EXHIBIT 10.43(c)
AMENDMENT NO. 2
TO
IRU AGREEMENT
THIS AMENDMENT NO. 2 to IRU Agreement (this "Amendment") is effective as of
June 28th, 2002 (the "Effective Date") by and between QWEST COMMUNICATIONS
CORPORATION ("Qwest") and PAC-WEST TELECOMM, INC. ("Customer"). Qwest and
Customer are sometimes collectively referred to herein as the "Parties."
WHEREAS, Qwest and Customer entered into that certain IRU agreement effective
as of June 30, 2000 (the "Agreement") and thereafter amended the payment terms
of the Agreement by executing Amendment No. 1 to the Agreement effective April
18, 2001.
WHEREAS, the Parties desire to modify the Agreement to reflect new payment
terms for the IRU Fee, as more particularly described below.
NOW, THEREFORE, in consideration of the foregoing and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the Parties agree as follows:
1. Amendment No. 1 to the Agreement is hereby rescinded and replaced in its
entirety by this Amendment.
2. The Agreement is hereby amended so as to provide that, notwithstanding
anything to the contrary in Section 3.1 or elsewhere in the Agreement,
Customer shall pay to Qwest the balance due of the IRU Fee ($8,619,920)
according to the following schedule:
A. $4,419,920.50 shall be due and payable December 15, 2002; and
B. $4,200,000.00 together with interest as provided in Section 3 of
this Amendment shall be payable May 15, 2003.
3. The payment due May 15, 2003 shall accrue interest annually from and after
May 15, 2002, at a variable rate equal to the Prime Rate, as defined
below, plus two percent (2%). "Prime Rate" means a rate per annum equal to
the prime rate as published in the "Money Rates" section of the Wall
Street Journal with adjustments in that varying rate to be made on the
same dates as any change in that rate is so published.
4. Attached to this Amendment as Exhibit A and incorporated into this
Amendment by this reference is a Promissory Note (the "Note") providing
further evidence of Customer's payment obligations that are required under
the Agreement by virtue of this Amendment. Qwest reserves all of its
rights under both the Agreement and the Note. The Note is additional
evidence of Customer's payment obligations under the Agreement and is not
in dimunition of any rights or obligations of the parties under the
Agreement. Qwest may enforce its remedies under the Agreement, or under
the Note, or under both, in any sequence, in Quest's sole discretion, but
is entitled only to a single satisfaction of the payment obligations.
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5. Section 13 of the Agreement shall be deleted in its entirety and replaced
with the following Section 13:
"13. CHARACTERIZATION OF TRANSACTION
13.1 Subject to Section 5.3 above, the parties intend that each IRU granted in
this Agreement does not provide Customer with any ownership or other possessory
interests in any real property, conduit, fiber, or equipment in or on the Qwest
Network or along the User Route of the Qwest Network (the "Physical Assets").
Further, it is not the intention of the parties to create a loan or other
financing arrangement between the parties. However, to secure payment of the IRU
Fee and in the event the express intent of the parties is not given legal effect
and that any portion of the transaction is deemed to constitute a loan or other
financing arrangement, or that any right in the IRU(s) granted herein are deemed
to create rights in the Physical Assets, Customer hereby grants to Qwest, as
security for the payment of all amounts due from Customer and the performance of
all other obligations of Customer hereunder, a first-priority security interest
in and continuing lien upon all of Customer's rights (including any right
Customer may have to convey title thereto), title and interest in: (i) the
granted IRU(s), and (ii) all rights of Customer under this Agreement
("Collateral"). Customer covenants that Qwest will have a first-priority
security interest in and continuing lien upon all of the Collateral. Customer's
breach of its covenant in this Section 13.1 shall be deemed a default of this
Agreement in accordance with Article 17 of the Agreement for which Qwest will be
entitled to terminate Customer's rights in and to the IRU(s) granted hereunder
and shall further be entitled to exercise all the rights and remedies of a
secured party under the Uniform Commercial Code. Upon payment in full of the IRU
Fee, Qwest will file all necessary documents to release its lien on the
Collateral."
6. The Agreement and this Amendment shall constitute the complete agreement
of the Parties concerning the subject matter hereof, and supersede any
prior written or verbal statements, representations, and agreements
concerning the subject matter hereof. Except as expressly modified by this
Amendment, the Agreement is and will remain in full force and effect in
accordance with its terms and constitutes the legal and binding
obligations of the Parties.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, an authorized representative of each Party has executed
this Amendment No. 2 as of the dates set forth below.
QWEST COMMUNICATIONS CORPORATION PAC-WEST TELECOMM, INC.
By: /s/ XXXXXX XXXXXX By: /s/ XXXXX XXXXXXX
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Name: XXXXXX XXXXXX Name: XXXXX XXXXXXX
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Title: EVP-WHOLESALE MARKETS Title: Chairman & CEO
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Date: 7/16/02 Date: 6/28/02
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*P&OM Director: XXXXXX X. XXXXXXX
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Date: 7/9/02
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*This Agreement shall not be binding upon Qwest until countersigned by the P&OM
Director and Executive Vice President, Wholesale Markets (or an authorized
designee) for Qwest.
Approved as to legal form
JUL 01 2002
[INITIALS]
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SECURED PROMISSORY NOTE
$8,619,920.00
June 28th, 2002
FOR VALUE RECEIVED, the undersigned, PAC-WEST TELECOMM, INC., with an
address at 0000 Xxxxxxxx Xxxxxx, Xxxxxxxx, Xxxxxxxxxx 00000 ("Maker"), hereby
promises to pay to the order of QWEST COMMUNICATIONS CORPORATION, a Delaware
corporation with an address at 000 00xx Xxxxxx, 0xx Xxxxx, Xxxxxx, Xxxxxxxx
00000 ("Holder"), in immediately available funds the principal sum of Eight
Million Six Hundred Nineteen Thousand Nine Hundred Twenty Dollars
($8,619,920.00) (the "Principal Amount"), together with interest thereon in
accordance with the terms hereof.
The following terms and conditions apply to Maker's promise under this
Note:
1. Security. This Note shall be secured by certain collateral in which a
security interest has been granted by Maker to Holder pursuant to Amendment No.
2 of even date herewith to the IRU Agreement effective as of June 30, 2000
between Holder and Maker ("IRU Agreement").
2. (a) Due Date, Extension. Principal and interest under this Note shall
be due and payable in full no later than May 15, 2003 (the "Maturity Date").
(b) Payment. Maker shall make payments of principal as follows:
$4,419,920.50 shall be due and payable on December 15, 2002 and $4,200,000.00
shall be due and payable on May 15, 2003 (subject to reduction as provided in
the IRU Agreement), together with interest computed as provided herein.
Payments hereunder shall be made to Holder by wire transfer of
immediately available funds not later than 3:00 p.m. Denver, Colorado time on
December 15, 2002 and May 15, 2003 to Holder's account at Mellon Bank
Pittsburgh, Bank ABA No. 000000000, Credit (dollar amount) to Quest account
0000000. In the event any date payment is due hereunder is not a Business Day,
payment shall be made the next preceding Business Day. As used in this Note, the
term "Business Day" shall mean any day other than a Saturday, Sunday, or a day
on which commercial or other banks are authorized or required to close in
Denver, Colorado.
3. Interest. Interest shall accrue on $4,200,000 of the Principal Amount
from May 15, 2002 until payment in full of this Note at a rate per annum equal
to two percent (2.00%) above the Prime Rate (the "Variable Rate") with changes
in such Variable Rate to be effective on the date of any change in the Prime
Rate. As used herein, the "Prime Rate" is defined as the prime rate published in
the "Money Rates" section of The Wall Street Journal.
4. Prepayment. Maker shall have the right to prepay all or any portion of
the Principal Amount due under this Note at any time without penalty.
5. Remedies. If an Event of Default occurs, in addition to any other
remedies against Maker and any real or personal property securing Maker's
obligations hereunder, Qwest shall have the right to offset against any
security instruments any amounts owed to Qwest by Customer and shall remit the
balance to Customer without interest, unless obligated by law to do so.
6. Costs of Collection. If this Note or any installment of principal or
interest is not paid when due, whether at maturity or by acceleration, Maker
promises to pay, upon Holder's demand, all costs of collection, including,
without limitation, reasonable attorneys' fees, and all expenses in connection
with the protection or realization of the collateral securing this Note
incurred by Holder on account of such collection, whether or not suit is filed
hereon or thereon, including, without limitation, all costs, expenses, and
attorneys' fees actually incurred by Holder in connection with any insolvency,
bankruptcy, arrangement, or other similar proceedings involving Maker that in
any way affect the exercise by Holder of its rights and remedies under this
Note, the IRU Agreement, or any other mortgage, deed of trust, security
agreement, pledge agreement, or other instrument or agreement securing or
pertaining to this Note.
7. Waiver of Presentment, Demand, Protest, etc. Maker hereby waives
presentment, demand, protest, notice of protest, notice of dishonor, notice of
nonpayment, and all notices of every kind. In the event of any litigation with
respect to any matter connected with this Note, Maker hereby waives the right
to a trial by jury and all defenses, rights of setoff, and rights to interpose
counterclaims of any nature. Holder shall have the right to exercise any and
all of its rights and remedies as a creditor pursuant to applicable law,
including, without limitation, the right of setoff as to any amounts owed by
Holder to Maker under any agreement between Holder and Maker.
8. CHOICE OF LAW. THIS NOTE HAS BEEN EXECUTED, DELIVERED, AND ACCEPTED AT
DENVER, COLORADO AND SHALL BE INTERPRETED UNDER, GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF COLORADO. IN ANY ACTION BROUGHT UNDER
OR ARISING OUT OF THIS NOTE, MAKER HEREBY CONSENTS TO THE IN PERSONAM
JURISDICTION OF ANY STATE OR FEDERAL COURT SITTING IN THE STATE OF COLORADO,
WAIVES ANY CLAIMS OR DEFENSE THAT SUCH FORUM IS NOT CONVENIENT OR PROPER, AND
CONSENTS TO SERVICE OF PROCESS BY ANY MEANS AUTHORIZED UNDER COLORADO LAW.
9. Transfer/Assignment. Holder reserves the right to transfer or assign any
and/or all of its rights under this Note.
10. Security Agreement. This Note is the secured promissory note referred
to in Amendment No. 2 and is subject to all of the terms and conditions
thereof, all of which hereby are incorporated herein by reference.
11. LIMITATION OF INTEREST. NOTWITHSTANDING ANY OTHER PROVISION HEREOF, IN
NO EVENT SHALL THE AMOUNT OR RATE OF INTEREST, INCLUDING,
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WITHOUT LIMITATION AND TO THE EXTENT APPLICABLE, THE DEFAULT RATE OR ANY OTHER
DEFAULT RATE OF INTEREST OR LATE PAYMENT CHARGE, PAYABLE, CONTRACTED FOR,
CHARGED, OR RECEIVED UNDER OR IN CONNECTION WITH THIS NOTE FROM TIME TO TIME OR
FOR WHATEVER REASON EXCEED THE MAXIMUM RATE OR AMOUNT OF INTEREST, IF ANY,
SPECIFIED BY APPLICABLE LAW. If, at the time such fulfillment shall be due and
from any circumstance whatsoever, fulfillment of any provision hereof or of any
other agreement related hereto shall involve exceeding the limit of validity
proscribed by applicable law, then, ipso facto, the obligation to be fulfilled
shall be reduced to the limit of such validity, and if from any such
circumstance Holder ever shall receive an amount deemed interest by applicable
law which shall exceed the highest lawful rate, such amount which would be
excessive interest shall be applied to the reduction of the Principal Amount or
on account of any other principal indebtedness of Maker to Holder, and not to
payment of interest, or if such excessive interest exceeds the unpaid balance of
the Principal Amount and such other indebtedness, or if Holder is prohibited by
applicable law from applying such excessive interest to the reduction of the
Principal Amount or on account of any other indebtedness of Maker, the excess
shall be refunded to Maker. All sums paid or agreed to be paid by Maker for the
use, forbearance, or detention of the indebtedness of Maker to Holder, to the
extent permitted by applicable law, shall be amortized, prorated, allocated, and
spread throughout the full term of such indebtedness until payment in full so
that the actual rate of interest on account of such indebtedness is uniform
through the term hereof. The terms and provisions of this Section 11 shall
control and supersede every other provision of all agreements between Maker and
Holder and all obligations of Maker to Holder.
Executed by Maker as of the first date set forth in this Note
PAC-WEST TELECOMM, INC.
By: /s/ Xxxxx Xxxxxxx
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Name: Xxxxx Xxxxxxx
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Title: Chairman & CEO
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