EXHIBIT 4.1
THIRD LIMITED WAIVER AND AGREEMENT
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This THIRD LIMITED WAIVER AND AGREEMENT (as amended or modified from
time to time, this "Agreement"), dated as of February 9, 2001, is among FiberNet
Telecom Group, Inc., a Delaware corporation formerly known as FiberNet Holdco,
Inc. (the "Parent"), Deutsche Banc Alex.Xxxxx Inc., formerly known as Deutsche
Bank Securities Inc. ("DBAB"), Toronto Dominion (Texas), Inc. ("TD" and,
together with DBAB, the "Beneficiaries") and Bankers Trust Company (the "Escrow
Agent").
RECITALS
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A. In connection with that certain Credit Agreement, dated as of
April 11, 2000 (the "Credit Agreement") among FiberNet Operations, Inc.,
formerly known as FiberNet Telecom Group, Inc. ("FiberNet"), the institutions
party thereto from time to time as lenders, Deutsche Bank AG New York Branch, as
administrative agent, DBAB, as co-syndications agent, and TD, as co-syndications
agent, (i) FiberNet and the Beneficiaries entered into that certain Warrant
Agreement, dated as of April 11, 2000 (as modified by the First Waiver Agreement
and the Second Waiver Agreement (as such terms are defined below), the "Warrant
Agreement"), pursuant to which FiberNet issued certain warrants (the
"Outstanding Warrants") directly to the Beneficiaries and issued certain
warrants into escrow (the "Escrowed Warrants" and together with the Outstanding
Warrants, the "Warrants") and (ii) FiberNet, the Beneficiaries and Bankers Trust
Company, as escrow agent (the "Escrow Agent") entered into that certain Warrant
Escrow Agreement, dated as of April 11, 2000 (as modified by the First Waiver
Agreement and the Second Waiver Agreement, the "Warrant Escrow Agreement" and,
together with the Warrant Agreement, the "Warrant Documents"), pursuant to
which, among other things, the parties thereto agreed that if the loans under
the Credit Agreement were not paid in full on or before certain dates set forth
in the Warrant Escrow Agreement, the Escrow Agent would register and release
portions of the Escrowed Warrants on such dates to the Beneficiaries, all as
more particularly described in the Warrant Escrow Agreement.
B. FiberNet has assigned its obligations under the Warrant Documents
to the Parent, and the Parent has assumed such obligations.
C. The Parent and the Beneficiaries have entered into that certain
Limited Waiver and Agreement, dated as of October 10, 2000 (the "First Waiver
Agreement"), pursuant to which, among other things, the Parent and the
Beneficiaries agreed to amend the first date on which the Beneficiaries were
entitled to receive a portion of the Escrowed Warrants.
D. The Parent and the Beneficiaries have entered into that certain
Second Limited Waiver and Agreement, dated as of November 22, 2000 (the "Second
Waiver Agreement"), pursuant to which, among other things, the Parent and the
Beneficiaries agreed to decrease the exercise price of the Warrants and to
further amend the first date on which the Beneficiaries were entitled to receive
a portion of the Escrowed Warrants.
E. In connection with the amendment and restatement of the Credit
Agreement, the Parent and the Beneficiaries have agreed to, subject to the terms
and conditions set forth herein, (i) modify the exercise price of the
Outstanding Warrants, (ii) return the warrant certificates in respect of the
Outstanding Warrants and issue certain new warrant certificates in exchange
therefor, (iii) terminate the Warrant Escrow Agreement and return and cancel the
Escrowed Warrants and (iv) transfer 75,000 of TD's Outstanding Warrants to IBM
Credit Corporation ("IBM Credit").
F. Capitalized terms used and not otherwise defined herein have the
meanings assigned to such terms in the Warrant Agreement.
AGREEMENT
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NOW, THEREFORE, in consideration of the premises and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Waiver and Agreement. Notwithstanding anything to the contrary in the
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Warrant Documents:
a. the Exercise Price of the Outstanding Warrants shall be $8.00 per
share;
b. upon the return and cancellation of all Warrant Certificates in
respect of the Warrants, new Warrant Certificates, each with an exercise price
of $8.00 per share, shall be issued as follows:
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Certificate Issued to Number of Shares Representing an Exchange of
Number
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1 DBAB 756,920 Returned DBAB Warrant Certificate No.
2 for 756,920 shares
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2 TD 756,922 Returned TD Warrant Certificate No. 1
for 756,922 shares
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3 DBAB 252,307 Returned DBAB Warrant Certificate No.
7 for 252,307 shares
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4 TD 177,307 Returned TD Warrant Certificate No. 3
for 252,307 shares
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5 IBM Credit 75,000 Returned TD Warrant Certificate No. 3
for 252,307 shares, and the transfer
by TD to IBM Credit of warrants to
purchase 75,000 shares previously
held by TD pursuant to Returned TD
Warrant Certificate No. 3
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c. subject to Section 4.2 of the Warrant Escrow Agreement, the
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Warrant Escrow Agreement is hereby terminated;
d. Section 6.5(d)(ii) of the Warrant Agreement is hereby amended by
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deleting the words "pursuant to a firm commitment underwriting" and replacing
such words with the words "to persons that are not Affiliates of the Borrower,
provided that the Beneficiaries receive evidence that the Board of Directors of
the Borrower has resolved that such rights, options or warrants were issued for
fair value";
e. Section 6.7(c)(iv) of the Warrant Agreement is hereby amended by
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deleting the words "pursuant to a firm commitment underwriting" and replacing
such words with the words "to persons that are not Affiliates of the Borrower,
provided that the Beneficiaries receive evidence that the Board of Directors of
the Borrower has resolved that such Common Stock was issued for fair value"; and
e. Section 6.8(d)(ii) of the Warrant Agreement is hereby amended by
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deleting the words "pursuant to a firm commitment underwriting" and replacing
such words with the words "to persons that are not Affiliates of the Borrower,
provided that the Beneficiaries receive evidence that the Board of Directors of
the Borrower has resolved that such convertible securities were issued for fair
value".
2. Representations and Warranties. The Parent represents and warrants to
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the Beneficiaries as of the date hereof as follows:
a. Authority. The Parent has the requisite corporate power and
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authority to execute and deliver this Agreement and to perform its obligations
hereunder and under the Warrant Documents (as modified hereby). The execution,
delivery and performance by the Parent of this Agreement, each of the Warrant
Documents (as modified hereby) and the transactions contemplated hereby and
thereby have been duly approved by all necessary corporate action of the Parent
and no other corporate proceedings on the part of the Parent are necessary to
consummate such transactions (except as expressly contemplated hereby and
thereby).
b. Enforceability. This Agreement has been duly executed and
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delivered by the Parent. Each of this Agreement and, after giving effect to this
Agreement, each of the Warrant Documents are (i) the legal, valid and binding
obligation of the Parent, enforceable against the Parent in accordance with its
terms, and (ii) in full force and effect.
c. No Conflicts. Neither the execution and delivery of this
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Agreement, nor the consummation of the transactions contemplated hereby, nor
performance of and compliance with the terms and provisions hereof by the Parent
will, at the time of such performance, (i) violate or conflict with any
provision of its articles of incorporation or bylaws or other organizational or
governing documents of the Parent, (ii) violate, contravene or conflict with any
law, regulation, order, writ, judgment, injunction, decree or permit applicable
to it, (iii) violate, contravene or conflict with contractual provisions of, or
cause an event of default under, any indenture, loan agreement, mortgage, deed
of trust, contract or other agreement or instrument to which it is a
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party or by which it may be bound or (iv) require the Parent to obtain any
consents, approvals, or authorizations or, to make any filings.
4. Reference to and Effect on Warrant Documents.
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a. Upon and after the effectiveness of this Agreement, each
reference in any of the Warrant Documents to "this Warrant Agreement", "this
Warrant Escrow Agreement", "hereunder", "hereof" or words of like import
referring to any of the Warrant Documents, shall mean and be a reference to the
Warrant Documents as modified hereby.
b. Except as specifically modified above, each of the Warrant
Documents are and shall continue to be in full force and effect and are hereby
in all respects ratified and confirmed. This Agreement is made in modification
of, but not extinguishment of, the obligations set forth in the Warrant
Documents and, except as specifically modified pursuant to the terms of this
Agreement, the terms and conditions of each of the Warrant Documents remain in
full force and effect. This Agreement supercedes in its entirety the First
Waiver Agreement and the Second Waiver Agreement. Nothing herein shall limit in
any way the rights and remedies of DBAB, TD or the Escrow Agent under any of the
Warrant Documents.
5. Counterparts. This Agreement may be executed in any number of
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counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed to be an original and all
of which taken together shall constitute one and the same agreement. Delivery
of an executed counterpart of a signature page to this Agreement by facsimile
shall be effective as delivery of a manually executed counterpart of this
Agreement.
6. Severability. Any provision of this Agreement that is prohibited or
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unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
7. Headings. Article and Section headings used herein are for
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convenience of reference only, are not part of this Agreement and shall not
affect the construction of, or be taken into consideration in interpreting, this
Agreement.
8. Further Assurances. Without limiting any party's obligations
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hereunder, the Parent hereby agrees to do all things and take all actions which
may reasonably be requested by any Beneficiary or the Escrow Agent to effectuate
the provisions of this Agreement.
9. Governing Law. This Agreement shall be governed by, and construed in
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accordance with, the laws of the State of New York.
[Signature Page Follows]
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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.
FIBERNET TELECOM GROUP, INC.
By: /s/ Xxxxxxx X. Xxxx
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Name: Xxxxxxx X. Xxxx
Title: President and Chief Executive Officer
DEUTSCHE BANK ALEX.XXXXX INC.
By: /s/ Xxxxxx Xxxxx
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Name: Xxxxxx Xxxxx
Title: Associate
By:_____________________________________
Name:
Title:
TORONTO DOMINION (TEXAS), INC.
By: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
Title: Vice President
BANKERS TRUST COMPANY
By: /s/ Xxxx Xxxxxxxx
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Name: Xxxx Xxxxxxxx
Title: Assistant Vice President
By: /s/ Xxxxx Xxxxxxxx
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Name: Xxxxx Xxxxxxxx
Title: Assistant Vice President
