PLEDGE AGREEMENT
Exhibit 10.6
PLEDGE AGREEMENT, dated as of March 31, 2008 (as amended, restated, modified and/or
supplemented from time to time, the “Agreement”), made by each of the undersigned pledgors
(each, a “Pledgor” and together with any other entity that becomes a party hereto pursuant
to Section 24 hereof, collectively, the “Pledgors”), in favor of XXXXXX COMMERCIAL PAPER
INC., as Collateral Agent (including any successor collateral agent, the “Pledgee”) for the
benefit of the Secured Creditors (as defined below). Except as otherwise defined herein, terms
used herein and defined in the Credit Agreement (as defined below) shall be used herein as therein
defined.
WITNESSETH:
WHEREAS, FairPoint Communications, Inc. (“FairPoint”), Northern New England Spinco
Inc. (“Spinco”), the lenders from time to time party thereto (the “Lenders”),
Xxxxxx Commercial Paper Inc. as Administrative Agent, Bank of America, N.A., as Syndication Agent
and Xxxxxx Xxxxxxx Senior Funding, Inc. and Deutsche Bank Securities Inc., as Co-Documentation
Agents have entered into a Credit Agreement, dated as of March 31, 2008 (as amended, modified,
restated and/or supplemented from time to time, the “Credit Agreement”), providing for the
making of Loans to, and the issuance of, and participation in, Letters of Credit for the account of
the Borrower, all as contemplated therein (the Lenders, each Letter of Credit Issuer, the Swingline
Lender, the Administrative Agent, the Collateral Agent, each other Agent and the Pledgee referred
to in the Pledge Agreement are herein called the “Lender Creditors”). As used herein, the
term “Borrower” shall mean (i) prior to the Merger, each of FairPoint and Spinco and (ii)
from and after the Merger, FairPoint.
WHEREAS, the Borrower may from time to time be a party to one or more Interest Rate Agreements
(each such Interest Rate Agreement with an Interest Rate Creditor (as defined below), a
“Secured Interest Rate Agreement”) with Xxxxxx Commercial Paper Inc., in its individual
capacity (“LCPI”), any Lender, a syndicate of financial institutions organized by LCPI or
such Lender or an affiliate of LCPI or such Lender (even if LCPI or any such Lender ceases to be a
Lender under the Credit Agreement for any reason), and any institution that participates therein,
and in each case their subsequent assigns (collectively, the “Interest Rate Creditors” and
together with the Lender Creditors, collectively, the “Secured Creditors”).
WHEREAS, it is a condition precedent to the making of Loans and the issuance of, and
participation in, Letters of Credit under the Credit Agreement that each Pledgor shall have
executed and delivered to the Pledgee this Agreement.
WHEREAS, each Pledgor desires to execute this Agreement to satisfy the condition described in
the preceding paragraph.
NOW, THEREFORE, in consideration of the benefits accruing to each Pledgor, the receipt and
sufficiency of which are hereby acknowledged, each Pledgor hereby makes the
following representations and warranties to the Pledgee and hereby covenants and agrees with
the Pledgee as follows:
1. SECURITY FOR OBLIGATIONS. This Agreement is made by each Pledgor for the benefit
of the Secured Creditors to secure:
(i) the full and prompt payment when due (whether at the stated maturity, by
acceleration or otherwise) of all obligations (including obligations which, but for the
automatic stay under Section 362(a) of the Bankruptcy Code, would become due) and
liabilities of the Borrower (in the case of the Borrower or an NSG Pledgor) or such Pledgor
(in the case of a Pledgor that is a Subsidiary Guarantor), now existing or hereafter
incurred under, arising out of or in connection with any Credit Document to which the
Borrower or such Pledgor, as the case may be, is a party (including, in the case of a
Pledgor that is a Subsidiary Guarantor, all such obligations of such Pledgor under the
Subsidiary Guaranty) and the due performance of and compliance by the Borrower or such
Pledgor, as the case may be, with the terms of each such Credit Document (all such
obligations and liabilities under this clause (i), except to the extent consisting of
obligations or indebtedness with respect to Secured Interest Rate Agreements, being herein
collectively called the “Credit Document Obligations”);
(ii) the full and prompt payment when due (whether at the stated maturity, by
acceleration or otherwise) of all obligations (including obligations which, but for the
automatic stay under Section 362(a) of the Bankruptcy Code, would become due) and
liabilities of the Borrower (in the case of the Borrower and each NSG Pledgor) or such
Pledgor (in the case of any Pledgor that is a Subsidiary Guarantor), now existing or
hereafter incurred under, arising out of or in connection with any Secured Interest Rate
Agreement (all such obligations and liabilities under this clause (ii) being herein
collectively called the “Interest Rate Obligations”);
(iii) any and all sums advanced by the Pledgee in order to preserve the Collateral (as
hereinafter defined) and/or its security interest therein;
(iv) in the event of any proceeding for the collection of the Obligations (as defined
below) or the enforcement of this Agreement, after an Event of Default (such term, as used
in this Agreement, shall mean any Event of Default under the Credit Agreement or any payment
default by the Borrower under any Secured Interest Rate Agreement after the expiration of
any applicable grace period) shall have occurred and be continuing, the reasonable
out-of-pocket expenses of retaking, holding, preparing for sale or lease, selling or
otherwise disposing of or realizing on the Collateral, or of any exercise by the Pledgee of
its rights hereunder, together with reasonable attorneys’ fees and disbursements of counsel;
and
(v) all amounts paid by any Secured Creditor as to which such Secured Creditor has the
right to reimbursement under Section 11 of this Agreement;
all such obligations, liabilities, sums and expenses set forth in clauses (i) through (v) of this
Section 1 being herein collectively called the “Obligations”.
2. DEFINITIONS. The following capitalized terms used herein shall have the
definitions specified below:
“Certificated Security” shall have the meaning given such term in Section 8-102(a)(4)
of the UCC.
“Clearing Corporation” shall have the meaning given such term in Section 8-102(a)(5)
of the UCC.
“Collateral” shall have the meaning provided in Section 3.1.
“Collateral Accounts” shall mean any and all accounts established and maintained by
the Pledgee in the name of any Pledgor to which Collateral may be credited.
“Excluded Entity” shall mean (x) each of the corporations, partnerships, limited
liability companies or associations listed on Annex G hereto where the capital stock or other
equity interests of such corporations, partnerships, limited liability companies or associations
are not permitted by applicable law, rule or regulation to be pledged and (y) any Telco or Carrier
Services Company acquired or created pursuant to a Permitted Acquisition after the Closing Date,
where the capital stock or other equity interests of such Telco or Carrier Services Company are not
permitted by applicable law, rule or regulation to be pledged and, after giving effect to the
acquisition or creation of such Telco or Carrier Services Company, the Pro Forma
EBITDA Test is satisfied.
“Exempted Foreign Entity” shall mean any Foreign Corporation, Foreign LLC or Foreign
Partnership that, in any such case, is treated as a corporation or an association taxable as a
corporation for U.S. Federal income tax purposes.
“Financial Asset” shall have the meaning given such term in Section 8-102(a)(9) of the
UCC.
“Instrument” shall have the meaning given such term in Section 9-102(a)(47) of the
UCC.
“Investment Property” shall have the meaning given such term in Section 9-102(a)(49)
of the UCC.
“Location” of any Pledgor has the meaning given such term in Section 9-307 of the UCC.
“Membership Interest” shall mean (x) the entire membership interest at any time owned
by any Pledgor in any limited liability company (other than (I) an Excluded Entity and (II) a
limited liability company that is not organized under the laws of the United States or any State or
territory thereof (a “Foreign LLC”)) and (y) with respect to a Foreign LLC (other than an
Excluded Entity), the entire membership interest at any time owned by any Pledgor in such Foreign
LLC, provided that such Pledgor shall not be required to pledge hereunder (and the term
“Membership Interest” shall not include) more than 65% of the total voting power of all classes
of the membership interests of any Foreign LLC (that is an Exempted Foreign Entity) entitled
to vote (with any limited liability company (other than an Excluded Entity) in which any Pledgor
owns a membership interest being herein called a “Pledged LLC”).
“Notes” shall mean all promissory notes at any time issued to, or held by, any
Pledgor.
“NSG Pledgor” shall mean each Pledgor which is not a Subsidiary Guarantor.
“Obligations” shall have the meaning provided in Section 1.
“Partnership Interest” shall mean (x) the entire partnership interest (whether general
and/or limited partnership interests) at any time owned by any Pledgor in any partnership (other
than (I) an Excluded Entity and (II) a partnership that is not organized under the laws of the
United States or any State or territory thereof (a “Foreign Partnership”)) and (y) with
respect to a Foreign Partnership (other than an Excluded Entity), the entire partnership interest
at any time owned by any Pledgor in such Foreign Partnership, provided that such Pledgor
shall not be required to pledge hereunder (and the term “Partnership Interest” shall not include)
more than 65% of the total voting power of all classes of partnership interests of any Foreign
Partnership (that is an Exempted Foreign Entity) entitled to vote (with any partnership (other than
an Excluded Entity) in which any Pledgor owns a partnership interest being herein called a
“Pledged Partnership”).
“Pledged Membership Interests” shall mean all Membership Interests at any time pledged
or required to be pledged hereunder.
“Pledged Notes” shall mean all Notes at any time pledged or required to be pledged
hereunder.
“Pledged Partnership Interests” shall mean all Partnership Interests at any time
pledged or required to be pledged hereunder.
“Pledged Securities” shall mean all Pledged Stock, Pledged Notes, Pledged Partnership
Interests and Pledged Membership Interests.
“Pledged Stock” shall mean all Stock at any time pledged or required to be pledged
hereunder.
“Proceeds” shall have the meaning given such term in Section 9-102(a)(64) of the UCC.
“Registered Organization” shall have the meaning given such term in Section
9-102(a)(70) of the UCC.
“Secured Debt Agreements” shall have the meaning provided in Section 5.
“Securities” shall mean all of the Stock, Notes, Partnership Interests and Membership
Interests.
“Securities Intermediary” shall have the meaning given such term in Section 8-102(14)
of the UCC.
“Security Entitlement” shall have the meaning given such term in Section 8-102(a)(17)
of the UCC.
“Stock” shall mean (x) all of the issued and outstanding shares of stock at any time
owned by any Pledgor of any corporation (other than (I) any Excluded Entity and (II) a corporation
that is not organized under the laws of the United States or any State or territory thereof (a
“Foreign Corporation”)) and (y) with respect to a Foreign Corporation that is a First-Tier
Subsidiary (other than any Excluded Entity), all of the issued and outstanding shares of capital
stock at any time owned by any Pledgor of such Foreign Corporation, provided that such
Pledgor shall not be required to pledge hereunder (and the term “Stock” shall not include) more
than 65% of the total combined voting power of all classes of capital stock of any Exempted Foreign
Entity entitled to vote.
“Transmitting Utility” has the meaning given such term in Section 9-102(a)(80) of the
UCC.
“UCC” shall mean the Uniform Commercial Code as in effect in the State of New York
from time to time; provided that all references herein to specific Sections or subsections
of the UCC are references to such Sections or subsections, as the case may be, of the Uniform
Commercial Code as in effect in the State of New York on the date hereof.
“Uncertificated Security” shall have the meaning given such term in Section
8-102(a)(18) of the UCC.
3. PLEDGE OF SECURITIES, ETC.
3.1 Pledge. To secure the Obligations now or hereafter owed or to be performed by
such Pledgor, each Pledgor does hereby grant, pledge, hypothecate, mortgage, charge and assign to
the Pledgee for the benefit of the Secured Creditors, and does hereby create a continuing security
interest (subject to those Liens permitted to exist with respect to the Collateral pursuant to the
terms of all Secured Debt Agreements then in effect) in favor of the Pledgee for the benefit of the
Secured Creditors in, all of its right, title and interest in and to the following, whether now
existing or hereafter from time to time acquired (collectively, the “Collateral”):
(i) all of the Securities owned or held by such Pledgor from time to time and all
options and warrants owned by such Pledgor from time to time to purchase Securities (and all
certificates or instruments evidencing such Securities);
(ii) each Collateral Account, including any and all assets of whatever type or kind
deposited by such Pledgor in any such Collateral Account, whether now owned or hereafter
acquired, existing or arising (including, without limitation, all Financial Assets,
Investment Property, monies, checks, drafts, Instruments or interests therein of any type or
nature deposited or required by the Credit Agreement or any other Secured Debt
Agreement to be deposited in such Collateral Account, and all investments and all
certificates and other instruments (including depository receipts, if any) from time to time
representing or evidencing the same, and all dividends, interest, distributions, cash and
other property from time to time received, receivable or otherwise distributed in respect of
or in exchange for any or all of the foregoing);
(iii) all of such Pledgor’s (x) Partnership Interest and all of such Pledgor’s right,
title and interest in each Pledged Partnership and (y) Membership Interest and all of such
Pledgor’s right, title and interest in each Pledged LLC, in each case including, without
limitation:
(a) all the capital thereof and its interest in all profits, losses and other
distributions to which such Pledgor shall at any time be entitled in respect of such
Partnership Interest and/or Membership Interest;
(b) all other payments due or to become due to such Pledgor in respect of such
Partnership Interest and/or Membership Interest, whether under any partnership
agreement, limited liability company agreement or otherwise, whether as contractual
obligations, damages, insurance proceeds or otherwise;
(c) all of its claims, rights, powers, privileges, authority, options, security
interest, liens and remedies, if any, under any partnership agreement, limited
liability company agreement or at law or otherwise in respect of such Partnership
Interest and/or Membership Interest;
(d) all present and future claims, if any, of the Pledgor against any Pledged
Partnership and any Pledged LLC for moneys loaned or advanced, for services rendered
or otherwise;
(e) all of such Pledgor’s rights under any partnership agreement or limited
liability company agreement or at law to exercise and enforce every right, power,
remedy, authority, option and privilege of such Pledgor relating to the Partnership
Interest and/or Membership Interest, including any power to terminate, cancel or
modify any partnership agreement or any limited liability company agreement, to
execute any instruments and to take any and all other action on behalf of and in the
name of such Pledgor in respect of any Partnership Interest or Membership Interest
and any Pledged Partnership and any Pledged LLC to make determinations, to exercise
any election (including, but not limited to, election of remedies) or option or to
give or receive any notice, consent, amendment, waiver or approval, together with
full power and authority to demand, receive, enforce, collect or receipt for any of
the foregoing, to enforce or execute any checks, or other instruments or orders, to
file any claims and to take any action in connection with any of the foregoing; and
(f) all other property hereafter delivered in substitution for or in addition
to any of the foregoing, all certificates and instruments representing or evidencing
such other property and all cash, securities, interest, dividends, rights
and other property at any time and from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all thereof;
(iv) all Security Entitlements owned by such Pledgor from time to time in any and all
of the foregoing; and
(v) all Proceeds of any and all of the foregoing.
Notwithstanding anything to the contrary contained in this Section 3.1, except as otherwise
required by Section 6.11 of the Credit Agreement, no Pledgor shall be required to pledge hereunder
any Margin Stock owned by such Pledgor.
3.2 Procedures. (a) To the extent that any Pledgor at any time or from time to time
owns, acquires or obtains any right, title or interest in any Collateral, such Collateral shall
automatically (and without the taking of any action by such Pledgor) be pledged pursuant to Section
3.1 of this Agreement and, in addition thereto, such Pledgor shall (to the extent provided below)
forthwith take the following actions as set forth below:
(i) with respect to a Certificated Security (other than a Certificated Security
credited on the books of a Clearing Corporation or Securities Intermediary), such Pledgor
shall physically deliver such Certificated Security to the Pledgee, endorsed to the Pledgee
or endorsed in blank;
(ii) with respect to an Uncertificated Security (other than an Uncertificated Security
credited on the books of a Clearing Corporation or Securities Intermediary), such Pledgor
shall cause the issuer of such Uncertificated Security to duly authorize, execute, and
deliver to the Pledgee, an agreement for the benefit of the Pledgee and the other Secured
Creditors substantially in the form of Annex E hereto (appropriately completed to the
satisfaction of the Pledgee and with such modifications, if any, as shall be satisfactory to
the Pledgee) pursuant to which such issuer agrees to comply with any and all instructions
originated by the Pledgee without further consent by the registered owner and not to comply
with instructions regarding such Uncertificated Security (and any Partnership Interests and
Membership Interests issued by such issuer) originated by any other Person other than a
court of competent jurisdiction;
(iii) with respect to a Certificated Security, Uncertificated Security, Partnership
Interest or Membership Interest credited on the books of a Clearing Corporation or
Securities Intermediary (including a Federal Reserve Bank, Participants Trust Company or The
Depository Trust Company), such Pledgor shall promptly notify the Pledgee thereof and shall
promptly take (x) all actions required (i) to comply with the applicable rules of such
Clearing Corporation or Securities Intermediary and (ii) to perfect the security interest of
the Pledgee under applicable law (including, in any event, under Sections 9-314(a), (b) and
(c), 9-106 and 8-106(d) of the UCC) and (y) such other actions as the Pledgee deems
necessary or desirable to effect the foregoing;
(iv) with respect to a Partnership Interest or a Membership Interest (other than a
Partnership Interest or Membership Interest credited on the books of a Clearing
Corporation or Securities Intermediary), (1) if such Partnership Interest or Membership
Interest is represented by a certificate and is a Security for purposes of the UCC, the
procedure set forth in Section 3.2(a)(i) hereof, and (2) if such Partnership Interest or
Membership Interest is not represented by a certificate or is not a Security for purposes of
the UCC, the procedure set forth in Section 3.2(a)(ii) hereof;
(v) with respect to any Note, physical delivery of such Note to the Pledgee, endorsed
in blank, or, at the request of the Pledgee, endorsed to the Pledgee; and
(vi) with respect to cash proceeds from any of the Collateral described in Section 3.1
hereof, (i) the establishment by the Pledgee of a cash account in the name of such Pledgor
over which the Pledgee shall have “control” within the meaning of the UCC and, at any time
any Event of Default is in existence, no withdrawals or transfers may be made therefrom by
any Person except with the prior written consent of the Pledgee and (ii) the deposit of such
cash in such cash account.
(b) In addition to the actions required to be taken pursuant to Section 3.2(a) hereof, each
Pledgor shall take the following additional actions with respect to the Collateral:
(i) with respect to all Collateral of such Pledgor whereby or with respect to which the
Pledgee may obtain “control” thereof within the meaning of Section 8-106 of the UCC (or
under any provision of the UCC as same may be amended or supplemented from time to time, or
under the laws of any relevant State other than the State of New York), such Pledgor shall
take all actions as may be requested from time to time by the Pledgee so that “control” of
such Collateral is obtained and at all times held by the Pledgee; and
(ii) each Pledgor shall from time to time cause appropriate financing statements (on
appropriate forms) under the Uniform Commercial Code as in effect in the various relevant
States, covering all Collateral hereunder (with the form of such financing statements to be
satisfactory to the Pledgee), to be filed in the relevant filing offices so that at all
times the Pledgee’s security interest in all Investment Property and other Collateral which
can be perfected by the filing of such financing statements (in each case to the maximum
extent perfection by filing may be obtained under the laws of the relevant States,
including, without limitation, Section 9-312(a) of the UCC) is so perfected.
3.3 Subsequently Acquired Collateral. If any Pledgor shall acquire (by purchase,
stock dividend or otherwise) any additional Collateral at any time or from time to time after the
date hereof, such Pledgor will forthwith thereafter take (or cause to be taken) all action with
respect to such Collateral in accordance with the procedures set forth in Section 3.2 hereof, and
will promptly thereafter deliver to the Pledgee a certificate executed by a principal executive
officer of such Pledgor describing such Collateral and certifying that the same have been duly
pledged with the Pledgee hereunder. Each Pledgor further agrees to provide an opinion of counsel
reasonably satisfactory to the Pledgee with respect to any pledge of Collateral constituting
Uncertificated Securities promptly upon request of the Pledgee. No Pledgor shall be required at
any time to pledge hereunder any Securities which constitute more than 65% of the
total combined voting power of all classes of ownership interests of any Exempted Foreign
Entity entitled to vote. Notwithstanding anything to the contrary contained above in this Section
3.3, except as otherwise required by Section 6.11 of the Credit Agreement, no Pledgor shall be
required to pledge hereunder any Margin Stock acquired by such Pledgor after the date hereof.
3.4 Certain Representations and Warranties Concerning the Collateral. Each Pledgor
represents and warrants that on the date hereof: (a) each Subsidiary of such Pledgor whose equity
interest is required to be pledged hereunder, and the direct ownership thereof, is listed on Annex
A hereto; (b) the Stock held by such Pledgor consists of the number and type of shares of the stock
of the corporations as described in Annex B hereto; (c) such Stock constitutes that percentage of
the issued and outstanding capital stock of the issuing corporation as set forth in Annex B hereto;
(d) the Notes held by such Pledgor consist of the promissory notes described in Annex C hereto; (e)
such Pledgor is the holder of record and sole beneficial owner of the Stock and Notes held by such
Pledgor and there exists no options or preemption rights in respect of any of the Stock; (f) the
Partnership Interests and Membership Interests, as the case may be, held by such Pledgor constitute
that percentage of the entire interest of the respective Pledged Partnership or Pledged LLC, as the
case may be, as is set forth under its name in Annex D hereto; (g) on the date hereof, such Pledgor
owns or possesses no other Securities except as described on Annexes B, C and D hereto; and (h) the
Pledgor has complied with the respective procedure set forth in Section 3.2(a) hereof with respect
to each item of Collateral described in Annexes B, C and D hereto.
4. APPOINTMENT OF SUB-AGENTS; ENDORSEMENTS, ETC. The Pledgee shall have the right to
appoint one or more sub-agents for the purpose of retaining physical possession of the Pledged
Securities, which may be held (in the discretion of the Pledgee) in the name of the relevant
Pledgor, endorsed or assigned in blank or in favor of the Pledgee or any nominee or nominees of the
Pledgee or a sub-agent appointed by the Pledgee.
5. VOTING, ETC., WHILE NO EVENT OF DEFAULT. Unless and until there shall have
occurred and be continuing an Event of Default, each Pledgor shall be entitled to exercise all
voting rights attaching to any and all Pledged Securities owned by it, and to give consents,
waivers or ratifications in respect thereof, provided that no vote shall be cast or any
consent, waiver or ratification given or any action taken which would violate, result in breach of
any covenant contained in, or be inconsistent with, any of the terms of this Agreement, the Credit
Agreement, any other Credit Document or any Secured Interest Rate Agreement (collectively, the
“Secured Debt Agreements”), or which would have the effect of impairing the value of the
Collateral or any part thereof or the position or interests of the Pledgee or any other Secured
Creditor therein. All such rights of a Pledgor to vote and to give consents, waivers and
ratifications shall cease in case an Event of Default shall occur and be continuing and Section 7
hereof shall become applicable.
6. DIVIDENDS AND OTHER DISTRIBUTIONS. Unless and until an Event of Default shall have
occurred and be continuing, all cash dividends, distributions or other amounts payable in respect
of the Pledged Securities shall be paid to the respective Pledgor, provided that all
dividends, distributions or other amounts payable in respect of the Pledged Securities which are
determined by the Pledgee, in its absolute discretion, to represent in whole or in part an
extraordinary, liquidating or other distribution in return of capital not permitted by
the Credit Agreement shall be paid, to the extent so determined to represent an extraordinary,
liquidating or other distribution in return of capital not permitted by the Credit Agreement, to
the Pledgee and retained by it as part of the Collateral (unless such cash dividends or
distributions are applied to repay the Obligations pursuant to Section 9 of this Agreement). The
Pledgee shall also be entitled to receive directly, and to retain as part of the Collateral:
(i) all other or additional stock, notes, membership interests, partnership interests
or other securities or property (other than cash) paid or distributed by way of dividend or
otherwise in respect of the Collateral;
(ii) all other or additional stock, notes, membership interests, partnership interests
or other securities or property (including cash) paid or distributed in respect of the
Collateral by way of stock-split, spin-off, split-up, reclassification, combination of shares or similar rearrangement; and
(iii) all other or additional stock, notes, membership interests, partnership interests
or other securities or property (including cash) which may be paid in respect of the
Collateral by reason of any consolidation, merger, exchange of stock, conveyance of assets,
liquidation or similar corporate reorganization (other than the Net Cash Proceeds from any
Asset Sale applied to repay Loans and/or reinvested in accordance with the relevant
provisions of the Credit Agreement).
Nothing contained in this Section 6 shall limit or restrict in any way the Pledgee’s right to
receive the proceeds of the Collateral in any form in accordance with Section 3 of this Agreement.
All dividends, distributions or other payments which are received by the respective Pledgor
contrary to the provisions of this Section 6 or Section 7 shall be received in trust for the
benefit of the Pledgee, shall be segregated from other property or funds of such Pledgor and shall
be forthwith paid over to the Pledgee as Collateral in the same form as so received (with any
necessary endorsement).
7. REMEDIES IN CASE OF AN EVENT OF DEFAULT. (a) In case an Event of Default shall
have occurred and be continuing, the Pledgee shall be entitled to exercise all of the rights,
powers and remedies (whether vested in it by this Agreement or any other Secured Debt Agreement or
by law) for the protection and enforcement of its rights in respect of the Collateral, including,
without limitation, all the rights and remedies of a secured party upon default under the Uniform
Commercial Code of the State of New York, and the Pledgee shall be entitled, without limitation, to
exercise any or all of the following rights, which each Pledgor hereby agrees to be commercially
reasonable:
(i) to receive all amounts payable in respect of the Collateral otherwise payable under
Section 6 to such Pledgor;
(ii) to transfer all or any part of the Collateral into the Pledgee’ s name or the name
of its nominee or nominees;
(iii) to accelerate any Pledged Note which may be accelerated in accordance with its
terms, and take any other lawful action to collect upon any Pledged Note (including, without
limitation, to make any demand for payment thereon);
(iv) to vote all or any part of the Collateral (whether or not transferred into the
name of the Pledgee) and give all consents, waivers and ratifications in respect of the
Collateral and otherwise act with respect thereto as though it were the outright owner
thereof (each Pledgor hereby irrevocably constituting and appointing the Pledgee the proxy
and attorney-in-fact of such Pledgor, with full power of substitution to do so);
(v) to set off any and all Collateral against any and all Obligations, and to withdraw
any and all cash or other Collateral from any and all Collateral Accounts and to apply such
cash and other Collateral to the payment of any and all Obligations; and
(vi) at any time or from time to time to sell, assign and deliver, or grant options to
purchase, all or any part of the Collateral, or any interest therein, at any public or
private sale, without demand of performance, advertisement or notice of intention to sell or
of the time or place of sale or adjournment thereof or to redeem or otherwise (all of which
are hereby waived by each Pledgor), for cash, on credit or for other property, for immediate
or future delivery without any assumption of credit risk, and for such price or prices and
on such terms as the Pledgee in its absolute discretion may determine, provided that
at least 10 days’ notice of the time and place of any such sale shall be given to such
Pledgor. The Pledgee shall not be obligated to make such sale of Collateral regardless of
whether any such notice of sale has theretofore been given. Each purchaser at any such sale
shall hold the property so sold absolutely free from any claim or right on the part of any
Pledgor, and each Pledgor hereby waives and releases to the fullest extent permitted by law
any right or equity of redemption with respect to the Collateral, whether before or after
sale hereunder, all rights, if any, of marshalling the Collateral and any other security for
the Obligations or otherwise, and all rights, if any, of stay and/or appraisal which it now
has or may at any time in the future have under rule of law or statute now existing or
hereafter enacted. At any such sale, unless prohibited by applicable law, the Pledgee on
behalf of all Secured Creditors (or certain of them) may bid for and purchase (by bidding in
Obligations or otherwise) all or any part of the Collateral so sold free from any such right
or equity of redemption. Neither the Pledgee nor any Secured Creditor shall be liable for
failure to collect or realize upon any or all of the Collateral or for any delay in so doing
nor shall it be under any obligation to take any action whatsoever with regard thereto.
8. REMEDIES, ETC., CUMULATIVE. Each right, power and remedy of the Pledgee provided
for in this Agreement or any other Secured Debt Agreement, or now or hereafter existing at law or
in equity or by statute shall be cumulative and concurrent and shall be in addition to every other
such right, power or remedy. The exercise or beginning of the exercise by the Pledgee or any other
Secured Creditor of any one or more of the rights, powers or remedies provided for in this
Agreement or any other Secured Debt Agreement or now or hereafter existing at law or in equity or
by statute or otherwise shall not preclude the simultaneous or later exercise by the Pledgee or any
other Secured Creditor of all such other rights, powers or remedies, and no failure or delay on the
part of the Pledgee or any other
Secured Creditor to exercise any such right, power or remedy shall operate as a waiver
thereof. Unless otherwise required by the Credit Documents, no notice to or demand on any Pledgor
in any case shall entitle it to any other or further notice or demand in similar other
circumstances or constitute a waiver of any of the rights of the Pledgee or any other Secured
Creditor to any other further action in any circumstances without demand or notice. The Secured
Creditors agree that this Agreement may be enforced only by the action of the Administrative Agent
or the Pledgee, in each case acting upon the instructions of the Required Lenders (or, after the
date on which all Credit Document Obligations have been paid in full, the holders of at least the
majority of the outstanding Interest Rate Obligations) and that no other Secured Creditor shall
have any right individually to seek to enforce or to enforce this Agreement or to realize upon the
security to be granted hereby, it being understood and agreed that such rights and remedies may be
exercised by the Administrative Agent or the Pledgee or the holders of at least a majority of the
outstanding Interest Rate Obligations, as the case may be, for the benefit of the Secured Creditors
upon the terms of this Agreement.
9. APPLICATION OF PROCEEDS. (a) All moneys collected by the Pledgee or the Collateral
Agent upon any sale or other disposition of the Collateral, together with all other moneys received
by the Pledgee or the Collateral Agent hereunder, shall be applied as follows:
(i) first, to the payment of all Obligations owing to the Pledgee or the
Collateral Agent of the type described in clauses (iii) and (iv) of the definition of
“Obligations” contained in Section 1 hereof;
(ii) second, to the extent proceeds remain after the application pursuant to
preceding clause (i), an amount equal to the outstanding Obligations to the Secured
Creditors shall be paid to the Secured Creditors as provided in Section 9(c), with each
Secured Creditor receiving an amount equal to its outstanding Obligations or, if the
proceeds are insufficient to pay in full all such Obligations, its Pro Rata Share of
the amount remaining to be distributed to be applied, with respect to the Credit Document
Obligations, firstly, to the payment of interest in respect of the unpaid principal
amount of Loans outstanding, secondly, to the payment of principal of Loans
outstanding, then to the other Credit Document Obligations; and
(iii) third, to the extent proceeds remain after the application pursuant to
the preceding clauses (i) and (ii) and following the termination of this Agreement pursuant
to Section 18 hereof, to the relevant Pledgor or, to the extent directed by such Pledgor or
a court of competent jurisdiction, to whomever may be lawfully entitled to receive such
surplus.
(b) For purposes of this Agreement, “Pro Rata Share” shall mean, when calculating a
Secured Creditor’s portion of any distribution or amount, the amount (expressed as a percentage)
equal to a fraction the numerator of which is the then outstanding amount of the relevant
Obligations owed such Secured Creditor and the denominator of which is the then outstanding amount
of all Obligations.
(c) All payments required to be made to the (i) Lender Creditors hereunder shall be made to
the Administrative Agent for the account of the respective Lender Creditors and (ii) Interest Rate
Creditors hereunder shall be made to the paying agent under the applicable Secured Interest Rate
Agreement or, in the case of Secured Interest Rate Agreements without a paying agent, directly to
the applicable Interest Rate Creditor.
(d) For purposes of applying payments received in accordance with this Section 9, the Pledgee
and the Collateral Agent shall be entitled to rely upon (i) the Administrative Agent for a
determination (which the Administrative Agent agrees to provide upon request to the Pledgee and the
Collateral Agent) of the outstanding Credit Document Obligations and (ii) any Interest Rate
Creditor for a determination (which each Interest Rate Creditor agrees to provide upon request to
the Pledgee and the Collateral Agent) of the outstanding Interest Rate Obligations owed to such
Interest Rate Creditor. Unless it has actual knowledge (including by way of written notice from a
Secured Creditor) to the contrary, the Administrative Agent under the Credit Agreement, in
furnishing information pursuant to the preceding sentence, and the Pledgee and the Collateral
Agent, in acting hereunder, shall be entitled to assume that (x) no Credit Document Obligations
other than principal, interest and regularly accruing fees are owing to any Lender Creditor and (y)
no Secured Interest Rate Agreements or Interest Rate Obligations with respect thereto are in
existence.
(e) It is understood that each Pledgor shall remain jointly and severally liable to the extent
of any deficiency between (x) the amount of the Obligations for which it is liable directly or as a
Guarantor that are satisfied with proceeds of the Collateral and (y) the aggregate outstanding
amount of the Obligations.
10. PURCHASERS OF COLLATERAL. Upon any sale of the Collateral by the Pledgee
hereunder (whether by virtue of the power of sale herein granted, pursuant to judicial process or
otherwise), the receipt of the Pledgee or the officer making the sale shall be a sufficient
discharge to the purchaser or purchasers of the Collateral so sold, and such purchaser or
purchasers shall not be obligated to see to the application of any part of the purchase money paid
over to the Pledgee or such officer or be answerable in any way for the misapplication or
nonapplication thereof.
11. INDEMNITY. Each Pledgor jointly and severally agrees (i) to indemnify and hold
harmless the Pledgee and the other Secured Creditors from and against any and all claims, demands,
losses, judgments and liabilities (including liabilities for penalties) of whatsoever kind or
nature, and (ii) to reimburse the Pledgee for all reasonable out-of-pocket costs and expenses,
including reasonable attorneys’ fees, arising in connection with any amendment, waiver or
modification to this Agreement and the Pledgee and the other Secured Creditors for all reasonable
costs and expenses (including reasonable attorney’s fees) growing out of or resulting from the
exercise by the Pledgee of any right or remedy granted to it hereunder or under any other Secured
Debt Agreement except, with respect to clauses (i) and (ii) above, for those arising from such
Person’s gross negligence or willful misconduct (as determined by a court of competent jurisdiction
in a final and non-appealable decision). In no event shall the Pledgee be liable, in the absence
of gross negligence or willful misconduct on its part (as determined by a court of competent
jurisdiction in a final and non-appealable decision), for any matter or thing in connection with
this Agreement other than to account for moneys or
other property actually received by it in accordance with the terms hereof. If and to the
extent that the obligations of any Pledgor under this Section 11 are unenforceable for any reason,
such Pledgor hereby agrees to make the maximum contribution to the payment and satisfaction of such
obligations which is permissible under applicable law.
12. FURTHER ASSURANCES; POWER OF ATTORNEY. (a) Each Pledgor agrees that it will join
with the Pledgee in executing and, at such Pledgor’s own expense, file and refile under the Uniform
Commercial Code such financing statements, continuation statements and other documents in such
offices as the Pledgee may reasonably deem necessary or appropriate and wherever required or
permitted by law in order to perfect and preserve the Pledgee’s security interest in the Collateral
hereunder and hereby authorizes the Pledgee to file financing statements and amendments thereto
relative to all or any part of the Collateral without the signature of such Pledgor where permitted
by law, and agrees to do such further acts and things and to execute and deliver to the Pledgee
such additional conveyances, assignments, agreements and instruments as the Pledgee may reasonably
require or deem advisable to carry into effect the purposes of this Agreement or to further assure
and confirm unto the Pledgee its rights, powers and remedies hereunder or thereunder.
(b) Each Pledgor hereby appoints the Pledgee, such Pledgor’s attorney-in-fact, with full
authority in the place and stead of such Pledgor and in the name of such Pledgor or otherwise, from
time to time after the occurrence and during the continuance of an Event of Default, in the
Pledgee’s reasonable discretion to take any action and to execute any instrument which the Pledgee
may reasonably deem necessary or advisable to accomplish the purposes of this Agreement.
13. THE PLEDGEE AS COLLATERAL AGENT. The Pledgee will hold in accordance with this
Agreement all items of the Collateral at any time received under this Agreement. It is expressly
understood and agreed that the obligations of the Pledgee as holder of the Collateral and interests
therein and with respect to the disposition thereof, and otherwise under this Agreement, are only
those expressly set forth in this Agreement. The Pledgee shall act hereunder on the terms and
conditions set forth herein and in Section 10 of the Credit Agreement.
14. TRANSFER BY THE PLEDGORS. No Pledgor will sell or otherwise dispose of, grant any
option with respect to, or mortgage, pledge or otherwise encumber any of the Collateral or any
interest therein (except in accordance with the terms of this Agreement and the other Secured Debt
Agreements).
15. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PLEDGORS. (a) Each Pledgor
represents, warrants and covenants that:
(i) it is, or at the time when pledged hereunder will be, the legal, beneficial and
record owner of, and has (or will have) good and marketable title to, all Securities pledged
by it hereunder, subject to no pledge, lien, mortgage, hypothecation, security interest,
charge, option or other encumbrance whatsoever, except (x) the liens and security interests
created by this Agreement and (y) liens permitted by Section 7.03(a) of the Credit
Agreement;
(ii) it has full power, authority and legal right to pledge all the Collateral pledged
by it pursuant to this Agreement;
(iii) this Agreement has been duly authorized, executed and delivered by such Pledgor
and constitutes a legal, valid and binding obligation of such Pledgor enforceable in
accordance with its terms, except to the extent that the enforceability thereof may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws generally affecting creditors’ rights and by equitable principles (regardless of
whether enforcement is sought in equity or at law);
(iv) except to the extent already obtained or made, no consent of any other party
(including, without limitation, any stockholder, limited or general partner, member or
creditor of such Pledgor or any of its Subsidiaries) and no consent, license, permit,
approval or authorization of, exemption by, notice or report to, or registration, filing or
declaration with, any governmental authority is required to be obtained by such Pledgor in
connection with (a) the execution, delivery or performance of this Agreement, (b) the
validity or enforceability of this Agreement, (c) the perfection or enforceability of the
Pledgee’s security interest in the Collateral or (d) except for compliance with or as may be
required by applicable securities laws, the exercise by the Pledgee of any of its rights or
remedies provided herein;
(v) the execution, delivery and performance of this Agreement by such Pledgor will not
violate any provision of any applicable law or regulation or of any order, judgment, writ,
award or decree of any court, arbitrator or governmental authority, domestic or foreign,
applicable to such Pledgor, or of the certificate of incorporation, certificate of
formation, by-laws, certificate of limited partnership, partnership agreement or limited
liability company agreement, as the case may be, of such Pledgor or of any securities issued
by such Pledgor or any of its Subsidiaries, or of any mortgage, indenture, lease, loan
agreement, credit agreement or other material contract, agreement or instrument or
undertaking to which such Pledgor or any of its Subsidiaries is a party or which purports to
be binding upon such Pledgor or any of its Subsidiaries or upon any of their respective
assets and will not result in the creation or imposition of (or the obligation to create or
impose) any lien or encumbrance on any of the assets of such Pledgor or any of its
Subsidiaries except as contemplated by this Agreement;
(vi) all the shares of the Stock have been duly and validly issued, are fully paid and
non-assessable and are subject to no options to purchase or similar rights;
(vii) each of the Pledged Notes constitutes, or when executed by the obligor thereof
will constitute, the legal, valid and binding obligation of such obligor, enforceable in
accordance with its terms, except to the extent that the enforceability thereof may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws generally affecting creditors’ rights and by equitable principles (regardless of
whether enforcement is sought in equity or at law);
(viii) the pledge, assignment and delivery to the Pledgee of the Securities (other than
those constituting Uncertificated Securities) pursuant to this Agreement creates a
valid and, assuming such Securities are held in the continued possession of the
Collateral Agent in the State of New York, perfected first priority Lien in the Securities
and the proceeds thereof, subject to no other Lien or to any agreement purporting to grant
to any third party a Lien on the property or assets of such Pledgor which would include the
Securities (other than Liens permitted by Section 7.03(a) of the Credit Agreement);
(ix) it has the unqualified right to pledge and grant a security interest in the
Partnership Interests and Membership Interests as herein provided without the consent of any
other Person, firm, association or entity which has not been obtained;
(x) the Partnership Interests and the Membership Interests pledged by it pursuant to
this Agreement have been validly acquired and are fully paid for and are duly and validly
pledged hereunder;
(xi) it is not in default in the payment of any portion of any mandatory capital
contribution, if any, required to be made under any partnership agreement or limited
liability company agreement to which such Pledgor is a party, and such Pledgor is not in
violation of any other material provisions of any partnership agreement or limited liability
company agreement to which such Pledgor is a party, or otherwise in default or violation
thereunder, no Partnership Interest or Membership Interest is subject to any defense, offset
or counterclaim, nor have any of the foregoing been asserted or alleged against such Pledgor
by any Person with respect thereto and as of the Closing Date, there are no certificates,
instruments, documents or other writings (other than the partnership agreements and
certificates, if any, delivered to the Collateral Agent) which evidence any Partnership
Interest or Membership Interest of such Pledgor;
(xii) the pledge and assignment of the Partnership Interests and the Membership
Interests pursuant to this Agreement, together with the relevant filings, consents or
recordings (which filings, consents and recordings have been made or obtained), creates a
valid, perfected and continuing first security interest in such Partnership Interests and
Membership Interest and the proceeds thereof, subject to no prior lien or encumbrance or to
any agreement purporting to grant to any third party a lien or encumbrance on the property
or assets of such Pledgor which would include the Collateral;
(xiii) other than financing statements pursuant to Liens permitted under Section 7.04
of the Credit Agreement, there are no currently effective financing statements under the UCC
covering any property which is now or hereafter may be included in the Collateral and such
Pledgor will not, without the prior written consent of the Pledgee, execute and, until the
Termination Date (as hereinafter defined), there will not ever be on file in any public
office, any enforceable financing statement or statements covering any or all of the
Collateral, except financing statements filed or to be filed in favor of the Pledgee as
secured party;
(xiv) it shall give the Pledgee prompt notice of any written claim relating to the
Collateral and shall deliver to the Pledgee a copy of each other demand, notice or document
received by it which may adversely affect the Pledgee’s interest in the
Collateral promptly upon, but in any event within 10 days after, such Pledgor’ s
receipt thereof;
(xv) it shall not withdraw as a partner of any Pledged Partnership or member of any
Pledged LLC, or file or pursue or take any action which may, directly or indirectly, cause a
dissolution or liquidation of or with respect to any Pledged Partnership or Pledged LLC or
seek a partition of any property of any Pledged Partnership or Pledged LLC, except as
permitted by the Credit Agreement;
(xvi) as of the date hereof, all of its Partnership Interests and Membership Interests
are uncertificated (other than the Membership Interests of Northern New England Telephone
Operations LLC and Fretel Communications, LLC) and each Pledgor covenants and agrees that it
will not approve of any action by any Pledged Partnership or Pledged LLC to convert such
uncertificated interests into certificated interests;
(xvii) it will take no action which would violate or be inconsistent with any of the
terms of any Secured Debt Agreement, or which would have the effect of impairing the
position or interests of the Pledgee or any other Secured Creditor under any Secured Debt
Agreement except as permitted by the Credit Agreement; and
(xviii) “control” (as defined in Section 8-106 of the UCC) has been obtained by the
Pledgee over all of such Pledgor’s Collateral consisting of Securities (including, without
limitation, Notes which are Securities) with respect to which such “control” may be obtained
pursuant to Section 8-106 of the UCC, except to the extent that the obligation of the
applicable Pledgor to provide the Pledgee with “control” of such Collateral has not yet
arisen under this Agreement; provided that in the case of the Pledgee obtaining
“control” over Collateral consisting of a Security Entitlement, such Pledgor shall have
taken all steps in its control so that the Pledgee obtains “control” over such Security
Entitlement.
16. PLEDGORS’ OBLIGATIONS ABSOLUTE, ETC. The obligations of each Pledgor under this
Agreement shall be absolute and unconditional and shall remain in full force and effect without
regard to, and shall not be released, suspended, discharged, terminated or otherwise affected by,
any circumstance or occurrence whatsoever, including, without limitation:
(i) any renewal, extension, amendment or modification of, or addition or supplement to
or deletion from any of the Secured Debt Agreements, or any other instrument or agreement
referred to therein, or any assignment or transfer of any thereof;
(ii) any waiver, consent, extension, indulgence or other action or inaction under or in
respect of any such agreement or instrument or this Agreement;
(iii) any furnishing of any additional security to the Pledgee or its assignee or any
acceptance thereof or any release of any security by the Pledgee or its assignee;
(iv) any limitation on any party’s liability or obligations under any such instrument
or agreement or any invalidity or unenforceability, in whole or in part, of any such
instrument or agreement or any term thereof; or
(v) any bankruptcy, insolvency, reorganization, composition, adjustment, dissolution,
liquidation or other like proceeding relating to such Pledgor or any Subsidiary of such
Pledgor, or any action taken with respect to this Agreement by any trustee or receiver, or
by any court, in any such proceeding, whether or not such Pledgor shall have notice or
knowledge of any of the foregoing.
17. REGISTRATION, ETC. (a) If an Event of Default shall have occurred and be
continuing and any Pledgor shall have received from the Pledgee a written request or requests that
such Pledgor cause any registration, qualification or compliance under any Federal or state
securities law or laws to be effected with respect to all or any part of the Pledged Stock, such
Pledgor as soon as practicable and at its expense will use its best efforts to cause such
registration to be effected (and be kept effective) and will use its best efforts to cause such
qualification and compliance to be effected (and be kept effective) as may be so requested and as
would permit or facilitate the sale and distribution of such Pledged Stock, including, without
limitation, registration under the Securities Act, as then in effect (or any similar statute then
in effect), appropriate qualifications under applicable blue sky or other state securities laws and
appropriate compliance with any other governmental requirements, provided that the Pledgee
shall furnish to such Pledgor such information regarding the Pledgee as such Pledgor may request in
writing and as shall be required in connection with any such registration, qualification or
compliance. Each Pledgor will cause the Pledgee to be kept reasonably advised in writing as to the
progress of each such registration, qualification or compliance and as to the completion thereof,
will furnish to the Pledgee such number of prospectuses, offering circulars and other documents
incident thereto as the Pledgee from time to time may reasonably request, and will indemnify, to
the extent permitted by law, the Pledgee, each other Secured Creditor and all others participating
in the distribution of such Pledged Stock against all claims, losses, damages or liabilities caused
by any untrue statement (or alleged untrue statement) of a material fact contained therein (or in
any related registration statement, notification or the like) or by any omission (or alleged
omission) to state therein (or in any related registration statement, notification or the like) a
material fact required to be stated therein or necessary to make the statements therein not
misleading, except insofar as the same may have been caused by an untrue statement or omission
based upon information furnished in writing to such Pledgor by the Pledgee or such other Secured
Creditor expressly for use therein.
(b) If at any time when the Pledgee shall determine to exercise its right to sell all or any
part of the Pledged Securities pursuant to Section 7, and such Pledged Securities or the part
thereof to be sold shall not, for any reason whatsoever, be effectively registered under the
Securities Act, as then in effect, the Pledgee may, in its sole and absolute discretion, sell such
Pledged Securities or part thereof by private sale in such manner and under such circumstances as
the Pledgee may deem necessary or advisable in order that such sale may legally be effected without
such registration. Without limiting the generality of the foregoing, in any such event the
Pledgee, in its sole and absolute discretion, (i) may proceed to make such private sale
notwithstanding that a registration statement for the purpose of registering such Pledged
Securities or part thereof shall have been filed under such Securities Act, (ii) may approach
and negotiate with a single possible purchaser to effect such sale and (iii) may restrict such sale
to a purchaser who will represent and agree that such purchaser is purchasing for its own account,
for investment, and not with a view to the distribution or sale of such Pledged Securities or part
thereof. In the event of any such sale, the Pledgee shall incur no responsibility or liability for
selling all or any part of the Pledged Securities at a price which the Pledgee, in its sole and
absolute discretion, may in good xxxxx xxxx reasonable under the circumstances, notwithstanding the
possibility that a substantially higher price might be realized if the sale were deferred until the
registration as aforesaid.
18. TERMINATION; RELEASE. (a) After the Termination Date (as defined below), this
Agreement shall terminate (provided that all indemnities set forth herein including,
without limitation, in Section 11 hereof shall survive any such termination) and the Pledgee, at
the request and expense of the respective Pledgor, will execute and deliver to such Pledgor a
proper instrument or instruments acknowledging the satisfaction and termination of this Agreement
as provided above, and will duly assign, transfer and deliver to such Pledgor (without recourse and
without any representation or warranty) such of the Collateral as may be in the possession of the
Pledgee and as has not theretofore been sold or otherwise applied or released pursuant to this
Agreement, together with any moneys at the time held by the Pledgee hereunder and, with respect to
any Collateral consisting of an Uncertificated Security, a Partnership Interest or a Membership
Interest (other than an Uncertificated Security, Partnership Interest or Membership Interest
credited on the books of a Clearing Corporation or Securities Intermediary), a termination of the
agreement relating thereto executed and delivered by the issuer of such Uncertificated Security
pursuant to Section 3.2(a)(ii) or by the respective partnership or limited liability company
pursuant to Section 3.2(a)(iv)(2). As used in this Agreement, “Termination Date” shall
mean the date upon which the Total Commitment and all Secured Interest Rate Agreements have been
terminated, no Note under the Credit Agreement is outstanding (and all Loans have been paid in
full) and all other Obligations have been paid in full (other than arising from indemnities for
which no request has been made).
(b) In the event that any part of the Collateral is sold or otherwise disposed of in
connection with a sale or other disposition permitted by Section 7.02 of the Credit Agreement or is
otherwise released at the direction of the Required Lenders (or all the Lenders if required by
Section 11.11 of the Credit Agreement), and the proceeds of such sale or other disposition or from
such release are applied in accordance with the terms of the Credit Agreement to the extent
required to be so applied, the Pledgee, at the request and expense of the respective Pledgor, will
release such Collateral from this Agreement, duly assign, transfer and deliver to such Pledgor
(without recourse and without any representation or warranty) such of the Collateral as is then
being (or has been) so sold, disposed of or released and as may be in possession of the Pledgee and
has not theretofore been released pursuant to this Agreement.
(c) At any time that any Pledgor desires that Collateral be released as provided in the
foregoing Section 18(a) or (b), it shall deliver to the Pledgee a certificate signed by a principal
executive officer stating that the release of the respective Collateral is permitted pursuant to
Section 18(a) or (b). The Pledgee shall have no liability whatsoever to any Secured Creditor as
the result of any release of Collateral by it in accordance with (or which the Pledgee
in the absence of gross negligence and willful misconduct believes to be in accordance with)
this Section 18.
19. NOTICES, ETC. All notices and other communications hereunder shall be in writing
(including telegraphic, telex, telecopier, facsimile or cable communication) and shall be
delivered, telegraphed, telexed, telecopied, faxed, cabled, or mailed (by first class mail, postage
prepaid):
(i) if to any Pledgor, at its address set forth opposite its signature below;
(ii) if to the Pledgee, at:
Xxxxxx Commercial Paper Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Loan Portfolio Group
Fax: (000) 000-0000
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Loan Portfolio Group
Fax: (000) 000-0000
(iii) if to any Lender Creditor (other than the Pledgee), either (x) to the
Administrative Agent, at the address of the Administrative Agent specified in the Credit
Agreement or (y) at such address as such Lender Creditor shall have specified in the Credit
Agreement;
(iv) if to any Interest Rate Creditor, at such address as such Interest Rate Creditor
shall have specified in writing to the Pledgors and the Pledgee;
or at such other address as shall have been furnished in writing by any Person described above to
the party required to give notice hereunder.
20. WAIVER; AMENDMENT. None of the terms and conditions of this Agreement may be
changed, waived, modified or varied in any manner whatsoever unless in writing duly signed by the
Pledgee (with the consent of the Required Lenders or, to the extent required by Section 11.11 of
the Credit Agreement, all of the Lenders) and each Pledgor affected thereby, provided that
(i) no such change, waiver, modification or variance shall be made to Section 9 hereof or this
Section 20 without the consent of each Secured Creditor adversely affected thereby and (ii) any
change, waiver, modification or variance affecting the rights and benefits of a single Class (as
defined below) of Secured Creditors (and not all Secured Creditors in a like or similar manner)
shall require the written consent of the Requisite Creditors (as defined below) of such Class of
Secured Creditors. For the purpose of this Agreement, the term “Class” shall mean each
class of Secured Creditors, i.e., whether (x) the Lender Creditors as holders of the Credit
Document Obligations or (y) the Interest Rate Creditors as holders of the Interest Rate
Obligations. For the purpose of this Agreement, the term “Requisite Creditors” of any Class
shall mean (x) with respect to the Credit Document Obligations, the Required Lenders (or, to the
extent required by Section 11.11 of the Credit Agreement, all of the Lenders) and (y) with respect
to the Interest Rate Obligations, the holders of at least a majority of all obligations outstanding
from time to time under the Secured Interest Rate Agreements.
21. PLEDGEE NOT BOUND. (a) Nothing herein shall be construed to make the Pledgee or
any other Secured Creditor liable as a general partner or limited partner of any Pledged
Partnership or a member of any Pledged LLC, and neither the Pledgee nor any Secured Creditor by
virtue of this Agreement or otherwise (except as referred to in the following sentence) shall have
any of the duties, obligations or liabilities of a general partner or limited partner of any
Pledged Partnership or a member of any Pledged LLC. The parties hereto expressly agree that,
unless the Pledgee shall become the absolute owner of a Partnership Interest or a Membership
Interest pursuant hereto, this Agreement shall not be construed as creating a partnership or joint
venture or membership agreement among the Pledgee, any other Secured Creditor and/or a Pledgor.
(b) Except as provided in the last sentence of paragraph (a) of this Section 21, the Pledgee,
by accepting this Agreement, does not intend to become a general partner or limited partner of any
Pledged Partnership or a member of any Pledged LLC or otherwise be deemed to be a co-venturer with
respect to any Pledgor or any Pledged Partnership or a member of any Pledged LLC either before or
after an Event of Default shall have occurred. The Pledgee shall have only those powers set forth
herein and shall assume none of the duties, obligations or liabilities of a general partner or
limited partner of any Pledged Partnership or of a member of any Pledged LLC or of a Pledgor.
(c) The Pledgee shall not be obligated to perform or discharge any obligation of a Pledgor as
a result of the collateral assignment hereby effected.
(d) The acceptance by the Pledgee of this Agreement, with all the rights, powers, privileges
and authority so created, shall not at any time or in any event obligate the Pledgee to appear in
or defend any action or proceeding relating to the Collateral to which it is not a party, or to
take any action hereunder or thereunder, or to expend any money or incur any expenses or perform or
discharge any obligation, duty or liability under the Collateral.
22. MISCELLANEOUS. This Agreement shall create a continuing security interest in the
Collateral and shall (i) remain in full force and effect, subject to release and/or termination as
set forth in Section 18, (ii) be binding upon each Pledgor, its successors and assigns;
provided that no Pledgor shall assign any of its rights or obligations hereunder without
the prior written consent of the Pledgee (with the prior written consent of the Required Lenders or
to the extent required by Section 11.11 of the Credit Agreement, all of the Lenders), and (iii)
inure, together with the rights and remedies of the Pledgee hereunder, to the benefit of the
Pledgee, the other Secured Creditors and their respective successors, transferees and assigns. The
headings of the several sections and subsections in this Agreement are for purposes of reference
only and shall not limit or define the meaning hereof. This Agreement may be executed in any
number of counterparts, each of which shall be an original, but all of which together shall
constitute one instrument. In the event that any provision of this Agreement shall prove to be
invalid or unenforceable, such provision shall be deemed to be severable from the other provisions
of this Agreement which shall remain binding on all parties hereto.
23. GOVERNING LAW, ETC. (a) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
SECURED CREDITORS AND OF THE UNDERSIGNED HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF
LAWS. Any legal action or proceeding with respect to this Agreement or any other Credit Document
may be brought in the courts of the State of New York or of the United States of America for the
Southern District of New York, and, by execution and delivery of this Agreement, each NSG Pledgor
hereby irrevocably accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts. Each NSG Pledgor further irrevocably
consents to the service of process out of any of the aforementioned courts in any such action or
proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to
each NSG Pledgor at its address set forth opposite its signature below, such service to become
effective 30 days after such mailing. Nothing herein shall affect the right of any of the Secured
Creditors to serve process in any other manner permitted by law or to commence legal proceedings or
otherwise proceed against any Pledgor in any other jurisdiction.
(b) Each NSG Pledgor hereby irrevocably waives any objection which it may now or hereafter
have to the laying of venue of any of the aforesaid actions or proceedings arising out of or in
connection with this Agreement or any other Credit Document brought in the courts referred to in
clause (a) above and hereby further irrevocably waives and agrees not to plead or claim in any such
court that such action or proceeding brought in any such court has been brought in an inconvenient
forum.
(c) EACH PLEDGOR AND THE PLEDGEE HEREBY IRREVOCABLY WAIVE ALL RIGHT TO A TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT
DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
24. ADDITIONAL PLEDGORS. It is understood and agreed that any Subsidiary of the
Borrower that is required to execute a counterpart of this Agreement pursuant to the Credit
Agreement shall become a Pledgor hereunder by executing a counterpart hereof and delivering the
same to the Pledgee and Annexes A, B, C and D will be modified at such time in a manner acceptable
to the Pledgee to give effect to such additional Pledgor.
25. COUNTERPARTS. This Agreement may be executed in any number of counterparts and by
the different parties hereto on separate counterparts, each of which when so executed and delivered
shall be an original, but all of which shall together constitute one and the same instrument. A
set of counterparts executed by all the parties hereto shall be lodged with each Pledgor and the
Pledgee.
26. CONTRIBUTION. At any time a payment is made by any Pledgor (other than the
Borrower) (each, a “Subsidiary Pledgor”) in respect of the Obligations from the proceeds of
any sale or other disposition of Collateral owned by such Subsidiary Pledgor (each, a “Relevant
Payment”), the right of contribution of each Subsidiary Pledgor hereunder against each other
such Subsidiary Pledgor shall be determined as provided in the immediately following sentence, with
the right of contribution of each Subsidiary Pledgor to be revised and restated as of each date on
which a Relevant Payment is made. At any time that a Relevant Payment is made by a Subsidiary
Pledgor that results in the aggregate payments made by such Subsidiary
Pledgor hereunder in respect of the Obligations to and including the date of the Relevant
Payment exceeding such Subsidiary Pledgor’s Contribution Percentage (as defined below) of the
aggregate payments made by all Subsidiary Pledgors hereunder in respect of the Obligations from the
proceeds of any sale or other disposition of Collateral owned by the Subsidiary Pledgors to and
including the date of the Relevant Payment (such excess, the “Aggregate Excess Amount”),
each such Subsidiary Pledgor shall have a right of contribution against each other Subsidiary
Pledgor who either has not made any payments or has made (or whose Collateral has been used to
make) payments hereunder in respect of the Obligations to and including the date of the Relevant
Payment in an aggregate amount less than such other Subsidiary Pledgor’s Contribution Percentage of
the aggregate payments made to and including the date of the Relevant Payment by all Subsidiary
Pledgors hereunder in respect of the Obligations from the proceeds of any sale or other disposition
of Collateral owned by the Subsidiary Pledgors (the aggregate amount of such deficit, the
“Aggregate Deficit Amount”) in an amount equal to (x) a fraction the numerator of which is
the Aggregate Excess Amount of such Subsidiary Pledgor and the denominator of which is the
Aggregate Excess Amount of all Subsidiary Pledgors multiplied by (y) the Aggregate Deficit Amount
of such other Subsidiary Pledgor. A Subsidiary Pledgor’s right of contribution pursuant to the
preceding sentences shall arise at the time of each computation, subject to adjustment to the time
of any subsequent computation; provided, that no Subsidiary Pledgor may take any action to
enforce such right until the Obligations have been paid in full and the Total Commitment has been
terminated, it being expressly recognized and agreed by all parties hereto that any Subsidiary
Pledgor’s right of contribution arising pursuant to this Agreement against any other Subsidiary
Pledgor shall be expressly junior and subordinate to such other Subsidiary Pledgor’s obligations
and liabilities in respect of the Obligations and any other obligations owing under this Agreement.
As used in this Section 26: (i) each Subsidiary Pledgor’s “Contribution Percentage” shall
mean the percentage obtained by dividing (x) the Adjusted Net Worth (as defined below) of such
Subsidiary Pledgor by (y) the aggregate Adjusted Net Worth of all Subsidiary Pledgors; (ii) the
“Adjusted Net Worth” of each Subsidiary Pledgor shall mean the greater of (x) the Net Worth
(as defined below) of such Subsidiary Pledgor and (y) zero; and (iii) the “Net Worth” of
each Subsidiary Pledgor shall mean the amount by which the fair salable value of such Subsidiary
Pledgor’s assets on the date of any Relevant Payment exceeds its existing debts and other
liabilities (including contingent liabilities, but without giving effect to any obligations arising
under this Agreement, any Guaranteed Obligations under, and as defined in, the Subsidiary Guaranty)
on such date. All parties hereto recognize and agree that, except for any right of contribution
arising pursuant to this Section 26, each Subsidiary Pledgor who makes (or whose Collateral has
been used to make) any payment in respect of the Obligations shall have no right of contribution or
subrogation against any other Subsidiary Pledgor in respect of such payment. Each of the
Subsidiary Pledgors recognizes and acknowledges that the rights to contribution arising hereunder
shall constitute an asset in favor of the party entitled to such contribution. In this connection,
each Subsidiary Pledgor has the right to waive its contribution right against any Subsidiary
Pledgor to the extent that after giving effect to such waiver such Subsidiary Pledgor would remain
solvent, in the determination of the Required Lenders.
27. LEGAL NAMES; TYPE OF ORGANIZATION (AND WHETHER A REGISTERED ORGANIZATION AND/OR A
TRANSMITTING UTILITY); JURISDICTION OF ORGANIZATION; LOCATION; ORGANIZATIONAL IDENTIFICATION
NUMBERS;
CHANGES THERETO; ETC. No Pledgor shall change its legal name, its type of
organization, its status as a Registered Organization (in the case of a Registered Organization),
its status as a Transmitting Utility or as a Person which is not a Transmitting Utility, as the
case may be, its jurisdiction of organization, its Location, or its organizational identification
number (if any), except that any such changes shall be permitted (so long as not in violation of
the applicable requirements of the Secured Debt Agreements and so long as same do not involve (x) a
Registered Organization ceasing to constitute same or (y) any Pledgor changing its jurisdiction of
organization or Location from the United States or a State thereof to a jurisdiction of
organization or Location, as the case may be, outside the United States or a State thereof) if (i)
it shall have given to the Collateral Agent not less than 10 days’ prior written notice of each
change to its legal name, its type of organization, whether or not it is a Registered Organization,
its jurisdiction of organization, its Location, its organizational identification number (if any),
and whether or not it is a Transmitting Utility, and (ii) in connection with the respective change
or changes, it shall have taken all action reasonably requested by the Collateral Agent to maintain
the security interests of the Collateral Agent in the Collateral intended to be granted hereby at
all times fully perfected and in full force and effect. In addition, to the extent that any
Pledgor does not have an organizational identification number on the date hereof and later obtains
one, such Pledgor shall promptly thereafter deliver a notification of the Collateral Agent of such
organizational identification number and shall take all actions reasonably satisfactory to the
Collateral Agent to the extent necessary to maintain the security interest of the Collateral Agent
in the Collateral intended to be granted hereby fully perfected and in full force and effect.
28. CHANGE OF CONTROL. The Pledgee acknowledges that, under existing law, a change of
control of a Subsidiary whose equity interests are pledged hereunder as a result of a proposed
exercise of remedies hereunder may require the prior approval of the FCC and/or a PUC. The Pledgee
further acknowledges that, notwithstanding the provisions of Section 5 and Sections 7(a)(ii), (iv)
and (vi), with respect to any Collateral constituting Securities issued by a Person organized under
the laws of any State of the United States, to the extent (and only to the extent) that applicable
law specifically requires that regulatory approval be obtained prior to such Pledgee enforcing its
rights hereunder with respect to such Collateral, the Pledgee shall not be entitled to enforce its
rights hereunder with respect to such Collateral without first obtaining such required regulatory
approval.
29. SEVERABILITY. Any provision of this Agreement which is prohibited or
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.
30. HEADINGS DESCRIPTIVE. The headings of the several Sections of this Agreement are
inserted for convenience only and shall not in any way affect the meaning or construction of any
provision of this Agreement.
* * * *
IN WITNESS WHEREOF, each Pledgor and the Pledgee have caused this Agreement to be executed and
delivered by their duly authorized officers as of the date first above written.
Address: 000 Xxxx Xxxxxxxx Xxxxxx Xxxxxxxxx, XX 00000 |
FAIRPOINT COMMUNICATIONS, INC. as a Pledgor |
|||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Treasurer | |||
Address: c/o FAIRPOINT COMMUNICATIONS, INC. 000 Xxxx Xxxxxxxx Xxxxxx Xxxxxxxxx, XX 00000 |
MJD VENTURES, INC., as a Pledgor |
|||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Treasurer | |||
Address: c/o FAIRPOINT COMMUNICATIONS, INC. 000 Xxxx Xxxxxxxx Xxxxxx Xxxxxxxxx, XX 00000 |
MJD SERVICES CORP., as a Pledgor |
|||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Treasurer | |||
Address: c/o FAIRPOINT COMMUNICATIONS, INC. 000 Xxxx Xxxxxxxx Xxxxxx Xxxxxxxxx, XX 00000 |
S T ENTERPRISES, LTD., as a Pledgor |
|||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Treasurer | |||
Address: c/o FAIRPOINT COMMUNICATIONS, INC. 000 Xxxx Xxxxxxxx Xxxxxx Xxxxxxxxx, XX 00000 |
FAIRPOINT CARRIER SERVICES, INC., as a Pledgor |
|||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Treasurer | |||
Address: c/o FAIRPOINT COMMUNICATIONS, INC. 000 Xxxx Xxxxxxxx Xxxxxx Xxxxxxxxx, XX 00000 |
FAIRPOINT BROADBAND, INC., as a Pledgor |
|||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Treasurer |
Address: c/o FAIRPOINT COMMUNICATIONS, INC. 000 Xxxx Xxxxxxxx Xxxxxx Xxxxxxxxx, XX 00000 |
FAIRPOINT LOGISTICS, INC. as a Pledgor |
|||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Treasurer | |||
Address: c/o FAIRPOINT COMMUNICATIONS, INC. 000 Xxxx Xxxxxxxx Xxxxxx Xxxxxxxxx, XX 00000 |
ENHANCED COMMUNICATIONS OF NORTHERN NEW ENGLAND INC. as a Pledgor |
|||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Treasurer | |||
Address: c/o FAIRPOINT COMMUNICATIONS, INC. 000 Xxxx Xxxxxxxx Xxxxxx Xxxxxxxxx, XX 00000 |
UTILITIES, INC. as a Pledgor |
|||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Treasurer | |||
Address: c/o FAIRPOINT COMMUNICATIONS, INC. 000 Xxxx Xxxxxxxx Xxxxxx Xxxxxxxxx, XX 00000 |
C-R COMMUNICATIONS, INC. as a Pledgor |
|||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Treasurer | |||
Address: c/o FAIRPOINT COMMUNICATIONS, INC. 000 Xxxx Xxxxxxxx Xxxxxx Xxxxxxxxx, XX 00000 |
COMERCO, INC. as a Pledgor |
|||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Treasurer | |||
Address: c/o FAIRPOINT COMMUNICATIONS, INC. 000 Xxxx Xxxxxxxx Xxxxxx Xxxxxxxxx, XX 00000 |
GTC COMMUNICATIONS, INC. as a Pledgor |
|||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Treasurer | |||
Address: c/o FAIRPOINT COMMUNICATIONS, INC. 000 Xxxx Xxxxxxxx Xxxxxx Xxxxxxxxx, XX 00000 |
ST. XXX COMMUNICATIONS, INC. as a Pledgor |
|||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Treasurer | |||
Address: c/o FAIRPOINT COMMUNICATIONS, INC. 000 Xxxx Xxxxxxxx Xxxxxx Xxxxxxxxx, XX 00000 |
RAVENSWOOD COMMUNICATIONS, INC. as a Pledgor |
|||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Treasurer | |||
Address: c/o FAIRPOINT COMMUNICATIONS, INC. 000 Xxxx Xxxxxxxx Xxxxxx Xxxxxxxxx, XX 00000 |
UNITE COMMUNICATIONS SYSTEMS, INC. as a Pledgor |
|||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Treasurer | |||
Accepted and Agreed to: XXXXXX COMMERCIAL PAPER INC., as Collateral Agent and Pledgee |
||||
By: | Xxxxxxx X. Xxxxxx | |||
Name: | XXXXXXX X. XXXXXX | |||
Title: | MANAGING DIRECTOR |
ANNEX A
LIST OF PLEDGED SUBSIDIARIES OF
FAIRPOINT COMMUNICATIONS, INC.
FAIRPOINT COMMUNICATIONS, INC.
A. | S T Enterprises, Ltd. |
1. | Sunflower Telephone Company, Inc. | ||
2. | FairPoint Vermont, Inc. | ||
3. | Northland Telephone Company of Maine, Inc. | ||
4. | S T Computer Resources, Inc. | ||
0. | XX Xxxx Xxxxxxxx, Xxx. |
X. | Xxxxxxxx Xxx Xxxxxxx Telephone Operations LLC | |
C. | Enhanced Communications of Northern New England Inc. | |
D. | FairPoint Logistics, Inc. | |
E. | MJD Ventures, Inc. |
1. | The Columbus Grove Telephone Company | ||
2. | C-R Communications, Inc. |
a. | C-R Telephone Company | ||
b. | X-X Xxxx Distance, Inc. |
3. | Taconic Telephone Corp. | ||
4. | Ellensburg Telephone Company | ||
5. | Xxxxxx Telephone Company | ||
6. | Utilities, Inc. |
x. | Xxxxxxxx Telephone Company | ||
b. | China Telephone Company | ||
c. | Maine Telephone Company |
A-1
d. | UI Communications, Inc. | ||
e. | UI Long Distance, Inc. | ||
f. | UI Telecom, Inc. |
7. | Telephone Service Company | ||
8. | Chouteau Telephone Company | ||
9. | Chautauqua and Erie Telephone Corporation | ||
10. | The Xxxxxx Telephone Company | ||
11. | GTC Communications, Inc. |
a. | St. Xxx Communications, Inc. |
i. | GTC, Inc. |
12. | Peoples Mutual Telephone Company | ||
13. | Fremont Telcom Co. | ||
14. | Comerco, Inc. |
a. | YCOM Networks, Inc. |
15. | Community Service Telephone Co. | ||
16. | Xxxxxxxx and Scenery Hill Telephone Company | ||
17. | The Germantown Independent Telephone Company | ||
18. | Berkshire Telephone Corporation | ||
19. | Bentleyville Communications Corporation | ||
20. | Commtel Communications Inc. | ||
21. | Fretel Communications, LLC |
F. | MJD Services Corp. |
1. | Bluestem Telephone Company | ||
2. | Big Xxxxx Telecom, Inc. |
A-2
3. | Odin Telephone Exchange, Inc. | ||
4. | Columbine Telecom Company | ||
5. | Ravenswood Communications, Inc. |
a. | The El Paso Telephone Company | ||
b. | El Paso Long Distance Company |
6. | Xxxxx City Telephone Company | ||
7. | FairPoint Communications Missouri, Inc. | ||
8. | Unite Communications Systems, Inc. |
a. | ExOp of Missouri, Inc. |
G. | FairPoint Broadband, Inc. | |
H. | FairPoint Carrier Services, Inc. |
1. | FairPoint Communications Solutions Corp. — New York | ||
2. | FairPoint Communications Solutions Corp. — Virginia |
A-3
ANNEX B
LIST OF PLEDGED STOCK
Type of | Number of | Percentage | ||||||||||
Name of Issuing Corporation | Shares | Shares | Owned | |||||||||
A. | FAIRPOINT COMMUNICATIONS, INC. |
|||||||||||
1. | FairPoint Broadband, Inc. |
Common | 100 | 100 | % | |||||||
2. | MJD Services Corp. |
Common | 100 | 100 | % | |||||||
3. | FairPoint Carrier Services, Inc. |
Common | 100 | 100 | % | |||||||
4. | MJD Ventures, Inc. |
Common | 100 | 100 | % | |||||||
5. | FairPoint Logistics, Inc. |
Common | 100 | 100 | % | |||||||
6. | S T Enterprises, Ltd. |
Common | 90,000 | 100 | % | |||||||
7. | Enhanced Communications of Northern New England Inc. |
Common | 1,000 | 100 | % | |||||||
B. | MJD SERVICES CORP. |
|||||||||||
1. | Bluestem Telephone Company |
Common | 100 | 100 | % | |||||||
2. | Big Xxxxx Telecom, Inc. |
Common | 100 | 100 | % | |||||||
3. | Odin Telephone Exchange, Inc. |
Common | 95.2857 | 100 | %1 | |||||||
4. | Columbine Telecom Company |
Common | 100 | 100 | % | |||||||
5. | Ravenswood Communications, Inc. |
Common | 405 | 100 | % | |||||||
6. | Xxxxx City Telephone Company |
Common | 252 | 100 | % | |||||||
7. | Unite Communications Systems, Inc. |
Common | 20,000 | 100 | % | |||||||
8. | FairPoint Communications Missouri, Inc. |
Common | 100 | 100 | % | |||||||
C. | MJD VENTURES, INC. |
|||||||||||
1. | The Columbus Grove Telephone Company |
Common | 318 | 100 | % |
1 | Of the 101 shares issued and outstanding, 5.7143 are held in treasury. |
B-1
Type of | Number of | Percentage | ||||||||||
Name of Issuing Corporation | Shares | Shares | Owned | |||||||||
2. | C-R Communications, Inc. |
Common | 750 | 100 | % | |||||||
3. | Taconic Telephone Corp. |
Common | 100 | 100 | % | |||||||
4. | Ellensburg Telephone Company |
Common | 100 | 100 | % | |||||||
5. | Xxxxxx Telephone Company |
Common | 100 | 100 | % | |||||||
6. | Utilities, Inc. |
Common | 100 | 100 | % | |||||||
7. | Chouteau Telephone Company |
Common | 100 | 100 | % | |||||||
8. | Chautauqua and Erie Telephone Corporation |
Common | 100 | 100 | % | |||||||
9. | The Xxxxxx Telephone Company |
Common | 4,795.7461 | 100 | % | |||||||
10. | Telephone Service Company |
Common | 100 | 100 | % | |||||||
11. | GTC Communications, Inc. |
Common | 1,000,000 | 100 | % | |||||||
12. | Peoples Mutual Telephone Company |
Common | 9,832 | 100 | % | |||||||
13. | Fremont Telcom Co. |
Common | 5,155.5 | 100 | % | |||||||
14. | Comerco, Inc. |
Common | 31,250 | 100 | % | |||||||
15. | Community Service Telephone Co. |
Common | 100 | 100 | % | |||||||
16. | Xxxxxxxx and Scenery Hill Telephone Company |
Common | 306 | 100 | % | |||||||
17. | Bentleyville Communications Corporation |
Common | 100 | 100 | % | |||||||
18. | The Germantown Independent Telephone Company |
Common | 1,500 | 100 | % | |||||||
19. | Berkshire Telephone Corporation |
Common | 100 | 100 | % | |||||||
20. | Commtel Communications Inc. |
Common | 1 | 100 | % | |||||||
D. | S T ENTERPRISES, LTD. |
|||||||||||
1. | Sunflower Telephone Company, Inc. |
Common | 684 | 99.7 | % | |||||||
2. | FairPoint Vermont, Inc. |
Common | 1,000 | 100 | % | |||||||
3. | Northland Telephone Company of Maine, Inc. |
Common | 100 | 100 | % | |||||||
4. | S T Computer Resources, Inc. |
Common | 500 | 100 | % |
B-2
Type of | Number of | Percentage | ||||||||||
Name of Issuing Corporation | Shares | Shares | Owned | |||||||||
5. | ST Long Distance, Inc. |
Common | 100 | 100 | % | |||||||
E. | C-R COMMUNICATIONS, INC. |
|||||||||||
1. | C-R Telephone Company |
Common | 100 | 100 | % | |||||||
2. | X-X Xxxx Distance, Inc. |
Common | 100 | 100 | % | |||||||
F. | UTILITIES, INC. |
|||||||||||
1. | Xxxxxxxx Telephone Company |
Common | 23,560 | 100 | % | |||||||
2. | China Telephone Company |
Common | 20,000 | 100 | % | |||||||
3. | Maine Telephone Company |
Common | 100 | 100 | % | |||||||
4. | UI Communications, Inc. |
Common | 100 | 100 | % | |||||||
5. | UI Long Distance, Inc. |
Common | 100 | 100 | % | |||||||
6. | UI Telecom, Inc. |
Common | 100 | 100 | % | |||||||
G. | RAVENSWOOD COMMUNICATIONS, INC. |
|||||||||||
1. | The El Paso Telephone Company |
Common | 405 | 100 | % | |||||||
2. | El Paso Long Distance Company |
Common | 1,000 | 100 | % | |||||||
H. | GTC COMMUNICATIONS, INC. |
|||||||||||
1. | St. Xxx Communications, Inc. |
Common | 1,000 | 100 | % | |||||||
I. | ST. XXX COMMUNICATIONS, INC. |
|||||||||||
1. | GTC, Inc. |
Common | 14,890 | 100 | % | |||||||
J. | COMERCO, INC. |
|||||||||||
1. | YCOM Networks, Inc. |
Common | 294 | 100 | % | |||||||
K. | FAIRPOINT CARRIER SERVICES, INC. |
|||||||||||
1. | FairPoint Communications Solutions Corp. — New York |
Common | 100 | 100 | % | |||||||
2. | FairPoint Communications Solutions Corp. — Virginia |
Common | 100 | 100 | % |
B-3
Type of | Number of | Percentage | ||||||||||
Name of Issuing Corporation | Shares | Shares | Owned | |||||||||
L. | UNITE COMMUNICATIONS SYSTEMS, INC. |
|||||||||||
1. | ExOp of Missouri, Inc. |
Common | 1,000,000 | 100 | % |
B-4
ANNEX C
LIST OF PROMISSORY NOTES
None.
C-1
ANNEX D
PART I
LIST OF PARTNERSHIP INTERESTS
None.
PART II
LIST OF MEMBERSHIP INTERESTS
Percentage | ||||||
Name of Issuing Corporation | Owned | |||||
A. | FAIRPOINT COMMUNICATIONS, INC. |
|||||
1. | Northern New England Telephone Operations LLC |
100 | ||||
B. | MJD VENTURES, INC. |
|||||
1. | Fretel Communications, LLC |
100 |
D-1
ANNEX E
Form of Agreement Regarding Uncertificated Securities,
Membership Interests and Partnership Interests
Membership Interests and Partnership Interests
AGREEMENT (as amended, modified, restated and/or supplemented from time to time, this
“Agreement”), dated as of [ , 20 ], among the undersigned pledgor (the
“Pledgor”), XXXXXX COMMERCIAL PAPER INC., not in its individual capacity but solely as
Collateral Agent (the “Pledgee”), and [ ], as the issuer of the Uncertificated Securities,
Membership Interests and/or Partnership Interests (each as defined below) (the “Issuer”).
WITNESSETH:
WHEREAS, the Pledgor, certain of its affiliates and the Pledgee have entered into a Pledge
Agreement, dated as of March 31, 2008 (as amended, modified, restated and/or supplemented from time
to time, the “Pledge Agreement”),1 under which, among other things, in order to
secure the payment of the Obligations, the Pledgor has pledged or will pledge to the Pledgee for
the benefit of the Secured Creditors, and grant a security interest in favor of the Pledgee for the
benefit of the Secured Creditors in, all of the right, title and interest of the Pledgor in and to
any and all [Uncertificated Securities] [Partnership Interests] [Membership Interests], from time
to time by the Issuer, whether now existing or hereafter from time to time acquired by the Pledgor
(with all of such [Uncertificated Securities] [Partnership Interests] [Membership Interests] being
herein collectively called the “Issuer Pledged Interests”); and
WHEREAS, the Pledgor desires the Issuer to enter into this Agreement in order to perfect the
security interest of the Pledgee under the Pledge Agreement in the Issuer Pledged Interests, to
vest in the Pledgee control of the Issuer Pledge Interests and to provide for the rights of the
parties under this Agreement;
NOW THEREFORE, in consideration of the premises and the mutual promises and agreements
contained herein, and for other valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:
1. The Pledgor hereby irrevocably authorizes and directs the Issuer, and the Issuer hereby
agrees, to comply with any and all instructions and orders originated by the Pledgee (and its
successors and assigns) regarding any and all of the Issuer Pledged Interests without the further
consent by the registered owner (including the Pledgor), and, following its receipt of a notice
from the Pledgee stating that the Pledgee is exercising exclusive control of the Issuer Pledged
Interests, not to comply with any instructions or orders regarding any or all of the Issuer Pledged
Interests originated by any person or entity other than the Pledgee (and its successors and
assigns) or a court of competent jurisdiction.
2. The Issuer hereby certifies that (i) no notice of any security interest, lien or other
encumbrance or claim affecting the Issuer Pledged Interests (other than the security interest
1 | Capitalized terms used but not defined herein shall have the meaning ascribed to them in the Pledge Agreement. |
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of the Pledgee) has been received by it, and (ii) the security interest of the Pledgee in the
Issuer Pledged Interests has been registered in the books and records of the Issuer.
3. The Issuer hereby represents and warrants that (i) the pledge by the Pledgor of, and the
granting by the Pledgor of a security interest in, the Issuer Pledged Interests to the Pledgee, for
the benefit of the Secured Creditors, does not violate the charter, by-laws, partnership agreement,
membership agreement or any other agreement governing the Issuer or the Issuer Pledged Interests,
and (ii) the Issuer Pledged Interests consisting of capital stock of a corporation are fully paid
and nonassessable.
4. All notices, statements of accounts, reports, prospectuses, financial statements and other
communications to be sent to the Pledgor by the Issuer in respect of the Issuer will also be sent
to the Pledgee at the following address:
[ ]
[ ]
Attention: [ ]
Telephone No.: [ ]
Telecopier No.: [ ]
[ ]
Attention: [ ]
Telephone No.: [ ]
Telecopier No.: [ ]
5. Following its receipt of a notice from the Pledgee stating that the Pledgee is exercising
exclusive control of the Issuer Pledged Interests and until the Pledgee shall have delivered
written notice to the Issuer that all of the Obligations have been paid in full and this Agreement
is terminated, the Issuer will send any and all redemptions, distributions, interest or other
payments in respect of the Issuer Pledged Interests from the Issuer for the account of the Pledgee
only by wire transfers to such account as the Pledgee shall instruct.
6. Except as expressly provided otherwise in Sections 4 and 5, all notices, instructions,
orders and communications hereunder shall be sent or delivered by mail, telegraph, telex, telecopy,
cable or overnight courier service and all such notices and communications shall, when mailed,
telexed, telecopied, cabled or sent by overnight courier, be effective when deposited in the mails
or delivered to overnight courier, prepaid and properly addressed for delivery on such or the next
Business Day, or sent by telex or telecopier, except that notices and communications to the Pledgee
or the Issuer shall not be effective until received. All notices and other communications shall be
in writing and addressed as follows:
(a) | if to the Pledgor, at: | ||
Attention: Telephone No.: Fax No.: |
|||
(b) | if to the Pledgee, at the address given in Section 4 hereof; | ||
(c) | if to the Issuer, at: |
or at such other address as shall have been furnished in writing by any Person described above to
the party required to give notice hereunder. As used in this Section 6, “Business Day”
means
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any day other than a Saturday, Sunday, or other day in which banks in New York are authorized to
remain closed.
7. This Agreement shall be binding upon the successors and assigns of the Pledgor and the
Issuer and shall inure to the benefit of and be enforceable by the Pledgee and its successors and
assigns. This Agreement may be executed in any number of counterparts, each of which shall be an
original, but all of which shall constitute one instrument. In the event that any provision of
this Agreement shall prove to be invalid or unenforceable, such provision shall be deemed to be
severable from the other provisions of this Agreement which shall remain binding on all parties
hereto. None of the terms and conditions of this Agreement may be changed, waived, modified or
varied in any manner whatsoever except in writing signed by the Pledgee, the Issuer and the
Pledgor.
8. This Agreement shall be governed by and construed in accordance with the laws of the State
of New York, without regard to its principles of conflict of laws.
IN WITNESS WHEREOF, the Pledgor, the Pledgee and the Issuer have caused this Agreement to be
executed by their duly elected officers duly authorized as of the date first above written.
[ ], as Pledgor |
||||
By: | ||||
Name: | ||||
Title: | ||||
[ ], not in its individual capacity but solely as Collateral Agent and Pledgee |
||||
By: | ||||
Name: | ||||
Title: | ||||
[ ], as the Issuer |
||||
By: | ||||
Name: | ||||
Title: | ||||
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ANNEX F
UCC FINANCING STATEMENTS
Entity | Filing Jurisdiction | |||||
1. | Comerco, Inc. |
Washington | ||||
2. | C-R Communications, Inc. |
Illinois | ||||
3. | Enhanced Communications of Northern New
England Inc. |
Delaware | ||||
4. | FairPoint Broadband, Inc. |
Delaware | ||||
5. | FairPoint Carrier Services, Inc. |
Delaware | ||||
6. | FairPoint Communications, Inc. |
Delaware | ||||
7. | FairPoint Logistics, Inc. |
South Dakota | ||||
8. | GTC Communications, Inc. |
Delaware | ||||
9. | MJD Services Corp. |
Delaware | ||||
10. | MJD Ventures, Inc. |
Delaware | ||||
11. | Ravenswood Communications, Inc. |
Illinois | ||||
12. | S T Enterprises, Ltd. |
Kansas | ||||
13. | St. Xxx Communications, Inc. |
Florida | ||||
14. | Unite Communications Systems, Inc. |
Missouri | ||||
15. | Utilities, Inc. |
Maine |
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ANNEX G
EXCLUDED ENTITIES
1. | BE Mobile Communications, Incorporated | |
2. | Berkshire Cable Corp. | |
3. | Berkshire Cellular, Inc. | |
4. | Berkshire Net, Inc. | |
5. | Berkshire New York Access, Inc. | |
6. | Chautauqua & Erie Communications, Inc. | |
7. | C & E Communications, Ltd. | |
8. | Elltel Long Distance Corp. | |
9. | Fremont Broadband, LLC | |
10. | Germantown Long Distance Company | |
11. | GIT-CELL, Inc. | |
12. | GITCO Sales, Inc. | |
13. | GTC Finance Corporation | |
14. | Xxxxxxxx Tel, Inc. | |
15. | Xxxxxx Communications, Inc. | |
16. | Peoples Mutual Services Company | |
17. | Peoples Mutual Long Distance Company | |
18. | Quality One Technologies, Inc. | |
19. | Taconic TelCom Corp. | |
20. | Taconic Technology Corp. | |
21. | Telephone Operating Company of Vermont LLC |
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