Attached files
| file | filename |
|---|---|
| S-1/A - Wave2Wave Communications, Inc. | c60096_s1a.htm |
| EX-4.6 - Wave2Wave Communications, Inc. | c60096_ex4-6.htm |
| EX-3.3 - Wave2Wave Communications, Inc. | c60096_ex3-3.htm |
| EX-4.3 - Wave2Wave Communications, Inc. | c60096_ex4-3.htm |
| EX-23.1 - Wave2Wave Communications, Inc. | c60096_ex23-1.htm |
| EX-99.7 - Wave2Wave Communications, Inc. | c60096_ex99-7.htm |
| EX-23.2 - Wave2Wave Communications, Inc. | c60096_ex23-2.htm |
| EX-10.88 - Wave2Wave Communications, Inc. | c60096_ex10-88.htm |
| EX-10.90 - Wave2Wave Communications, Inc. | c60096_ex10-90.htm |
| EX-10.84 - Wave2Wave Communications, Inc. | c60096_ex10-84.htm |
| EX-10.86 - Wave2Wave Communications, Inc. | c60096_ex10-86.htm |
| EX-10.85 - Wave2Wave Communications, Inc. | c60096_ex10-85.htm |
| EX-10.87 - Wave2Wave Communications, Inc. | c60096_ex10-87.htm |
Exhibit 10.89
NOTE EXCHANGE AND MODIFICATION AGREEMENT
This NOTE EXCHANGE AND MODIFICATION AGREEMENT (as amended, restated, supplemented or otherwise modified from time to time, this “Agreement”) is entered into as of September 21, 2010 by and among THE WILMINGTON TRUST COMPANY AND GEORGE JEFF MENNEN AS CO-TRUSTEES U/A/D NOVEMBER 25, 1970, AS AMENDED FOR THE BENEFIT OF JOHN HENRY MENNEN, successor in interest to Greystone Funding Corporation solely in its capacity as Lender under the Subordinated Debt Documents (as defined below) (together with their respective successors and assigns, the “Subordinated Creditor”), WAVE2WAVE COMMUNICATIONS, INC., a Delaware corporation (together with its successors and assigns, including any receiver, trustee or debtor-in-possession, the “Borrower”), and each of the other Obligors (as defined below).
R E C I T A L S
A. The Borrower, the “Guarantors” party thereto, Victory Park Management, LLC, a Delaware limited liability company, as Agent for the Senior Lenders (as defined below) and Senior Lenders (as defined below) have entered into the Senior Credit Agreement pursuant to which, among other things and in each case subject to the terms and conditions set forth therein, Senior Lenders have agreed to extend loans and other financial accommodations to the Borrower and each of the other Obligors has agreed to guaranty the obligations of the Borrower thereunder and under the other Senior Debt Documents (as defined below).
B. Prior to the date hereof, the Borrower has issued the Subordinated Notes (as defined below) to the Subordinated Creditor and certain of the other Obligors have agreed to guaranty the obligations of the Borrower thereunder and under the other Subordinated Debt Documents (as defined below).
C. The Borrower, the other Obligors (collectively with the Borrower, the “Companies”), and Agent and Senior Lenders have entered into a series of forbearance agreements pursuant to which, among other things, the Agent and Lenders have agreed to forbear from exercising rights and remedies available to them as a result of certain events of default under the Senior Credit Agreement (collectively, the “Existing Events of Default”), including, without limitation, that certain Sixth Forbearance Agreement dated as of September 21, 2010 (as amended, restated, supplemented or otherwise modified in accordance with its terms, the “Sixth Forbearance Agreement”).
D. One of the conditions set forth in the Sixth Forbearance Agreement to the continuing obligation of Agent and the Senior Lenders to forbear from exercising their rights and remedies with respect to the Existing Events of Default is, among other things, that the Subordinated Creditor agrees (i) to exchange fifty (50%) percent of the outstanding principal amount of the Subordinated Debt (as defined below), and all accrued and unpaid interest on such principal amount, for newly issued shares (the “Exchange Shares”) of Common Stock $0.0001 par value per share of the Borrower (the “Common Stock”), based on a price of $5.00 per share (the “Exchange Share Price”), and (ii) to amend and modify the terms of the remaining Subordinated Debt as set forth herein.
NOW, THEREFORE, in order to induce Agent and Senior Lenders to continue to forbear from exercising certain of their rights and remedies, and for other good and valuable consideration, the receipt and sufficiency of which hereby are acknowledged, the parties hereto hereby agree as follows:
1. Definitions. To the extent not otherwise defined herein, the following terms shall have the following meanings in this Agreement:
“Agent” shall mean Victory Park Management, LLC, as Agent for the Senior Creditors, or any other Person appointed by the holders of the Senior Debt as administrative agent for purposes of the Senior Debt Documents.
“Bankruptcy Code” shall mean Title 11 of the United States Code, as amended from time to time and any successor statute and all rules and regulations promulgated thereunder.
“Obligor” means the Borrower, each “Guarantor” party to the Senior Credit Agreement and each other Person liable on or in respect of all or any part of the Obligations or that has granted a Lien on any property or assets as Collateral, together with each such Person’s successors and assigns, including a receiver, trustee or debtor-in-possession on behalf of such Person.
“Person” means any natural person, corporation, general or limited partnership, limited liability company, firm, trust, association, government, governmental agency or other entity, whether acting in an individual, fiduciary or other capacity.
“Proceeding” means, as to any Obligor, any of the following: (a) any case or proceeding with respect to such Person under the Bankruptcy Code or any other federal or state bankruptcy, insolvency, reorganization or other law affecting creditors’ rights or any other or similar proceedings seeking any stay, reorganization, arrangement, composition or readjustment of the obligations and indebtedness of such Obligor, (b) any proceeding seeking the appointment of any trustee, receiver, liquidator, custodian or other insolvency official with similar powers with respect to such Obligor or any of its assets,
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(c) any proceeding for liquidation, dissolution or other winding up of the business of such Obligor or (d) any assignment for the benefit of creditors or any marshalling of assets of such Obligor.
“Refinancing Senior Debt” has the meaning set forth in Section 3(a).
“Refinancing Senior Debt Documents” shall mean any financing documentation which replaces the VPC Loan Documents and pursuant to which the Senior Debt under the VPC Loan Documents is refinanced, as such financing documentation may be amended, supplemented or otherwise modified from time to time.
“Secured Creditors” means the Senior Creditors and the Subordinated Creditors, or any of them.
“Senior Credit Agreement” shall mean the Financing Agreement, dated as of September 8, 2009, by and among the Obligors, the Agent and Senior Lenders (as the same may be amended, restated, supplemented or otherwise modified from time to time) and any successor loan, credit or financing agreement or note or similar agreement or instrument pursuant to which the obligations under such Financing Agreement (or its successor) are refinanced and replaced in whole or in part, as such successor may be amended, restated, supplemented or otherwise modified from time to time.
“Senior Creditors” means the Agent, the Senior Lenders and the other Persons from time to time holding Senior Debt,
“Senior Debt” shall mean all obligations, liabilities and indebtedness of every nature of each Obligor from time to time owed to Agent or any other Senior Creditor under the Senior Debt Documents, including but not limited to the principal amount of all debts, claims and indebtedness, accrued and unpaid interest and all fees, expenses and reasonable costs, whether primary, secondary, direct, contingent, fixed or otherwise, heretofore, now and from time to time hereafter owing, due or payable, whether before or after the filing of a Proceeding under the Bankruptcy Code together with (a) any amendments, modifications, renewals or extensions thereof and (b) any interest accruing thereon after the commencement of a Proceeding, without regard to whether or not such interest is an allowed claim. Senior Debt shall be considered to be outstanding whenever any loan commitment under the Senior Debt Document is outstanding.
“Senior Debt Documents” shall mean the VPC Loan Documents and, after any refinancing of the Senior Debt under the VPC Loan Documents, the Refinancing Senior Debt Documents.
“Senior Lenders” shall mean the “Lenders” from time to time party to the Senior Credit Agreement.
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“Subordinated Debt” shall mean all of the obligations of the Obligors to Subordinated Creditor evidenced by or incurred pursuant to the Subordinated Debt Documents.
“Subordinated Debt Documents” shall mean the Subordinated Notes, any guaranty with respect to the Subordinated Debt and all other documents, agreements and instruments now existing or hereinafter entered into in connection therewith or evidencing or pertaining to all or any portion of the Subordinated Debt, in each case as amended, supplemented or otherwise modified from time prior to the date hereof.
“Subordinated Debt Exchange” has the meaning set forth in Section 2.
“Subordinated Notes” shall mean each of (i) that certain Amended and Restated Term Note dated as of September 8, 2009 in the original face amount of $34,000,000 issued by the Borrower to Wilmington Trust Company and George Jeff Mennen, Co-Trustees U/A/D November 25, 1970 as amended for the benefit of John Henry Mennen, (ii) that certain Amended and Restated Term Note dated as of September 8, 2009 in the original face amount of $1,700,000 issued by the Borrower to Wilmington Trust Company and George Jeff Mennen, Co-Trustees U/A/D November 25, 1970 as amended for the benefit of John Henry Mennen, and (iii) that certain Term Note dated as of September 8, 2009 in the original face amount of $3,500,000 issued by the Borrower to Wilmington Trust Company and George Jeff Mennen, Co-Trustees U/A/D November 25, 1970 as amended for the benefit of John Henry Mennen, in each case as amended, supplemented or otherwise modified from time to time prior to the date hereof.
“Subordination Agreement” means the Subordination and Intercreditor Agreement dated as of September 8, 2009 by and among the Subordinated Creditor, the Company and the Agent, as amended, supplemented or otherwise modified from time to time.
“UCC” means the Uniform Commercial Code of any applicable jurisdiction and, if the applicable jurisdiction shall not have any Uniform Commercial Code, the Uniform Commercial Code as in effect in the State of Illinois.
“VPC Loan Documents” shall mean the Senior Credit Agreement and all other agreements, documents and instruments executed from time to time in connection therewith, as the same may be amended, supplemented or otherwise modified from time to time.
2. Subordinated Note Exchange.
(a) The Subordinated Creditor agrees, on the date hereof, to exchange fifty (50%) percent of the outstanding principal balance of its Subordinated Note, and fifty (50%) of all accrued and unpaid interest on the Subordinated Debt, for the
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Exchange Shares for a purchase price equal to $5.00 per share of Common Stock (the “Subordinated Debt Exchange”). The principal balance of its Subordinated Note, accrued and unpaid interest thereon, and number of Exchange Shares to be issued to the Subordinated Creditor pursuant to the Subordinated Debt Exchange is set forth on Exhibit A attached hereto.
(b) The Exchange Shares to be issued to the Subordinated Creditor shall be evidenced by a newly issued stock certificate, to be issued and delivered concurrently herewith, that shall include the following legend:
THE ISSUANCE AND SALE OF THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SHARES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL, IN A FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SUCH ACT. NOTWITHSTANDING THE FOREGOING, THE SHARES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SHARES, PROVIDED SUCH PLEDGE IS MADE IN COMPLIANCE WITH APPLICABLE FEDERAL AND STATE SECURITIES LAWS.
(c) Concurrently herewith, the Borrower shall issue to the Subordinated Creditor an Amended and Restated Subordinated Note (the “Amended Subordinated Note”) in the remaining principal amount of the Subordinated Debt held by the Subordinated Creditor after giving effect to the Subordinated Debt Exchange.
3. Acknowledgement of Subordinated Creditor. The Subordinated Creditor (for the benefit of Agent, the Senior Lenders and each Company) hereby (i) ratifies and reaffirms the continued subordination of the Subordinated Debt (including, all Subordinated Debt evidenced by the Amended Subordinated Note) to the Senior Debt (including any Refinancing Senior Debt, which may be in a principal amount greater than the Senior Debt outstanding under the VPC Loan Documents) in accordance with, and its liabilities, obligations and agreements under, the terms of the Subordination Agreement, (ii) acknowledges that (a) it has no defenses, claims or setoffs to the enforcement by the Agent or the Senior Lenders of the liabilities, obligations and agreements of the Subordinated Creditor thereunder and (b) neither the Agent nor any Senior Lenders waives, diminishes or limits any term or condition contained in the Subordination Agreement and (iii) agrees that the Subordination Agreement, the subordination effected thereby and the rights and obligations of the Subordinated Creditor, the Agent, the Senior
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Lenders and the Obligors arising thereunder shall not be affected, modified or impaired in any manner or to any extent by the Sixth Forbearance Agreement, any other forbearance agreement or the transactions contemplated thereby.
4. Representations and Warranties.
4.1 Representations and Warranties of Subordinated Creditor. The Subordinated Creditor hereby represents arid warrants, severally and not jointly, to the Obligors, Agent and Senior Creditors that as of the date hereof: (a) the Subordinated Creditor has the power and authority to enter into, execute, deliver and carry out the terms of this Agreement, all of which have been duly authorized by all proper and necessary action; (b) the execution of this Agreement by the Subordinated Creditor will not violate or conflict with the organizational documents of the Subordinated Creditor, as applicable, any material agreement binding upon the Subordinated Creditor or any law, regulation or order or require any consent or approval which has not been obtained; (c) this Agreement is the legal, valid and binding obligation of the Subordinated Creditor, enforceable against the Subordinated Creditor in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by equitable principles; (d) the Subordinated Creditor is the sole owner, beneficially and of record, of its Subordinated Debt Documents and its Subordinated Debt; (e) no Person other than the Obligors is obligated in respect of the Subordinated Debt or under any Subordinated Debt Documents; and (f) the outstanding amount of the Subordinated Debt held by the Subordinated Creditor as of the date hereof is identified on Exhibit A attached hereto.
4.2 Representations and Warranties of the Obligors. Each Obligor hereby represents and warrants to Agent, Senior Creditors and Subordinated Creditor that as of the date hereof: (a) such Obligor is a registered organization duly formed and validly existing under the laws of its state of organization; (b) such Obligor has the power and authority to enter into, execute, deliver and carry out the terms of this Agreement, all of which have been duly authorized by all proper and necessary action; (c) the execution of this Agreement by such Obligor will not violate or conflict with the organizational documents of such Obligor, any material agreement binding upon such Obligor or any law, regulation or order or require any consent or approval which has not been obtained; and (d) this Agreement is the legal, valid and binding obligation of such Obligor, enforceable against such Obligor in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally or by equitable principles.
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5. Miscellaneous.
5.1 Modification; Further Assurances.
(a) Any modification or waiver of any provision of this Agreement, or any consent to any departure by any party from the terms hereof, shall not be effective in any event unless the same is in writing and signed by RNK Holding and the Obligors (as applicable), and then such modification, waiver or consent shall be effective only in the specific instance and for the specific purpose given. Any notice to or demand on any party hereto in any event not specifically required hereunder shall not entitle the party receiving such notice or demand to any other or further notice or demand in the same, similar or other circumstances unless specifically required hereunder. By their signatures hereto, each of the Subordinated Creditors hereby authorizes and directs RNK Holding to execute and deliver any such modification, waiver or consent on its behalf.
(b) Each party to this Agreement promptly will execute and deliver such further instruments and agreements and do such further acts and things as may be reasonably requested in writing by any other party hereto that may be necessary or desirable in order to effect fully the purposes of this Agreement.
5.2 Notices. Unless otherwise specifically provided herein, any notice or other communication delivered under this Agreement shall be in writing addressed to the respective party as set forth below and may be personally served, telecopied or sent by overnight courier service or certified or registered United States mail and shall be deemed to have been given (a) if delivered in person, when delivered; (b) if delivered by telecopy, on the date of transmission if transmitted on a business day before 4:00 p.m. (Chicago time) or, if not, on the next succeeding business day; (c) if delivered by overnight courier, one business day after delivery to such courier properly addressed; or (d) if by United States mail, four business days after deposit in the United States mail, postage prepaid and properly addressed.
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Notices shall be addressed as follows: |
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If to any Subordinated Creditor: |
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Wilmington
Trust Company and George Jeff Mennen as co-trustees U/A/D November 25, 1970, as amended for the Benefit of |
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With a copy to: |
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Choate Hall
& Stewart LLP |
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Attention: Douglas Gooding, Esq. |
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Facsimile: (617) 248-4000 |
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If to any Obligor: |
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c/o
Wave2Wave Communications, Inc. |
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Facsimile: |
(201) 968-1886 |
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Attention: |
Eric Mann, Chief Financial Officer |
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And with a copy (for informational purposes only) to: |
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Cole,
Schotz, Meisel, Forman & Leonard, P.A. |
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Facsimile: |
(201) 678-6271 |
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Attention: |
Marc P. Press, Esq. |
or in any case, to such other address as the party addressed shall have previously designated by written notice to the serving party, given in accordance with this Section 5.2.
5.3 Successors and Assigns. This Agreement and the rights and benefits hereof shall inure to the benefit of, and shall be binding upon, the respective successors and assigns of the Subordinated Creditor and the Obligors.
5.4 Conflict. In the event of any conflict between any term, covenant or condition of this Agreement and any term, covenant or condition of any of the Subordinated Debt Documents, the provisions of this Agreement shall control and govern.
5.5 Headings. The paragraph headings used in this Agreement are for convenience only and shall not affect the interpretation of any of the provisions hereof.
5.6 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Furthermore, such counterparts may be delivered by facsimile or by electronic mail in “portable document format” (or “.pdf’), with any such counterpart delivered in such way deemed an original.
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5.7 Severability. In the event that any provision of this Agreement is deemed to be invalid, illegal or unenforceable by reason of the operation of any law or by reason of the interpretation placed thereon by any court or governmental authority, the validity, legality and enforceability of the remaining provisions of this Agreement shall not in any way be affected or impaired thereby, and the affected provision shall be modified to the minimum extent permitted by law so as most frilly to achieve the intention of this Agreement.
5.8 Applicable Law. This Agreement shall be governed by and shall be construed and enforced in accordance with the internal laws of the State of New Jersey, without giving effect to any choice of law or conflict of law provision or rule that would cause the application of the laws of any jurisdictions other than the State of New Jersey.
5.9 CONSENT TO JURISDICTION. THE SUBORDINATED CREDITOR AND EACH OBLIGOR HEREBY CONSENTS TO THE JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED WITHIN THE STATE OF NEW JERSEY AND IRREVOCABLY AGREES THAT ALL ACTIONS OR PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT SHALL BE LITIGATED IN SUCH COURTS. THE SUBORDINATED CREDITOR AND EACH OBLIGOR EXPRESSLY SUBMITS AND CONSENTS TO THE JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS. EACH SUBORDINATED CREDITOR AND EACH OBLIGOR HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS AND AGREES THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE UPON IT BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED, ADDRESSED TO SUBORDINATED CREDITORS AND THE BORROWER AT THEIR RESPECTIVE ADDRESSES SET FORTH IN THIS AGREEMENT AND SERVICE SO MADE SHALL BE COMPLETE TEN (10) DAYS AFTER THE SAME HAS BEEN POSTED.
5.10 WAIVER OF JURY TRIAL. THE SUBORDINATED CREDITOR AND EACH OBLIGOR HEREBY WAIVES THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE SUBORDINATED DEBT DOCUMENTS. THE SUBORDINATED CREDITOR AND EACH OBLIGOR ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS RELIED ON THE WAIVER IN ENTERING INTO THIS AGREEMENT. THE SUBORDINATED CREDITOR AND EACH OBLIGOR WARRANTS AND REPRESENTS THAT EACH HAS HAD THE OPPORTUNITY OF REVIEWING THIS JURY WAIVER WITH LEGAL
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COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS.
- Remainder of page intentionally blank; signature pages follow -
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IN WITNESS WHEREOF, the Subordinated Creditor and each Obligor have caused this Agreement to be executed as of the date first above written.
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BORROWER: |
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WAVE2WAVE COMMUNICATIONS, INC.,
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By: /s/ Eric Mann |
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Name: Eric Mann |
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Its: Chief Financial Officer |
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SUBORDINATED CREDITOR: |
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THE WILMINGTON TRUST |
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George Jeff
Mennen, Co-Trustee U/A/D |
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By: /s/ George Jeff Mennen |
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Name: George Jeff Mennen |
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The
Wilmington Trust Company, Co- |
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By: /s/ Mark A. Oller |
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Name Mark A. Oller |
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Title: Vice President |
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OTHER OBLIGORS: |
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RNK INC., a Massachusetts business trust |
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WAVE2WAVE
VOIP |
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By: /s/ Eric Mann |
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By: /s/ Eric Mann |
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Name: Eric Mann |
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Name: Eric Mann |
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Title: Secretary and Treasurer |
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Title Chief Financial Officer |
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WAVE2WAVE DATA |
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WAVE2WAVE COMMUNICATIONS, |
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By: /s/ Eric Mann |
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By: /s/ Eric Mann |
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Name: Eric Mann |
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Name: Eric Mann |
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Title Chief Financial Officer |
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Title Chief Financial Officer |
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RNK VA, LLC, a Virginia limited liability company |
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By: /s/ Eric Mann |
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Name: Eric Mann |
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Title Secretary and Treasurer |
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EXHIBIT A
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Total
Outstanding Principal and |
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$ |
40,861,917.00 |
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50% of
Principal and Interest |
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$ |
20,430,958.50 |
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Number of Exchange Shares1 to be issued |
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$ |
4,086,192.00 |
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1 The number of Exchange Shares equals (a) 50% of the total principal and interest of the Subordinated Note divided by (b) $5.00 per share. |
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