to the Closing, duly 3 executed and delivered by the Company and (assuming the due authorization, execution and delivery by the other parties hereto and thereto) this Agreement constitutes, and each Company Document when so executed and delivered will constitute, legal, valid and binding obligations of the Company, enforceable against the Company in accordance with their respective terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors' rights and remedies generally, and subject, as to enforceability, to general principles of equity, including principles of commercial reasonableness, good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity). 4.2 Conflicts; Consents of Third Parties. No consent, waiver, approval, order, permit or authorization of, or declaration or filing with, or notification to, any Person or governmental body is required on the part of the Company in connection with the execution and delivery of this Agreement or the Company Documents or the compliance by the Company with any of the provisions hereof or thereof. 4.3 Litigation. There are no legal proceedings pending or, to the knowledge of the Company, threatened that are reasonably likely to prohibit or restrain the ability of the Company to enter into this Agreement or consummate the transactions contemplated hereby. 4.4 Red Cube Litigation. Nothing in this Agreement shall be construed to assign, affect, or release any claim, right of recovery or amounts due to Winter Harbor from Red Cube AG, KPR or any of their respective parent entities, subsidiaries, affiliates, officers, directors, shareholders, agents or employees or any person or entity acting in concert therewith (the "Red Cube AG Defendants"). The Company shall, at Winter Harbor's sole expense, render all reasonable assistance in the prosecution of any claims by Winter Harbor against Red Cube AG, KPR or the Red Cube AG Defendants. 4.5 Absence of Conflicting Agreements; Consents. To the knowledge of the Company the execution, delivery, and performance by the Company of this Agreement and the documents contemplated hereby (with or without the giving of notice, the lapse of time, or both): (a) do not require the consent of any third party; (b) will not conflict with any provision of the Articles of Incorporation or Bylaws of the Company, each as currently in effect; (c) will not conflict with, result in a breach of, or constitute a default under any permit, authorization, consent or approval of, any court, arbitrational tribunal, administrative agency or commission or other governmental or regulatory authority or agency; and (d) will not conflict with, constitute grounds for termination of, result in a breach of, constitute a default under, or accelerate or permit the acceleration of any performance required by the terms of any agreement, instrument, license, or permit to which the Company is a party or by which the Company may be bound. 4.6 Company Stock. The Company Stock issued hereunder is fully paid, validly issued and nonassessable and is free and clear of any lien, pledge or other security interest or encumbrance (other than any restrictions under the securities laws). Following Closing, Holder will have all rights to title to the Company Stock. Attached hereto as Exhibit A is an accurate description of the warrants issued by the Company to Holder. 4 ARTICLE V. DOCUMENTS TO BE DELIVERED 5.1 Deliveries by the Holder to the Company at the Closing. At Closing, Holder shall deliver, or shall cause to be delivered, to the Company certificates representing the Owned Securities (to the extent such Owned Securities are certificated), together with duly executed assignments separate from certificate in form and substance sufficient to effectuate the transfer of the Owned Securities to the Company, free and clear of any lien, pledge or other security interest or encumbrance (other than any restrictions under the securities laws and restrictions under this Agreement and the I-Link Shareholders Agreement and other than the Red Cube AG Claims). 5.2 Deliveries by the Holder to the Company Prior to Closing. On or before 3:15 p.m. Eastern Standard Time on March 1, 2001, Holder shall deliver, or shall cause to be delivered, to the Company duly executed instruments effecting the conversion of all convertible debt issued by the Company and beneficially owned by the Holder (the "Convertible Debt"), which is convertible into 4,122 shares of Series M Preferred Stock, in accordance with the documents and instruments governing the Convertible Debt. 5.3 Deliveries by the Company at the Closing. The Company shall have delivered, or cause to be delivered, to Holder an irrevocable instruction letter addressed to the Company's transfer agent, instructing such transfer agent to issue certificates representing the Consideration free and clear of any lien, pledge or other security interest or encumbrance (other than any restrictions under the securities laws) to the Holder within three (3) business days of the date of this Agreement. The Company hereby covenants with the Holder that such certificates shall be delivered to Holder within three (3) business days. Each certificate representing the Consideration shall be stamped or otherwise imprinted with the following legend: THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR THE SECURITIES LAWS OF ANY STATE. THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE TRANSFERRED, AND THE COMPANY WILL NOT REGISTER THE TRANSFER OF SUCH SECURITIES, EXCEPT (A) IF REGISTERED UNDER THE ACT, (B) PURSUANT TO RULE 144 UNDER THE ACT OR (C) UPON RECEIPT BY THE COMPANY OF AN OPINION OF COUNSEL, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH TRANSFER IS EXEMPT FROM REGISTRATION UNDER THE ACT. 5.4 Conversion of Owned Securities at Closing. Effective at the time of Closing, all of the Owned Securities shall automatically terminate, and become null and void, without the necessity of any further action by any party hereto. 5 ARTICLE VI. MISCELLANEOUS 6.1 Certain Definitions. For purposes of this Agreement, the following terms shall have the meanings specified in this Section 6.1: "Order" means any order, injunction, judgment, decree, ruling, writ, assessment or arbitration award. "Owned Securities" means all of the warrants to purchase equity securities of the Company beneficially owned by Holder, including warrants to purchase equity securities of the Company that will be issued by the Company upon the Holder's conversion of any convertible debt pursuant to Section 5.2 hereof, and prior to the Closing contemplated by Sections 5.1 and 5.3 hereof. "Person" means any individual, corporation, partnership, firm, joint venture, association, joint-stock company, trust, unincorporated organization, Governmental Body or other entity. 6.2 Survival of Representations and Warranties; Covenants. (a) Representations and Warranties. The parties hereto hereby agree that the representations and warranties contained in this Agreement, shall survive the execution and delivery of this Agreement, and the Closing hereunder, regardless of any investigation made by the parties hereto, through the period until the applicable statute of limitations is reached. (b) Covenants. All covenants and agreements of the parties herein shall survive the consummation of the transactions contemplated hereby. 6.3 Specific Performance. Each of the Company and Holder acknowledges and agrees that the breach of this Agreement would cause irreparable damage to the Company and/or the Holder and that the Company and/or the Holder will not have an adequate remedy at law. Therefore, the obligations under this Agreement shall be enforceable by a decree of specific performance issued by any court of competent jurisdiction, and appropriate injunctive relief may be applied for and granted in connection therewith. Such remedies shall, however, be cumulative and not exclusive and shall be in addition to any other remedies which any party may have under this Agreement or otherwise. 6.4 Other Assurances. The Holder and the Company each agree to execute and deliver such other documents or agreements and to take such other action as may be necessary for the implementation of this Agreement and the consummation of the transactions contemplated hereby. 6.5 Submission to Jurisdiction; Consent to Service of Process. (a) The parties hereto hereby irrevocably submit to the non-exclusive jurisdiction of any federal or state court located within the State of New York over any dispute arising out of or relating to this Agreement or any of the transactions contemplated hereby and each party hereby irrevocably agrees that 6 all claims in respect of such dispute or any suit, action proceeding related thereto may be heard and determined in such courts. THE PARTIES HEREBY IRREVOCABLY WAIVE ANY RIGHT TO A TRIAL BY A JURY. The parties hereby irrevocably waive, to the fullest extent permitted by applicable law, any objection which they may now or hereafter have to the laying of venue of any such dispute brought in such court or any defense of inconvenient forum for the maintenance of such dispute. Each of the parties hereto agrees that a judgment in any such dispute may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. (b) Each of the parties hereto hereby consents to process being served by any party to this Agreement in any suit, action or proceeding by the mailing of a copy thereof in accordance with the provisions of Section 6.9 hereof. 6.6 Demand Registration. For a period of 18 months following the release to Holder of the Company Stock from escrow pursuant to the Escrow Agreement to be entered into by and among Holder, Counsel Communications LLC (U.S.), and the escrow agent named therein, Holder shall have the right to demand and the Company shall, at its expense, register the Company Stock pursuant to a shelf registration statement. Such registration statement shall remain effective for twelve (12) months.. 6.7 Entire Agreement; Amendments and Waivers. This Agreement (including the schedules and exhibits hereto) represents the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and can be amended, supplemented or changed, and any provision hereof can be waived, only by written instrument making specific reference to this Agreement signed by the Company and the Holder. 6.8 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York without giving effect to their conflict of laws principles. 6.9 Notices. All notices and other communications under this Agreement shall be in writing and shall be deemed given when delivered personally or mailed by certified mail, return receipt requested, to the parties (and shall also be transmitted by facsimile to the Persons receiving copies thereof) at the following addresses (or to such other address as a party may have specified by notice given to the other party pursuant to this provision). If to the Holder: Winter Harbor, LLC 11400 Skipwith Lane Potomac, Maryland 20854-1639 Attention: Ralph W. Hardy, Jr. 7 With a copy to: Dow, Lohnes & Albertson, PLLC 1200 New Hampshire Avenue, NW Suite 800 Washington, DC 20036-6802 Attention: David D. Wild Facsimile: (202) 776-2222 If to the Company, to: I-Link, Incorporated 13751 S. Wadsworth Park Drive Suite 200 Draper, UT 84020 Attention: John W. Edwards, Chairman and Chief Executive Officer Facsimile: (801) 576-5000 With a copy to: De Martino Finkelstein Rosen & Virga 1818 N Street, N.W. Suite 400 Washington, DC 20036 Attention: Ralph V. De Martino, Esq. Facsimile: (202) 659-1290 9.12 Severability. If any provision of this Agreement is invalid or unenforceable, the balance of this Agreement shall remain in effect. 9.13 Binding Effect; Assignment. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and permitted assigns. Nothing in this Agreement shall create or be deemed to create any third party beneficiary rights in any person or entity not a party to this Agreement. No assignment of this Agreement or of any rights or obligations hereunder may be made by the Company (by operation of law or otherwise) without the prior written consent of the other parties hereto and any attempted assignment without the required consents shall be void. 9.14 Counterparts. This Agreement may be executed in two counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument. [THE REMAINDER OF THIS PAGE IS LEFT INTENTIONALLY BLANK.] 8 WARRANT EXCHANGE AGREEMENT SIGNATURE PAGE IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first written above. THE HOLDER WINTER HARBOR, LLC By: First Media, L.P., its sole member and manager By: First Media Corporation, its sole general partner By: /s/Ralph W. Hardy -------------------------------------- Name: Ralph W. Hardy --------------------------------- Title: Secretary -------------------------------- THE COMPANY I-LINK, INCORPORATED By:/s/John W. Edwards -------------------------------------- Name: John W. Edwards --------------------------------- Title: Chief Executive Officer -------------------------------- 9 EX-4.21 3 0003.txt PURCHASE AGREEMENT Exhibit 4.21 SECURITIES PURCHASE AGREEMENT SECURITIES PURCHASE AGREEMENT, dated as of March 1, 2001 (this "Agreement"), by and among WINTER HARBOR, LLC, a Delaware limited liability company (the "Holder" or "Winter Harbor") and COUNSEL COMMUNICATIONS LLC (the "Purchaser" or "Counsel"). W I T N E S S E T H: WHEREAS, Holder proposes to sell to Purchaser, and Purchaser proposes to purchase from Holder all of the securities and other convertible instruments as reflected on Exhibit A (the "Owned Securities"), which constitute all of the debt and equity interests in I-Link, Incorporated (the "Company") beneficially owned by Holder, other than the 5,000,000 shares of common stock issued by the Company to Holder pursuant to the Warrant Exchange Agreement between Holder and the Company dated of the date hereof (the "Warrant Exchange Agreement"); and NOW, THEREFORE, in consideration of the premises and the mutual covenants and agreements hereinafter contained, the parties hereby agree as follows: ARTICLE I. AUTHORIZATION AND SALE OF THE OWNED SECURITIES 1.1 Sale and Purchase of Owned Securities. Upon the terms and subject to the conditions contained herein at the Closing (as hereinafter defined), the Holder shall sell, assign, transfer, convey and deliver to the Purchaser, and the Purchaser shall be obligated to purchase from the Holder on the terms described herein, the Owned Securities. ARTICLE II. PURCHASE PRICE AND CLOSING 2.1 Purchase Price. The aggregate purchase price for the Owned Securities to be purchased at the Closing shall be US$5,000,000 (the "Purchase Price"). 2.2 Closing Date. The closing of the purchase and sale of the Owned Securities provided for in Section 1.1 hereof (the "Closing") shall take place at 3:30 p.m. at the offices of the Company on the date hereof. ARTICLE III. REPRESENTATIONS OF HOLDER Holder represents and warrants to Counsel, subject to the provisions of Section 3.9, as follows: 3.1 Organization and Authority. Holder is a limited liability company duly organized, validly existing, and in good standing under the laws of the State of Delaware. 3.2 Authorization and Binding Obligation. Holder has full power and authority to execute and deliver this Agreement and the assignment documents described in Section 5.1 (this Agreement, together with such other assignment documents being hereinafter referred to, collectively, as the "Holder Documents"), and to consummate the transactions contemplated hereby and thereby. The execution, delivery and performance by the Holder of this Agreement and each other Holder Document have been duly authorized by all necessary action on behalf of the Holder. This Agreement has been, and each other Holder Documents will be at or prior to the Closing, duly executed and delivered by the Holder and (assuming the due authorization, execution and delivery by the other parties hereto and thereto) this Agreement constitutes, and each Holder Document when so executed and delivered will constitute, legal, valid and binding obligations of the Holder, enforceable against the Holder in accordance with their respective terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors' rights and remedies generally, and subject, as to enforceability, to general principles of equity, including principles of commercial reasonableness, good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity). 3.3 Ownership of Stock. Holder owns of record and beneficially the Owned Securities listed as owned by it on Exhibit A, free and clear of any lien, pledge, or other security interest or encumbrance (other than any restrictions under securities laws and restrictions under this Agreement, the I-Link Shareholders Agreement and other than those arising out of the Red Cube AG Claims (as hereinafter defined)). Holder is not a party to any option, warrant, purchase right, or other contract or commitment that requires Holder to sell, transfer, or otherwise dispose of any Owned Securities (other than this Agreement, the I-Link Shareholders Agreement and those arising out of the Red Cube AG Claims (as hereinafter defined)), and, following Closing, Counsel will have no restrictions on its ability to vote or otherwise exercise all rights to title to the Owned Securities being acquired. 3.4 Voting Authority. Holder is not a party to any voting agreement with respect to any of the Owned Securities other than the I-Link Shareholders Agreement or arising out of the Red Cube AG Securities Purchase Agreement and has not granted a revocable or an irrevocable proxy to any Person with respect to any of the Owned Securities other than the proxy granted to Red Cube, which proxy has been expired or terminated. 3.5 Absence of Conflicting Agreements; Consents. To the knowledge of Holder the execution, delivery, and performance by Holder of this Agreement and the documents contemplated hereby (with or without the giving of notice, the lapse of time, or both): (a) do not require the consent of any third party; (b) will not conflict with any provision of the limited liability company agreement or certificate of formation of Holder, each as currently in effect; (c) will not conflict with, result in a breach of, or constitute a default under any Legal Requirement; and (d) will not conflict with, constitute grounds for termination of, result in a breach of, constitute a default under, or accelerate or permit the acceleration of any performance required by the terms of any agreement, instrument, license, or permit to which Holder is a party or by which Holder may be bound. 3.6 Disclosure. No representation or warranty of Holder contained in this Agreement contains any untrue statement of a material fact, or omits to state any material fact which is required to be stated therein to make the statements contained herein, in the light of the circumstances in which they were made, not misleading. 3.7 No Related Party Transactions. Except as set forth on Schedule 3.7, Holder does not have any interest in any property used in I-Link's business, has -2 no equity or other financial interest in any person that has business dealings with I-Link or a material financial interest in any transaction to which I-Link is a party, other than in the ordinary course of business and at market prices and on market terms, is not engaged in competition with I-Link, is not party to any contract with I-Link, and does not have any claim or right against I-Link 3.8 Litigation. Other than any Legal Proceeding with Red Cube International AG ("Red Cube AG"), there are no Legal Proceedings pending or, to the knowledge of the Purchaser, threatened that are reasonably likely to prohibit or restrain the ability of the Purchaser to enter into this Agreement or consummate the transactions contemplated hereby. 3.9 Exclusion. Counsel has been appraised of that certain Securities Purchase Agreement by and among Winter Harbor, KPR Finanz-Und Verwlatungs AG ("KPR") and Red Cube AG, dated August 30, 2000 (as amended, the "Red Cube AG Securities Purchase Agreement"), Winter Harbor's termination thereof and Red Cube AG and KPR's allegation regarding their purported rights to the Covered Securities pursuant thereto. No representation, warranty or statement, express or implied, made by or on behalf of Winter Harbor shall be deemed to be false or misleading or shall form the basis of any claim against Winter Harbor, its directors, officers, agents or shareholders, except for indemnity claims pursuant to Section 6.3 hereof, as a result of any claim of any kind or nature made by or on behalf of Red Cube AG, KPR or their respective Affiliates, officers, directors, agents, employees, creditors or shareholders (a "Red Cube AG Claim"). ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER Purchaser hereby represents and warrants to Holder that: 4.1 Authorization of Agreement. Purchaser has full power and authority to execute and deliver this Agreement and each other agreement, document, instrument or certificate contemplated by this Agreement or to be executed by Purchaser in connection with the consummation of the transactions contemplated hereby and thereby (this Agreement, together with such other agreements, documents, instruments and certificates being hereinafter referred to, collectively, as the "Purchaser Documents"), and to consummate the transactions contemplated hereby and thereby. The execution, delivery and performance by the Purchaser of this Agreement and each other Purchaser Document have been duly authorized by all necessary action on behalf of the Purchaser. This Agreement has been, and each other Purchaser Documents will be at or prior to the Closing, duly executed and delivered by the Purchaser and (assuming the due authorization, execution and delivery by the other parties hereto and thereto) this Agreement constitutes, and each Purchaser Document when so executed and delivered will constitute, legal, valid and binding obligations of the Purchaser, enforceable against the Purchasers in accordance with their respective terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors' rights and remedies generally, and subject, as to enforceability, to general principles of equity, including principles of commercial reasonableness, good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity). -3 4.2 Litigation. There are no Legal Proceedings pending or, to the knowledge of the Purchaser, threatened that are reasonably likely to prohibit or restrain the ability of the Purchaser to enter into this Agreement or consummate the transactions contemplated hereby. 4.3 Red Cube Litigation. Nothing in this Agreement shall be construed to assign, affect, or release any claim, right of recovery or amounts due to Winter Harbor from Red Cube AG, KPR or any of their respective parent entities, subsidiaries, Affiliates, officers, directors, shareholders, agents or employees or any person or entity acting in concert therewith (the "Red Cube AG Defendants"). Counsel shall, at Winter Harbor's sole expense, render all reasonable assistance in the prosecution of any claims by Winter Harbor against Red Cube AG, KPR or the Red Cube AG Defendants. 4.4 Absence of Conflicting Agreements; Consents. To the knowledge of Purchaser the execution, delivery, and performance by Purchaser of this Agreement and the documents contemplated hereby (with or without the giving of notice, the lapse of time, or both): (a) do not require the consent of any third party; (b) will not conflict with any provision of the limited liability company agreement or certificate of formation of Purchaser, each as currently in effect; (c) will not conflict with, result in a breach of, or constitute a default under any Legal Requirement; and (d) will not conflict with, constitute grounds for termination of, result in a breach of, constitute a default under, or accelerate or permit the acceleration of any performance required by the terms of any agreement, instrument, license, or permit to which Purchaser is a party or by which Purchaser may be bound. 4.5 Disclosure. No representation or warranty of Purchaser contained in this Agreement contains any untrue statement of a material fact, or omits to state any material fact which is required to be stated therein to make the statements contained therein, in the light of the circumstances in which they were made, not misleading. ARTICLE V. DOCUMENTS TO BE DELIVERED 5.1 Deliveries by the Holder to the Purchaser at the Closing. The Holder shall deliver, or shall cause to be delivered, to the Purchaser certificates representing the Owned Securities (to the extent such Securities are certificated), together with duly executed assignments separate from certificate in form and substance sufficient to effectuate the transfer of the Owned Securities to the Purchaser, free and clear of any lien, pledge, or other security interest or encumbrance (other than any restrictions under securities laws and restrictions under this Agreement and the I-Link Shareholders Agreement and other than Red Cube A.G. Claims). 5.2 Deliveries by the Purchaser at the Closing. The Purchaser shall pay at the Closing to the Holder the Purchase Price by wire transfer of immediately available funds. ARTICLE VI. INDEMNIFICATION 6.1 Indemnification. (a) Subject to Section 6.3, the Holder hereby agrees to indemnify and hold the Purchaser and its respective directors, officers, employees, agents, successors, assigns and their affiliates (collectively, the "Purchaser Indemnified Parties") harmless from and against any and all losses, liabilities, -4 obligations, damages, claims, judgments, assessments, penalties, costs and expenses, including reasonable attorneys' and other professionals' fees and disbursements paid by either the indemnified or indemnifying party (collectively, "Losses") based upon, attributable to or resulting from the breach of any representation, warranty or covenant of the Holder set forth herein. (a) The Purchaser hereby agrees to indemnify and hold the Holder and its directors, officers, employees, agents and successors (collectively, the "Holder Indemnified Parties") harmless from and against any and all Losses based upon, attributable to or resulting from the breach of any representation, warranty or covenant of the Purchaser set forth herein. 6.2 Indemnification Procedures. (a) In the event that any third-party legal proceedings shall be instituted or any third-party claim or demand ("Claim") shall be asserted by any Person in respect of which payment may be sought under Section 6.1 or Section 6.3 hereof, the indemnified party shall promptly cause written notice of the assertion of any Claim of which it has knowledge which is covered by this indemnity to be forwarded to the indemnifying party. The indemnifying party shall have the right, in its sole discretion, to be represented by counsel of its choice, and to thereby assume the defense of, negotiate, settle or otherwise deal with any Claim which relates to any Losses indemnified against hereunder. If the indemnifying party elects to assume the defense of, negotiate, settle or otherwise deal with any Claim which relates to any Losses indemnified against hereunder, it shall within five (5) days of receipt of written notice of the assertion of a Claim (or sooner, if the nature of the Claim so requires) notify the indemnified party of its intent to do so. If the indemnifying party elects not to defend against, negotiate, settle or otherwise deal with any Claim which relates to any Losses indemnified against hereunder, fails to notify the indemnified party of its election as herein provided or contests its obligation to indemnify the indemnified party for such Losses under this Agreement, the indemnified party may defend against, negotiate, settle or otherwise deal with such Claim. If the indemnifying party shall assume the defense of any Claim, the indemnified party may participate, at his or its own expense, in the defense of such Claim; provided, however, that such indemnified party shall be entitled to participate in any such defense with separate counsel if, (i) so requested by the indemnifying party to participate or (ii) in the reasonable opinion of counsel to the indemnified party, a conflict or potential conflict exists between the indemnified party and the indemnifying party that would make such separate representation advisable. The parties hereto agree to cooperate fully with each other in connection with the defense, negotiation or settlement of any such Claim. (b) After any final judgment or award shall have been rendered by a court, arbitration board or administrative agency of competent jurisdiction and the expiration of the time in which to appeal therefrom, or a settlement shall have been consummated, or the indemnified party and the indemnifying party shall have arrived at a mutually binding agreement with respect to a Claim hereunder, the indemnified party shall forward to the indemnifying party and the escrow agent under the escrow agreement of even date herewith between the Holder, the Purchaser and such escrow agent notice of any Losses pursuant to this Agreement with respect to such matter. -5 (c) Except with respect to the determination of an Escrow Termination Event (as hereinafter defined), the failure of the indemnified party to give reasonably prompt notice of any Claim shall not release, waive or otherwise affect the indemnifying party's obligations with respect thereto except to the extent that the indemnifying party can demonstrate actual loss and prejudice as a result of such failure. 6.3 Escrow. (a) Upon receipt thereof, Winter Harbor shall deposit in an interest bearing escrow (the "Escrow") the Purchase Price and those securities issued to Winter Harbor pursuant to the Securities Exchange Agreement (such securities and any additional or other shares or securities or property into which such securities are converted or for which such securities are exchanged including through any reorganization, recapitalization, reclassification, stock dividend, stock split or reverse stock split, or other transaction being the "Issued Securities"). The Escrow shall terminate, and the remaining contents thereof transferred to Winter Harbor, free and clear of any claim, liens, encumbrances by Purchaser or any Purchaser Indemnified Party, upon the first occurrence of an Escrow Termination Event. An Escrow Termination Event shall have occurred upon the earlier of (i) the end of the 540th day after the date of this Agreement, if during such period no Red Cube AG Claim premised upon the Red Cube AG Securities Purchase Agreement has been initiated (other than a claim in connection with the mediation currently pending before the American Arbitration Association), and (ii) the final resolution or settlement of all claims brought against Winter Harbor or Purchaser before the 540th day after the date of this Agreement that could result in potentially indemnifiable losses related to any Red Cube AG Claim. (b) Winter Harbor and Purchaser acknowledge that as a result of the transaction contemplated by this Agreement, there is a risk that Purchaser or a Purchaser Indemnified Party may be exposed to (i) Losses resulting from a determination and order by a court of competent jurisdiction, arbitral panel or other adjudicatory entity that, pursuant to the Red Cube AG Securities Purchase Agreement, Red Cube AG is entitled to the transfer of ownership from Purchaser of all or substantially all the Covered Securities (a "Specific Performance Claim") or (ii) Losses premised upon the Red Cube AG Securities Purchase Agreement and which arise from a Red Cube AG Claim which is not a Specific Performance Claim (a "Red Cube Damage Claim"). If, prior to the occurrence of an Escrow Termination Event, Purchaser or a Purchaser Indemnified Person gives notice of a Specific Performance Claim or a claim under Section 6.1(a) above, then Winter Harbor shall, solely out of and up to a maximum of the Issued Securities and Purchase Price deposited in the Escrow, indemnify and hold harmless Purchaser and Purchaser Indemnified Person from all Losses arising out of such Specific Performance Claim or claim under Section 6.1(a) above. If, prior to the occurrence of an Escrow Termination Event, Purchaser or a Purchaser Indemnified Person gives notice of a Red Cube Damage Claim, then Winter Harbor shall, solely out of and up to a maximum of the Issued Securities deposited in the Escrow, indemnify and hold harmless Purchaser and Purchaser Indemnified Person from all Losses arising out of such Red Cube Damage Claim. Winter Harbor's total aggregate liability for all Specific Performance Claims and all claims under Section 6.1(a) above shall not exceed the loss of its right to the Issued Securities and Purchase Price deposited in the Escrow. Winter Harbor's total aggregate liability for all Red Cube Damage Claims shall not exceed the loss of its right to the Issued Securities deposited in the Escrow. -6 (c) All Losses properly due a Purchaser or Purchaser Indemnified Person pursuant to this Section 6.3, Section 6.1 and Section 6.2 (including, without limitation, reimbursement of attorneys' or other professional fees arising out of article VI of this Agreement) shall first be satisfied by transferring to Purchaser or the applicable Purchaser Indemnified Party a number of Issued Securities determined by dividing the applicable Loss by the then current market price (as calculated by the average closing price for I-Link common stock for the most recent ten (10) days upon which such securities traded) of such shares. In the event that the total number of Issued Securities then deposited in the Escrow is insufficient to satisfy the applicable Losses, and solely where such Losses arise exclusively and solely from a Red Cube Specific Performance Claim or from a claim under Section 6.1(a), any shortfall shall be satisfied by transferring to the Purchaser or applicable Purchaser Indemnified Person, a portion, up to a maximum of the total Purchase Price, of the cash proceeds then deposited in the Escrow. 6.4 Tax Treatment of Indemnity Payments. The parties agree to treat any indemnity payment made pursuant to this Article VI as an adjustment to the Purchase Price for federal, state, local and foreign income tax purposes. 6.5 Settlement of Specific Performance Claims. Holder hereby agrees it shall not enter into any agreement to settle any Specific Performance Claim that would attempt to transfer to any other party any right, title to or interest in or to the Owned Securities from Purchaser. ARTICLE VII. MISCELLANEOUS 7.1 Certain Definitions. For purposes of this Agreement, the following terms shall have the meanings specified in this Section 7.1: "Affiliate" means, with respect to any Person, any other Person controlling, controlled by or under common control with such Person. "Legal Requirement" means applicable common law and any applicable law, statute, regulation, rule, ordinance, order, administrative order, treaty, standard, decree or judgment enacted, adopted, or promulgated by any governmental authority and having the full force and effect of law. "Order" means any order, injunction, judgment, decree, ruling, writ, assessment or arbitration award. "Person" means any individual, corporation, partnership, firm, joint venture, association, joint-stock company, trust, unincorporated organization, Governmental Body or other entity. 7.2 Survival of Representations and Warranties; Covenants. (a) Representations and Warranties. The parties hereto hereby agree that the representations and warranties contained in this Agreement shall survive the execution and delivery of this Agreement, and the Closing hereunder, regardless -7 of any investigation made by the parties hereto, through the period until the applicable statute of limitations is reached. (b) Covenants. All covenants and agreements of the parties herein shall survive the consummation of the transactions contemplated hereby. 7.3 Specific Performance. Holder acknowledges and agrees that the breach of this Agreement would cause irreparable damage to the Purchaser and that the Purchaser will not have an adequate remedy at law. Therefore, the obligations of the Holder under this Agreement, including, without limitation, the Holder's obligation to sell the Owned Securities to the Purchaser, shall be enforceable by a decree of specific performance issued by any court of competent jurisdiction, and appropriate injunctive relief may be applied for and granted in connection therewith. Such remedies shall, however, be cumulative and not exclusive and shall be in addition to any other remedies which any party may have under this Agreement or otherwise. 7.4 Other Assurances. The Holder and the Purchaser each agree to execute and deliver such other documents or agreements and to take such other action as may be necessary for the implementation of this Agreement and the consummation of the transactions contemplated hereby. 7.5 Submission to Jurisdiction; Consent to Service of Process. The parties hereto hereby irrevocably submit to the non-exclusive jurisdiction of any federal or state court located within the State of New York over any dispute arising out of or relating to this Agreement or any of the transactions contemplated hereby and each party hereby irrevocably agrees that all claims in respect of such dispute or any suit, action proceeding related thereto may be heard and determined in such courts. THE PARTIES HEREBY IRREVOCABLY WAIVE ANY RIGHT TO A TRIAL BY A JURY. The parties hereby irrevocably waive, to the fullest extent permitted by applicable law, any objection which they may now or hereafter have to the laying of venue of any such dispute brought in such court or any defense of inconvenient forum for the maintenance of such dispute. Each of the parties hereto agrees that a judgment in any such dispute may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Each of the parties hereto hereby consents to process being served by any party to this Agreement in any suit, action or proceeding by the mailing of a copy thereof in accordance with the provisions of Section 7.8 hereof. 7.6 Entire Agreement; Amendments and Waivers. This Agreement (including the schedules and exhibits hereto) represents the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and can be amended, supplemented or changed, and any provision hereof can be waived, only by written instrument making specific reference to this Agreement signed by the Purchaser and the Holder. 7.7 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York. -8 7.8 Notices. All notices and other communications under this Agreement shall be in writing and shall be deemed given when delivered personally or mailed by certified mail, return receipt requested, to the parties (and shall also be transmitted by facsimile to the Persons receiving copies thereof) at the following addresses (or to such other address as a party may have specified by notice given to the other party pursuant to this provision): If to the Holder: Winter Harbor, LLC 11400 Skipwith Lane Potomac, Maryland 20854-1639 Attention: Ralph W. Hardy, Jr. With a copy to: Dow, Lohnes & Albertson, PLLC 1200 New Hampshire Avenue, NW Suite 800 Washington, DC 20036-6802 Attention: David D. Wild Facsimile: (202) 776-2222 If to a Purchaser, to: Counsel Corporation (US) 280 Park Avenue West Building, 28th Floor New York, NY 10017 Attention: Chief Executive Officer Facsimile: (212) 286-5000 With a copy to: Harwell Howard Hyne Gabbert & Manner, PC 1800 First American Center Nashville TN 37238 Attention: Mark Manner Facsimile: (615) 251-1056 7.9 Consequential or Special Damages. No party hereto shall be entitled to any consequential or special damages. All liabilities related to or arising under this Agreement, including all obligations of indemnity hereunder, shall be limited to the maximum amount set forth in Section 6.3(b) herein. 7.10 Severability. If any provision of this Agreement is invalid or unenforceable, the balance of this Agreement shall remain in effect. -9 7.11 Binding Effect; Assignment. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and permitted assigns. Nothing in this Agreement shall create or be deemed to create any third party beneficiary rights in any person or entity not a party to this Agreement. No assignment of this Agreement or of any rights or obligations hereunder may be made by the Purchaser (by operation of law or otherwise) without the prior written consent of the other parties hereto and any attempted assignment without the required consents shall be void; provided, however, that Purchaser may assign its rights and obligations under this Agreement (including, without limitation, such Purchaser's rights to purchase the Owned Securities and to seek indemnification hereunder) to any affiliate of Purchaser and may transfer its rights and obligations under this Agreement, upon obtaining consent of Holder (which shall not be unreasonably withheld) to any key employee(s) or personnel of Purchaser. Upon any such permitted assignment, the references in this Agreement to the Purchasers shall also apply to any such assignee unless the context otherwise requires. 7.12 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument. [Remainder of page intentionally left blank.] -10 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first written above. THE HOLDER WINTER HARBOR, LLC By: First Media, L.P., its member By: First Media Corporation, its general partner By:/s/Ralph W. Hardy --------------------------------- Name: Ralph W. Hardy Title: Secretary THE PURCHASER COUNSEL COMMUNICATIONS LLC By:/s/Stephen Weintraub ------------------------------------ Name: Stephen Weintraub Title: Assistant Secretary -11 Exhibit A -12 EX-4.22 4 0004.txt FORM OF ESCROW AGREEMENT Exhibit 4.22 ESCROW AGREEMENT THIS ESCROW AGREEMENT (the "Agreement") is made as of March __, 2001, by and among WINTER HARBOR, LLC, a Delaware limited liability company (the "Holder"), COUNSEL COMMUNICATIONS LLC (the "Purchaser" or "Counsel"), and UNION BANK OF CALIFORNIA, N.A., as escrow agent (the "Escrow Agent"). Holder and Purchaser have entered into a Securities Purchase Agreement, dated as of March 1, 2001 (the "Purchase Agreement"). Section 6.3 of the Purchase Agreement requires that Holder and Purchaser enter into this Agreement. The parties, intending to be legally bound, hereby agree as follows: 1. ESTABLISHMENT OF ESCROW; INVESTMENT OF CASH DEPOSIT. (a) Holder is depositing, or will deposit within five business days of the date hereof, with Escrow Agent an amount equal to Five Million (5,000,000) shares of I-Link, Incorporated ("I-Link") common stock (the "I-Link Stock") and the Purchase Price in the amount of Five Million Dollars ($5,000,000) under the Purchase Agreement (the "Cash Deposit") (the I-Link Stock and the Cash Deposit are collectively referred to herein as the "Escrow Property"). Escrow Agent will acknowledge receipt promptly upon receipt of the Escrow Property. Escrow Agent hereby agrees to act as escrow agent and to hold, safeguard and disburse the Escrow Property pursuant to the terms and conditions hereof. Holder shall retain the right to vote the I-Link Stock in escrow and to receive all proceeds (including dividends and interest) earned or paid on the Escrow Property. (b) Upon receipt of the Cash Deposit the Escrow Agent shall pending the disbursement thereof pursuant to this Agreement, invest the Cash Deposit in accordance with Holder's written instructions in (a) direct obligations of, or obligations fully guaranteed by, the United States of America or any agency thereof, (b) certificates of deposit issued by commercial banks having a combined capital, surplus and undivided profits of not less than One Hundred Million Dollars ($100,000,000), (c) repurchase agreements collateralized by securities issued by the United States of America or any agency thereof, or by any private corporation the obligations of which are guaranteed by the full faith and credit of the United states of America, (d) prime banker's acceptances, (e) money market funds investing in any of the above, or (f) other investments of equal or greater security and liquidity. Absent written direction, the Escrow Agent will invest funds in the Provident Cash Management Shares T-Fund, and the parties acknowledge that the Escrow Agent may render administrative services and receive additional fees from the administrator or distributor of said Fund. The Escrow Agent shall pay to Holder by check on a quarterly basis all interest or other proceeds earned on the Cash Deposit. 2. ADMINISTRATION OF ESCROW PROPERTY. The Escrow Agent shall administer the Escrow Property as follows: (a) Delivery of Claim Notice. Upon the receipt of notice (hereinafter the "Claim Notice"), duly certified by an officer of Purchaser, setting forth Purchaser's calculation of the portion of Escrow Property due at that time under Article 6 of the Purchase Agreement (the "Claimed Amount") the Escrow Agent shall send a copy of such notice to the Holder. (b) Response Notice; Uncontested Claims. Within ten (10) days of the date the Claim Notice was sent to Holder (the "Response Date"), Holder shall provide to Purchaser and to the Escrow Agent a written response (the "Response Notice") in which Holder shall: (i) agree that the full Claimed Amount may be released from the Escrow Property to Purchaser, (ii) agree that part, but not all, of the Claimed Amount (the "Agreed Amount") may be released from the Escrow Property to Purchaser or (iii) contest that any of the Claimed Amount may be released from the Escrow Property to Purchaser. Holder may contest the release of all or a portion of the Claimed Amount only based upon a good faith belief that all or such portion of the Claimed Amount does not constitute an indemnity obligation under the Purchase Agreement and Purchaser may make a claim hereunder only based upon a good faith belief that it is entitled to the Claimed Amount under the Purchase Agreement. If no Response Notice is delivered by Holder to the Escrow Agent by the Response Date, Holder shall be deemed to have agreed that the entire Claimed Amount may be released to Purchaser from the Escrow Property. (c) Uncontested Claim. If Holder in the Response Notice agrees or is deemed to have agreed that the Claimed Amount may be released from the Escrow Property to Purchaser, the Escrow Agent shall, no later than ten (10) days after receipt of the Response Notice, transfer, deliver, and assign to Purchaser the Claimed Amount from the Escrow Property. (d) Partially Contested Claims. If Holder in the Response Notice agrees that part, but not all, of the Claimed Amount may be released from the Escrow Property to Purchaser, the Escrow Agent shall, no later than ten (10) days after receipt of the Response Notice, transfer, deliver, and assign to Purchaser the Agreed Amount from the Escrow Property (or such lesser amount as is then held in the Escrow Property). (e) Fully Contested Claims. If Holder in the Response Notice contests the release of all or part of the Claimed Amount (the "Contested Amount"), the matter shall be settled by binding arbitration held in New York City, New York. All claims shall be settled by three arbitrators in accordance with the Commercial Arbitration Rules then in effect of the American Arbitration Association (the "Rules"). Holder and Purchaser shall each designate one arbitrator within fifteen (15) days of the delivery of the Response Notice contesting the Claimed Amount. Such designated arbitrators shall mutually agree upon and shall designate a third arbitrator; provided however, that (i) in the event the two designated arbitrators fail to reach agreement with respect to the designation of the third arbitrator within fifteen (15) days of delivery of the Response Notice, the third arbitrator shall be appointed in accordance with the Rules and (ii) if either Holder or Purchaser fail to timely designate an arbitrator, the dispute shall be resolved by the one arbitrator timely designated. There shall be limited discovery prior to the arbitration hearing, subject to the discretion of the arbitrators, as follows: (a) exchange of witness lists and copies of documentary evidence and documents related to or arising out of the issues to be arbitrated, (b) depositions of all party witnesses, and (c) such other depositions as may be allowed by the arbitrators upon a showing of good cause. Depositions shall be conducted in accordance with the New York Code of Civil Procedure. Each of Holder and Purchaser shall pay its own costs and expenses (including counsel fees) of any such arbitration. Holder and Purchaser shall pay the fees and expenses of their respectively designated -2- arbitrators and shall bear equally the fees and expenses of the third arbitrator. The arbitrators shall decide the matter to be arbitrated pursuant hereto within sixty (60) days after the appointment of the last arbitrator. The arbitrators' decision shall relate solely to whether Purchaser is entitled to receive the Contested Amount (or a portion thereof) pursuant to the applicable terms of the Purchase Agreement and this Agreement. The final decision of the majority of the arbitrators shall be furnished to Holder, Purchaser and the Escrow Agent in writing and shall constitute a conclusive determination of the issue in question, binding upon Holder, Purchaser and the Escrow Agent and shall not be contested by any of them. Such decision may be used in a court of law only for the purpose of seeking enforcement of the arbitrators' award. After delivery of a Response Notice that the Claimed Amount is contested by Holder, the Escrow Agent shall continue to hold in escrow the Escrow Property, until (i) delivery of written joint instructions executed by Purchaser and Holder setting forth instructions to the Escrow Agent as to release of all or portion of the Escrow Property, or (ii) delivery of a copy of the final award of the majority of the arbitrators setting forth instructions to the Escrow Agent as to the release of all or portion the Escrow Property. The Escrow Agent shall thereupon release the applicable amount from the Escrow Property in accordance with such joint written instructions or the award of a majority of the arbitrators. 3. FINAL RELEASE OF ESCROW PROPERTY. (a) Upon the occurrence of an Escrow Termination Event under Section 6.3(a) of the Purchase Agreement, Holder and Purchaser shall immediately instruct the Escrow Agent to disburse any remaining Escrow Property to Holder. Upon receipt of such joint instructions from Holder and Purchaser, the Escrow Agent shall promptly comply with such joint instructions. (b) If Holder is unable to get joint instructions from Purchaser, Holder may deliver a notice to Escrow Agent duly certified by an officer of Holder stating that an Escrow Termination Event has occurred and that Holder is entitled to the Escrow Property. Upon receipt of such notice, the Escrow Agent shall send a copy of such notice to Purchaser. Within ten (10) days of the notice to Purchaser (the "Purchaser Response Date"), Purchaser shall send a notice to Escrow Agent and Holder indicating whether or not it agrees that the Escrow Termination Event has occurred (the "Purchaser Response Notice"). If Purchaser agrees in its Purchaser Response Notice that an Escrow Termination Event has occurred or if the Purchaser does not respond to the Escrow Agent within the Purchaser Response Date, the Escrow Agent shall promptly thereafter disburse to Holder the Escrow Property. If Purchaser contests in its Response Notice to the Escrow Agent that an Escrow Termination Event has occurred, the Escrow Agent shall retain the Escrow Property and Holder and Purchaser shall resolve their disagreement in accordance with the terms of Section 2(e). After delivery of a Purchaser Response Notice from Purchaser contesting that an Escrow Termination Event has occurred, the Escrow Agent shall continue to hold in escrow the Escrow Property, until (i) delivery of joint written instructions executed by Purchaser and Holder setting forth instructions to the Escrow Agent as to release of all or portion of the Escrow Property, or (ii) delivery of a copy of the final award of the majority of the arbitrators setting forth instructions to the Escrow Agent as to the release of all or portion of the Escrow Property. The Escrow Agent shall thereupon release the applicable amount from the Escrow Property in accordance with such joint written instructions or the award of a majority of the arbitrators. -3- (c) Notwithstanding the other provisions of Section 2 and 3, the Escrow Agent, upon receipt of written instructions signed by both Holder and Purchaser with respect to the delivery of all or portion of the Escrow Property, shall deliver the Escrow Property in accordance with such instructions without any need for the parties to comply with the other provisions of Sections 2 and 3. 4. DUTIES OF ESCROW AGENT. (a) Escrow Agent shall not be under any duty to give the Escrow Property held by it hereunder any greater degree of care than it gives its own similar property. (b) Escrow Agent shall not be liable, except for its own gross negligence or willful misconduct and, except with respect to claims based upon such gross negligence or willful misconduct that are successfully asserted against Escrow Agent, the other parties hereto shall jointly and severally indemnify and hold harmless Escrow Agent (and any successor Escrow Agent) from and against any and all losses, liabilities, claims, actions, damages and expenses, including reasonable attorneys' fees and disbursements, arising out of and in connection with this Agreement. Without limiting the foregoing, Escrow Agent shall in no event be liable in connection with action taken in good faith (not resulting from its gross negligence or willful misconduct) in connection with the release of the Escrow Property, or any loss of interest incident to any such delays. (c) Escrow Agent shall be entitled to rely upon any order, judgment, certification, demand, notice, instrument or other writing delivered to it hereunder without being required to determine the authenticity or the correctness of any fact stated therein or the propriety or validity of the service thereof. Escrow Agent may act in reliance upon any instrument or signature believed by it to be genuine and may assume that the person purporting to give receipt or advice or make any statement or execute any document in connection with the provisions hereof has been duly authorized to do so. Escrow Agent may conclusively presume that the undersigned representative of any party hereto which is an entity other than a natural person has full power and authority to instruct Escrow Agent on behalf of that party unless written notice to the contrary is delivered to Escrow Agent. (d) Escrow Agent may act pursuant to the advice of counsel with respect to any matter relating to this Agreement and shall not be liable for any action taken or omitted by it in good faith in accordance with such advice. (e) Escrow Agent does not have any interest in the Escrow Property deposited hereunder but is serving as escrow agent only and having only possession thereof. (f) Escrow Agent makes no representation as to the validity, value, genuineness or the collectability of any security or other document or instrument held by or delivered to it. (g) Escrow Agent shall not be called upon to advise any party as to the wisdom in selling or retaining or taking or refraining from any action with respect to any securities or other property deposited hereunder. -4- (h) Holder and Purchaser jointly and severally agree to indemnify and hold Escrow Agent, its officers, directors, employees and agents (collectively, the "Indemnified Parties") harmless from all loss, cost, damages, expenses, liabilities, judgments and attorneys' fees (including without limitation, allocated costs of in-house counsel) suffered or incurred by the Indemnified Parties or any of them arising out of or in connection with this Agreement, except that this indemnity obligation shall not apply in the event of the gross negligence or willful misconduct of the Indemnified Parties or any of them. This indemnity obligation shall survive termination of this Agreement. (i) If Purchaser and Holder provide conflicting instructions to Escrow Agent, Escrow Agent may refuse to act until the dispute is resolved and may bring interpleader (all costs with respect thereto to be borne by Holder and Purchaser). (j) Escrow Agent (and any successor Escrow Agent) may at any time resign as such by delivering the Escrow Property to any successor Escrow Agent jointly designated by the other parties hereto in writing, or to any court of competent jurisdiction, whereupon Escrow Agent shall be discharged of and from any and all further obligations arising in connection with this Agreement. The resignation of Escrow Agent will take effect on the earlier of (i) the appointment of a successor (including a court of competent jurisdiction) or (ii) the day which is thirty (30) days after the date of delivery of its written notice of resignation to the other parties hereto. If at that time Escrow Agent has not received a designation of a successor Escrow Agent, Escrow Agent's sole responsibility after that time shall be to retain and safeguard the Escrow Property until delivery by Escrow Agent of the Escrow Property into a court of competent jurisdiction or until receipt of a designation of successor Escrow Agent or a joint written disposition instruction by the other parties hereto or a final non-appealable order of a court of competent jurisdiction or a written order of the arbitration panel referred to above. (k) Holder and Purchaser shall pay Escrow Agent compensation for the services to be rendered by Escrow Agent hereunder in accordance with Exhibit A hereto and agree to reimburse Escrow Agent for all reasonable expenses, disbursements and advances incurred or made by Escrow Agent in performance of its duties hereunder (including reasonable fees, expenses and disbursements of its counsel). Any such compensation and reimbursement to which Escrow Agent is entitled shall be shared equally by Holder and Purchaser. Any fees or expenses of Escrow Agent or its counsel that are not paid as provided for herein may be taken from any property held by Escrow Agent hereunder. (l) No printed or other matter in any language (including, without limitation, prospectuses, notices, reports and promotional material) that mentions Escrow Agent's name or the rights, powers, or duties of Escrow Agent shall be issued by the other parties hereto or on such parties' behalf unless Escrow Agent shall first have given its specific written consent thereto. 5. LIMITED RESPONSIBILITY. This Agreement expressly sets forth all the duties of Escrow Agent with respect to any and all matters pertinent hereto. No implied duties or obligations shall be read into this agreement against Escrow Agent. Escrow Agent -5- shall not be bound by the provisions of any agreement among the other parties hereto except this Agreement. 6. NOTICES. All notices and other communications required or permitted under this Agreement shall be in writing and shall be delivered personally or sent by: (a) registered or certified mail, return receipt requested; (b) a nationally-recognized courier service guaranteeing next-day delivery, charges prepaid; or (c) facsimile (with the original promptly sent by any of the foregoing manners). Any such notices shall be addressed to the receiving party at such party's address set forth below, or at such other address as may from time to time be furnished by similar notice by either party. If to Holder: Winter Harbor, LLC 11400 Skipwith Lane Potomac, Maryland 20854-1639 Attention: Ralph W. Hardy, Jr. With a copy to: Dow, Lohnes & Albertson, pllc 1200 New Hampshire Ave., N.W. Washington, DC 20036 Attention: David D. Wild, Esq. Facsimile: (202) 776-2222 If to Purchaser: Counsel Communications LLC 280 Park Avenue West Building, 28th Floor New York, NY 10017 Attention: Chief Executive Officer Facsimile: (212) 286-5000 With a copy to: Harwell Howard Hyne Gabbert & Manner, PC 1800 First American Center Nashville TN 37238 Attention: Mark Manner Facsimile: (615) 251-1056 If to Escrow Agent: -6- Union Bank of California, N.A. 120 S. San Pedro Street, Suite 400 Los Angeles, California 90012 Attention: Rene Torres, Corporate Trust Department Facsimile: (213) 972-5694 7. TERMINATION. This Agreement shall terminate upon the release by the Escrow Agent of the entire Escrow Property in accordance with this Agreement. 8. COUNTERPARTS. This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original and all of which, when taken together, will be deemed to constitute one and the same. 9. SECTION HEADINGS. The headings of sections in this Agreement are provided for convenience only and will not affect its construction or interpretation. 10. WAIVER. The rights and remedies of the parties to this Agreement are cumulative and not alternative. Neither the failure nor any delay by any party in exercising any right, power, or privilege under this Agreement or the documents referred to in this Agreement will operate as a waiver of such right, power, or privilege, and no single or partial exercise of any such right, power, or privilege will preclude any other or further exercise of such right, power, or privilege or the exercise of any other right, power, or privilege. To the maximum extent permitted by applicable law, (a) no claim or right arising out of this Agreement or the documents referred to in this Agreement can be discharged by one party, in whole or in part, by a waiver or renunciation of the claim or right unless in writing signed by the other party; (b) no waiver that may be given by a party will be applicable except in the specific instance for which it is given; and (c) no notice to or demand on one party will be deemed to be a waiver of any obligation of such party or of the right of the party giving such notice or demand to take further action without notice or demand as provided in this Agreement or the documents referred to in this Agreement. 11. EXCLUSIVE AGREEMENT; MODIFICATION. This Agreement supersedes all prior agreements among the parties with respect to its subject matter and constitutes (along with the documents referred to in this Agreement) a complete and exclusive statement of the terms of the agreement between the parties with respect to its subject matter. This Agreement may not be amended except by a written agreement executed by the Purchaser, the Holder and the Escrow Agent. -7- 12. GOVERNING LAW. This Agreement shall be governed by the laws of the State of New York, without regard to conflicts of law principles provided that the rights and duties of the Escrow Agent shall be governed, construed and enforced in accordance with the laws of the State of California. -8- EX-4.23 5 0005.txt COVENANT NOT TO SUE Exhibit 4.23 COVENANT NOT TO SUE This Covenant Not To Sue (the "Covenant Not To Sue") by and between I-Link, Inc. ("I-Link"), its officers, directors, agents, employees, subsidiaries, parent entities, affiliates, and each of their respective officers, directors, agents, and employees (the "Covenanting Parties") and Winter Harbor, LLC ("Winter Harbor"), its officers, directors, agents, employees, parent entities, direct and indirect shareholders and partners and each of their respective officers, directors, agent and employees (the "Beneficiaries") is entered into and made effective on this 1st day of March, 2001 (the "Effective Date"). WITNESSETH WHEREAS, at the request of, and to the benefit of, I-Link, Winter Harbor is relinquishing to a third party all of its ownership and dominion in its holdings of debt and equity securities of I-Link; and WHEREAS, as part of that transaction, the Covenanting Parties, including, without limitation, I-Link, wish to finally resolve any and all matters between themselves and the Beneficiaries, including, without limitation, binding themselves not to commence any actions, claims or proceedings against the Beneficiaries; NOW THEREFORE, for good and valuable consideration, the sufficiency and receipt of which are expressly covenanted to by the Covenanting Parties, it is hereby agreed by the Covenanting Parties as follows: 1. Covenant Not To Sue. I-Link covenants and agrees, and hereby undertakes to have each of the Covenanting Parties undertake and agree, that from and after the Effective Date, it and they will not, directly or indirectly, initiate, file, commence or prosecute, or assist in the filing, commencement or prosecution of, any action, claim or proceeding, whether premised on facts either known or not known now, against any or all of the Beneficiaries in any federal, state, local or foreign court, arbitral forum or administrative agency. I-Link and the other Covenanting Parties agree that under no conditions will it or any entity or person under its control, directly or indirectly, initiate, file, commence or prosecute, or assist in the initiation, filing, commencement or prosecution of any action, claim or proceeding against any or all of the Beneficiaries. Except pursuant to an order entered by a competent judicial authority, the Covenanting Parties shall not render assistance of any kind, including, without limitation, the provision of documents or information, to any person or entity who has or is threatening to initiate, file, commence or prosecute any action, claim or proceeding against any of the Beneficiaries. 2. Dismissal of Actions. In the event any action, claim or proceeding is initiated, filed, commenced or prosecuted, directly or indirectly, by or on behalf of any of the Covenanting Parties against any of the Beneficiaries in any federal, state, local or foreign court, arbitral forum or administrative agency, within two (2) days of the receipt of a written notice sent to the offices of I-Link, the Covenanting Parties or the designated agent set forth in Section 8 hereof shall execute and consent to -2- the submission and/or filing of all documents, affidavits, stipulations or other pleading or papers as may be necessary to effectuate a total and complete dismissal, with prejudice or equivalent final and irrevocable resolution, of any such action, claim or proceeding. The Covenanting Parties shall bear all of the Beneficiaries' costs and attorney's fees associated with the dismissal with prejudice or other final resolution of any action, claim or proceeding subject to this Covenant Not To Sue. 3. Covenant Not To Sue Defense. The Covenanting Parties consent to the interposition of this Covenant Not To Sue as a full and complete defense to, or an abatement of, and may be used as the basis for an injunction against, any action, claim or proceeding initiated, filed, commenced or prosecuted, directly or indirectly, against the Beneficiaries whatsoever. 4. Specific Performance. The Covenanting Parties acknowledge, confirm, and agree that damages may be inadequate for a breach or a threatened breach of this Covenant Not To Sue and, in the event of a breach or threatened breach hereof, the respective rights and obligations hereunder shall be immediately enforceable by specific performance, injunction, or other equitable remedy. The Covenanting Parties shall raise no equitable or legal defense to any action to enforce specific performance of this Covenant Not To Sue, whether such action is by way of a legal or equitable proceeding. Nothing contained in this Section 4 shall limit or affect any rights at law or otherwise of the Beneficiaries for a breach or threatened breach of any provision hereof, it being the intent of this provision to make clear that the respective rights and obligations of the Beneficiaries shall be enforceable in equity as well as at law or otherwise. 5. Binding Effect. This Covenant Not To Sue shall be binding on the legal representatives, heirs, successors, and assigns of each of the Covenanting Parties and shall inure to the benefit of the successors and assigns of each of the Beneficiaries. 6. Execution and Further Documents. This Covenant Not To Sue may be executed in any number of counterparts, each of which shall be deemed an original and all of which shall be deemed for all purposes one agreement. Each of the Covenanting Parties agrees to execute any further documents, instruments, or other writing as the Beneficiaries, in their sole discretion, deem are required to obtain the full benefit of the Covenant Not To Sue granted hereunder. 7. Choice of Law/Forum. This Covenant Not To Sue, any performance under it, and any disputes arising under it shall be governed exclusively by the law of the State of New York, without giving effect to their conflict of laws principles. The Covenanting Parties expressly consent to the exclusive forum, jurisdiction, and venue of the Courts of the State of New York and the United States District Court for the Southern District of New York in any and all actions, disputes, or controversies arising out of or relating to this Covenant Not To Sue, including, without limitation, any proceeding to seek injunctive relief to bar any action, claim or proceeding from continuing. -3- 8. Power of Attorney. Each of the Covenanting Party grants to I-Link a limited irrevocable power of attorney, coupled with an interest, sufficient to permit I-Link to execute such documents, instruments or other writings as are necessary and proper to give full force and effect to this Covenant Not To Sue. Dated: March 1, 2001 /s/John W. Edwards - ------------------------------------ By: Title: (on behalf of I-Link and the other Covenanting Parties) Accepted and Agreed to: - ---------------------- Winter Harbor, LLC By: First Media, L.P., its member By: First Media Corporation, its General Partner By: /s/Ralph W. Hardy, Jr. -------------------------------------------- Ralph W. Hardy, Jr. Secretary (on behalf of Winter Harbor, LLC and the other Beneficiaries) Dated: March 1, 2001 -----END PRIVACY-ENHANCED MESSAGE-----