EXHIBIT 10.7
X.X. XXXX ASSET MANAGEMENT CO., L.L.C.
00 Xxxx Xxxxx, Xxxxx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
September 3, 1998
Arch Communications Group, Inc.
0000 Xxxx Xxxx Xxxxx
Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000
MobileMedia Communications, Inc.
Fort Xxx Executive Park
Xxx Xxxxxxxxx Xxxxx
Xxxxx 000
Xxxx Xxx, Xxx Xxxxxx 00000
Re: Amendment to Commitment
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Gentlemen:
Reference is made to the letter agreement, dated August 18, 1998 (the
"Standby Commitment Letter"), among Arch Communications Group, Inc., MobileMedia
Communications, Inc. and X.X. Xxxx Asset Management Co., L.L.C. Terms used
herein with initial capital letters that are not otherwise defined shall have
the meanings ascribed to such terms in the Standby Commitment Letter.
The parties hereto hereby agree as follows:
1. First Paragraph. The second sentence of the first paragraph of the
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Standby Commitment Letter is hereby amended in its entirety to read as follows:
It is our understanding that in connection with the Reorganization, among
other things: (a) pursuant to the Agreement and Plan of Merger, dated as of
the date hereof (as amended by the First Amendment thereto dated as of
September 3, 1998 (the "Merger Agreement"), among Arch, a wholly owned
subsidiary of Arch ("Merger Sub"), Parent and MobileMedia, MobileMedia will
merge with and into Merger Sub, with Merger Sub continuing as the surviving
corporation and a wholly owned subsidiary of Arch; (b) pursuant to the
Merger Agreement, Arch will make available for distribution pursuant to a
plan of reorganization of the Debtors in the form attached as Exhibit A to
the Merger Agreement, with such amendments and modifications thereto as are
made in a manner consistent with clause (e) of Section 5 hereto (such plan
of reorganization being referred to herein as the "Plan"), (i) cash, (ii)
shares of its Common Stock, par value $.01 per share ("Existing Arch Common
Stock"), and (iii) either (A) if a Rights Offering Adjustment (as defined
in Schedule II to the Merger Agreement) shall not have occurred, warrants
entitling the holders
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 2
thereof to purchase shares of Existing Arch Common Stock ("Arch Warrants"),
with such Arch Warrants to be issued pursuant to, and to have the terms set
forth in, a warrant agreement in the form attached as Exhibit B to the
Merger Agreement (the "Arch Warrant Agreement") or (B) if a Rights Offering
Adjustment shall have occurred, warrants entitling the holders thereof to
purchase shares of Existing Arch Common Stock ("Arch Participation
Warrants"), with such Arch Participation Warrants to be issued pursuant to,
and to have the terms set forth in, a warrant agreement in the form
attached as Exhibit B-1 to the Merger Agreement (the "Arch Participation
Warrant Agreement"); (c) holders of unsecured non-priority claims against
the Debtors ("Unsecured Claims"), to the extent such Unsecured Claims are
Allowed (as defined in the Plan), will receive pursuant to the Plan (i)
shares of Existing Arch Common Stock and (ii) rights to purchase ("Rights")
for cash either (A) if a Rights Offering Adjustment shall not have
occurred, units ("Units") consisting of (x) shares of Existing Arch Common
Stock and (y) Arch Warrants or (B) if a Rights Offering Adjustment shall
have occurred, shares of Existing Arch Common Stock ("Rights Shares"); (d)
holders of claims arising under or relating to the Credit Agreement, dated
December 4, 1995, as amended, among MobileMedia and the other parties
thereto ("Secured Claims"), to the extent such Secured Claims are Allowed,
will receive pursuant to the Plan cash in an amount equal to 100% of such
claims; (e) all of the outstanding equity interests in MobileMedia and
Parent will be canceled without consideration and Parent will be dissolved;
and (f) the commitments under the DIP Loan Agreement will terminate and all
amounts owed under or in respect of the DIP Loan Agreement will be paid in
full in cash. Arch will conduct the Stockholder Rights Offering, in which
it will issue to holders of Buyer Stock Stockholder Rights to acquire
shares of Existing Arch Common Stock if a Rights Offering Adjustment shall
have occurred, and, in addition, if a Rights Offering Adjustment shall have
occurred, immediately following the Combination, Arch will issue Arch
Participation Warrants to the stockholders of Arch to the extent any
Stockholder Rights issued to such Stockholder Rights Holder were not
exercised.
2. Section 1(a). Section 1(a) of the Standby Commitment Letter is hereby
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amended in its entirety to read as follows:
(a) to exercise any Rights distributed to it in respect of its Allowed
Unsecured Claims in accordance with the Plan and not thereafter sold or
transferred as permitted by Section 3 below to purchase either (i) if a
Rights Offering Adjustment shall not have occurred, Units or (ii) if a
Rights Offering Adjustment shall have occurred, Rights Shares, to the
extent that the aggregate purchase price payable upon such exercise, as
determined in accordance with Schedule II to the Merger Agreement (the
"Subscription Price"), does not
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 3
exceed the Rights Exercise Commitment Amount of the Standby Purchaser as
set forth in Annex I hereto;
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3. Section 1(b).Section 1(b) of the Standby Commitment Letter is hereby
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amended in its entirety to read as follows:
(b) if (i) the Standby Purchaser sells or otherwise transfers any or
all of the (A) the Rights distributed to it in accordance with the Plan or
(B) Unsecured Claims held by it as of the date hereof in respect of which
Rights are to be distributed, in each case as permitted by Section 3 below,
and (ii) the Rights sold or transferred by the Standby Purchaser or the
Rights distributed in respect of Unsecured Claims held by it as of the date
hereof that are hereafter sold or transferred by the Standby Purchaser are
not exercised prior to the expiration thereof (at which time such Rights
will be void and will no longer be exercisable), to purchase for cash
(based upon the Subscription Price payable upon exercise of such Rights)
either (x) if a Rights Offering Adjustment shall not have occurred,
identical Units or (y) if a Rights Offering Adjustment shall have occurred,
Rights Shares underlying, in each case, such unexercised Rights, to the
extent that the aggregate purchase price therefor, together with the
aggregate Subscription Price payable upon exercise of Rights exercised as
contemplated by clause (a) above, does not exceed the Rights Exercise
Commitment Amount of the Standby Purchaser as set forth in Annex I hereto;
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and
4. Section 1(c). Section 1(c) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(c) if any Rights distributed in accordance with the Plan (other than
(i) Rights distributed to the Standby Purchaser or the other holders of
Unsecured Claims listed on Annex I hereto (the "Other Standby Purchasers")
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and retained by them (which Rights are referred to in Section 1(a) above
and Section 1(a) of each of the Other Standby Purchase Commitments (as
defined in Section 13(a) below)) or (ii) subject to Section 3(b) below,
Rights distributed in respect of Unsecured Claims held by the Standby
Purchaser or the Other Standby Purchasers as of the date hereof that are
hereafter sold or transferred by them (which Rights are referred to in
Sections 1(b) and 3 hereof and Sections 1(b) and 3 of each of the Other
Standby Purchase Commitments)) remain unexercised upon the expiration
thereof (at which time such Rights will be void and will no longer be
exercisable), to purchase for cash (based on the Subscription Price payable
upon exercise of such Rights ) pro rata in accordance with and up to the
Unexercised Rights Commitment Amount of the Standby Purchaser as set forth
in Annex I hereto either (x) if a Rights Offering Adjustment shall not have
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occurred, identical Units or (y) if a Rights
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 4
Offering Adjustment shall have occurred, Rights Shares, underlying, in each
case, such unexercised Rights.
5. Section 2(a). Section 2(a) of the Standby Commitment Letter is hereby
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amended in its entirety to read as follows:
(a) Notwithstanding anything to the contrary herein contained, if the
purchases by the Standby Purchaser contemplated by Section 1 above would
cause the Standby Purchaser, the Other Standby Purchasers, and any other
persons or entities who, when taken together with any one or more of the
Standby Purchaser and the Other Standby Purchasers, would constitute a
"person" or "group" as used in Section 13(d) or Section 14(d) of the
Exchange Act or Rule 13d-3 or Rule 13d-5 promulgated thereunder, or any
"affiliate" as defined in Rule 405 promulgated under the Securities Act of
any of them (collectively, the "Standby Class B Holders"), in the
aggregate, to beneficially own on the effective date of the Plan (the
"Effective Date") shares representing more than 49.0% of the capital stock
of Arch generally entitled to vote in the election of directors or more
than 49.0% of the total voting power of the capital stock of Arch, Arch
will substitute shares of Class B Common Stock, par value $.01 per share,
of Arch ("Arch Class B Common Stock"), with such Arch Class B Common Stock
having the terms set forth in the form of Certificate of Amendment to
Certificate of Incorporation of Arch attached as Exhibit F to the Merger
Agreement (the "Arch Charter Amendment"), for shares of Existing Arch
Common Stock so purchased on a one-for-one basis such that on the Effective
Date the Standby Class B Holders, in the aggregate, will beneficially own
shares representing not more than 49.0% of the capital stock of Arch
generally entitled to vote in the election of directors and not more than
49.0% of the total voting power of the capital stock of Arch, all as
provided in the Plan. For purposes of this letter agreement, "beneficial
ownership" shall be determined as provided in Rule 13d-3 and Rule 13d-5
promulgated under the Exchange Act, except that a person or entity shall be
deemed to have "beneficial ownership" of all securities that such person or
entity has the right to acquire, whether such right is exercisable
immediately or only after the passage of time.
6. Section 3(b). Section 3(b) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(b) Notwithstanding the provisions of clause (Y) of the proviso in
Section 3(a) above, the Standby Purchaser may elect to sell or otherwise
transfer (i) any or all of the Rights distributed to it in accordance with
the Plan or (ii) Unsecured Claims in respect of which Rights are to be so
distributed, in either case without entering into a Tracking Agreement with
its transferee or transferees (any Rights so transferred and any Rights
distributed in respect of
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 5
Allowed Claims so transferred, together with any Rights so transferred and
any Rights distributed in respect of Allowed Claims so transferred by the
Other Standby Purchasers pursuant to Section 3(b) of the Other Standby
Purchase Commitments, being referred to herein collectively as "Untracked
Rights"). Any Rights that remain unexercised upon expiration thereof will
be deemed to be "Section 3(b) Rights" up to, but not exceeding, the amount
of Untracked Rights. The Section 3(b) Rights shall be exercised as follows
prior to the application of Section 1(c) above and Section 1(c) of the
Other Standby Purchase Commitments: (A) the Standby Purchaser and the Other
Standby Purchasers will first be given the opportunity to purchase for cash
(based on the Subscription Price payable upon exercise of such Rights)
either (x) if a Rights Offering Adjustment shall not have occurred, Units
or (y) if a Rights Offering Adjustment shall have occurred, Rights Shares,
underlying, in each case, a number of unexercised Rights up to the amount
of Section 3(b) Rights in accordance with the percentages set forth in
Column D of Annex I hereto and (B) to the extent such Units or Rights
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Shares, as the case may be, are not so purchased, the Standby Purchaser and
any Other Standby Purchasers that are responsible for the existence of the
Section 3(b) Rights will be required to purchase such Units or Rights
Shares, as the case may be, pro rata based on the number of Section 3(b)
Rights resulting from their respective transfers. Nothing in this Section
3(b) will in any way reduce the commitment of the Standby Purchaser
specified in Section 1(c) above or the Unexercised Rights Commitment Amount
as set forth in Annex I hereto.
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7. Section 4. Section 4 of the Standby Commitment Letter is hereby
---------
amended in its entirety to read as follows:
4. The Closing. (a) Notwithstanding anything to the contrary herein
-----------
contained or the terms of the Rights or the Plan, subject to the conditions
set forth herein, on the Effective Date the Standby Purchaser, in
satisfaction of the Commitment, will deliver at the Closing (i) the
aggregate Subscription Price payable upon exercise of any Rights exercised
by it and (ii) the purchase price payable in consideration of any shares of
Existing Arch Common Stock or, if applicable, Arch Class B Common Stock
and, if a Rights Offering Adjustment shall not have occurred, Arch Warrants
to be otherwise purchased by it pursuant to the Commitment; provided,
--------
however, that, if requested by the Standby Purchaser in writing at least
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two business days prior to the Effective Date, any cash to be distributed
to the Standby Purchaser in respect of Allowed Secured Claims pursuant to
the Plan will, prior to the distribution thereof pursuant to the Plan and
in accordance with the instructions included in such written request, be
first applied, on behalf of the Standby Purchaser, to the payment of such
amounts payable on the Effective Date as provided in this Section 4(a).
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 6
(b) Upon payment of the amounts payable as provided in Section 4(a),
on the Effective Date at the Closing Arch will deliver to the Standby
Purchaser (or its designees) certificates representing the shares of
Existing Arch Common Stock, shares of Arch Class B Common Stock, if
applicable, and, if a Rights Offering Adjustment shall not have occurred,
the Arch Warrants, in each case, (i) issuable upon exercise of any Rights
exercised by the Standby Purchaser or (ii) otherwise purchased by the
Standby Purchaser pursuant to the Commitment. At the Closing, Arch will
also deliver to the Standby Purchaser (or its designees) certificates
representing the Arch Warrants or Arch Participation Warrants, as the case
may be, contemplated by Section 7 below.
(c) (i) Arch will deliver to the Standby Purchaser two business days
after the expiration of the Stockholder Rights Offering a written notice
which shall (A) specify the amounts payable at the Closing by it in
satisfaction of the Commitment (without taking into account Section 4(e)
below), (B) specify the Maximum Reduction Number (as defined in Section
4(e) below, (C) specify the last date on which the notice referred to in
Section 4(c) (ii) below may be delivered, and (D) indicate the matters
required to be addressed in such notice.
(ii) Within 10 business days after its receipt of the notice
referred to in Section 4(c)(i) above, the Standby Purchaser will deliver to
Arch and MobileMedia a written notice which shall set forth the Elected
Reduction Number (as defined in Section 4(e) below) determined by the
Standby Purchaser in accordance with Section 4(e) below.
(d) (i) Arch will deliver to the Standby Purchaser at least five
business days prior to the Effective Date a written notice which shall
specify the date on which the Effective Date is to occur and the last date
on which the notice referred to in Section 4(d)(ii) below may be delivered.
(ii) At least two business days prior to the Effective Date, the
Standby Purchaser will deliver to Arch and MobileMedia a written notice
which shall set forth the number of shares of Existing Arch Common Stock
beneficially owned by it as of such date. During the period from the date
of such notice through the Effective Date, neither the Standby Purchaser
nor any affiliate thereof shall acquire beneficial ownership of, or any
rights to acquire, any additional shares of Existing Arch Common Stock or
any Unsecured Claim.
(e) If a Rights Offering Adjustment shall have occurred,
notwithstanding anything to the contrary herein contained, the Standby
Purchaser may elect to reduce the number of Rights Shares required to be
purchased by the Standby Purchaser in satisfaction of its Commitment by a
number (the "Elected Reduction Number") of Rights Shares equal to or less
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 7
than the product of (i) the number of shares of Existing Arch Common Stock
to be issued by Arch in the Stockholder Rights Offering and (ii) the
percentage in Column D of Annex I hereto specified opposite the Standby
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Purchaser's name (such product being referred to herein as the "Maximum
Reduction Number"). Subject to the immediately preceding sentence, the
Standby Purchaser shall determine the Elected Reduction Number in its sole
discretion.
8. Section 5(c). Section 5(c) of the Standby Commitment Letter is hereby
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amended in its entirety to read as follows:
(c) there shall be effective under the Securities Act, a registration
statement (the "Shelf Registration Statement") covering the resale by the
Standby Purchaser of (i) all shares of Existing Arch Common Stock, all
shares of Arch Class B Common Stock, if applicable, and, if a Rights
Offering Adjustment shall not have occurred, all Arch Warrants received by
the Standby Purchaser as a result of the transactions contemplated by the
Plan (including those received upon the exercise of Rights and pursuant to
this letter agreement), (ii) if a Rights Offering Adjustment shall have
occurred, all Arch Participation Warrants received by the Standby Purchaser
pursuant to this letter agreement, and (iii) all shares of Existing Arch
Common Stock issuable upon conversion of any such shares of the Arch Class
B Common Stock or exercise of any such Arch Warrants or Arch Participation
Warrants, as the case may be (the securities referred to in the foregoing
clauses (i), (ii) and (iii) are referred to herein as the "Registrable
Securities");
9. Section 5(e). Section 5(e) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(e) any and all amendments or modifications to the Merger Agreement or
any exhibit or schedule thereto (including without limitation the Plan, the
Arch Charter Amendment, the Arch Warrant Agreement, the Arch Participation
Warrant Agreement and the Registration Rights Agreement) on or after the
date hereof and any consents or waivers delivered on or after the date
hereof by Arch or MobileMedia to the other under the Merger Agreement
(other than (i) subject to Section 15(a) below, consents under Section 4.5
of the Merger Agreement, (ii) waivers of Unilateral Conditions or (iii) any
amendment to the Merger Agreement solely to reduce the amount of the Buyer
Breakup Fee) shall have been in form and substance reasonably satisfactory
to the Standby Purchaser;
10. Section 5(j). Section 5(j) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 8
(j) (i) the shares of Existing Arch Common Stock to be issued and
distributed as contemplated by Section 1.3(e) and Section 1.6 of the Merger
Agreement shall be so issued and distributed pursuant to an exemption from
registration under the Securities Act provided by Section 1145 of the
Bankruptcy Code, and (ii)(A) the issuance of the Rights, (B) the issuance
of the shares of Existing Arch Common Stock, the shares of Arch Class B
Common Stock, if applicable, and, if a Rights Offering Adjustment shall not
have occurred, the Arch Warrants upon exercise of the Rights, (C) the
issuance to the Standby Purchaser of the shares of Existing Arch Common
Stock, the shares of Arch Class B Common Stock, if applicable, and, if a
Rights Offering Adjustment shall not have occurred, the Arch Warrants as
contemplated by Section 1 and Section 3 above and the Arch Warrants or Arch
Participation Warrants, as the case may be, as contemplated by Section 7
below, and (D) the issuance of Existing Arch Common Stock upon exercise of
the Arch Warrants or Arch Participation Warrants, as the case may be, or
conversion of Arch Class B Common Stock, if applicable, shall be covered by
the Registration Statement, the Registration Statement shall have been
declared effective and no stop order with respect thereto shall be in
effect;
11. Section 5(m) of the Standby Commitment Letter is hereby deleted.
12. Section 7. Section 7 of the Standby Commitment Letter is hereby
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amended in its entirety to read as follows:
Consideration for the Commitment. In consideration for the
--------------------------------
Commitment, on the Effective Date at the Closing the Standby Purchaser will
receive its pro rata share of either (a) if a Rights Offering Adjustment
shall not have occurred, Arch Warrants entitling the holders thereof to
purchase, in the aggregate, a number of shares of Existing Arch Common
Stock equal to 2.50% of the issued and outstanding shares of Existing Arch
Common Stock and, if applicable, Arch Class B Common Stock, computed on a
Fully Diluted Basis (as defined in the Plan) on the date the "Initial Buyer
Market Price" is determined in accordance with Schedule II to the Merger
Agreement giving effect to the Plan as if the Effective Date had occurred
on such date and assuming 21,067,110 shares of Existing Arch Common Stock
are issued and outstanding immediately prior thereto or (b) if a Rights
Offering Adjustment shall have occurred, Arch Participation Warrants
entitling the holders thereof to purchase, in the aggregate, a number of
shares of Existing Arch Common Stock equal to 2.50% of the issued and
outstanding shares of Existing Arch Common Stock and, if applicable, Arch
Class B Common Stock, computed on a Fully Diluted Basis on the Rights
Offering Adjustment Determination Date giving effect to the Plan as if the
Effective Date had occurred on such date and assuming 21,067,110 shares of
Existing Arch Common Stock are issued and outstanding immediately prior
thereto. Such Arch Warrants or Arch
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 9
Participation Warrants, as the case may be, will be delivered to the
Standby Purchaser and the Other Standby Purchasers, in accordance with the
percentages specified in Column D of Annex I hereto.
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13. Section 9(a)(x). Section 9(a)(x) of the Standby Commitment Letter is
---------------
hereby amended in its entirety to read as follows:
(a)(x) The shares of Existing Arch Common Stock to be issued and
distributed as contemplated by Section 1.3(e) and Section 1.6 of the Merger
Agreement and the shares of Existing Arch Common Stock, the shares of Arch
Class B Common Stock, if applicable, and either the Arch Warrants to be
issued and delivered as contemplated by Section 1 and Section 3 above and
the Arch Warrants to be issued as contemplated by Section 7 above or, if a
Rights Offering Adjustment shall have occurred, the Arch Participation
Warrants to be issued as contemplated by Section 7 above, in each case,
when so issued and distributed or delivered, as the case may be, and the
shares of Existing Arch Common Stock issued upon conversation of such
shares of Arch Class B Common Stock, if applicable, when so converted in
accordance with the Arch Charter Amendment, and either, if a Rights
Offering Adjustment shall not have occurred, the shares of Existing Arch
Common Stock issued upon exercise of such Arch Warrants, when issued, paid
for and delivered as provided in the Arch Warrant Agreement or, if a Rights
Offering Adjustment shall have occurred, the shares of Existing Arch Common
Stock issued upon exercise of Arch Participation Warrants, when issued,
paid for and delivered as provided in the Arch Participation Warrant
Agreement, will be duly authorized, validly issued, fully paid,
nonassessable and free of all preemptive rights; and
14. Section 11. Section 11 of the Standby Commitment Letter is hereby
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amended to change the reference therein to "Exhibit D" to a reference to
"Exhibit D-1."
15. Schedule A to Annex I. Schedule A to Annex I to the Standby
---------------------
Commitment Letter is hereby amended to read in its entirety as Schedule A
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hereto.
16. Continuation of Standby Commitment Letter. Except as specifically
-----------------------------------------
amended hereby, the Standby Commitment Letter shall continue in full force and
effect and is hereby certified and confirmed in all respects.
17. Consent to Amendments. The Standby Purchaser hereby (a) consents to
---------------------
the amendments to the Other Standby Purchase Commitments to be effected by the
letter agreements attached as Exhibit C-1 hereto, which amendments shall be
-----------
entered into simultaneously herewith, (b) consents to (i) the First Amendment
dated as of September 3, 1998 to the Merger Agreement and each of the exhibits
attached thereto
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 10
and (ii) the Second Amended Joint Plan of Reorganization dated as of September
4, 1998 and each of the exhibits attached thereto, and (c) agrees that the form
and substance thereof are reasonably satisfactory to the Standby Purchaser.
18. Governing Law. This letter agreement shall be governed by and
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construed in accordance with the laws of the State of Delaware without regard to
its principles of conflicts of law.
19. Counterparts. This letter agreement may be executed in
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counterparts which, taken together, shall constitute one and the same
instrument.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 11
If the foregoing accurately reflects your understanding with respect to the
matters set forth herein, please confirm by executing and returning a copy of
this letter to the undersigned.
Very truly yours,
X.X. XXXX ASSET MANAGEMENT CO., L.L.C.,
as agent for its separate accounts and
affiliates
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Name: Xxxxx X. Xxxxx, Esq.
Its: Attorney-in-Fact
Address: 00 Xxxx Xxxxx, 0xx Xxxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxx, Esq.
ACCEPTED AND AGREED TO:
ARCH COMMUNICATIONS GROUP, INC.
By: /s/ J. Xxx Xxxxxx
-------------------------------------
Name: J. Xxx Xxxxxx
Its: Executive Vice President and
Chief Financial Officer
Address: 0000 Xxxx Xxxx Xxxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000
Attn: Chairman and Chief
Executive Officer
With copy to: Xxxx and Xxxx LLP
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxx X. Xxxxxxxx
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 12
Subject to entry of the Confirmation Order:
MOBILEMEDIA COMMUNICATIONS, INC.
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxx
Its: Chairman - Restructuring
Address: Fort Xxx Executive Park
Xxx Xxxxxxxxx Xxxxx, Xxxxx 000
Xxxx Xxx, XX 00000
Attn: Chairman - Restructuring
With a copy to: Sidley & Austin
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attn: Xxxxx X. Xxxxxxx
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
September 3, 1998
Arch Communications Group, Inc.
0000 Xxxx Xxxx Xxxxx
Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000
MobileMedia Communications, Inc.
Fort Xxx Executive Park
Xxx Xxxxxxxxx Xxxxx
Xxxxx 000
Xxxx Xxx, Xxx Xxxxxx 00000
Re: Amendment to Commitment
-----------------------
Gentlemen:
Reference is made to the letter agreement, dated August 18, 1998 (the
"Standby Commitment Letter"), among Arch Communications Group, Inc., MobileMedia
Communications, Inc. and The Northwestern Mutual Life Insurance Company. Terms
used herein with initial capital letters that are not otherwise defined shall
have the meanings ascribed to such terms in the Standby Commitment Letter. The
parties hereto hereby agree as follows:
1. First Paragraph. The second sentence of the first paragraph of the
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Standby Commitment Letter is hereby amended in its entirety to read as follows:
It is our understanding that in connection with the Reorganization, among
other things: (a) pursuant to the Agreement and Plan of Merger, dated as of
the date hereof (as amended by the First Amendment thereto dated as of
September 3, 1998 (the "Merger Agreement"), among Arch, a wholly owned
subsidiary of Arch ("Merger Sub"), Parent and MobileMedia, MobileMedia will
merge with and into Merger Sub, with Merger Sub continuing as the surviving
corporation and a wholly owned subsidiary of Arch; (b) pursuant to the
Merger Agreement, Arch will make available for distribution pursuant to a
plan of reorganization of the Debtors in the form attached as Exhibit A to
the Merger Agreement, with such amendments and modifications thereto as are
made in a manner consistent with clause (e) of Section 5 hereto (such plan
of reorganization being referred to herein as the "Plan"), (i) cash, (ii)
shares of its Common Stock, par value $.01 per share ("Existing Arch Common
Stock"), and (iii) either (A) if a Rights Offering Adjustment (as defined
in Schedule II to the Merger Agreement) shall not have occurred, warrants
entitling the holders
Arch Communications Group, Inc.
Mobile Media Communications, Inc.
Page 2
thereof to purchase shares of Existing Arch Common Stock ("Arch Warrants"),
with such Arch Warrants to be issued pursuant to, and to have the terms set
forth in, a warrant agreement in the form attached as Exhibit B to the
Merger Agreement (the "Arch Warrant Agreement") or (B) if a Rights Offering
Adjustment shall have occurred, warrants entitling the holders thereof to
purchase shares of Existing Arch Common Stock ("Arch Participation
Warrants"), with such Arch Participation Warrants to be issued pursuant to,
and to have the terms set forth in, a warrant agreement in the form
attached as Exhibit B-1 to the Merger Agreement (the "Arch Participation
Warrant Agreement"); (c) holders of unsecured non-priority claims against
the Debtors ("Unsecured Claims"), to the extent such Unsecured Claims are
Allowed (as defined in the Plan), will receive pursuant to the Plan (i)
shares of Existing Arch Common Stock and (ii) rights to purchase ("Rights")
for cash either (A) if a Rights Offering Adjustment shall not have
occurred, units ("Units") consisting of (x) shares of Existing Arch Common
Stock and (y) Arch Warrants or (B) if a Rights Offering Adjustment shall
have occurred, shares of Existing Arch Common Stock ("Rights Shares"); (d)
holders of claims arising under or relating to the Credit Agreement, dated
December 4, 1995, as amended, among MobileMedia and the other parties
thereto ("Secured Claims"), to the extent such Secured Claims are Allowed,
will receive pursuant to the Plan cash in an amount equal to 100% of such
claims; (e) all of the outstanding equity interests in MobileMedia and
Parent will be canceled without consideration and Parent will be dissolved;
and (f) the commitments under the DIP Loan Agreement will terminate and all
amounts owed under or in respect of the DIP Loan Agreement will be paid in
full in cash. Arch will conduct the Stockholder Rights Offering, in which
it will issue to holders of Buyer Stock Stockholder Rights to acquire
shares of Existing Arch Common Stock if a Rights Offering Adjustment shall
have occurred, and, in addition, if a Rights Offering Adjustment shall have
occurred, immediately following the Combination, Arch will issue Arch
Participation Warrants to the stockholders of Arch to the extent any
Stockholder Rights issued to such Stockholder Rights Holder were not
exercised.
2. Section 1(a). Section 1(a) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(a) to exercise any Rights distributed to it in respect of its Allowed
Unsecured Claims in accordance with the Plan and not thereafter sold or
transferred as permitted by Section 3 below to purchase either (i) if a
Rights Offering Adjustment shall not have occurred, Units or (ii) if a
Rights Offering Adjustment shall have occurred, Rights Shares, to the
extent that the aggregate purchase price payable upon such exercise, as
determined in accordance with Schedule II to the Merger Agreement (the
"Subscription Price"), does not
Arch Communications Group, Inc.
Mobile Media Communications, Inc.
Page 3
exceed the Rights Exercise Commitment Amount of the Standby Purchaser as
set forth in Annex I hereto;
-------
3. Section 1(b).Section 1(b) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(b) if (i) the Standby Purchaser sells or otherwise transfers any or
all of the (A) the Rights distributed to it in accordance with the Plan or
(B) Unsecured Claims held by it as of the date hereof in respect of which
Rights are to be distributed, in each case as permitted by Section 3 below,
and (ii) the Rights sold or transferred by the Standby Purchaser or the
Rights distributed in respect of Unsecured Claims held by it as of the date
hereof that are hereafter sold or transferred by the Standby Purchaser are
not exercised prior to the expiration thereof (at which time such Rights
will be void and will no longer be exercisable), to purchase for cash
(based upon the Subscription Price payable upon exercise of such Rights)
either (x) if a Rights Offering Adjustment shall not have occurred,
identical Units or (y) if a Rights Offering Adjustment shall have occurred,
Rights Shares underlying, in each case, such unexercised Rights, to the
extent that the aggregate purchase price therefor, together with the
aggregate Subscription Price payable upon exercise of Rights exercised as
contemplated by clause (a) above, does not exceed the Rights Exercise
Commitment Amount of the Standby Purchaser as set forth in Annex I hereto;
-------
and
4. Section 1(c). Section 1(c) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(c) if any Rights distributed in accordance with the Plan (other than
(i) Rights distributed to the Standby Purchaser or the other holders of
Unsecured Claims listed on Annex I hereto (the "Other Standby Purchasers")
-------
and retained by them (which Rights are referred to in Section 1(a) above
and Section 1(a) of each of the Other Standby Purchase Commitments (as
defined in Section 13(a) below)) or (ii) subject to Section 3(b) below,
Rights distributed in respect of Unsecured Claims held by the Standby
Purchaser or the Other Standby Purchasers as of the date hereof that are
hereafter sold or transferred by them (which Rights are referred to in
Sections 1(b) and 3 hereof and Sections 1(b) and 3 of each of the Other
Standby Purchase Commitments)) remain unexercised upon the expiration
thereof (at which time such Rights will be void and will no longer be
exercisable), to purchase for cash (based on the Subscription Price payable
upon exercise of such Rights ) pro rata in accordance with and up to the
Unexercised Rights Commitment Amount of the Standby Purchaser as set forth
in Annex I hereto either (x) if a Rights Offering Adjustment shall not have
-------
occurred, identical Units or (y) if a Rights
Arch Communications Group, Inc.
Mobile Media Communications, Inc.
Page 4
Offering Adjustment shall have occurred, Rights Shares, underlying, in each
case, such unexercised Rights.
5. Section 2(a). Section 2(a) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(a) Notwithstanding anything to the contrary herein contained, if the
purchases by the Standby Purchaser contemplated by Section 1 above would
cause the Standby Purchaser, the Other Standby Purchasers, and any other
persons or entities who, when taken together with any one or more of the
Standby Purchaser and the Other Standby Purchasers, would constitute a
"person" or "group" as used in Section 13(d) or Section 14(d) of the
Exchange Act or Rule 13d-3 or Rule 13d-5 promulgated thereunder, or any
"affiliate" as defined in Rule 405 promulgated under the Securities Act of
any of them (collectively, the "Standby Class B Holders"), in the
aggregate, to beneficially own on the effective date of the Plan (the
"Effective Date") shares representing more than 49.0% of the capital stock
of Arch generally entitled to vote in the election of directors or more
than 49.0% of the total voting power of the capital stock of Arch, Arch
will substitute shares of Class B Common Stock, par value $.01 per share,
of Arch ("Arch Class B Common Stock"), with such Arch Class B Common Stock
having the terms set forth in the form of Certificate of Amendment to
Certificate of Incorporation of Arch attached as Exhibit F to the Merger
Agreement (the "Arch Charter Amendment"), for shares of Existing Arch
Common Stock so purchased on a one-for-one basis such that on the Effective
Date the Standby Class B Holders, in the aggregate, will beneficially own
shares representing not more than 49.0% of the capital stock of Arch
generally entitled to vote in the election of directors and not more than
49.0% of the total voting power of the capital stock of Arch, all as
provided in the Plan. For purposes of this letter agreement, "beneficial
ownership" shall be determined as provided in Rule 13d-3 and Rule 13d-5
promulgated under the Exchange Act, except that a person or entity shall be
deemed to have "beneficial ownership" of all securities that such person or
entity has the right to acquire, whether such right is exercisable
immediately or only after the passage of time.
6. Section 3(b). Section 3(b) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(b) Notwithstanding the provisions of clause (Y) of the proviso in
Section 3(a) above, the Standby Purchaser may elect to sell or otherwise
transfer (i) any or all of the Rights distributed to it in accordance with
the Plan or (ii) Unsecured Claims in respect of which Rights are to be so
distributed, in either case without entering into a Tracking Agreement with
its transferee or transferees (any Rights so transferred and any Rights
distributed in respect of
Arch Communications Group, Inc.
Mobile Media Communications, Inc.
Page 5
Allowed Claims so transferred, together with any Rights so transferred and
any Rights distributed in respect of Allowed Claims so transferred by the
Other Standby Purchasers pursuant to Section 3(b) of the Other Standby
Purchase Commitments, being referred to herein collectively as "Untracked
Rights"). Any Rights that remain unexercised upon expiration thereof will
be deemed to be "Section 3(b) Rights" up to, but not exceeding, the amount
of Untracked Rights. The Section 3(b) Rights shall be exercised as follows
prior to the application of Section 1(c) above and Section 1(c) of the
Other Standby Purchase Commitments: (A) the Standby Purchaser and the Other
Standby Purchasers will first be given the opportunity to purchase for cash
(based on the Subscription Price payable upon exercise of such Rights)
either (x) if a Rights Offering Adjustment shall not have occurred, Units
or (y) if a Rights Offering Adjustment shall have occurred, Rights Shares,
underlying, in each case, a number of unexercised Rights up to the amount
of Section 3(b) Rights in accordance with the percentages set forth in
Column D of Annex I hereto and (B) to the extent such Units or Rights
-------
Shares, as the case may be, are not so purchased, the Standby Purchaser and
any Other Standby Purchasers that are responsible for the existence of the
Section 3(b) Rights will be required to purchase such Units or Rights
Shares, as the case may be, pro rata based on the number of Section 3(b)
Rights resulting from their respective transfers. Nothing in this Section
3(b) will in any way reduce the commitment of the Standby Purchaser
specified in Section 1(c) above or the Unexercised Rights Commitment Amount
as set forth in Annex I hereto.
-------
7. Section 4. Section 4 of the Standby Commitment Letter is hereby
---------
amended in its entirety to read as follows:
4. The Closing. (a) Notwithstanding anything to the contrary herein
-----------
contained or the terms of the Rights or the Plan, subject to the conditions
set forth herein, on the Effective Date the Standby Purchaser, in
satisfaction of the Commitment, will deliver at the Closing (i) the
aggregate Subscription Price payable upon exercise of any Rights exercised
by it and (ii) the purchase price payable in consideration of any shares of
Existing Arch Common Stock or, if applicable, Arch Class B Common Stock
and, if a Rights Offering Adjustment shall not have occurred, Arch Warrants
to be otherwise purchased by it pursuant to the Commitment; provided,
--------
however, that, if requested by the Standby Purchaser in writing at least
-------
two business days prior to the Effective Date, any cash to be distributed
to the Standby Purchaser in respect of Allowed Secured Claims pursuant to
the Plan will, prior to the distribution thereof pursuant to the Plan and
in accordance with the instructions included in such written request, be
first applied, on behalf of the Standby Purchaser, to the payment of such
amounts payable on the Effective Date as provided in this Section 4(a).
Arch Communications Group, Inc.
Mobile Media Communications, Inc.
Page 6
(b) Upon payment of the amounts payable as provided in Section 4(a),
on the Effective Date at the Closing Arch will deliver to the Standby
Purchaser (or its designees) certificates representing the shares of
Existing Arch Common Stock, shares of Arch Class B Common Stock, if
applicable, and, if a Rights Offering Adjustment shall not have occurred,
the Arch Warrants, in each case, (i) issuable upon exercise of any Rights
exercised by the Standby Purchaser or (ii) otherwise purchased by the
Standby Purchaser pursuant to the Commitment. At the Closing, Arch will
also deliver to the Standby Purchaser (or its designees) certificates
representing the Arch Warrants or Arch Participation Warrants, as the case
may be, contemplated by Section 7 below.
(c) (i) Arch will deliver to the Standby Purchaser two business
days after the expiration of the Stockholder Rights Offering a written
notice which shall (A) specify the amounts payable at the Closing by it in
satisfaction of the Commitment (without taking into account Section 4(e)
below), (B) specify the Maximum Reduction Number (as defined in Section
4(e) below, (C) specify the last date on which the notice referred to in
Section 4(c) (ii) below may be delivered, and (D) indicate the matters
required to be addressed in such notice.
(ii) Within 10 business days after its receipt of the notice
referred to in Section 4(c)(i) above, the Standby Purchaser will deliver to
Arch and MobileMedia a written notice which shall set forth the Elected
Reduction Number (as defined in Section 4(e) below) determined by the
Standby Purchaser in accordance with Section 4(e) below.
(d) (i) Arch will deliver to the Standby Purchaser at least five
business days prior to the Effective Date a written notice which shall
specify the date on which the Effective Date is to occur and the last date
on which the notice referred to in Section 4(d)(ii) below may be delivered.
(ii) At least two business days prior to the Effective Date, the
Standby Purchaser will deliver to Arch and MobileMedia a written notice
which shall set forth the number of shares of Existing Arch Common Stock
beneficially owned by it as of such date. During the period from the date
of such notice through the Effective Date, neither the Standby Purchaser
nor any affiliate thereof shall acquire beneficial ownership of, or any
rights to acquire, any additional shares of Existing Arch Common Stock or
any Unsecured Claim.
(e) If a Rights Offering Adjustment shall have occurred,
notwithstanding anything to the contrary herein contained, the Standby
Purchaser may elect to reduce the number of Rights Shares required to be
purchased by the Standby Purchaser in satisfaction of its Commitment by a
number (the "Elected Reduction Number") of Rights Shares equal to or less
Arch Communications Group, Inc.
Mobile Media Communications, Inc.
Page 7
than the product of (i) the number of shares of Existing Arch Common Stock
to be issued by Arch in the Stockholder Rights Offering and (ii) the
percentage in Column D of Annex I hereto specified opposite the Standby
-------
Purchaser's name (such product being referred to herein as the "Maximum
Reduction Number"). Subject to the immediately preceding sentence, the
Standby Purchaser shall determine the Elected Reduction Number in its sole
discretion.
8. Section 5(c). Section 5(c) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(c) there shall be effective under the Securities Act, a registration
statement (the "Shelf Registration Statement") covering the resale by the
Standby Purchaser of (i) all shares of Existing Arch Common Stock, all
shares of Arch Class B Common Stock, if applicable, and, if a Rights
Offering Adjustment shall not have occurred, all Arch Warrants received by
the Standby Purchaser as a result of the transactions contemplated by the
Plan (including those received upon the exercise of Rights and pursuant to
this letter agreement), (ii) if a Rights Offering Adjustment shall have
occurred, all Arch Participation Warrants received by the Standby Purchaser
pursuant to this letter agreement, and (iii) all shares of Existing Arch
Common Stock issuable upon conversion of any such shares of the Arch Class
B Common Stock or exercise of any such Arch Warrants or Arch Participation
Warrants, as the case may be (the securities referred to in the foregoing
clauses (i), (ii) and (iii) are referred to herein as the "Registrable
Securities");
9. Section 5(e). Section 5(e) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(e) any and all amendments or modifications to the Merger Agreement or
any exhibit or schedule thereto (including without limitation the Plan, the
Arch Charter Amendment, the Arch Warrant Agreement, the Arch Participation
Warrant Agreement and the Registration Rights Agreement) on or after the
date hereof and any consents or waivers delivered on or after the date
hereof by Arch or MobileMedia to the other under the Merger Agreement
(other than (i) subject to Section 15(a) below, consents under Section 4.5
of the Merger Agreement, (ii) waivers of Unilateral Conditions or (iii) any
amendment to the Merger Agreement solely to reduce the amount of the Buyer
Breakup Fee) shall have been in form and substance reasonably satisfactory
to the Standby Purchaser;
10. Section 5(j). Section 5(j) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
Arch Communications Group, Inc.
Mobile Media Communications, Inc.
Page 8
(j) (i) the shares of Existing Arch Common Stock to be issued and
distributed as contemplated by Section 1.3(e) and Section 1.6 of the Merger
Agreement shall be so issued and distributed pursuant to an exemption from
registration under the Securities Act provided by Section 1145 of the
Bankruptcy Code, and (ii)(A) the issuance of the Rights, (B) the issuance
of the shares of Existing Arch Common Stock, the shares of Arch Class B
Common Stock, if applicable, and, if a Rights Offering Adjustment shall not
have occurred, the Arch Warrants upon exercise of the Rights, (C) the
issuance to the Standby Purchaser of the shares of Existing Arch Common
Stock, the shares of Arch Class B Common Stock, if applicable, and, if a
Rights Offering Adjustment shall not have occurred, the Arch Warrants as
contemplated by Section 1 and Section 3 above and the Arch Warrants or Arch
Participation Warrants, as the case may be, as contemplated by Section 7
below, and (D) the issuance of Existing Arch Common Stock upon exercise of
the Arch Warrants or Arch Participation Warrants, as the case may be, or
conversion of Arch Class B Common Stock, if applicable, shall be covered by
the Registration Statement, the Registration Statement shall have been
declared effective and no stop order with respect thereto shall be in
effect;
11. Section 5(m) of the Standby Commitment Letter is hereby deleted.
12. Section 7. Section 7 of the Standby Commitment Letter is hereby
---------
amended in its entirety to read as follows:
Consideration for the Commitment. In consideration for the
--------------------------------
Commitment, on the Effective Date at the Closing the Standby Purchaser will
receive its pro rata share of either (a) if a Rights Offering Adjustment
shall not have occurred, Arch Warrants entitling the holders thereof to
purchase, in the aggregate, a number of shares of Existing Arch Common
Stock equal to 2.50% of the issued and outstanding shares of Existing Arch
Common Stock and, if applicable, Arch Class B Common Stock, computed on a
Fully Diluted Basis (as defined in the Plan) on the date the "Initial Buyer
Market Price" is determined in accordance with Schedule II to the Merger
Agreement giving effect to the Plan as if the Effective Date had occurred
on such date and assuming 21,067,110 shares of Existing Arch Common Stock
are issued and outstanding immediately prior thereto or (b) if a Rights
Offering Adjustment shall have occurred, Arch Participation Warrants
entitling the holders thereof to purchase, in the aggregate, a number of
shares of Existing Arch Common Stock equal to 2.50% of the issued and
outstanding shares of Existing Arch Common Stock and, if applicable, Arch
Class B Common Stock, computed on a Fully Diluted Basis on the Rights
Offering Adjustment Determination Date giving effect to the Plan as if the
Effective Date had occurred on such date and assuming 21,067,110 shares of
Existing Arch Common Stock are issued and outstanding immediately prior
thereto. Such Arch Warrants or Arch
Arch Communications Group, Inc.
Mobile Media Communications, Inc.
Page 9
Participation Warrants, as the case may be, will be delivered to the
Standby Purchaser and the Other Standby Purchasers, in accordance with the
percentages specified in Column D of Annex I hereto.
-------
13. Section 9(a)(x). Section 9(a)(x) of the Standby Commitment Letter is
---------------
hereby amended in its entirety to read as follows:
(a)(x) The shares of Existing Arch Common Stock to be issued and
distributed as contemplated by Section 1.3(e) and Section 1.6 of the Merger
Agreement and the shares of Existing Arch Common Stock, the shares of Arch
Class B Common Stock, if applicable, and either the Arch Warrants to be
issued and delivered as contemplated by Section 1 and Section 3 above and
the Arch Warrants to be issued as contemplated by Section 7 above or, if a
Rights Offering Adjustment shall have occurred, the Arch Participation
Warrants to be issued as contemplated by Section 7 above, in each case,
when so issued and distributed or delivered, as the case may be, and the
shares of Existing Arch Common Stock issued upon conversation of such
shares of Arch Class B Common Stock, if applicable, when so converted in
accordance with the Arch Charter Amendment, and either, if a Rights
Offering Adjustment shall not have occurred, the shares of Existing Arch
Common Stock issued upon exercise of such Arch Warrants, when issued, paid
for and delivered as provided in the Arch Warrant Agreement or, if a Rights
Offering Adjustment shall have occurred, the shares of Existing Arch Common
Stock issued upon exercise of Arch Participation Warrants, when issued,
paid for and delivered as provided in the Arch Participation Warrant
Agreement, will be duly authorized, validly issued, fully paid,
nonassessable and free of all preemptive rights; and
14. Section 11. Section 11 of the Standby Commitment Letter is hereby
----------
amended to change the reference therein to "Exhibit D" to a reference to
"Exhibit D-1."
15. Schedule A to Annex I. Schedule A to Annex I to the Standby
---------------------
Commitment Letter is hereby amended to read in its entirety as Schedule A
----------
hereto.
16. Continuation of Standby Commitment Letter. Except as specifically
-----------------------------------------
amended hereby, the Standby Commitment Letter shall continue in full force and
effect and is hereby certified and confirmed in all respects.
17. Consent to Amendments. The Standby Purchaser hereby (a) consents to
---------------------
the amendments to the Other Standby Purchase Commitments to be effected by the
letter agreements attached as Exhibit C-1 hereto, which amendments shall be
-----------
entered into simultaneously herewith, (b) consents to (i) the First Amendment
dated as of September 3, 1998 to the Merger Agreement and each of the exhibits
attached thereto
Arch Communications Group, Inc.
Mobile Media Communications, Inc.
Page 10
and (ii) the Second Amended Joint Plan of Reorganization dated as of September
4, 1998 and each of the exhibits attached thereto, and (c) agrees that the form
and substance thereof are reasonably satisfactory to the Standby Purchaser.
18. Governing Law. This letter agreement shall be governed by and
-------------
construed in accordance with the laws of the State of Delaware without regard to
its principles of conflicts of law.
19. Counterparts. This letter agreement may be executed in
------------
counterparts which, taken together, shall constitute one and the same
instrument.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page
If the foregoing accurately reflects your understanding with respect to the
matters set forth herein, please confirm by executing and returning a copy of
this letter to the undersigned.
Very truly yours,
THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
-------------------------------
Name: Xxxxxx X. Xxxxxxx
Its: Authorized Representative
Address: 000 X. Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Securities Department
ACCEPTED AND AGREED TO:
ARCH COMMUNICATIONS GROUP, INC.
By: /s/ J. Xxx Xxxxxx
-------------------------------------
Name: J. Xxx Xxxxxx
Its: Executive Vice President and
Chief Financial Officer
Address: 0000 Xxxx Xxxx Xxxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000
Attn: Chairman and Chief
Executive Officer
With copy to: Xxxx and Xxxx LLP
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxx X. Xxxxxxxx
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page
Subject to entry of the Confirmation Order:
MOBILEMEDIA COMMUNICATIONS, INC.
By: /s/ Xxxxxx X. Xxxxx
----------------------------------
Name: Xxxxxx X. Xxxxx
Its: Chairman - Restructuring
Address: Fort Xxx Executive Park
Xxx Xxxxxxxxx Xxxxx, Xxxxx 000
Xxxx Xxx, XX 00000
Attn: Chairman - Restructuring
With a copy to: Sidley & Austin
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attn: Xxxxx X. Xxxxxxx
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
for its Group Annuity Separate Account
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
September 3, 1998
Arch Communications Group, Inc.
0000 Xxxx Xxxx Xxxxx
Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000
MobileMedia Communications, Inc.
Fort Xxx Executive Park
Xxx Xxxxxxxxx Xxxxx
Xxxxx 000
Xxxx Xxx, Xxx Xxxxxx 00000
Re: Amendment to Commitment
-----------------------
Gentlemen:
Reference is made to the letter agreement, dated August 18, 1998 (the
"Standby Commitment Letter"), among Arch Communications Group, Inc., MobileMedia
Communications, Inc. and The Northwestern Mutual Life Insurance Company for its
Group Annuity Separate Account. Terms used herein with initial capital letters
that are not otherwise defined shall have the meanings ascribed to such terms in
the Standby Commitment Letter.
The parties hereto hereby agree as follows:
1. First Paragraph. The second sentence of the first paragraph of the
---------------
Standby Commitment Letter is hereby amended in its entirety to read as follows:
It is our understanding that in connection with the Reorganization, among
other things: (a) pursuant to the Agreement and Plan of Merger, dated as of
the date hereof (as amended by the First Amendment thereto dated as of
September 3, 1998 (the "Merger Agreement"), among Arch, a wholly owned
subsidiary of Arch ("Merger Sub"), Parent and MobileMedia, MobileMedia will
merge with and into Merger Sub, with Merger Sub continuing as the surviving
corporation and a wholly owned subsidiary of Arch; (b) pursuant to the
Merger Agreement, Arch will make available for distribution pursuant to a
plan of reorganization of the Debtors in the form attached as Exhibit A to
the Merger Agreement, with such amendments and modifications thereto as are
made in a manner consistent with clause (e) of Section 5 hereto (such plan
of reorganization being referred to herein as the "Plan"), (i) cash, (ii)
shares of its Common Stock, par value $.01 per share ("Existing Arch Common
Stock"), and
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 2
(iii) either (A) if a Rights Offering Adjustment (as defined in Schedule II
to the Merger Agreement) shall not have occurred, warrants entitling the
holders thereof to purchase shares of Existing Arch Common Stock ("Arch
Warrants"), with such Arch Warrants to be issued pursuant to, and to have
the terms set forth in, a warrant agreement in the form attached as Exhibit
B to the Merger Agreement (the "Arch Warrant Agreement") or (B) if a Rights
Offering Adjustment shall have occurred, warrants entitling the holders
thereof to purchase shares of Existing Arch Common Stock ("Arch
Participation Warrants"), with such Arch Participation Warrants to be
issued pursuant to, and to have the terms set forth in, a warrant agreement
in the form attached as Exhibit B-1 to the Merger Agreement (the "Arch
Participation Warrant Agreement"); (c) holders of unsecured non-priority
claims against the Debtors ("Unsecured Claims"), to the extent such
Unsecured Claims are Allowed (as defined in the Plan), will receive
pursuant to the Plan (i) shares of Existing Arch Common Stock and (ii)
rights to purchase ("Rights") for cash either (A) if a Rights Offering
Adjustment shall not have occurred, units ("Units") consisting of (x)
shares of Existing Arch Common Stock and (y) Arch Warrants or (B) if a
Rights Offering Adjustment shall have occurred, shares of Existing Arch
Common Stock ("Rights Shares"); (d) holders of claims arising under or
relating to the Credit Agreement, dated December 4, 1995, as amended, among
MobileMedia and the other parties thereto ("Secured Claims"), to the extent
such Secured Claims are Allowed, will receive pursuant to the Plan cash in
an amount equal to 100% of such claims; (e) all of the outstanding equity
interests in MobileMedia and Parent will be canceled without consideration
and Parent will be dissolved; and (f) the commitments under the DIP Loan
Agreement will terminate and all amounts owed under or in respect of the
DIP Loan Agreement will be paid in full in cash. Arch will conduct the
Stockholder Rights Offering, in which it will issue to holders of Buyer
Stock Stockholder Rights to acquire shares of Existing Arch Common Stock if
a Rights Offering Adjustment shall have occurred, and, in addition, if a
Rights Offering Adjustment shall have occurred, immediately following the
Combination, Arch will issue Arch Participation Warrants to the
stockholders of Arch to the extent any Stockholder Rights issued to such
Stockholder Rights Holder were not exercised.
2. Section 1(a). Section 1(a) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(a) to exercise any Rights distributed to it in respect of its Allowed
Unsecured Claims in accordance with the Plan and not thereafter sold or
transferred as permitted by Section 3 below to purchase either (i) if a
Rights Offering Adjustment shall not have occurred, Units or (ii) if a
Rights Offering Adjustment shall have occurred, Rights Shares, to the
extent that the aggregate purchase price payable upon such exercise, as
determined in accordance with
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 3
Schedule II to the Merger Agreement (the "Subscription Price"), does not
exceed the Rights Exercise Commitment Amount of the Standby Purchaser as
set forth in Annex I hereto;
-------
3. Section 1(b).Section 1(b) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(b) if (i) the Standby Purchaser sells or otherwise transfers any or
all of the (A) the Rights distributed to it in accordance with the Plan or
(B) Unsecured Claims held by it as of the date hereof in respect of which
Rights are to be distributed, in each case as permitted by Section 3 below,
and (ii) the Rights sold or transferred by the Standby Purchaser or the
Rights distributed in respect of Unsecured Claims held by it as of the date
hereof that are hereafter sold or transferred by the Standby Purchaser are
not exercised prior to the expiration thereof (at which time such Rights
will be void and will no longer be exercisable), to purchase for cash
(based upon the Subscription Price payable upon exercise of such Rights)
either (x) if a Rights Offering Adjustment shall not have occurred,
identical Units or (y) if a Rights Offering Adjustment shall have occurred,
Rights Shares underlying, in each case, such unexercised Rights, to the
extent that the aggregate purchase price therefor, together with the
aggregate Subscription Price payable upon exercise of Rights exercised as
contemplated by clause (a) above, does not exceed the Rights Exercise
Commitment Amount of the Standby Purchaser as set forth in Annex I hereto;
-------
and
4. Section 1(c). Section 1(c) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(c) if any Rights distributed in accordance with the Plan (other than
(i) Rights distributed to the Standby Purchaser or the other holders of
Unsecured Claims listed on Annex I hereto (the "Other Standby Purchasers")
-------
and retained by them (which Rights are referred to in Section 1(a) above
and Section 1(a) of each of the Other Standby Purchase Commitments (as
defined in Section 13(a) below)) or (ii) subject to Section 3(b) below,
Rights distributed in respect of Unsecured Claims held by the Standby
Purchaser or the Other Standby Purchasers as of the date hereof that are
hereafter sold or transferred by them (which Rights are referred to in
Sections 1(b) and 3 hereof and Sections 1(b) and 3 of each of the Other
Standby Purchase Commitments)) remain unexercised upon the expiration
thereof (at which time such Rights will be void and will no longer be
exercisable), to purchase for cash (based on the Subscription Price payable
upon exercise of such Rights ) pro rata in accordance with and up to the
Unexercised Rights Commitment Amount of the Standby Purchaser as set forth
in Annex I hereto either (x) if a Rights Offering Adjustment shall not have
-------
occurred, identical Units or (y) if a Rights
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 4
Offering Adjustment shall have occurred, Rights Shares, underlying, in each
case, such unexercised Rights.
5. Section 2(a). Section 2(a) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(a) Notwithstanding anything to the contrary herein contained, if the
purchases by the Standby Purchaser contemplated by Section 1 above would
cause the Standby Purchaser, the Other Standby Purchasers, and any other
persons or entities who, when taken together with any one or more of the
Standby Purchaser and the Other Standby Purchasers, would constitute a
"person" or "group" as used in Section 13(d) or Section 14(d) of the
Exchange Act or Rule 13d-3 or Rule 13d-5 promulgated thereunder, or any
"affiliate" as defined in Rule 405 promulgated under the Securities Act of
any of them (collectively, the "Standby Class B Holders"), in the
aggregate, to beneficially own on the effective date of the Plan (the
"Effective Date") shares representing more than 49.0% of the capital stock
of Arch generally entitled to vote in the election of directors or more
than 49.0% of the total voting power of the capital stock of Arch, Arch
will substitute shares of Class B Common Stock, par value $.01 per share,
of Arch ("Arch Class B Common Stock"), with such Arch Class B Common Stock
having the terms set forth in the form of Certificate of Amendment to
Certificate of Incorporation of Arch attached as Exhibit F to the Merger
Agreement (the "Arch Charter Amendment"), for shares of Existing Arch
Common Stock so purchased on a one-for-one basis such that on the Effective
Date the Standby Class B Holders, in the aggregate, will beneficially own
shares representing not more than 49.0% of the capital stock of Arch
generally entitled to vote in the election of directors and not more than
49.0% of the total voting power of the capital stock of Arch, all as
provided in the Plan. For purposes of this letter agreement, "beneficial
ownership" shall be determined as provided in Rule 13d-3 and Rule 13d-5
promulgated under the Exchange Act, except that a person or entity shall be
deemed to have "beneficial ownership" of all securities that such person or
entity has the right to acquire, whether such right is exercisable
immediately or only after the passage of time.
6. Section 3(b). Section 3(b) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(b) Notwithstanding the provisions of clause (Y) of the proviso in
Section 3(a) above, the Standby Purchaser may elect to sell or otherwise
transfer (i) any or all of the Rights distributed to it in accordance with
the Plan or (ii) Unsecured Claims in respect of which Rights are to be so
distributed, in either case without entering into a Tracking Agreement with
its transferee or transferees (any Rights so transferred and any Rights
distributed in respect of
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 5
Allowed Claims so transferred, together with any Rights so transferred and
any Rights distributed in respect of Allowed Claims so transferred by the
Other Standby Purchasers pursuant to Section 3(b) of the Other Standby
Purchase Commitments, being referred to herein collectively as "Untracked
Rights"). Any Rights that remain unexercised upon expiration thereof will
be deemed to be "Section 3(b) Rights" up to, but not exceeding, the amount
of Untracked Rights. The Section 3(b) Rights shall be exercised as follows
prior to the application of Section 1(c) above and Section 1(c) of the
Other Standby Purchase Commitments: (A) the Standby Purchaser and the Other
Standby Purchasers will first be given the opportunity to purchase for cash
(based on the Subscription Price payable upon exercise of such Rights)
either (x) if a Rights Offering Adjustment shall not have occurred, Units
or (y) if a Rights Offering Adjustment shall have occurred, Rights Shares,
underlying, in each case, a number of unexercised Rights up to the amount
of Section 3(b) Rights in accordance with the percentages set forth in
Column D of Annex I hereto and (B) to the extent such Units or Rights
-------
Shares, as the case may be, are not so purchased, the Standby Purchaser and
any Other Standby Purchasers that are responsible for the existence of the
Section 3(b) Rights will be required to purchase such Units or Rights
Shares, as the case may be, pro rata based on the number of Section 3(b)
Rights resulting from their respective transfers. Nothing in this Section
3(b) will in any way reduce the commitment of the Standby Purchaser
specified in Section 1(c) above or the Unexercised Rights Commitment Amount
as set forth in Annex I hereto.
-------
7. Section 4. Section 4 of the Standby Commitment Letter is hereby
---------
amended in its entirety to read as follows:
4. The Closing. (a) Notwithstanding anything to the contrary herein
-----------
contained or the terms of the Rights or the Plan, subject to the conditions
set forth herein, on the Effective Date the Standby Purchaser, in
satisfaction of the Commitment, will deliver at the Closing (i) the
aggregate Subscription Price payable upon exercise of any Rights exercised
by it and (ii) the purchase price payable in consideration of any shares of
Existing Arch Common Stock or, if applicable, Arch Class B Common Stock
and, if a Rights Offering Adjustment shall not have occurred, Arch Warrants
to be otherwise purchased by it pursuant to the Commitment; provided,
--------
however, that, if requested by the Standby Purchaser in writing at least
-------
two business days prior to the Effective Date, any cash to be distributed
to the Standby Purchaser in respect of Allowed Secured Claims pursuant to
the Plan will, prior to the distribution thereof pursuant to the Plan and
in accordance with the instructions included in such written request, be
first applied, on behalf of the Standby Purchaser, to the payment of such
amounts payable on the Effective Date as provided in this Section 4(a).
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 6
(b) Upon payment of the amounts payable as provided in Section 4(a),
on the Effective Date at the Closing Arch will deliver to the Standby
Purchaser (or its designees) certificates representing the shares of
Existing Arch Common Stock, shares of Arch Class B Common Stock, if
applicable, and, if a Rights Offering Adjustment shall not have occurred,
the Arch Warrants, in each case, (i) issuable upon exercise of any Rights
exercised by the Standby Purchaser or (ii) otherwise purchased by the
Standby Purchaser pursuant to the Commitment. At the Closing, Arch will
also deliver to the Standby Purchaser (or its designees) certificates
representing the Arch Warrants or Arch Participation Warrants, as the case
may be, contemplated by Section 7 below.
(c) (i) Arch will deliver to the Standby Purchaser two business days
after the expiration of the Stockholder Rights Offering a written notice
which shall (A) specify the amounts payable at the Closing by it in
satisfaction of the Commitment (without taking into account Section 4(e)
below), (B) specify the Maximum Reduction Number (as defined in Section
4(e) below, (C) specify the last date on which the notice referred to in
Section 4(c) (ii) below may be delivered, and (D) indicate the matters
required to be addressed in such notice.
(ii) Within 10 business days after its receipt of the notice
referred to in Section 4(c)(i) above, the Standby Purchaser will deliver to
Arch and MobileMedia a written notice which shall set forth the Elected
Reduction Number (as defined in Section 4(e) below) determined by the
Standby Purchaser in accordance with Section 4(e) below.
(d) (i) Arch will deliver to the Standby Purchaser at least five
business days prior to the Effective Date a written notice which shall
specify the date on which the Effective Date is to occur and the last date
on which the notice referred to in Section 4(d)(ii) below may be delivered.
(ii) At least two business days prior to the Effective Date, the
Standby Purchaser will deliver to Arch and MobileMedia a written notice
which shall set forth the number of shares of Existing Arch Common Stock
beneficially owned by it as of such date. During the period from the date
of such notice through the Effective Date, neither the Standby Purchaser
nor any affiliate thereof shall acquire beneficial ownership of, or any
rights to acquire, any additional shares of Existing Arch Common Stock or
any Unsecured Claim.
(e) If a Rights Offering Adjustment shall have occurred,
notwithstanding anything to the contrary herein contained, the Standby
Purchaser may elect to reduce the number of Rights Shares required to be
purchased by the Standby Purchaser in satisfaction of its Commitment by a
number (the "Elected Reduction Number") of Rights Shares equal to or less
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 7
than the product of (i) the number of shares of Existing Arch Common Stock
to be issued by Arch in the Stockholder Rights Offering and (ii) the
percentage in Column D of Annex I hereto specified opposite the Standby
-------
Purchaser's name (such product being referred to herein as the "Maximum
Reduction Number"). Subject to the immediately preceding sentence, the
Standby Purchaser shall determine the Elected Reduction Number in its sole
discretion.
8. Section 5(c). Section 5(c) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(c) there shall be effective under the Securities Act, a registration
statement (the "Shelf Registration Statement") covering the resale by the
Standby Purchaser of (i) all shares of Existing Arch Common Stock, all
shares of Arch Class B Common Stock, if applicable, and, if a Rights
Offering Adjustment shall not have occurred, all Arch Warrants received by
the Standby Purchaser as a result of the transactions contemplated by the
Plan (including those received upon the exercise of Rights and pursuant to
this letter agreement), (ii) if a Rights Offering Adjustment shall have
occurred, all Arch Participation Warrants received by the Standby Purchaser
pursuant to this letter agreement, and (iii) all shares of Existing Arch
Common Stock issuable upon conversion of any such shares of the Arch Class
B Common Stock or exercise of any such Arch Warrants or Arch Participation
Warrants, as the case may be (the securities referred to in the foregoing
clauses (i), (ii) and (iii) are referred to herein as the "Registrable
Securities");
9. Section 5(e). Section 5(e) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(e) any and all amendments or modifications to the Merger Agreement or
any exhibit or schedule thereto (including without limitation the Plan, the
Arch Charter Amendment, the Arch Warrant Agreement, the Arch Participation
Warrant Agreement and the Registration Rights Agreement) on or after the
date hereof and any consents or waivers delivered on or after the date
hereof by Arch or MobileMedia to the other under the Merger Agreement
(other than (i) subject to Section 15(a) below, consents under Section 4.5
of the Merger Agreement, (ii) waivers of Unilateral Conditions or (iii) any
amendment to the Merger Agreement solely to reduce the amount of the Buyer
Breakup Fee) shall have been in form and substance reasonably satisfactory
to the Standby Purchaser;
10. Section 5(j). Section 5(j) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 8
(j) (i) the shares of Existing Arch Common Stock to be issued and
distributed as contemplated by Section 1.3(e) and Section 1.6 of the Merger
Agreement shall be so issued and distributed pursuant to an exemption from
registration under the Securities Act provided by Section 1145 of the
Bankruptcy Code, and (ii)(A) the issuance of the Rights, (B) the issuance
of the shares of Existing Arch Common Stock, the shares of Arch Class B
Common Stock, if applicable, and, if a Rights Offering Adjustment shall not
have occurred, the Arch Warrants upon exercise of the Rights, (C) the
issuance to the Standby Purchaser of the shares of Existing Arch Common
Stock, the shares of Arch Class B Common Stock, if applicable, and, if a
Rights Offering Adjustment shall not have occurred, the Arch Warrants as
contemplated by Section 1 and Section 3 above and the Arch Warrants or Arch
Participation Warrants, as the case may be, as contemplated by Section 7
below, and (D) the issuance of Existing Arch Common Stock upon exercise of
the Arch Warrants or Arch Participation Warrants, as the case may be, or
conversion of Arch Class B Common Stock, if applicable, shall be covered by
the Registration Statement, the Registration Statement shall have been
declared effective and no stop order with respect thereto shall be in
effect;
11. Section 5(m) of the Standby Commitment Letter is hereby deleted.
12. Section 7. Section 7 of the Standby Commitment Letter is hereby
---------
amended in its entirety to read as follows:
Consideration for the Commitment. In consideration for the
--------------------------------
Commitment, on the Effective Date at the Closing the Standby Purchaser will
receive its pro rata share of either (a) if a Rights Offering Adjustment
shall not have occurred, Arch Warrants entitling the holders thereof to
purchase, in the aggregate, a number of shares of Existing Arch Common
Stock equal to 2.50% of the issued and outstanding shares of Existing Arch
Common Stock and, if applicable, Arch Class B Common Stock, computed on a
Fully Diluted Basis (as defined in the Plan) on the date the "Initial Buyer
Market Price" is determined in accordance with Schedule II to the Merger
Agreement giving effect to the Plan as if the Effective Date had occurred
on such date and assuming 21,067,110 shares of Existing Arch Common Stock
are issued and outstanding immediately prior thereto or (b) if a Rights
Offering Adjustment shall have occurred, Arch Participation Warrants
entitling the holders thereof to purchase, in the aggregate, a number of
shares of Existing Arch Common Stock equal to 2.50% of the issued and
outstanding shares of Existing Arch Common Stock and, if applicable, Arch
Class B Common Stock, computed on a Fully Diluted Basis on the Rights
Offering Adjustment Determination Date giving effect to the Plan as if the
Effective Date had occurred on such date and assuming 21,067,110 shares of
Existing Arch Common Stock are issued and outstanding immediately prior
thereto. Such Arch Warrants or Arch
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 9
Participation Warrants, as the case may be, will be delivered to the
Standby Purchaser and the Other Standby Purchasers, in accordance with the
percentages specified in Column D of Annex I hereto.
-------
13. Section 9(a)(x). Section 9(a)(x) of the Standby Commitment Letter is
---------------
hereby amended in its entirety to read as follows:
(a)(x) The shares of Existing Arch Common Stock to be issued and
distributed as contemplated by Section 1.3(e) and Section 1.6 of the Merger
Agreement and the shares of Existing Arch Common Stock, the shares of Arch
Class B Common Stock, if applicable, and either the Arch Warrants to be
issued and delivered as contemplated by Section 1 and Section 3 above and
the Arch Warrants to be issued as contemplated by Section 7 above or, if a
Rights Offering Adjustment shall have occurred, the Arch Participation
Warrants to be issued as contemplated by Section 7 above, in each case,
when so issued and distributed or delivered, as the case may be, and the
shares of Existing Arch Common Stock issued upon conversation of such
shares of Arch Class B Common Stock, if applicable, when so converted in
accordance with the Arch Charter Amendment, and either, if a Rights
Offering Adjustment shall not have occurred, the shares of Existing Arch
Common Stock issued upon exercise of such Arch Warrants, when issued, paid
for and delivered as provided in the Arch Warrant Agreement or, if a Rights
Offering Adjustment shall have occurred, the shares of Existing Arch Common
Stock issued upon exercise of Arch Participation Warrants, when issued,
paid for and delivered as provided in the Arch Participation Warrant
Agreement, will be duly authorized, validly issued, fully paid,
nonassessable and free of all preemptive rights; and
14. Section 11. Section 11 of the Standby Commitment Letter is hereby
----------
amended to change the reference therein to "Exhibit D" to a reference to
"Exhibit D-1."
15. Schedule A to Annex I. Schedule A to Annex I to the Standby
---------------------
Commitment Letter is hereby amended to read in its entirety as Schedule A
----------
hereto.
16. Continuation of Standby Commitment Letter. Except as specifically
-----------------------------------------
amended hereby, the Standby Commitment Letter shall continue in full force and
effect and is hereby certified and confirmed in all respects.
17. Consent to Amendments. The Standby Purchaser hereby (a) consents to
---------------------
the amendments to the Other Standby Purchase Commitments to be effected by the
letter agreements attached as Exhibit C-1 hereto, which amendments shall be
-----------
entered into simultaneously herewith, (b) consents to (i) the First Amendment
dated as of September 3, 1998 to the Merger Agreement and each of the exhibits
attached thereto
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 10
and (ii) the Second Amended Joint Plan of Reorganization dated as of September
4, 1998 and each of the exhibits attached thereto, and (c) agrees that the form
and substance thereof are reasonably satisfactory to the Standby Purchaser.
18. Governing Law. This letter agreement shall be governed by and
-------------
construed in accordance with the laws of the State of Delaware without regard to
its principles of conflicts of law.
19. Counterparts. This letter agreement may be executed in
------------
counterparts which, taken together, shall constitute one and the same
instrument.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 11
If the foregoing accurately reflects your understanding with respect to the
matters set forth herein, please confirm by executing and returning a copy of
this letter to the undersigned.
Very truly yours,
THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY
FOR ITS GROUP ANNUITY SEPARATE ACCOUNT
By: Northwestern Investment
Management Company
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Its: Managing Director
Address: 000 X. Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Securities Department
ACCEPTED AND AGREED TO:
ARCH COMMUNICATIONS GROUP, INC.
By: /s/ J. Xxx Xxxxxx
-------------------------------------
Name: J. Xxx Xxxxxx
Its: Executive Vice President
Address: 0000 Xxxx Xxxx Xxxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000
Attn: Chairman and Chief
Executive Officer
With copy to: Xxxx and Xxxx LLP
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxx X. Xxxxxxxx
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 12
Subject to entry of the Confirmation Order:
MOBILEMEDIA COMMUNICATIONS, INC.
By: /s/ Xxxxxx X. Xxxxx
------------------------------------------
Name: Xxxxxx X. Xxxxx
Its: Chairman - Restructuring
Address: Fort Xxx Executive Park
Xxx Xxxxxxxxx Xxxxx, Xxxxx 000
Xxxx Xxx, XX 00000
Attn: Chairman - Restructuring
With a copy to: Sidley & Austin
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attn: Xxxxx X. Xxxxxxx
NORTHWESTERN MUTUAL SERIES FUND, INC.
for the High Yield Bond Portfolio
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
September 3, 1998
Arch Communications Group, Inc.
0000 Xxxx Xxxx Xxxxx
Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000
MobileMedia Communications, Inc.
Fort Xxx Executive Park
Xxx Xxxxxxxxx Xxxxx
Xxxxx 000
Xxxx Xxx, Xxx Xxxxxx 00000
Re: Amendment to Commitment
-----------------------
Gentlemen:
Reference is made to the letter agreement, dated August 18, 1998 (the
"Standby Commitment Letter"), among Arch Communications Group, Inc., MobileMedia
Communications, Inc. and Northwestern Mutual Series Fund, Inc. for the High
Yield Bond Portfolio. Terms used herein with initial capital letters that are
not otherwise defined shall have the meanings ascribed to such terms in the
Standby Commitment Letter.
The parties hereto hereby agree as follows:
1. First Paragraph. The second sentence of the first paragraph of the
---------------
Standby Commitment Letter is hereby amended in its entirety to read as follows:
It is our understanding that in connection with the Reorganization, among
other things: (a) pursuant to the Agreement and Plan of Merger, dated as of
the date hereof (as amended by the First Amendment thereto dated as of
September 3, 1998 (the "Merger Agreement"), among Arch, a wholly owned
subsidiary of Arch ("Merger Sub"), Parent and MobileMedia, MobileMedia will
merge with and into Merger Sub, with Merger Sub continuing as the surviving
corporation and a wholly owned subsidiary of Arch; (b) pursuant to the
Merger Agreement, Arch will make available for distribution pursuant to a
plan of reorganization of the Debtors in the form attached as Exhibit A to
the Merger Agreement, with such amendments and modifications thereto as are
made in a manner consistent with clause (e) of Section 5 hereto (such plan
of reorganization being referred to herein as the "Plan"), (i) cash, (ii)
shares of its Common Stock, par value $.01 per share ("Existing Arch Common
Stock"), and
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 2
(iii) either (A) if a Rights Offering Adjustment (as defined in Schedule II
to the Merger Agreement) shall not have occurred, warrants entitling the
holders thereof to purchase shares of Existing Arch Common Stock ("Arch
Warrants"), with such Arch Warrants to be issued pursuant to, and to have
the terms set forth in, a warrant agreement in the form attached as Exhibit
B to the Merger Agreement (the "Arch Warrant Agreement") or (B) if a Rights
Offering Adjustment shall have occurred, warrants entitling the holders
thereof to purchase shares of Existing Arch Common Stock ("Arch
Participation Warrants"), with such Arch Participation Warrants to be
issued pursuant to, and to have the terms set forth in, a warrant agreement
in the form attached as Exhibit B-1 to the Merger Agreement (the "Arch
Participation Warrant Agreement"); (c) holders of unsecured non-priority
claims against the Debtors ("Unsecured Claims"), to the extent such
Unsecured Claims are Allowed (as defined in the Plan), will receive
pursuant to the Plan (i) shares of Existing Arch Common Stock and (ii)
rights to purchase ("Rights") for cash either (A) if a Rights Offering
Adjustment shall not have occurred, units ("Units") consisting of (x)
shares of Existing Arch Common Stock and (y) Arch Warrants or (B) if a
Rights Offering Adjustment shall have occurred, shares of Existing Arch
Common Stock ("Rights Shares"); (d) holders of claims arising under or
relating to the Credit Agreement, dated December 4, 1995, as amended, among
MobileMedia and the other parties thereto ("Secured Claims"), to the extent
such Secured Claims are Allowed, will receive pursuant to the Plan cash in
an amount equal to 100% of such claims; (e) all of the outstanding equity
interests in MobileMedia and Parent will be canceled without consideration
and Parent will be dissolved; and (f) the commitments under the DIP Loan
Agreement will terminate and all amounts owed under or in respect of the
DIP Loan Agreement will be paid in full in cash. Arch will conduct the
Stockholder Rights Offering, in which it will issue to holders of Buyer
Stock Stockholder Rights to acquire shares of Existing Arch Common Stock if
a Rights Offering Adjustment shall have occurred, and, in addition, if a
Rights Offering Adjustment shall have occurred, immediately following the
Combination, Arch will issue Arch Participation Warrants to the
stockholders of Arch to the extent any Stockholder Rights issued to such
Stockholder Rights Holder were not exercised.
2. Section 1(a). Section 1(a) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(a) to exercise any Rights distributed to it in respect of its Allowed
Unsecured Claims in accordance with the Plan and not thereafter sold or
transferred as permitted by Section 3 below to purchase either (i) if a
Rights Offering Adjustment shall not have occurred, Units or (ii) if a
Rights Offering Adjustment shall have occurred, Rights Shares, to the
extent that the aggregate purchase price payable upon such exercise, as
determined in accordance with
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 3
Schedule II to the Merger Agreement (the "Subscription Price"), does not
exceed the Rights Exercise Commitment Amount of the Standby Purchaser as
set forth in Annex I hereto;
-------
3. Section 1(b).Section 1(b) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(b) if (i) the Standby Purchaser sells or otherwise transfers any or
all of the (A) the Rights distributed to it in accordance with the Plan or
(B) Unsecured Claims held by it as of the date hereof in respect of which
Rights are to be distributed, in each case as permitted by Section 3 below,
and (ii) the Rights sold or transferred by the Standby Purchaser or the
Rights distributed in respect of Unsecured Claims held by it as of the date
hereof that are hereafter sold or transferred by the Standby Purchaser are
not exercised prior to the expiration thereof (at which time such Rights
will be void and will no longer be exercisable), to purchase for cash
(based upon the Subscription Price payable upon exercise of such Rights)
either (x) if a Rights Offering Adjustment shall not have occurred,
identical Units or (y) if a Rights Offering Adjustment shall have occurred,
Rights Shares underlying, in each case, such unexercised Rights, to the
extent that the aggregate purchase price therefor, together with the
aggregate Subscription Price payable upon exercise of Rights exercised as
contemplated by clause (a) above, does not exceed the Rights Exercise
Commitment Amount of the Standby Purchaser as set forth in Annex I hereto;
-------
and
4. Section 1(c). Section 1(c) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(c) if any Rights distributed in accordance with the Plan (other than
(i) Rights distributed to the Standby Purchaser or the other holders of
Unsecured Claims listed on Annex I hereto (the "Other Standby Purchasers")
-------
and retained by them (which Rights are referred to in Section 1(a) above
and Section 1(a) of each of the Other Standby Purchase Commitments (as
defined in Section 13(a) below)) or (ii) subject to Section 3(b) below,
Rights distributed in respect of Unsecured Claims held by the Standby
Purchaser or the Other Standby Purchasers as of the date hereof that are
hereafter sold or transferred by them (which Rights are referred to in
Sections 1(b) and 3 hereof and Sections 1(b) and 3 of each of the Other
Standby Purchase Commitments)) remain unexercised upon the expiration
thereof (at which time such Rights will be void and will no longer be
exercisable), to purchase for cash (based on the Subscription Price payable
upon exercise of such Rights ) pro rata in accordance with and up to the
Unexercised Rights Commitment Amount of the Standby Purchaser as set forth
in Annex I hereto either (x) if a Rights Offering Adjustment shall not have
-------
occurred, identical Units or (y) if a Rights
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 4
Offering Adjustment shall have occurred, Rights Shares, underlying, in each
case, such unexercised Rights.
5. Section 2(a). Section 2(a) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(a) Notwithstanding anything to the contrary herein contained, if the
purchases by the Standby Purchaser contemplated by Section 1 above would
cause the Standby Purchaser, the Other Standby Purchasers, and any other
persons or entities who, when taken together with any one or more of the
Standby Purchaser and the Other Standby Purchasers, would constitute a
"person" or "group" as used in Section 13(d) or Section 14(d) of the
Exchange Act or Rule 13d-3 or Rule 13d-5 promulgated thereunder, or any
"affiliate" as defined in Rule 405 promulgated under the Securities Act of
any of them (collectively, the "Standby Class B Holders"), in the
aggregate, to beneficially own on the effective date of the Plan (the
"Effective Date") shares representing more than 49.0% of the capital stock
of Arch generally entitled to vote in the election of directors or more
than 49.0% of the total voting power of the capital stock of Arch, Arch
will substitute shares of Class B Common Stock, par value $.01 per share,
of Arch ("Arch Class B Common Stock"), with such Arch Class B Common Stock
having the terms set forth in the form of Certificate of Amendment to
Certificate of Incorporation of Arch attached as Exhibit F to the Merger
Agreement (the "Arch Charter Amendment"), for shares of Existing Arch
Common Stock so purchased on a one-for-one basis such that on the Effective
Date the Standby Class B Holders, in the aggregate, will beneficially own
shares representing not more than 49.0% of the capital stock of Arch
generally entitled to vote in the election of directors and not more than
49.0% of the total voting power of the capital stock of Arch, all as
provided in the Plan. For purposes of this letter agreement, "beneficial
ownership" shall be determined as provided in Rule 13d-3 and Rule 13d-5
promulgated under the Exchange Act, except that a person or entity shall be
deemed to have "beneficial ownership" of all securities that such person or
entity has the right to acquire, whether such right is exercisable
immediately or only after the passage of time.
6. Section 3(b). Section 3(b) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(b) Notwithstanding the provisions of clause (Y) of the proviso in
Section 3(a) above, the Standby Purchaser may elect to sell or otherwise
transfer (i) any or all of the Rights distributed to it in accordance with
the Plan or (ii) Unsecured Claims in respect of which Rights are to be so
distributed, in either case without entering into a Tracking Agreement with
its transferee or transferees (any Rights so transferred and any Rights
distributed in respect of
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 5
Allowed Claims so transferred, together with any Rights so transferred and
any Rights distributed in respect of Allowed Claims so transferred by the
Other Standby Purchasers pursuant to Section 3(b) of the Other Standby
Purchase Commitments, being referred to herein collectively as "Untracked
Rights"). Any Rights that remain unexercised upon expiration thereof will
be deemed to be "Section 3(b) Rights" up to, but not exceeding, the amount
of Untracked Rights. The Section 3(b) Rights shall be exercised as follows
prior to the application of Section 1(c) above and Section 1(c) of the
Other Standby Purchase Commitments: (A) the Standby Purchaser and the Other
Standby Purchasers will first be given the opportunity to purchase for cash
(based on the Subscription Price payable upon exercise of such Rights)
either (x) if a Rights Offering Adjustment shall not have occurred, Units
or (y) if a Rights Offering Adjustment shall have occurred, Rights Shares,
underlying, in each case, a number of unexercised Rights up to the amount
of Section 3(b) Rights in accordance with the percentages set forth in
Column D of Annex I hereto and (B) to the extent such Units or Rights
-------
Shares, as the case may be, are not so purchased, the Standby Purchaser and
any Other Standby Purchasers that are responsible for the existence of the
Section 3(b) Rights will be required to purchase such Units or Rights
Shares, as the case may be, pro rata based on the number of Section 3(b)
Rights resulting from their respective transfers. Nothing in this Section
3(b) will in any way reduce the commitment of the Standby Purchaser
specified in Section 1(c) above or the Unexercised Rights Commitment Amount
as set forth in Annex I hereto.
-------
7. Section 4. Section 4 of the Standby Commitment Letter is hereby
---------
amended in its entirety to read as follows:
4. The Closing. (a) Notwithstanding anything to the contrary herein
-----------
contained or the terms of the Rights or the Plan, subject to the conditions
set forth herein, on the Effective Date the Standby Purchaser, in
satisfaction of the Commitment, will deliver at the Closing (i) the
aggregate Subscription Price payable upon exercise of any Rights exercised
by it and (ii) the purchase price payable in consideration of any shares of
Existing Arch Common Stock or, if applicable, Arch Class B Common Stock
and, if a Rights Offering Adjustment shall not have occurred, Arch Warrants
to be otherwise purchased by it pursuant to the Commitment; provided,
--------
however, that, if requested by the Standby Purchaser in writing at least
-------
two business days prior to the Effective Date, any cash to be distributed
to the Standby Purchaser in respect of Allowed Secured Claims pursuant to
the Plan will, prior to the distribution thereof pursuant to the Plan and
in accordance with the instructions included in such written request, be
first applied, on behalf of the Standby Purchaser, to the payment of such
amounts payable on the Effective Date as provided in this Section 4(a).
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 6
(b) Upon payment of the amounts payable as provided in Section 4(a),
on the Effective Date at the Closing Arch will deliver to the Standby
Purchaser (or its designees) certificates representing the shares of
Existing Arch Common Stock, shares of Arch Class B Common Stock, if
applicable, and, if a Rights Offering Adjustment shall not have occurred,
the Arch Warrants, in each case, (i) issuable upon exercise of any Rights
exercised by the Standby Purchaser or (ii) otherwise purchased by the
Standby Purchaser pursuant to the Commitment. At the Closing, Arch will
also deliver to the Standby Purchaser (or its designees) certificates
representing the Arch Warrants or Arch Participation Warrants, as the case
may be, contemplated by Section 7 below.
(c) (i) Arch will deliver to the Standby Purchaser two business days
after the expiration of the Stockholder Rights Offering a written notice
which shall (A) specify the amounts payable at the Closing by it in
satisfaction of the Commitment (without taking into account Section 4(e)
below), (B) specify the Maximum Reduction Number (as defined in Section
4(e) below, (C) specify the last date on which the notice referred to in
Section 4(c) (ii) below may be delivered, and (D) indicate the matters
required to be addressed in such notice.
(ii) Within 10 business days after its receipt of the notice
referred to in Section 4(c)(i) above, the Standby Purchaser will deliver to
Arch and MobileMedia a written notice which shall set forth the Elected
Reduction Number (as defined in Section 4(e) below) determined by the
Standby Purchaser in accordance with Section 4(e) below.
(d) (i) Arch will deliver to the Standby Purchaser at least five
business days prior to the Effective Date a written notice which shall
specify the date on which the Effective Date is to occur and the last date
on which the notice referred to in Section 4(d)(ii) below may be delivered.
(ii) At least two business days prior to the Effective Date, the
Standby Purchaser will deliver to Arch and MobileMedia a written notice
which shall set forth the number of shares of Existing Arch Common Stock
beneficially owned by it as of such date. During the period from the date
of such notice through the Effective Date, neither the Standby Purchaser
nor any affiliate thereof shall acquire beneficial ownership of, or any
rights to acquire, any additional shares of Existing Arch Common Stock or
any Unsecured Claim.
(e) If a Rights Offering Adjustment shall have occurred,
notwithstanding anything to the contrary herein contained, the Standby
Purchaser may elect to reduce the number of Rights Shares required to be
purchased by the Standby Purchaser in satisfaction of its Commitment by a
number (the "Elected Reduction Number") of Rights Shares equal to or less
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 7
than the product of (i) the number of shares of Existing Arch Common Stock
to be issued by Arch in the Stockholder Rights Offering and (ii) the
percentage in Column D of Annex I hereto specified opposite the Standby
-------
Purchaser's name (such product being referred to herein as the "Maximum
Reduction Number"). Subject to the immediately preceding sentence, the
Standby Purchaser shall determine the Elected Reduction Number in its sole
discretion.
8. Section 5(c). Section 5(c) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(c) there shall be effective under the Securities Act, a registration
statement (the "Shelf Registration Statement") covering the resale by the
Standby Purchaser of (i) all shares of Existing Arch Common Stock, all
shares of Arch Class B Common Stock, if applicable, and, if a Rights
Offering Adjustment shall not have occurred, all Arch Warrants received by
the Standby Purchaser as a result of the transactions contemplated by the
Plan (including those received upon the exercise of Rights and pursuant to
this letter agreement), (ii) if a Rights Offering Adjustment shall have
occurred, all Arch Participation Warrants received by the Standby Purchaser
pursuant to this letter agreement, and (iii) all shares of Existing Arch
Common Stock issuable upon conversion of any such shares of the Arch Class
B Common Stock or exercise of any such Arch Warrants or Arch Participation
Warrants, as the case may be (the securities referred to in the foregoing
clauses (i), (ii) and (iii) are referred to herein as the "Registrable
Securities");
9. Section 5(e). Section 5(e) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(e) any and all amendments or modifications to the Merger Agreement or
any exhibit or schedule thereto (including without limitation the Plan, the
Arch Charter Amendment, the Arch Warrant Agreement, the Arch Participation
Warrant Agreement and the Registration Rights Agreement) on or after the
date hereof and any consents or waivers delivered on or after the date
hereof by Arch or MobileMedia to the other under the Merger Agreement
(other than (i) subject to Section 15(a) below, consents under Section 4.5
of the Merger Agreement, (ii) waivers of Unilateral Conditions or (iii) any
amendment to the Merger Agreement solely to reduce the amount of the Buyer
Breakup Fee) shall have been in form and substance reasonably satisfactory
to the Standby Purchaser;
10. Section 5(j). Section 5(j) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 8
(j) (i) the shares of Existing Arch Common Stock to be issued and
distributed as contemplated by Section 1.3(e) and Section 1.6 of the Merger
Agreement shall be so issued and distributed pursuant to an exemption from
registration under the Securities Act provided by Section 1145 of the
Bankruptcy Code, and (ii)(A) the issuance of the Rights, (B) the issuance
of the shares of Existing Arch Common Stock, the shares of Arch Class B
Common Stock, if applicable, and, if a Rights Offering Adjustment shall not
have occurred, the Arch Warrants upon exercise of the Rights, (C) the
issuance to the Standby Purchaser of the shares of Existing Arch Common
Stock, the shares of Arch Class B Common Stock, if applicable, and, if a
Rights Offering Adjustment shall not have occurred, the Arch Warrants as
contemplated by Section 1 and Section 3 above and the Arch Warrants or Arch
Participation Warrants, as the case may be, as contemplated by Section 7
below, and (D) the issuance of Existing Arch Common Stock upon exercise of
the Arch Warrants or Arch Participation Warrants, as the case may be, or
conversion of Arch Class B Common Stock, if applicable, shall be covered by
the Registration Statement, the Registration Statement shall have been
declared effective and no stop order with respect thereto shall be in
effect;
11. Section 5(m) of the Standby Commitment Letter is hereby deleted.
12. Section 7. Section 7 of the Standby Commitment Letter is hereby
---------
amended in its entirety to read as follows:
Consideration for the Commitment. In consideration for the
--------------------------------
Commitment, on the Effective Date at the Closing the Standby Purchaser will
receive its pro rata share of either (a) if a Rights Offering Adjustment
shall not have occurred, Arch Warrants entitling the holders thereof to
purchase, in the aggregate, a number of shares of Existing Arch Common
Stock equal to 2.50% of the issued and outstanding shares of Existing Arch
Common Stock and, if applicable, Arch Class B Common Stock, computed on a
Fully Diluted Basis (as defined in the Plan) on the date the "Initial Buyer
Market Price" is determined in accordance with Schedule II to the Merger
Agreement giving effect to the Plan as if the Effective Date had occurred
on such date and assuming 21,067,110 shares of Existing Arch Common Stock
are issued and outstanding immediately prior thereto or (b) if a Rights
Offering Adjustment shall have occurred, Arch Participation Warrants
entitling the holders thereof to purchase, in the aggregate, a number of
shares of Existing Arch Common Stock equal to 2.50% of the issued and
outstanding shares of Existing Arch Common Stock and, if applicable, Arch
Class B Common Stock, computed on a Fully Diluted Basis on the Rights
Offering Adjustment Determination Date giving effect to the Plan as if the
Effective Date had occurred on such date and assuming 21,067,110 shares of
Existing Arch Common Stock are issued and outstanding immediately prior
thereto. Such Arch Warrants or Arch
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 9
Participation Warrants, as the case may be, will be delivered to the
Standby Purchaser and the Other Standby Purchasers, in accordance with the
percentages specified in Column D of
Annex I hereto.
-------
13. Section 9(a)(x). Section 9(a)(x) of the Standby Commitment Letter is
---------------
hereby amended in its entirety to read as follows:
(a)(x) The shares of Existing Arch Common Stock to be issued and
distributed as contemplated by Section 1.3(e) and Section 1.6 of the Merger
Agreement and the shares of Existing Arch Common Stock, the shares of Arch
Class B Common Stock, if applicable, and either the Arch Warrants to be
issued and delivered as contemplated by Section 1 and Section 3 above and
the Arch Warrants to be issued as contemplated by Section 7 above or, if a
Rights Offering Adjustment shall have occurred, the Arch Participation
Warrants to be issued as contemplated by Section 7 above, in each case,
when so issued and distributed or delivered, as the case may be, and the
shares of Existing Arch Common Stock issued upon conversation of such
shares of Arch Class B Common Stock, if applicable, when so converted in
accordance with the Arch Charter Amendment, and either, if a Rights
Offering Adjustment shall not have occurred, the shares of Existing Arch
Common Stock issued upon exercise of such Arch Warrants, when issued, paid
for and delivered as provided in the Arch Warrant Agreement or, if a Rights
Offering Adjustment shall have occurred, the shares of Existing Arch Common
Stock issued upon exercise of Arch Participation Warrants, when issued,
paid for and delivered as provided in the Arch Participation Warrant
Agreement, will be duly authorized, validly issued, fully paid,
nonassessable and free of all preemptive rights; and
14. Section 11. Section 11 of the Standby Commitment Letter is hereby
----------
amended to change the reference therein to "Exhibit D" to a reference to
"Exhibit D-1."
15. Schedule A to Annex I. Schedule A to Annex I to the Standby
---------------------
Commitment Letter is hereby amended to read in its entirety as Schedule A
----------
hereto.
16. Continuation of Standby Commitment Letter. Except as specifically
-----------------------------------------
amended hereby, the Standby Commitment Letter shall continue in full force and
effect and is hereby certified and confirmed in all respects.
17. Consent to Amendments. The Standby Purchaser hereby (a) consents to
---------------------
the amendments to the Other Standby Purchase Commitments to be effected by the
letter agreements attached as Exhibit C-1 hereto, which amendments shall be
-----------
entered into simultaneously herewith, (b) consents to (i) the First Amendment
dated as of September 3, 1998 to the Merger Agreement and each of the exhibits
attached thereto
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 10
and (ii) the Second Amended Joint Plan of Reorganization dated as of September
4, 1998 and each of the exhibits attached thereto, and (c) agrees that the form
and substance thereof are reasonably satisfactory to the Standby Purchaser.
18. Governing Law. This letter agreement shall be governed by and
-------------
construed in accordance with the laws of the State of Delaware without regard to
its principles of conflicts of law.
19. Counterparts. This letter agreement may be executed in counterparts
------------
which, taken together, shall constitute one and the same instrument.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 11
If the foregoing accurately reflects your understanding with respect to the
matters set forth herein, please confirm by executing and returning a copy of
this letter to the undersigned.
Very truly yours,
NORTHWESTERN MUTUAL SERIES FUND, INC.
FOR THE HIGH YIELD BOND PORTFOLIO
By: /s/ Xxxxxxx X. Xxxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxxx
Its: Vice President
Address: c/o The Northwestern Mutual Life
Insurance Company
000 X. Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Securities Department
ACCEPTED AND AGREED TO:
ARCH COMMUNICATIONS GROUP, INC.
By: /s/ J. Xxx Xxxxxx
---------------------------------
Name: J. Xxx Xxxxxx
Its: Executive Vice President and
Chief Financial Officer
Address: 0000 Xxxx Xxxx Xxxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000
Attn: Chairman and Chief
Executive Officer
With copy to: Xxxx and Xxxx LLP
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxx X. Xxxxxxxx
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 12
Subject to entry of the Confirmation Order:
MOBILEMEDIA COMMUNICATIONS, INC.
By: /s/ Xxxxxx X. Xxxxx
---------------------------------
Name: Xxxxxx X. Xxxxx
Its: Chairman - Restructuring
Address: Fort Xxx Executive Park
Xxx Xxxxxxxxx Xxxxx, Xxxxx 000
Xxxx Xxx, XX 00000
Attn: Chairman - Restructuring
With a copy to: Sidley & Austin
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attn: Xxxxx X. Xxxxxxx
CREDIT SUISSE FIRST BOSTON CORPORATION
00 Xxxxxxx Xxxxxx, Xxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
September 3, 1998
Arch Communications Group, Inc.
0000 Xxxx Xxxx Xxxxx
Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000
MobileMedia Communications, Inc.
Fort Xxx Executive Park
Xxx Xxxxxxxxx Xxxxx
Xxxxx 000
Xxxx Xxx, Xxx Xxxxxx 00000
Re: Amendment to Commitment
-----------------------
Gentlemen:
Reference is made to the letter agreement, dated August 18, 1998 (the
"Standby Commitment Letter"), among Arch Communications Group, Inc., MobileMedia
Communications, Inc. and Credit Suisse First Boston Corporation. Terms used
herein with initial capital letters that are not otherwise defined shall have
the meanings ascribed to such terms in the Standby Commitment Letter.
The parties hereto hereby agree as follows:
1. First Paragraph. The second sentence of the first paragraph of the
---------------
Standby Commitment Letter is hereby amended in its entirety to read as follows:
It is our understanding that in connection with the Reorganization, among
other things: (a) pursuant to the Agreement and Plan of Merger, dated as of
the date hereof (as amended by the First Amendment thereto dated as of
September 3, 1998 (the "Merger Agreement"), among Arch, a wholly owned
subsidiary of Arch ("Merger Sub"), Parent and MobileMedia, MobileMedia will
merge with and into Merger Sub, with Merger Sub continuing as the surviving
corporation and a wholly owned subsidiary of Arch; (b) pursuant to the
Merger Agreement, Arch will make available for distribution pursuant to a
plan of reorganization of the Debtors in the form attached as Exhibit A to
the Merger Agreement, with such amendments and modifications thereto as are
made in a manner consistent with clause (e) of Section 5 hereto (such plan
of reorganization being referred to herein as the "Plan"), (i) cash, (ii)
shares of its Common Stock, par value $.01 per share ("Existing Arch Common
Stock"), and (iii) either (A) if a Rights Offering Adjustment (as defined
in Schedule II to the
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 2
Merger Agreement) shall not have occurred, warrants entitling the holders
thereof to purchase shares of Existing Arch Common Stock ("Arch Warrants"),
with such Arch Warrants to be issued pursuant to, and to have the terms set
forth in, a warrant agreement in the form attached as Exhibit B to the
Merger Agreement (the "Arch Warrant Agreement") or (B) if a Rights Offering
Adjustment shall have occurred, warrants entitling the holders thereof to
purchase shares of Existing Arch Common Stock ("Arch Participation
Warrants"), with such Arch Participation Warrants to be issued pursuant to,
and to have the terms set forth in, a warrant agreement in the form
attached as Exhibit B-1 to the Merger Agreement (the "Arch Participation
Warrant Agreement"); (c) holders of unsecured non-priority claims against
the Debtors ("Unsecured Claims"), to the extent such Unsecured Claims are
Allowed (as defined in the Plan), will receive pursuant to the Plan (i)
shares of Existing Arch Common Stock and (ii) rights to purchase ("Rights")
for cash either (A) if a Rights Offering Adjustment shall not have
occurred, units ("Units") consisting of (x) shares of Existing Arch Common
Stock and (y) Arch Warrants or (B) if a Rights Offering Adjustment shall
have occurred, shares of Existing Arch Common Stock ("Rights Shares"); (d)
holders of claims arising under or relating to the Credit Agreement, dated
December 4, 1995, as amended, among MobileMedia and the other parties
thereto ("Secured Claims"), to the extent such Secured Claims are Allowed,
will receive pursuant to the Plan cash in an amount equal to 100% of such
claims; (e) all of the outstanding equity interests in MobileMedia and
Parent will be canceled without consideration and Parent will be dissolved;
and (f) the commitments under the DIP Loan Agreement will terminate and all
amounts owed under or in respect of the DIP Loan Agreement will be paid in
full in cash. Arch will conduct the Stockholder Rights Offering, in which
it will issue to holders of Buyer Stock Stockholder Rights to acquire
shares of Existing Arch Common Stock if a Rights Offering Adjustment shall
have occurred, and, in addition, if a Rights Offering Adjustment shall have
occurred, immediately following the Combination, Arch will issue Arch
Participation Warrants to the stockholders of Arch to the extent any
Stockholder Rights issued to such Stockholder Rights Holder were not
exercised.
2. Section 1(a). Section 1(a) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(a) to exercise any Rights distributed to it in respect of its Allowed
Unsecured Claims in accordance with the Plan and not thereafter sold or
transferred as permitted by Section 3 below to purchase either (i) if a
Rights Offering Adjustment shall not have occurred, Units or (ii) if a
Rights Offering Adjustment shall have occurred, Rights Shares, to the
extent that the aggregate purchase price payable upon such exercise, as
determined in accordance with Schedule II to the Merger Agreement (the
"Subscription Price"), does not
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 3
exceed the Rights Exercise Commitment Amount of the Standby Purchaser as
set forth in Annex I hereto;
-------
3. Section 1(b).Section 1(b) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(b) if (i) the Standby Purchaser sells or otherwise transfers any or
all of the (A) the Rights distributed to it in accordance with the Plan or
(B) Unsecured Claims held by it as of the date hereof in respect of which
Rights are to be distributed, in each case as permitted by Section 3 below,
and (ii) the Rights sold or transferred by the Standby Purchaser or the
Rights distributed in respect of Unsecured Claims held by it as of the date
hereof that are hereafter sold or transferred by the Standby Purchaser are
not exercised prior to the expiration thereof (at which time such Rights
will be void and will no longer be exercisable), to purchase for cash
(based upon the Subscription Price payable upon exercise of such Rights)
either (x) if a Rights Offering Adjustment shall not have occurred,
identical Units or (y) if a Rights Offering Adjustment shall have occurred,
Rights Shares underlying, in each case, such unexercised Rights, to the
extent that the aggregate purchase price therefor, together with the
aggregate Subscription Price payable upon exercise of Rights exercised as
contemplated by clause (a) above, does not exceed the Rights Exercise
Commitment Amount of the Standby Purchaser as set forth in Annex I hereto;
-------
and
4. Section 1(c). Section 1(c) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(c) if any Rights distributed in accordance with the Plan (other than
(i) Rights distributed to the Standby Purchaser or the other holders of
Unsecured Claims listed on Annex I hereto (the "Other Standby Purchasers")
-------
and retained by them (which Rights are referred to in Section 1(a) above
and Section 1(a) of each of the Other Standby Purchase Commitments (as
defined in Section 13(a) below)) or (ii) subject to Section 3(b) below,
Rights distributed in respect of Unsecured Claims held by the Standby
Purchaser or the Other Standby Purchasers as of the date hereof that are
hereafter sold or transferred by them (which Rights are referred to in
Sections 1(b) and 3 hereof and Sections 1(b) and 3 of each of the Other
Standby Purchase Commitments)) remain unexercised upon the expiration
thereof (at which time such Rights will be void and will no longer be
exercisable), to purchase for cash (based on the Subscription Price payable
upon exercise of such Rights ) pro rata in accordance with and up to the
Unexercised Rights Commitment Amount of the Standby Purchaser as set forth
in Annex I hereto either (x) if a Rights Offering Adjustment shall not have
-------
occurred, identical Units or (y) if a Rights
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 4
Offering Adjustment shall have occurred, Rights Shares, underlying, in each
case, such unexercised Rights.
5. Section 2(a). Section 2(a) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(a) Notwithstanding anything to the contrary herein contained, if the
purchases by the Standby Purchaser contemplated by Section 1 above would
cause the Standby Purchaser, the Other Standby Purchasers, and any other
persons or entities who, when taken together with any one or more of the
Standby Purchaser and the Other Standby Purchasers, would constitute a
"person" or "group" as used in Section 13(d) or Section 14(d) of the
Exchange Act or Rule 13d-3 or Rule 13d-5 promulgated thereunder, or any
"affiliate" as defined in Rule 405 promulgated under the Securities Act of
any of them (collectively, the "Standby Class B Holders"), in the
aggregate, to beneficially own on the effective date of the Plan (the
"Effective Date") shares representing more than 49.0% of the capital stock
of Arch generally entitled to vote in the election of directors or more
than 49.0% of the total voting power of the capital stock of Arch, Arch
will substitute shares of Class B Common Stock, par value $.01 per share,
of Arch ("Arch Class B Common Stock"), with such Arch Class B Common Stock
having the terms set forth in the form of Certificate of Amendment to
Certificate of Incorporation of Arch attached as Exhibit F to the Merger
Agreement (the "Arch Charter Amendment"), for shares of Existing Arch
Common Stock so purchased on a one-for-one basis such that on the Effective
Date the Standby Class B Holders, in the aggregate, will beneficially own
shares representing not more than 49.0% of the capital stock of Arch
generally entitled to vote in the election of directors and not more than
49.0% of the total voting power of the capital stock of Arch, all as
provided in the Plan. For purposes of this letter agreement, "beneficial
ownership" shall be determined as provided in Rule 13d-3 and Rule 13d-5
promulgated under the Exchange Act, except that a person or entity shall be
deemed to have "beneficial ownership" of all securities that such person or
entity has the right to acquire, whether such right is exercisable
immediately or only after the passage of time.
6. Section 3(b). Section 3(b) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(b) Notwithstanding the provisions of clause (Y) of the proviso in
Section 3(a) above, the Standby Purchaser may elect to sell or otherwise
transfer (i) any or all of the Rights distributed to it in accordance with
the Plan or (ii) Unsecured Claims in respect of which Rights are to be so
distributed, in either case without entering into a Tracking Agreement with
its transferee or transferees (any Rights so transferred and any Rights
distributed in respect of
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 5
Allowed Claims so transferred, together with any Rights so transferred and
any Rights distributed in respect of Allowed Claims so transferred by the
Other Standby Purchasers pursuant to Section 3(b) of the Other Standby
Purchase Commitments, being referred to herein collectively as "Untracked
Rights"). Any Rights that remain unexercised upon expiration thereof will
be deemed to be "Section 3(b) Rights" up to, but not exceeding, the amount
of Untracked Rights. The Section 3(b) Rights shall be exercised as follows
prior to the application of Section 1(c) above and Section 1(c) of the
Other Standby Purchase Commitments: (A) the Standby Purchaser and the Other
Standby Purchasers will first be given the opportunity to purchase for cash
(based on the Subscription Price payable upon exercise of such Rights)
either (x) if a Rights Offering Adjustment shall not have occurred, Units
or (y) if a Rights Offering Adjustment shall have occurred, Rights Shares,
underlying, in each case, a number of unexercised Rights up to the amount
of Section 3(b) Rights in accordance with the percentages set forth in
Column D of Annex I hereto and (B) to the extent such Units or Rights
-------
Shares, as the case may be, are not so purchased, the Standby Purchaser and
any Other Standby Purchasers that are responsible for the existence of the
Section 3(b) Rights will be required to purchase such Units or Rights
Shares, as the case may be, pro rata based on the number of Section 3(b)
Rights resulting from their respective transfers. Nothing in this Section
3(b) will in any way reduce the commitment of the Standby Purchaser
specified in Section 1(c) above or the Unexercised Rights Commitment Amount
as set forth in Annex I hereto.
-------
7. Section 4. Section 4 of the Standby Commitment Letter is hereby
---------
amended in its entirety to read as follows:
4. The Closing. (a) Notwithstanding anything to the contrary herein
-----------
contained or the terms of the Rights or the Plan, subject to the conditions
set forth herein, on the Effective Date the Standby Purchaser, in
satisfaction of the Commitment, will deliver at the Closing (i) the
aggregate Subscription Price payable upon exercise of any Rights exercised
by it and (ii) the purchase price payable in consideration of any shares of
Existing Arch Common Stock or, if applicable, Arch Class B Common Stock
and, if a Rights Offering Adjustment shall not have occurred, Arch Warrants
to be otherwise purchased by it pursuant to the Commitment; provided,
--------
however, that, if requested by the Standby Purchaser in writing at least
-------
two business days prior to the Effective Date, any cash to be distributed
to the Standby Purchaser in respect of Allowed Secured Claims pursuant to
the Plan will, prior to the distribution thereof pursuant to the Plan and
in accordance with the instructions included in such written request, be
first applied, on behalf of the Standby Purchaser, to the payment of such
amounts payable on the Effective Date as provided in this Section 4(a).
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 6
(b) Upon payment of the amounts payable as provided in Section 4(a),
on the Effective Date at the Closing Arch will deliver to the Standby
Purchaser (or its designees) certificates representing the shares of
Existing Arch Common Stock, shares of Arch Class B Common Stock, if
applicable, and, if a Rights Offering Adjustment shall not have occurred,
the Arch Warrants, in each case, (i) issuable upon exercise of any Rights
exercised by the Standby Purchaser or (ii) otherwise purchased by the
Standby Purchaser pursuant to the Commitment. At the Closing, Arch will
also deliver to the Standby Purchaser (or its designees) certificates
representing the Arch Warrants or Arch Participation Warrants, as the case
may be, contemplated by Section 7 below.
(c) (i) Arch will deliver to the Standby Purchaser two business days
after the expiration of the Stockholder Rights Offering a written notice
which shall (A) specify the amounts payable at the Closing by it in
satisfaction of the Commitment (without taking into account Section 4(e)
below), (B) specify the Maximum Reduction Number (as defined in Section
4(e) below, (C) specify the last date on which the notice referred to in
Section 4(c) (ii) below may be delivered, and (D) indicate the matters
required to be addressed in such notice.
(ii) Within 10 business days after its receipt of the notice
referred to in Section 4(c)(i) above, the Standby Purchaser will deliver to
Arch and MobileMedia a written notice which shall set forth the Elected
Reduction Number (as defined in Section 4(e) below) determined by the
Standby Purchaser in accordance with Section 4(e) below.
(d) (i) Arch will deliver to the Standby Purchaser at least five
business days prior to the Effective Date a written notice which shall
specify the date on which the Effective Date is to occur and the last date
on which the notice referred to in Section 4(d)(ii) below may be delivered.
(ii) At least two business days prior to the Effective Date, the
Standby Purchaser will deliver to Arch and MobileMedia a written notice
which shall set forth the number of shares of Existing Arch Common Stock
beneficially owned by it as of such date. During the period from the date
of such notice through the Effective Date, neither the Standby Purchaser
nor any affiliate thereof shall acquire beneficial ownership of, or any
rights to acquire, any additional shares of Existing Arch Common Stock or
any Unsecured Claim.
(e) If a Rights Offering Adjustment shall have occurred,
notwithstanding anything to the contrary herein contained, the Standby
Purchaser may elect to reduce the number of Rights Shares required to be
purchased by the Standby Purchaser in satisfaction of its Commitment by a
number (the "Elected Reduction Number") of Rights Shares equal to or less
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 7
than the product of (i) the number of shares of Existing Arch Common Stock
to be issued by Arch in the Stockholder Rights Offering and (ii) the
percentage in Column D of Annex I hereto specified opposite the Standby
-------
Purchaser's name (such product being referred to herein as the "Maximum
Reduction Number"). Subject to the immediately preceding sentence, the
Standby Purchaser shall determine the Elected Reduction Number in its sole
discretion.
8. Section 5(c). Section 5(c) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(c) there shall be effective under the Securities Act, a registration
statement (the "Shelf Registration Statement") covering the resale by the
Standby Purchaser of (i) all shares of Existing Arch Common Stock, all
shares of Arch Class B Common Stock, if applicable, and, if a Rights
Offering Adjustment shall not have occurred, all Arch Warrants received by
the Standby Purchaser as a result of the transactions contemplated by the
Plan (including those received upon the exercise of Rights and pursuant to
this letter agreement), (ii) if a Rights Offering Adjustment shall have
occurred, all Arch Participation Warrants received by the Standby Purchaser
pursuant to this letter agreement, and (iii) all shares of Existing Arch
Common Stock issuable upon conversion of any such shares of the Arch Class
B Common Stock or exercise of any such Arch Warrants or Arch Participation
Warrants, as the case may be (the securities referred to in the foregoing
clauses (i), (ii) and (iii) are referred to herein as the "Registrable
Securities");
9. Section 5(e). Section 5(e) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(e) any and all amendments or modifications to the Merger Agreement or
any exhibit or schedule thereto (including without limitation the Plan, the
Arch Charter Amendment, the Arch Warrant Agreement, the Arch Participation
Warrant Agreement and the Registration Rights Agreement) on or after the
date hereof and any consents or waivers delivered on or after the date
hereof by Arch or MobileMedia to the other under the Merger Agreement
(other than (i) subject to Section 15(a) below, consents under Section 4.5
of the Merger Agreement, (ii) waivers of Unilateral Conditions or (iii) any
amendment to the Merger Agreement solely to reduce the amount of the Buyer
Breakup Fee) shall have been in form and substance reasonably satisfactory
to the Standby Purchaser;
10. Section 5(j). Section 5(j) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 8
(j) (i) the shares of Existing Arch Common Stock to be issued and
distributed as contemplated by Section 1.3(e) and Section 1.6 of the Merger
Agreement shall be so issued and distributed pursuant to an exemption from
registration under the Securities Act provided by Section 1145 of the
Bankruptcy Code, and (ii)(A) the issuance of the Rights, (B) the issuance
of the shares of Existing Arch Common Stock, the shares of Arch Class B
Common Stock, if applicable, and, if a Rights Offering Adjustment shall not
have occurred, the Arch Warrants upon exercise of the Rights, (C) the
issuance to the Standby Purchaser of the shares of Existing Arch Common
Stock, the shares of Arch Class B Common Stock, if applicable, and, if a
Rights Offering Adjustment shall not have occurred, the Arch Warrants as
contemplated by Section 1 and Section 3 above and the Arch Warrants or Arch
Participation Warrants, as the case may be, as contemplated by Section 7
below, and (D) the issuance of Existing Arch Common Stock upon exercise of
the Arch Warrants or Arch Participation Warrants, as the case may be, or
conversion of Arch Class B Common Stock, if applicable, shall be covered by
the Registration Statement, the Registration Statement shall have been
declared effective and no stop order with respect thereto shall be in
effect;
11. Section 5(m) of the Standby Commitment Letter is hereby deleted.
12. Section 7. Section 7 of the Standby Commitment Letter is hereby
---------
amended in its entirety to read as follows:
Consideration for the Commitment. In consideration for the
--------------------------------
Commitment, on the Effective Date at the Closing the Standby Purchaser will
receive its pro rata share of either (a) if a Rights Offering Adjustment
shall not have occurred, Arch Warrants entitling the holders thereof to
purchase, in the aggregate, a number of shares of Existing Arch Common
Stock equal to 2.50% of the issued and outstanding shares of Existing Arch
Common Stock and, if applicable, Arch Class B Common Stock, computed on a
Fully Diluted Basis (as defined in the Plan) on the date the "Initial Buyer
Market Price" is determined in accordance with Schedule II to the Merger
Agreement giving effect to the Plan as if the Effective Date had occurred
on such date and assuming 21,067,110 shares of Existing Arch Common Stock
are issued and outstanding immediately prior thereto or (b) if a Rights
Offering Adjustment shall have occurred, Arch Participation Warrants
entitling the holders thereof to purchase, in the aggregate, a number of
shares of Existing Arch Common Stock equal to 2.50% of the issued and
outstanding shares of Existing Arch Common Stock and, if applicable, Arch
Class B Common Stock, computed on a Fully Diluted Basis on the Rights
Offering Adjustment Determination Date giving effect to the Plan as if the
Effective Date had occurred on such date and assuming 21,067,110 shares of
Existing Arch Common Stock are issued and outstanding immediately prior
thereto. Such Arch Warrants or Arch
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 9
Participation Warrants, as the case may be, will be delivered to the
Standby Purchaser and the Other Standby Purchasers, in accordance with the
percentages specified in Column D of Annex I hereto.
-------
13. Section 9(a)(x). Section 9(a)(x) of the Standby Commitment Letter is
---------------
hereby amended in its entirety to read as follows:
(a)(x) The shares of Existing Arch Common Stock to be issued and
distributed as contemplated by Section 1.3(e) and Section 1.6 of the Merger
Agreement and the shares of Existing Arch Common Stock, the shares of Arch
Class B Common Stock, if applicable, and either the Arch Warrants to be
issued and delivered as contemplated by Section 1 and Section 3 above and
the Arch Warrants to be issued as contemplated by Section 7 above or, if a
Rights Offering Adjustment shall have occurred, the Arch Participation
Warrants to be issued as contemplated by Section 7 above, in each case,
when so issued and distributed or delivered, as the case may be, and the
shares of Existing Arch Common Stock issued upon conversation of such
shares of Arch Class B Common Stock, if applicable, when so converted in
accordance with the Arch Charter Amendment, and either, if a Rights
Offering Adjustment shall not have occurred, the shares of Existing Arch
Common Stock issued upon exercise of such Arch Warrants, when issued, paid
for and delivered as provided in the Arch Warrant Agreement or, if a Rights
Offering Adjustment shall have occurred, the shares of Existing Arch Common
Stock issued upon exercise of Arch Participation Warrants, when issued,
paid for and delivered as provided in the Arch Participation Warrant
Agreement, will be duly authorized, validly issued, fully paid,
nonassessable and free of all preemptive rights; and
14. Section 11. Section 11 of the Standby Commitment Letter is hereby
----------
amended to change the reference therein to "Exhibit D" to a reference to
"Exhibit D-1."
15. Schedule A to Annex I. Schedule A to Annex I to the Standby
---------------------
Commitment Letter is hereby amended to read in its entirety as Schedule A
----------
hereto.
16. Continuation of Standby Commitment Letter. Except as specifically
-----------------------------------------
amended hereby, the Standby Commitment Letter shall continue in full force and
effect and is hereby certified and confirmed in all respects.
17. Consent to Amendments. The Standby Purchaser hereby (a) consents to
---------------------
the amendments to the Other Standby Purchase Commitments to be effected by the
letter agreements attached as Exhibit C-1 hereto, which amendments shall be
-----------
entered into simultaneously herewith, (b) consents to (i) the First Amendment
dated as of September 3, 1998 to the Merger Agreement and each of the exhibits
attached thereto
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 10
and (ii) the Second Amended Joint Plan of Reorganization dated as of September
4, 1998 and each of the exhibits attached thereto, and (c) agrees that the form
and substance thereof are reasonably satisfactory to the Standby Purchaser.
18. Governing Law. This letter agreement shall be governed by and
-------------
construed in accordance with the laws of the State of Delaware without regard to
its principles of conflicts of law.
19. Counterparts. This letter agreement may be executed in
------------
counterparts which, taken together, shall constitute one and the same
instrument.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 11
If the foregoing accurately reflects your understanding with respect to the
matters set forth herein, please confirm by executing and returning a copy of
this letter to the undersigned.
Very truly yours,
CREDIT SUISSE FIRST BOSTON CORPORATION
By: /s/ Xxxx Xxxxxxx
---------------------------------
Name: Xxxx Xxxxxxx
Its: Director
Address: 00 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxxxx
Xxxx Xxxxxxx
With a copy to:
Cadwalader, Xxxxxxxxxx & Xxxx
000 Xxxxxx Xxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx X. Xxxx
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 12
ACCEPTED AND AGREED TO:
ARCH COMMUNICATIONS GROUP, INC.
By: /s/ J. Xxx Xxxxxx
---------------------------------
Name: J. Xxx Xxxxxx
Its: Executive Vice President and
Chief Financial Officer
Address: 0000 Xxxx Xxxx Xxxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000
Attn: Chairman and Chief
Executive Officer
With copy to: Xxxx and Xxxx LLP
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxx X. Xxxxxxxx
Subject to entry of the Confirmation Order:
MOBILEMEDIA COMMUNICATIONS, INC.
By: /s/ Xxxxxx X. Xxxxx
---------------------------------
Name: Xxxxxx X. Xxxxx
Its: Chairman - Restructuring
Address: Fort Xxx Executive Park
Xxx Xxxxxxxxx Xxxxx, Xxxxx 000
Xxxx Xxx, XX 00000
Attn: Chairman - Restructuring
With a copy to: Sidley & Austin
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attn: Xxxxx X. Xxxxxxx
WHIPPOORWILL ASSOCIATES, INC.
00 Xxxxxxx Xxxxxx
Xxxxx Xxxxxx, Xxx Xxxx 00000
September 3, 1998
Arch Communications Group, Inc.
0000 Xxxx Xxxx Xxxxx
Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000
MobileMedia Communications, Inc.
Fort Xxx Executive Park
Xxx Xxxxxxxxx Xxxxx
Xxxxx 000
Xxxx Xxx, Xxx Xxxxxx 00000
Re: Amendment to Commitment
-----------------------
Gentlemen:
Reference is made to the letter agreement, dated August 18, 1998 (the
"Standby Commitment Letter"), among Arch Communications Group, Inc., MobileMedia
Communications, Inc. and Whippoorwill Associates, Inc., as general partner of
and/or as agent for, each Whippoorwill Account. Terms used herein with initial
capital letters that are not otherwise defined shall have the meanings ascribed
to such terms in the Standby Commitment Letter.
The parties hereto hereby agree as follows:
1. First Paragraph. The second sentence of the first paragraph of the
---------------
Standby Commitment Letter is hereby amended in its entirety to read as follows:
It is our understanding that in connection with the Reorganization, among
other things: (a) pursuant to the Agreement and Plan of Merger, dated as of
the date hereof (as amended by the First Amendment thereto dated as of
September 3, 1998 (the "Merger Agreement"), among Arch, a wholly owned
subsidiary of Arch ("Merger Sub"), Parent and MobileMedia, MobileMedia will
merge with and into Merger Sub, with Merger Sub continuing as the surviving
corporation and a wholly owned subsidiary of Arch; (b) pursuant to the
Merger Agreement, Arch will make available for distribution pursuant to a
plan of reorganization of the Debtors in the form attached as Exhibit A to
the Merger Agreement, with such amendments and modifications thereto as are
made in a manner consistent with clause (e) of Section 5 hereto (such plan
of reorganization being referred to herein as the "Plan"), (i) cash, (ii)
shares of its Common Stock, par value $.01 per share ("Existing Arch Common
Stock"), and
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 2
(iii) either (A) if a Rights Offering Adjustment (as defined in Schedule II
to the Merger Agreement) shall not have occurred, warrants entitling the
holders thereof to purchase shares of Existing Arch Common Stock ("Arch
Warrants"), with such Arch Warrants to be issued pursuant to, and to have
the terms set forth in, a warrant agreement in the form attached as Exhibit
B to the Merger Agreement (the "Arch Warrant Agreement") or (B) if a Rights
Offering Adjustment shall have occurred, warrants entitling the holders
thereof to purchase shares of Existing Arch Common Stock ("Arch
Participation Warrants"), with such Arch Participation Warrants to be
issued pursuant to, and to have the terms set forth in, a warrant agreement
in the form attached as Exhibit B-1 to the Merger Agreement (the "Arch
Participation Warrant Agreement"); (c) holders of unsecured non-priority
claims against the Debtors ("Unsecured Claims"), to the extent such
Unsecured Claims are Allowed (as defined in the Plan), will receive
pursuant to the Plan (i) shares of Existing Arch Common Stock and (ii)
rights to purchase ("Rights") for cash either (A) if a Rights Offering
Adjustment shall not have occurred, units ("Units") consisting of (x)
shares of Existing Arch Common Stock and (y) Arch Warrants or (B) if a
Rights Offering Adjustment shall have occurred, shares of Existing Arch
Common Stock ("Rights Shares"); (d) holders of claims arising under or
relating to the Credit Agreement, dated December 4, 1995, as amended, among
MobileMedia and the other parties thereto ("Secured Claims"), to the extent
such Secured Claims are Allowed, will receive pursuant to the Plan cash in
an amount equal to 100% of such claims; (e) all of the outstanding equity
interests in MobileMedia and Parent will be canceled without consideration
and Parent will be dissolved; and (f) the commitments under the DIP Loan
Agreement will terminate and all amounts owed under or in respect of the
DIP Loan Agreement will be paid in full in cash. Arch will conduct the
Stockholder Rights Offering, in which it will issue to holders of Buyer
Stock Stockholder Rights to acquire shares of Existing Arch Common Stock if
a Rights Offering Adjustment shall have occurred, and, in addition, if a
Rights Offering Adjustment shall have occurred, immediately following the
Combination, Arch will issue Arch Participation Warrants to the
stockholders of Arch to the extent any Stockholder Rights issued to such
Stockholder Rights Holder were not exercised.
2. Section 1(a). Section 1(a) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(a) to exercise any Rights distributed to it in respect of its Allowed
Unsecured Claims in accordance with the Plan and not thereafter sold or
transferred as permitted by Section 3 below to purchase either (i) if a
Rights Offering Adjustment shall not have occurred, Units or (ii) if a
Rights Offering Adjustment shall have occurred, Rights Shares, to the
extent that the aggregate purchase price payable upon such exercise, as
determined in accordance with
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 3
Schedule II to the Merger Agreement (the "Subscription Price"), does not
exceed the Rights Exercise Commitment Amount of the Standby Purchaser as
set forth in Annex I hereto;
-------
3. Section 1(b).Section 1(b) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(b) if (i) the Standby Purchaser sells or otherwise transfers any or
all of the (A) the Rights distributed to it in accordance with the Plan or
(B) Unsecured Claims held by it as of the date hereof in respect of which
Rights are to be distributed, in each case as permitted by Section 3 below,
and (ii) the Rights sold or transferred by the Standby Purchaser or the
Rights distributed in respect of Unsecured Claims held by it as of the date
hereof that are hereafter sold or transferred by the Standby Purchaser are
not exercised prior to the expiration thereof (at which time such Rights
will be void and will no longer be exercisable), to purchase for cash
(based upon the Subscription Price payable upon exercise of such Rights)
either (x) if a Rights Offering Adjustment shall not have occurred,
identical Units or (y) if a Rights Offering Adjustment shall have occurred,
Rights Shares underlying, in each case, such unexercised Rights, to the
extent that the aggregate purchase price therefor, together with the
aggregate Subscription Price payable upon exercise of Rights exercised as
contemplated by clause (a) above, does not exceed the Rights Exercise
Commitment Amount of the Standby Purchaser as set forth in Annex I hereto;
-------
and
4. Section 1(c). Section 1(c) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(c) if any Rights distributed in accordance with the Plan (other than
(i) Rights distributed to the Standby Purchaser or the other holders of
Unsecured Claims listed on Annex I hereto (the "Other Standby Purchasers")
-------
and retained by them (which Rights are referred to in Section 1(a) above
and Section 1(a) of each of the Other Standby Purchase Commitments (as
defined in Section 13(a) below)) or (ii) subject to Section 3(b) below,
Rights distributed in respect of Unsecured Claims held by the Standby
Purchaser or the Other Standby Purchasers as of the date hereof that are
hereafter sold or transferred by them (which Rights are referred to in
Sections 1(b) and 3 hereof and Sections 1(b) and 3 of each of the Other
Standby Purchase Commitments)) remain unexercised upon the expiration
thereof (at which time such Rights will be void and will no longer be
exercisable), to purchase for cash (based on the Subscription Price payable
upon exercise of such Rights ) pro rata in accordance with and up to the
Unexercised Rights Commitment Amount of the Standby Purchaser as set forth
in Annex I hereto either (x) if a Rights Offering Adjustment shall not have
-------
occurred, identical Units or (y) if a Rights
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 4
Offering Adjustment shall have occurred, Rights Shares, underlying, in each
case, such unexercised Rights.
5. Section 2(a). Section 2(a) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(a) Notwithstanding anything to the contrary herein contained, if the
purchases by the Standby Purchaser contemplated by Section 1 above would
cause the Standby Purchaser, the Other Standby Purchasers, and any other
persons or entities who, when taken together with any one or more of the
Standby Purchaser and the Other Standby Purchasers, would constitute a
"person" or "group" as used in Section 13(d) or Section 14(d) of the
Exchange Act or Rule 13d-3 or Rule 13d-5 promulgated thereunder, or any
"affiliate" as defined in Rule 405 promulgated under the Securities Act of
any of them (collectively, the "Standby Class B Holders"), in the
aggregate, to beneficially own on the effective date of the Plan (the
"Effective Date") shares representing more than 49.0% of the capital stock
of Arch generally entitled to vote in the election of directors or more
than 49.0% of the total voting power of the capital stock of Arch, Arch
will substitute shares of Class B Common Stock, par value $.01 per share,
of Arch ("Arch Class B Common Stock"), with such Arch Class B Common Stock
having the terms set forth in the form of Certificate of Amendment to
Certificate of Incorporation of Arch attached as Exhibit F to the Merger
Agreement (the "Arch Charter Amendment"), for shares of Existing Arch
Common Stock so purchased on a one-for-one basis such that on the Effective
Date the Standby Class B Holders, in the aggregate, will beneficially own
shares representing not more than 49.0% of the capital stock of Arch
generally entitled to vote in the election of directors and not more than
49.0% of the total voting power of the capital stock of Arch, all as
provided in the Plan. For purposes of this letter agreement, "beneficial
ownership" shall be determined as provided in Rule 13d-3 and Rule 13d-5
promulgated under the Exchange Act, except that a person or entity shall be
deemed to have "beneficial ownership" of all securities that such person or
entity has the right to acquire, whether such right is exercisable
immediately or only after the passage of time.
6. Section 3(b). Section 3(b) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(b) Notwithstanding the provisions of clause (Y) of the proviso in
Section 3(a) above, the Standby Purchaser may elect to sell or otherwise
transfer (i) any or all of the Rights distributed to it in accordance with
the Plan or (ii) Unsecured Claims in respect of which Rights are to be so
distributed, in either case without entering into a Tracking Agreement with
its transferee or transferees (any Rights so transferred and any Rights
distributed in respect of Allowed Claims so transferred, together with any
Rights so transferred and any Rights distributed in respect of
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 5
Allowed Claims so transferred by the Other Standby Purchasers pursuant to
Section 3(b) of the Other Standby Purchase Commitments, being referred to
herein collectively as "Untracked Rights"). Any Rights that remain
unexercised upon expiration thereof will be deemed to be "Section 3(b)
Rights" up to, but not exceeding, the amount of Untracked Rights. The
Section 3(b) Rights shall be exercised as follows prior to the application
of Section 1(c) above and Section 1(c) of the Other Standby Purchase
Commitments: (A) the Standby Purchaser and the Other Standby Purchasers
will first be given the opportunity to purchase for cash (based on the
Subscription Price payable upon exercise of such Rights) either (x) if a
Rights Offering Adjustment shall not have occurred, Units or (y) if a
Rights Offering Adjustment shall have occurred, Rights Shares, underlying,
in each case, a number of unexercised Rights up to the amount of Section
3(b) Rights in accordance with the percentages set forth in Column D of
Annex I hereto and (B) to the extent such Units or Rights Shares, as the
-------
case may be, are not so purchased, the Standby Purchaser and any Other
Standby Purchasers that are responsible for the existence of the Section
3(b) Rights will be required to purchase such Units or Rights Shares, as
the case may be, pro rata based on the number of Section 3(b) Rights
resulting from their respective transfers. Nothing in this Section 3(b)
will in any way reduce the commitment of the Standby Purchaser specified in
Section 1(c) above or the Unexercised Rights Commitment Amount as set forth
in Annex I hereto.
-------
7. Section 4. Section 4 of the Standby Commitment Letter is hereby
---------
amended in its entirety to read as follows:
4. The Closing. (a) Notwithstanding anything to the contrary herein
-----------
contained or the terms of the Rights or the Plan, subject to the conditions
set forth herein, on the Effective Date the Standby Purchaser, in
satisfaction of the Commitment, will deliver at the Closing (i) the
aggregate Subscription Price payable upon exercise of any Rights exercised
by it and (ii) the purchase price payable in consideration of any shares of
Existing Arch Common Stock or, if applicable, Arch Class B Common Stock
and, if a Rights Offering Adjustment shall not have occurred, Arch Warrants
to be otherwise purchased by it pursuant to the Commitment; provided,
--------
however, that, if requested by the Standby Purchaser in writing at least
-------
two business days prior to the Effective Date, any cash to be distributed
to the Standby Purchaser in respect of Allowed Secured Claims pursuant to
the Plan will, prior to the distribution thereof pursuant to the Plan and
in accordance with the instructions included in such written request, be
first applied, on behalf of the Standby Purchaser, to the payment of such
amounts payable on the Effective Date as provided in this Section 4(a).
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 6
(b) Upon payment of the amounts payable as provided in Section 4(a),
on the Effective Date at the Closing Arch will deliver to the Standby
Purchaser (or its designees) certificates representing the shares of
Existing Arch Common Stock, shares of Arch Class B Common Stock, if
applicable, and, if a Rights Offering Adjustment shall not have occurred,
the Arch Warrants, in each case, (i) issuable upon exercise of any Rights
exercised by the Standby Purchaser or (ii) otherwise purchased by the
Standby Purchaser pursuant to the Commitment. At the Closing, Arch will
also deliver to the Standby Purchaser (or its designees) certificates
representing the Arch Warrants or Arch Participation Warrants, as the case
may be, contemplated by Section 7 below.
(c) (i) Arch will deliver to the Standby Purchaser two business days
after the expiration of the Stockholder Rights Offering a written notice
which shall (A) specify the amounts payable at the Closing by it in
satisfaction of the Commitment (without taking into account Section 4(e)
below), (B) specify the Maximum Reduction Number (as defined in Section
4(e) below, (C) specify the last date on which the notice referred to in
Section 4(c) (ii) below may be delivered, and (D) indicate the matters
required to be addressed in such notice.
(ii) Within 10 business days after its receipt of the notice
referred to in Section 4(c)(i) above, the Standby Purchaser will deliver to
Arch and MobileMedia a written notice which shall set forth the Elected
Reduction Number (as defined in Section 4(e) below) determined by the
Standby Purchaser in accordance with Section 4(e) below.
(d) (i) Arch will deliver to the Standby Purchaser at least five
business days prior to the Effective Date a written notice which shall
specify the date on which the Effective Date is to occur and the last date
on which the notice referred to in Section 4(d)(ii) below may be delivered.
(ii) At least two business days prior to the Effective Date, the
Standby Purchaser will deliver to Arch and MobileMedia a written notice
which shall set forth the number of shares of Existing Arch Common Stock
beneficially owned by it as of such date. During the period from the date
of such notice through the Effective Date, neither the Standby Purchaser
nor any affiliate thereof shall acquire beneficial ownership of, or any
rights to acquire, any additional shares of Existing Arch Common Stock or
any Unsecured Claim.
(e) If a Rights Offering Adjustment shall have occurred,
notwithstanding anything to the contrary herein contained, the Standby
Purchaser may elect to reduce the number of Rights Shares required to be
purchased by the Standby Purchaser in satisfaction of its Commitment by a
number (the "Elected Reduction Number") of Rights Shares equal to or less
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 7
than the product of (i) the number of shares of Existing Arch Common Stock
to be issued by Arch in the Stockholder Rights Offering and (ii) the
percentage in Column D of Annex I hereto specified opposite the Standby
-------
Purchaser's name (such product being referred to herein as the "Maximum
Reduction Number"). Subject to the immediately preceding sentence, the
Standby Purchaser shall determine the Elected Reduction Number in its sole
discretion.
8. Section 5(c). Section 5(c) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(c) there shall be effective under the Securities Act, a registration
statement (the "Shelf Registration Statement") covering the resale by the
Standby Purchaser of (i) all shares of Existing Arch Common Stock, all
shares of Arch Class B Common Stock, if applicable, and, if a Rights
Offering Adjustment shall not have occurred, all Arch Warrants received by
the Standby Purchaser as a result of the transactions contemplated by the
Plan (including those received upon the exercise of Rights and pursuant to
this letter agreement), (ii) if a Rights Offering Adjustment shall have
occurred, all Arch Participation Warrants received by the Standby Purchaser
pursuant to this letter agreement, and (iii) all shares of Existing Arch
Common Stock issuable upon conversion of any such shares of the Arch Class
B Common Stock or exercise of any such Arch Warrants or Arch Participation
Warrants, as the case may be (the securities referred to in the foregoing
clauses (i), (ii) and (iii) are referred to herein as the "Registrable
Securities");
9. Section 5(e). Section 5(e) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(e) any and all amendments or modifications to the Merger Agreement or
any exhibit or schedule thereto (including without limitation the Plan, the
Arch Charter Amendment, the Arch Warrant Agreement, the Arch Participation
Warrant Agreement and the Registration Rights Agreement) on or after the
date hereof and any consents or waivers delivered on or after the date
hereof by Arch or MobileMedia to the other under the Merger Agreement
(other than (i) subject to Section 15(a) below, consents under Section 4.5
of the Merger Agreement, (ii) waivers of Unilateral Conditions or (iii) any
amendment to the Merger Agreement solely to reduce the amount of the Buyer
Breakup Fee) shall have been in form and substance reasonably satisfactory
to the Standby Purchaser;
10. Section 5(j). Section 5(j) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 8
(j) (i) the shares of Existing Arch Common Stock to be issued and
distributed as contemplated by Section 1.3(e) and Section 1.6 of the Merger
Agreement shall be so issued and distributed pursuant to an exemption from
registration under the Securities Act provided by Section 1145 of the
Bankruptcy Code, and (ii)(A) the issuance of the Rights, (B) the issuance
of the shares of Existing Arch Common Stock, the shares of Arch Class B
Common Stock, if applicable, and, if a Rights Offering Adjustment shall not
have occurred, the Arch Warrants upon exercise of the Rights, (C) the
issuance to the Standby Purchaser of the shares of Existing Arch Common
Stock, the shares of Arch Class B Common Stock, if applicable, and, if a
Rights Offering Adjustment shall not have occurred, the Arch Warrants as
contemplated by Section 1 and Section 3 above and the Arch Warrants or Arch
Participation Warrants, as the case may be, as contemplated by Section 7
below, and (D) the issuance of Existing Arch Common Stock upon exercise of
the Arch Warrants or Arch Participation Warrants, as the case may be, or
conversion of Arch Class B Common Stock, if applicable, shall be covered by
the Registration Statement, the Registration Statement shall have been
declared effective and no stop order with respect thereto shall be in
effect;
11. Section 5(m) of the Standby Commitment Letter is hereby deleted.
12. Section 7. Section 7 of the Standby Commitment Letter is hereby
---------
amended in its entirety to read as follows:
Consideration for the Commitment. In consideration for the
--------------------------------
Commitment, on the Effective Date at the Closing the Standby Purchaser will
receive its pro rata share of either (a) if a Rights Offering Adjustment
shall not have occurred, Arch Warrants entitling the holders thereof to
purchase, in the aggregate, a number of shares of Existing Arch Common
Stock equal to 2.50% of the issued and outstanding shares of Existing Arch
Common Stock and, if applicable, Arch Class B Common Stock, computed on a
Fully Diluted Basis (as defined in the Plan) on the date the "Initial Buyer
Market Price" is determined in accordance with Schedule II to the Merger
Agreement giving effect to the Plan as if the Effective Date had occurred
on such date and assuming 21,067,110 shares of Existing Arch Common Stock
are issued and outstanding immediately prior thereto or (b) if a Rights
Offering Adjustment shall have occurred, Arch Participation Warrants
entitling the holders thereof to purchase, in the aggregate, a number of
shares of Existing Arch Common Stock equal to 2.50% of the issued and
outstanding shares of Existing Arch Common Stock and, if applicable, Arch
Class B Common Stock, computed on a Fully Diluted Basis on the Rights
Offering Adjustment Determination Date giving effect to the Plan as if the
Effective Date had occurred on such date and assuming 21,067,110 shares of
Existing Arch Common Stock are issued and outstanding immediately prior
thereto. Such Arch Warrants or Arch
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 9
Participation Warrants, as the case may be, will be delivered to the
Standby Purchaser and the Other Standby Purchasers, in accordance with the
percentages specified in Column D of Annex I hereto.
-------
13. Section 9(a)(x). Section 9(a)(x) of the Standby Commitment Letter is
---------------
hereby amended in its entirety to read as follows:
(a)(x) The shares of Existing Arch Common Stock to be issued and
distributed as contemplated by Section 1.3(e) and Section 1.6 of the Merger
Agreement and the shares of Existing Arch Common Stock, the shares of Arch
Class B Common Stock, if applicable, and either the Arch Warrants to be
issued and delivered as contemplated by Section 1 and Section 3 above and
the Arch Warrants to be issued as contemplated by Section 7 above or, if a
Rights Offering Adjustment shall have occurred, the Arch Participation
Warrants to be issued as contemplated by Section 7 above, in each case,
when so issued and distributed or delivered, as the case may be, and the
shares of Existing Arch Common Stock issued upon conversation of such
shares of Arch Class B Common Stock, if applicable, when so converted in
accordance with the Arch Charter Amendment, and either, if a Rights
Offering Adjustment shall not have occurred, the shares of Existing Arch
Common Stock issued upon exercise of such Arch Warrants, when issued, paid
for and delivered as provided in the Arch Warrant Agreement or, if a Rights
Offering Adjustment shall have occurred, the shares of Existing Arch Common
Stock issued upon exercise of Arch Participation Warrants, when issued,
paid for and delivered as provided in the Arch Participation Warrant
Agreement, will be duly authorized, validly issued, fully paid,
nonassessable and free of all preemptive rights; and
14. Section 11. Section 11 of the Standby Commitment Letter is hereby
----------
amended to change the reference therein to "Exhibit D" to a reference to
"Exhibit D-1."
15. Schedule A to Annex I. Schedule A to Annex I to the Standby
---------------------
Commitment Letter is hereby amended to read in its entirety as Schedule A
----------
hereto.
16. Continuation of Standby Commitment Letter. Except as specifically
-----------------------------------------
amended hereby, the Standby Commitment Letter shall continue in full force and
effect and is hereby certified and confirmed in all respects.
17. Consent to Amendments. The Standby Purchaser hereby (a) consents to
---------------------
the amendments to the Other Standby Purchase Commitments to be effected by the
letter agreements attached as Exhibit C-1 hereto, which amendments shall be
-----------
entered into simultaneously herewith, (b) consents to (i) the First Amendment
dated as of September 3, 1998 to the Merger Agreement and each of the exhibits
attached thereto
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 10
and (ii) the Second Amended Joint Plan of Reorganization dated as of September
4, 1998 and each of the exhibits attached thereto, and (c) agrees that the form
and substance thereof are reasonably satisfactory to the Standby Purchaser.
18. Governing Law. This letter agreement shall be governed by and
-------------
construed in accordance with the laws of the State of Delaware without regard to
its principles of conflicts of law.
19. Counterparts. This letter agreement may be executed in
------------
counterparts which, taken together, shall constitute one and the same
instrument.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 11
If the foregoing accurately reflects your understanding with respect to the
matters set forth herein, please confirm by executing and returning a copy of
this letter to the undersigned.
Very truly yours,
WHIPPOORWILL ASSOCIATES, INC.,
AS GENERAL PARTNER OF AND/OR AGENT FOR,
EACH WHIPPOORWILL ACCOUNT
By: /s/ Xxxxx Xxxxxxxxxxx
---------------------------------
Name: Xxxxx Xxxxxxxxxxx
Its: Managing Director
Address: 00 Xxxxxxx Xxxxxx
Xxxxx Xxxxxx, XX 00000
Attn: Xxxxx Xxxxxxxxxxx
ACCEPTED AND AGREED TO:
ARCH COMMUNICATIONS GROUP, INC.
By: /s/ J. Xxx Xxxxxx
---------------------------------
Name: J. Xxx Xxxxxx
Its: Executive Vice President and
Chief Financial Officer
Address: 0000 Xxxx Xxxx Xxxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000
Attn: Chairman and Chief
Executive Officer
With copy to: Xxxx and Xxxx LLP
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxx X. Xxxxxxxx
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 12
Subject to entry of the Confirmation Order:
MOBILEMEDIA COMMUNICATIONS, INC.
By: /s/ Xxxxxx X. Xxxxx
-------------------------------
Name: Xxxxxx X. Xxxxx
Its: Chairman - Restructuring
Address: Fort Xxx Executive Park
Xxx Xxxxxxxxx Xxxxx, Xxxxx 000
Xxxx Xxx, XX 00000
Attn: Chairman - Restructuring
With a copy to: Sidley & Austin
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attn: Xxxxx X. Xxxxxxx
