EXHIBIT 10.8
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
December 1, 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 (as
amended pursuant to the letter agreement dated September 3, 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 and third sentences of the first
---------------
paragraph of the Standby Commitment Letter are hereby amended in their 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 August 18, 1998 (as amended by the First Amendment thereto dated as of
September 3, 1998 and the Second Amendment thereto dated as of December 1,
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,
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 2
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 and
(ii) shares of its Common Stock, par value $.01 per share ("Existing Arch
Common Stock"); (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) an
aggregate of 14,344,969 shares of Existing Arch Common Stock and (ii)
rights to purchase ("Rights") an aggregate of 108,500,000 shares of
Existing Arch Common Stock ("Rights Shares") for $2.00 per share in cash
(the "Subscription Price"); (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 an aggregate of 44,893,166 shares of
Existing Arch Common Stock, and, immediately following the Combination,
Arch will issue 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"), 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 Rights Shares, to
the extent that the aggregate Subscription Price payable upon such exercise
does not 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
------------
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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 3
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) the Rights Shares
underlying 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
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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 the Rights Shares underlying such unexercised Rights.
-------
5. 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 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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 4
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) the Rights
Shares underlying 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 Right Shares 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 Rights Shares 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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6. Section 4(a). Section 4(a) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(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 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).
7. Section 4(b). Section 4(b) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(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 or shares of Arch Class B Common Stock, if applicable, (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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 5
designees) certificates representing the Arch Participation Warrants
contemplated by Section 7 below.
8. Section 4(e). Section 4(e) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(e) 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
than the product of (i) the number of shares of Existing Arch Common Stock
issued by Arch in connection with 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.
9. New Section 4(f). Section 4 of the Standby Commitment Letter is
----------------
hereby amended to add the following Section 4(f) of the end thereof:
(f) Notwithstanding anything to the contrary herein contained, if the Buyer
effects the reverse stock split contemplated by Section 4.5 of the Buyer
Disclosure Schedule (the "Reverse Stock Split") prior to or simultaneously
the Closing, (i)(A) the number of Plan Shares, (B) the number of Rights
Shares, and (C) the number of Arch Participation Warrants to be issued
pursuant to Section 7 below, will be adjusted, in each case, to a number
equal to the product of (x) the number provided therefor herein and (y) the
Adjustment Fraction and (ii) the Subscription Price will be adjusted to a
price equal to the product of (x) $2.00 and (y) the Inverse Adjustment
Fraction. For purposes of this Section 4(f) the term "Adjustment Fraction"
means a fraction, the numerator of which is the total number of shares of
Buyer Common Stock issued and outstanding immediately following the
effectiveness of the Reverse Stock Split and the denominator of which is
the total number of shares of Buyer Common Stock issued and outstanding
immediately prior to the effectiveness of the Reverse Stock Split, and the
term "Inverse Adjustment Fraction" means the fraction that is the inverse
of the Adjustment Fraction.
10. 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 and all
shares of Arch Class B Common Stock, if applicable, (ii) all Arch
Participation Warrants received by the Standby Purchaser pursuant to this
letter agreement, and (iii) all
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 6
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
Participation Warrants (the securities referred to in the foregoing clauses
(i), (ii) and (iii) are referred to herein as the "Registrable
Securities");
11. 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 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;
12. Section 5(j). Section 5(j) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(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 and the shares of Arch Class B
Common Stock, if applicable, upon exercise of the Rights, (C) the issuance
to the Standby Purchaser of the shares of Existing Arch Common Stock and
the shares of Arch Class B Common Stock, if applicable, as contemplated by
Section 1 and Section 3 above and the Arch Participation Warrants as
contemplated by Section 7 below, and (D) the issuance of Existing Arch
Common Stock upon exercise of the Arch Participation Warrants 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;
13. Section 6. The proviso at the end of Section 6 of the Standby
---------
Commitment Letter is hereby amended in its entirety to read as follows:
provided, however, that the Standby Purchaser may not assert the condition
-------- -------
contained in this clause (iii) if each of the Unaffiliated Standby
Purchasers (other than Credit Suisse First Boston Corporation), acting in
good faith, shall have waived the condition in clause (iii) of Section 6 of
the Other Standby Purchase Commitment to which such Unaffiliated Standby
Purchaser is a party.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 7
14. Section 7. Section 7 of the Standby Commitment Letter is hereby
---------
amended in its entirety to read as follows:
7. Consideration for the Commitment. In consideration for the Commitment,
--------------------------------
on the Effective Date at the Closing the Standby Purchaser will receive the
number of Arch Participation Warrants specified in Column E of Annex I
-------
hereto.
15. Section 9(a)(x). Section 9(a)(x) of the Standby Commitment Letter is
---------------
hereby amended in its entirety to read as follows:
(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 and the shares of Arch Class B
Common Stock, if applicable, to be issued and delivered as contemplated by
Section 1 and Section 3 above and 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 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
16. Section 10. Section 10 of the Standby Commitment Letter is hereby
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amended to add Sections 10(g), 10(h) and 10(i) at the end thereof, with such
Sections 10(g), 10(h) and 10(i) to read in their entirety as follows:
(g) The Standby Purchaser will not, and will cause each of its respective
directors, officers, employees, representatives and agents not to, directly
or indirectly, solicit, initiate, engage or participate in or encourage
discussions or negotiations with any person or entity concerning any
Acquisition Proposals (other than with Arch or the Debtors concerning the
transactions contemplated hereby, including any modifications thereto).
The Standby Purchaser will immediately cease any and all existing
activities, discussions or negotiations with any person with respect to any
Acquisition Proposal (other than with Arch or the Debtors concerning the
transactions contemplated hereby, including any modifications thereto).
Notwithstanding anything to the contrary herein contained, the Standby
Purchaser may take any action in its capacity as a member of the Official
Committee of Unsecured Creditors appointed in connection with the Chapter
11 proceeding (the "Committee") that the Standby Purchaser determines, in
good faith, after consultation with counsel (which may be counsel to the
Committee), is required by its fiduciary duties as a member of the
Committee under applicable law.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 8
(h) Without intending to limit the generality or effect of Section 10(g)
above, the Standby Purchaser expressly covenants that it will not enter
into any agreement, arrangement or understanding (other than those set
forth in this letter agreement) with any party pursuant to which the
Standby Purchaser would, directly or indirectly, provide any financing in
connection with any Acquisition Proposal or any plan of reorganization of
the Debtors, whether filed by the Debtors or any other person; provided,
--------
however, that nothing herein contained will prevent the Standby Purchaser
-------
from accepting its pro rata portion of any distribution made to creditors
of the Debtors in connection with any such Acquisition Proposal or plan of
reorganization or from exercising any rights, warrants or options received
by the Standby Purchaser as part of such a pro rata distribution.
(i) The Standby Purchaser agrees that the waiver by Credit Suisse First
Boston Corporation of the conditions contained in clause (ii) of Section
5(a) and clause (ii) of Section 5(k) of the Other Standby Purchase
Commitment to which it is a party, pursuant to Section 10(i) of such Other
Standby Purchase Commitment, shall be deemed a good faith waiver for
purposes of Sections 5(a)(ii) and 5(k)(ii) above.
17. Section 12. Section 12 of the Standby Commitment Letter is hereby
----------
amended to delete the phrase "and the Confirmation Order is entered not later
than March 31, 1999".
18. New Section 13(c). Article 13 of the Standby Commitment Letter is
-----------------
hereby amended to add the following Section 13(c) of the end thereof:
(c) Each of the parties hereto acknowledges and agrees that,
notwithstanding anything to the contrary herein contained, the Standby
Purchaser may not waive, or otherwise abrogate its right to assert, the
conditions contained in clause (ii) of Section 5(a), clause (ii) of Section
5(k) and clause (iii) of Section 6 other than in connection with a
scheduled Closing.
19. Conclusion. The third sentence of the paragraph immediately following
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Section 16 of the Standby Commitment Letter is hereby amended to read in its
entirety as follows:
Once effective, this letter agreement will terminate on (i) June 30, 1999,
unless the effectiveness of the Plan occurs on or before such date, or (ii)
if not theretofore terminated pursuant to the foregoing clause, the date on
which the Merger Agreement is terminated in accordance with the terms
thereof.
20. Annex I. Annex I to the Standby Commitment Letter (as heretofore
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amended) is hereby further amended to read in its entirety as Annex I hereto.
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21. 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.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 9
22. 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-2 hereto, which amendments shall be
-----------
entered into simultaneously herewith, (b) consents to (i) the Second Amendment
dated as of December 1, 1998 to the Merger Agreement and each of the exhibits,
schedules and annexes attached thereto and (ii) the Third Amended Joint Plan of
Reorganization dated as of December 1, 1998 and each of the exhibits, schedules
and annexes attached thereto, and (c) agrees that the form and substance thereof
are reasonably satisfactory to the Standby Purchaser.
23. 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.
24. 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 10
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, whereupon this letter will become a valid and
binding obligation of each party hereto.
Very truly yours,
THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY
By: /s/
-------------------------------
Name:
Its:
Address: 000 X. Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Securities Department
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 11
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 a 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
ANNEX I
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COMMITMENT AMOUNTS
------------------
(dollars in millions)
Column A Column B Column C Column D Column E
---------------- ------------ ---------- ----------- -------------
Unexercised
Rights Exercise Rights Total
Commitment Commitment Commitment Commitment Participation
Name and Address of Standby Purchasers Amount (1) Amount (2) Amount Percentage Warrants
-------------------------------------- --------------- ----------- ---------- ---------- -------------
X.X. Xxxx Asset Management Co., L.L.C., $ 39.27 $ 35.80 $ 75.07 34.60% 1,704,006
as agent for its affiliates and
discretionary accounts
00 Xxxx Xxxxx, 0xx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 57,847,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 27,970,000
----------------
The Northwestern Mutual Life Insurance $ 10.95 $ 9.97 $ 20.92 9.64% 474,861
Company/1/
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 19,776,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 3,350,000
----------------
The Northwestern Mutual Life Insurance $ 2.65 $ 2.42 $ 5.07 2.34%/1/ 115,084
Company for its Group Annuity
Separate Account*
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ -0-
----------------
Stated Principal Amount of 10 1/2% Notes
$ 7,000,000
----------------
COMMITMENT AMOUNTS
------------------
(dollars in millions)
Column A Column B Column C Column D Column E
---------------- ------------ ---------- ----------- -------------
Unexercised
Rights Exercise Rights Total
Commitment Commitment Commitment Commitment Participation
Name and Address of Standby Purchasers Amount (1) Amount (2) Amount Percentage Warrants
-------------------------------------- --------------- ----------- ---------- ---------- -------------
Northwestern Mutual Series Fund, Inc. for $ .75 $ .69 $ 1.44 0.66% 32,686
the High Yield Bond Portfolio*
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ -0-
----------------
Stated Principal Amount of 10 1/2%
Notes:
$ 2,000,000
----------------
Credit Suisse First Boston Corporation $ 29.48 $ 26.88 $ 56.36 25.97% 29,309
00 Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 32,453,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 35,930,000
----------------
Whippoorwill Associates, Inc., as general $ 30.42 $ 27.72 $ 58.14 26.79% 1,319,713
partner and/or agent for the parties set
forth on Schedule A hereto in the
percentages noted thereon
00 Xxxxxxx Xxxxxx
Xxxxx Xxxxxx, Xxx Xxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 37,855,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 31,410,000
----------------
Total: $113.52 $103.48 $217.00 100.00% 3,675,659
------- ------- ------- ---------
----------------
* The Northwestern Mutual Life Insurance Company, The Northwestern Mutual Life
Insurance Company for its Group Annuity Separate Account and Northwestern Mutual
Series Fund, Inc. for the High Yield Bond Portfolio are affiliated entities for
purposes of clauses (a) and (k) of Section 5 and clause (iii) of Section 6.
(1)The "Rights Exercise Commitment Amount", for each Standby Purchaser, shall
mean an amount equal to the product of (i) the Subscription Price (which is
subject to adjustment as provided in Section 4(f) of the Standby Commitment
Letter) and (ii) the number of Rights issuable in respect of an amount of
Allowed Unsecured Claims derived from the principal amount of 9 3/8% Notes and
the 10 1/2% Notes indicated under the Standby Purchaser's name on this Annex I
held by such Standby Purchaser on the date hereof. The dollar amounts set forth
under Column A are estimates provided for illustrative purposes only, based on
the assumptions that (x) there is a total of $475 million of Allowed Unsecured
Claims, (y) there is no Rights Reserve (as defined in the Plan) and (z) the
aggregate amount of Subordinated Noteholder Claims (as defined in the Plan) is
$441,819,762.
(2)The "Unexercised Rights Commitment Amount", for each Standby Purchaser, shall
mean an amount equal to (i) the Total Commitment Amount indicated in Column C
for such Standby Purchaser less (ii) the Rights Exercise Commitment Amount for
such Standby Purchaser. The dollar amounts set forth under Column B are
estimates provided for illustrative purposes only, based on the estimates set
forth in Column A.
SCHEDULE A
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(DOLLARS IN MILLIONS)
PERCENTAGE OF UNEXERCISED
TOTAL FACE RIGHTS EXERCISE RIGHTS TOTAL
FACE AMOUNT AMOUNT OF COMMITMENT COMMITMENT COMMITMENT COMMITMENT
ACCOUNT OF CLAIM CLAIM AMOUNT AMOUNT AMOUNT PERCENTAGE
---------------------------------------- ----------- -------------------- --------------- ----------- ------------- ----------
President & Fellows of Harvard College $18.60 26.85% $ 8.12 $ 4.91 $13.03 22.41%
The Rockefeller Foundation 6.79 9.81% 2.95 3.85 6.80 11.69%
Xxxx Partners II, L.P. 7.84 11.32% 3.40 4.25 7.65 13.15%
Xxxx Partners III, L.P. 20.47 29.55% 8.95 3.97 12.92 22.22%
Xxxx Partners IV, L.P. 5.52 7.97% 2.43 8.89 11.33 19.48%
Xxxx Offshore Fund Trust 9.99 14.42% 4.53 1.86 6.39 10.99%
The Whippoorwill Profit Sharing Plan 0.06 0.09% 0.03 - 0.03 0.05%
------ ------ ------ ------
TOTAL $69.27 100.00% $30.42 $27.72 $58.14 100.00%
====== ====== ====== ======
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
for its Group Annuity Separate Account
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
December 1, 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 (as
amended pursuant to the letter agreement dated September 3, 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 and third sentences of the first
---------------
paragraph of the Standby Commitment Letter are hereby amended in their 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 August 18, 1998 (as amended by the First Amendment thereto dated as of
September 3, 1998 and the Second Amendment thereto dated as of December 1,
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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 2
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 and (ii) shares of its
Common Stock, par value $.01 per share ("Existing Arch Common Stock"); (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) an aggregate of 14,344,969
shares of Existing Arch Common Stock and (ii) rights to purchase ("Rights")
an aggregate of 108,500,000 shares of Existing Arch Common Stock ("Rights
Shares") for $2.00 per share in cash (the "Subscription Price"); (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 an
aggregate of 44,893,166 shares of Existing Arch Common Stock, and,
immediately following the Combination, Arch will issue 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"), 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 Rights Shares, to
the extent that the aggregate Subscription Price payable upon such exercise
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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 3
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) the
Rights Shares underlying 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 the Rights Shares underlying such unexercised Rights.
-------
5. 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 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").
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 4
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) the
Rights Shares underlying 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 Right Shares 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 Rights Shares 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.
-------
6. Section 4(a). Section 4(a) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(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 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).
7. Section 4(b). Section 4(b) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(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 or shares of Arch Class B Common Stock, if applicable, (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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 5
designees) certificates representing the Arch Participation Warrants
contemplated by Section 7 below.
8. Section 4(e). Section 4(e) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(e) 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
than the product of (i) the number of shares of Existing Arch Common Stock
issued by Arch in connection with 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.
9. New Section 4(f). Section 4 of the Standby Commitment Letter is
----------------
hereby amended to add the following Section 4(f) of the end thereof:
(f) Notwithstanding anything to the contrary herein contained, if the Buyer
effects the reverse stock split contemplated by Section 4.5 of the Buyer
Disclosure Schedule (the "Reverse Stock Split") prior to or simultaneously
the Closing, (i)(A) the number of Plan Shares, (B) the number of Rights
Shares, and (C) the number of Arch Participation Warrants to be issued
pursuant to Section 7 below, will be adjusted, in each case, to a number
equal to the product of (x) the number provided therefor herein and (y) the
Adjustment Fraction and (ii) the Subscription Price will be adjusted to a
price equal to the product of (x) $2.00 and (y) the Inverse Adjustment
Fraction. For purposes of this Section 4(f) the term "Adjustment Fraction"
means a fraction, the numerator of which is the total number of shares of
Buyer Common Stock issued and outstanding immediately following the
effectiveness of the Reverse Stock Split and the denominator of which is
the total number of shares of Buyer Common Stock issued and outstanding
immediately prior to the effectiveness of the Reverse Stock Split, and the
term "Inverse Adjustment Fraction" means the fraction that is the inverse
of the Adjustment Fraction.
10. 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 and all
shares of Arch Class B Common Stock, if applicable, (ii) all Arch
Participation Warrants received by the Standby Purchaser pursuant to this
letter agreement, and (iii) all
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 6
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
Participation Warrants (the securities referred to in the foregoing clauses
(i), (ii) and (iii) are referred to herein as the "Registrable
Securities");
11. 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 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;
12. Section 5(j). Section 5(j) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(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 and the shares of Arch Class B
Common Stock, if applicable, upon exercise of the Rights, (C) the issuance
to the Standby Purchaser of the shares of Existing Arch Common Stock and
the shares of Arch Class B Common Stock, if applicable, as contemplated by
Section 1 and Section 3 above and the Arch Participation Warrants as
contemplated by Section 7 below, and (D) the issuance of Existing Arch
Common Stock upon exercise of the Arch Participation Warrants 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;
13. Section 6. The proviso at the end of Section 6 of the Standby
---------
Commitment Letter is hereby amended in its entirety to read as follows:
provided, however, that the Standby Purchaser may not assert the condition
-------- -------
contained in this clause (iii) if each of the Unaffiliated Standby
Purchasers (other than Credit Suisse First Boston Corporation), acting in
good faith, shall have waived the condition in clause (iii) of Section 6 of
the Other Standby Purchase Commitment to which such Unaffiliated Standby
Purchaser is a party.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 7
14. Section 7. Section 7 of the Standby Commitment Letter is hereby
---------
amended in its entirety to read as follows:
7. Consideration for the Commitment. In consideration for the Commitment,
--------------------------------
on the Effective Date at the Closing the Standby Purchaser will receive the
number of Arch Participation Warrants specified in Column E of Annex I
-------
hereto.
15. Section 9(a)(x). Section 9(a)(x) of the Standby Commitment Letter is
---------------
hereby amended in its entirety to read as follows:
(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 and the shares of Arch Class B
Common Stock, if applicable, to be issued and delivered as contemplated by
Section 1 and Section 3 above and 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 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
16. Section 10. Section 10 of the Standby Commitment Letter is hereby
----------
amended to add Sections 10(g), 10(h) and 10(i) at the end thereof, with such
Sections 10(g), 10(h) and 10(i) to read in their entirety as follows:
(g) The Standby Purchaser will not, and will cause each of its respective
directors, officers, employees, representatives and agents not to, directly
or indirectly, solicit, initiate, engage or participate in or encourage
discussions or negotiations with any person or entity concerning any
Acquisition Proposals (other than with Arch or the Debtors concerning the
transactions contemplated hereby, including any modifications thereto).
The Standby Purchaser will immediately cease any and all existing
activities, discussions or negotiations with any person with respect to any
Acquisition Proposal (other than with Arch or the Debtors concerning the
transactions contemplated hereby, including any modifications thereto).
Notwithstanding anything to the contrary herein contained, the Standby
Purchaser may take any action in its capacity as a member of the Official
Committee of Unsecured Creditors appointed in connection with the Chapter
11 proceeding (the "Committee") that the Standby Purchaser determines, in
good faith, after consultation with counsel (which may
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 8
be counsel to the Committee), is required by its fiduciary duties as a
member of the Committee under applicable law.
(h) Without intending to limit the generality or effect of Section 10(g)
above, the Standby Purchaser expressly covenants that it will not enter
into any agreement, arrangement or understanding (other than those set
forth in this letter agreement) with any party pursuant to which the
Standby Purchaser would, directly or indirectly, provide any financing in
connection with any Acquisition Proposal or any plan of reorganization of
the Debtors, whether filed by the Debtors or any other person; provided,
--------
however, that nothing herein contained will prevent the Standby Purchaser
-------
from accepting its pro rata portion of any distribution made to creditors
of the Debtors in connection with any such Acquisition Proposal or plan of
reorganization or from exercising any rights, warrants or options received
by the Standby Purchaser as part of such a pro rata distribution.
(i) The Standby Purchaser agrees that the waiver by Credit Suisse First
Boston Corporation of the conditions contained in clause (ii) of Section
5(a) and clause (ii) of Section 5(k) of the Other Standby Purchase
Commitment to which it is a party, pursuant to Section 10(i) of such Other
Standby Purchase Commitment, shall be deemed a good faith waiver for
purposes of Sections 5(a)(ii) and 5(k)(ii) above.
17. Section 12. Section 12 of the Standby Commitment Letter is hereby
----------
amended to delete the phrase "and the Confirmation Order is entered not later
than March 31, 1999".
18. New Section 13(c). Article 13 of the Standby Commitment Letter is
-----------------
hereby amended to add the following Section 13(c) of the end thereof:
(c) Each of the parties hereto acknowledges and agrees that,
notwithstanding anything to the contrary herein contained, the Standby
Purchaser may not waive, or otherwise abrogate its right to assert, the
conditions contained in clause (ii) of Section 5(a), clause (ii) of Section
5(k) and clause (iii) of Section 6 other than in connection with a
scheduled Closing.
19. Conclusion. The third sentence of the paragraph immediately following
----------
Section 16 of the Standby Commitment Letter is hereby amended to read in its
entirety as follows:
Once effective, this letter agreement will terminate on (i) June 30, 1999,
unless the effectiveness of the Plan occurs on or before such date, or (ii)
if not theretofore terminated pursuant to the foregoing clause, the date on
which the Merger Agreement is terminated in accordance with the terms
thereof.
20. Annex I. Annex I to the Standby Commitment Letter (as heretofore
-------
amended) is hereby further amended to read in its entirety as Annex I hereto.
-------
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 9
21. 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.
22. 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-2 hereto, which amendments shall be
-----------
entered into simultaneously herewith, (b) consents to (i) the Second Amendment
dated as of December 1, 1998 to the Merger Agreement and each of the exhibits,
schedules and annexes attached thereto and (ii) the Third Amended Joint Plan of
Reorganization dated as of December 1, 1998 and each of the exhibits, schedules
and annexes attached thereto, and (c) agrees that the form and substance thereof
are reasonably satisfactory to the Standby Purchaser.
23. 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.
24. 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 10
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, whereupon this letter will become a valid and
binding obligation of each party hereto.
Very truly yours,
THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY
FOR ITS GROUP ANNUITY SEPARATE ACCOUNT
By: Northwestern Investment
Management Company
By: /s/
---------------------------
Name:
Its:
Address: 000 X. Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Securities
Department
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 11
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 a 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
ANNEX I
-------
COMMITMENT AMOUNTS
------------------
(dollars in millions)
Column A Column B Column C Column D Column E
---------------- ------------ ---------- ----------- -------------
Unexercised
Rights Exercise Rights Total
Commitment Commitment Commitment Commitment Participation
Name and Address of Standby Purchasers Amount (1) Amount (2) Amount Percentage Warrants
-------------------------------------- --------------- ----------- ---------- ---------- -------------
X.X. Xxxx Asset Management Co., L.L.C., $ 39.27 $ 35.80 $ 75.07 34.60% 1,704,006
as agent for its affiliates and
discretionary accounts
00 Xxxx Xxxxx, 0xx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 57,847,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 27,970,000
----------------
The Northwestern Mutual Life Insurance $ 10.95 $ 9.97 $ 20.92 9.64% 474,861
Company/1/
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 19,776,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 3,350,000
----------------
The Northwestern Mutual Life Insurance $ 2.65 $ 2.42 $ 5.07 2.34%/1/ 115,084
Company for its Group Annuity
Separate Account*
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ -0-
----------------
Stated Principal Amount of 10 1/2% Notes
$ 7,000,000
----------------
COMMITMENT AMOUNTS
------------------
(dollars in millions)
Column A Column B Column C Column D Column E
---------------- ------------ ---------- ----------- -------------
Unexercised
Rights Exercise Rights Total
Commitment Commitment Commitment Commitment Participation
Name and Address of Standby Purchasers Amount (1) Amount (2) Amount Percentage Warrants
-------------------------------------- --------------- ----------- ---------- ---------- -------------
Northwestern Mutual Series Fund, Inc. for $ .75 $ .69 $ 1.44 0.66% 32,686
the High Yield Bond Portfolio*
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ -0-
----------------
Stated Principal Amount of 10 1/2%
Notes:
$ 2,000,000
----------------
Credit Suisse First Boston Corporation $ 29.48 $ 26.88 $ 56.36 25.97% 29,309
00 Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 32,453,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 35,930,000
----------------
Whippoorwill Associates, Inc., as general $ 30.42 $ 27.72 $ 58.14 26.79% 1,319,713
partner and/or agent for the parties set
forth on Schedule A hereto in the
percentages noted thereon
00 Xxxxxxx Xxxxxx
Xxxxx Xxxxxx, Xxx Xxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 37,855,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 31,410,000
----------------
Total: $113.52 $103.48 $217.00 100.00% 3,675,659
------- ------- ------- ---------
----------------
* The Northwestern Mutual Life Insurance Company, The Northwestern Mutual Life
Insurance Company for its Group Annuity Separate Account and Northwestern Mutual
Series Fund, Inc. for the High Yield Bond Portfolio are affiliated entities for
purposes of clauses (a) and (k) of Section 5 and clause (iii) of Section 6.
(1)The "Rights Exercise Commitment Amount", for each Standby Purchaser, shall
mean an amount equal to the product of (i) the Subscription Price (which is
subject to adjustment as provided in Section 4(f) of the Standby Commitment
Letter) and (ii) the number of Rights issuable in respect of an amount of
Allowed Unsecured Claims derived from the principal amount of 9 3/8% Notes and
the 10 1/2% Notes indicated under the Standby Purchaser's name on this Annex I
held by such Standby Purchaser on the date hereof. The dollar amounts set forth
under Column A are estimates provided for illustrative purposes only, based on
the assumptions that (x) there is a total of $475 million of Allowed Unsecured
Claims, (y) there is no Rights Reserve (as defined in the Plan) and (z) the
aggregate amount of Subordinated Noteholder Claims (as defined in the Plan) is
$441,819,762.
(2)The "Unexercised Rights Commitment Amount", for each Standby Purchaser, shall
mean an amount equal to (i) the Total Commitment Amount indicated in Column C
for such Standby Purchaser less (ii) the Rights Exercise Commitment Amount for
such Standby Purchaser. The dollar amounts set forth under Column B are
estimates provided for illustrative purposes only, based on the estimates set
forth in Column A.
SCHEDULE A
----------
(DOLLARS IN MILLIONS)
PERCENTAGE OF UNEXERCISED
TOTAL FACE RIGHTS EXERCISE RIGHTS TOTAL
FACE AMOUNT AMOUNT OF COMMITMENT COMMITMENT COMMITMENT COMMITMENT
ACCOUNT OF CLAIM CLAIM AMOUNT AMOUNT AMOUNT PERCENTAGE
---------------------------------------- ----------- -------------------- --------------- ----------- ------------- ----------
President & Fellows of Harvard College $18.60 26.85% $ 8.12 $ 4.91 $13.03 22.41%
The Rockefeller Foundation 6.79 9.81% 2.95 3.85 6.80 11.69%
Xxxx Partners II, L.P. 7.84 11.32% 3.40 4.25 7.65 13.15%
Xxxx Partners III, L.P. 20.47 29.55% 8.95 3.97 12.92 22.22%
Xxxx Partners IV, L.P. 5.52 7.97% 2.43 8.89 11.33 19.48%
Xxxx Offshore Fund Trust 9.99 14.42% 4.53 1.86 6.39 10.99%
The Whippoorwill Profit Sharing Plan 0.06 0.09% 0.03 - 0.03 0.05%
------ ------ ------ ------
TOTAL $69.27 100.00% $30.42 $27.72 $58.14 100.00%
====== ====== ====== ======
NORTHWESTERN MUTUAL SERIES FUND, INC.
for the High Yield Bond Portfolio
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
December 1, 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 (as
amended pursuant to the letter agreement dated September 3, 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 and third sentences of the first
---------------
paragraph of the Standby Commitment Letter are hereby amended in their 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 August 18, 1998 (as amended by the First Amendment thereto dated as of
September 3, 1998 and the Second Amendment thereto dated as of December 1,
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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 2
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 and (ii) shares of its
Common Stock, par value $.01 per share ("Existing Arch Common Stock"); (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) an aggregate of 14,344,969
shares of Existing Arch Common Stock and (ii) rights to purchase ("Rights")
an aggregate of 108,500,000 shares of Existing Arch Common Stock ("Rights
Shares") for $2.00 per share in cash (the "Subscription Price"); (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 an
aggregate of 44,893,166 shares of Existing Arch Common Stock, and,
immediately following the Combination, Arch will issue 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"), 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 Rights Shares, to
the extent that the aggregate Subscription Price payable upon such exercise
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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 3
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) the
Rights Shares underlying 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 the Rights Shares underlying such unexercised Rights.
-------
5. 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 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").
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 4
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) the
Rights Shares underlying 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 Right Shares 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 Rights Shares 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.
-------
6. Section 4(a). Section 4(a) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(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 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).
7. Section 4(b). Section 4(b) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(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 or shares of Arch Class B Common Stock, if applicable, (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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 5
designees) certificates representing the Arch Participation Warrants
contemplated by Section 7 below.
8. Section 4(e). Section 4(e) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(e) 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
than the product of (i) the number of shares of Existing Arch Common Stock
issued by Arch in connection with 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.
9. New Section 4(f). Section 4 of the Standby Commitment Letter is
----------------
hereby amended to add the following Section 4(f) of the end thereof:
(f) Notwithstanding anything to the contrary herein contained, if the Buyer
effects the reverse stock split contemplated by Section 4.5 of the Buyer
Disclosure Schedule (the "Reverse Stock Split") prior to or simultaneously
the Closing, (i)(A) the number of Plan Shares, (B) the number of Rights
Shares, and (C) the number of Arch Participation Warrants to be issued
pursuant to Section 7 below, will be adjusted, in each case, to a number
equal to the product of (x) the number provided therefor herein and (y) the
Adjustment Fraction and (ii) the Subscription Price will be adjusted to a
price equal to the product of (x) $2.00 and (y) the Inverse Adjustment
Fraction. For purposes of this Section 4(f) the term "Adjustment Fraction"
means a fraction, the numerator of which is the total number of shares of
Buyer Common Stock issued and outstanding immediately following the
effectiveness of the Reverse Stock Split and the denominator of which is
the total number of shares of Buyer Common Stock issued and outstanding
immediately prior to the effectiveness of the Reverse Stock Split, and the
term "Inverse Adjustment Fraction" means the fraction that is the inverse
of the Adjustment Fraction.
10. 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 and all
shares of Arch Class B Common Stock, if applicable, (ii) all Arch
Participation Warrants received by the Standby Purchaser pursuant to this
letter agreement, and (iii) all
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 6
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
Participation Warrants (the securities referred to in the foregoing clauses
(i), (ii) and (iii) are referred to herein as the "Registrable
Securities");
11. 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 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;
12. Section 5(j). Section 5(j) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(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 and the shares of Arch Class B
Common Stock, if applicable, upon exercise of the Rights, (C) the issuance
to the Standby Purchaser of the shares of Existing Arch Common Stock and
the shares of Arch Class B Common Stock, if applicable, as contemplated by
Section 1 and Section 3 above and the Arch Participation Warrants as
contemplated by Section 7 below, and (D) the issuance of Existing Arch
Common Stock upon exercise of the Arch Participation Warrants 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;
13. Section 6. The proviso at the end of Section 6 of the Standby
---------
Commitment Letter is hereby amended in its entirety to read as follows:
provided, however, that the Standby Purchaser may not assert the condition
-------- -------
contained in this clause (iii) if each of the Unaffiliated Standby
Purchasers (other than Credit Suisse First Boston Corporation), acting in
good faith, shall have waived the condition in clause (iii) of Section 6 of
the Other Standby Purchase Commitment to which such Unaffiliated Standby
Purchaser is a party.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 7
14. Section 7. Section 7 of the Standby Commitment Letter is hereby
---------
amended in its entirety to read as follows:
7. Consideration for the Commitment. In consideration for the Commitment,
--------------------------------
on the Effective Date at the Closing the Standby Purchaser will receive the
number of Arch Participation Warrants specified in Column E of Annex I
-------
hereto.
15. Section 9(a)(x). Section 9(a)(x) of the Standby Commitment Letter is
---------------
hereby amended in its entirety to read as follows:
(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 and the shares of Arch Class B
Common Stock, if applicable, to be issued and delivered as contemplated by
Section 1 and Section 3 above and 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 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
16. Section 10. Section 10 of the Standby Commitment Letter is hereby
----------
amended to add Sections 10(g), 10(h) and 10(i) at the end thereof, with such
Sections 10(g), 10(h) and 10(i) to read in their entirety as follows:
(g) The Standby Purchaser will not, and will cause each of its respective
directors, officers, employees, representatives and agents not to, directly
or indirectly, solicit, initiate, engage or participate in or encourage
discussions or negotiations with any person or entity concerning any
Acquisition Proposals (other than with Arch or the Debtors concerning the
transactions contemplated hereby, including any modifications thereto).
The Standby Purchaser will immediately cease any and all existing
activities, discussions or negotiations with any person with respect to any
Acquisition Proposal (other than with Arch or the Debtors concerning the
transactions contemplated hereby, including any modifications thereto).
Notwithstanding anything to the contrary herein contained, the Standby
Purchaser may take any action in its capacity as a member of the Official
Committee of Unsecured Creditors appointed in connection with the Chapter
11 proceeding (the "Committee") that the Standby Purchaser determines, in
good faith, after consultation with counsel (which may
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 8
be counsel to the Committee), is required by its fiduciary duties as a
member of the Committee under applicable law.
(h) Without intending to limit the generality or effect of Section 10(g)
above, the Standby Purchaser expressly covenants that it will not enter
into any agreement, arrangement or understanding (other than those set
forth in this letter agreement) with any party pursuant to which the
Standby Purchaser would, directly or indirectly, provide any financing in
connection with any Acquisition Proposal or any plan of reorganization of
the Debtors, whether filed by the Debtors or any other person; provided,
--------
however, that nothing herein contained will prevent the Standby Purchaser
-------
from accepting its pro rata portion of any distribution made to creditors
of the Debtors in connection with any such Acquisition Proposal or plan of
reorganization or from exercising any rights, warrants or options received
by the Standby Purchaser as part of such a pro rata distribution.
(i) The Standby Purchaser agrees that the waiver by Credit Suisse First
Boston Corporation of the conditions contained in clause (ii) of Section
5(a) and clause (ii) of Section 5(k) of the Other Standby Purchase
Commitment to which it is a party, pursuant to Section 10(i) of such Other
Standby Purchase Commitment, shall be deemed a good faith waiver for
purposes of Sections 5(a)(ii) and 5(k)(ii) above.
17. Section 12. Section 12 of the Standby Commitment Letter is hereby
----------
amended to delete the phrase "and the Confirmation Order is entered not later
than March 31, 1999".
18. New Section 13(c). Article 13 of the Standby Commitment Letter is
-----------------
hereby amended to add the following Section 13(c) of the end thereof:
(c) Each of the parties hereto acknowledges and agrees that,
notwithstanding anything to the contrary herein contained, the Standby
Purchaser may not waive, or otherwise abrogate its right to assert, the
conditions contained in clause (ii) of Section 5(a), clause (ii) of Section
5(k) and clause (iii) of Section 6 other than in connection with a
scheduled Closing.
19. Conclusion. The third sentence of the paragraph immediately following
----------
Section 16 of the Standby Commitment Letter is hereby amended to read in its
entirety as follows:
Once effective, this letter agreement will terminate on (i) June 30, 1999,
unless the effectiveness of the Plan occurs on or before such date, or (ii)
if not theretofore terminated pursuant to the foregoing clause, the date on
which the Merger Agreement is terminated in accordance with the terms
thereof.
20. Annex I. Annex I to the Standby Commitment Letter (as heretofore
-------
amended) is hereby further amended to read in its entirety as Annex I hereto.
-------
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 9
21. 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.
22. 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-2 hereto, which amendments shall be
-----------
entered into simultaneously herewith, (b) consents to (i) the Second Amendment
dated as of December 1, 1998 to the Merger Agreement and each of the exhibits,
schedules and annexes attached thereto and (ii) the Third Amended Joint Plan of
Reorganization dated as of December 1, 1998 and each of the exhibits, schedules
and annexes attached thereto, and (c) agrees that the form and substance thereof
are reasonably satisfactory to the Standby Purchaser.
23. 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.
24. 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 10
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, whereupon this letter will become a valid and
binding obligation of each party hereto.
Very truly yours,
NORTHWESTERN MUTUAL SERIES FUND, INC.
FOR THE HIGH YIELD BOND PORTFOLIO
By: /s/
---------------------------------
Name:
Its:
Address: c/o The Northwestern Mutual Life
Insurance Company
000 X. Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Securities Department
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 11
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 a 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
ANNEX I
-------
COMMITMENT AMOUNTS
------------------
(dollars in millions)
Column A Column B Column C Column D Column E
---------------- ------------ ---------- ----------- -------------
Unexercised
Rights Exercise Rights Total
Commitment Commitment Commitment Commitment Participation
Name and Address of Standby Purchasers Amount (1) Amount (2) Amount Percentage Warrants
-------------------------------------- --------------- ----------- ---------- ---------- -------------
X.X. Xxxx Asset Management Co., L.L.C., $ 39.27 $ 35.80 $ 75.07 34.60% 1,704,006
as agent for its affiliates and
discretionary accounts
00 Xxxx Xxxxx, 0xx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 57,847,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 27,970,000
----------------
The Northwestern Mutual Life Insurance $ 10.95 $ 9.97 $ 20.92 9.64% 474,861
Company/1/
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 19,776,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 3,350,000
----------------
The Northwestern Mutual Life Insurance $ 2.65 $ 2.42 $ 5.07 2.34%/1/ 115,084
Company for its Group Annuity
Separate Account*
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ -0-
----------------
Stated Principal Amount of 10 1/2% Notes
$ 7,000,000
----------------
COMMITMENT AMOUNTS
------------------
(dollars in millions)
Column A Column B Column C Column D Column E
---------------- ------------ ---------- ----------- -------------
Unexercised
Rights Exercise Rights Total
Commitment Commitment Commitment Commitment Participation
Name and Address of Standby Purchasers Amount (1) Amount (2) Amount Percentage Warrants
-------------------------------------- --------------- ----------- ---------- ---------- -------------
Northwestern Mutual Series Fund, Inc. for $ .75 $ .69 $ 1.44 0.66% 32,686
the High Yield Bond Portfolio*
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ -0-
----------------
Stated Principal Amount of 10 1/2%
Notes:
$ 2,000,000
----------------
Credit Suisse First Boston Corporation $ 29.48 $ 26.88 $ 56.36 25.97% 29,309
00 Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 32,453,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 35,930,000
----------------
Whippoorwill Associates, Inc., as general $ 30.42 $ 27.72 $ 58.14 26.79% 1,319,713
partner and/or agent for the parties set
forth on Schedule A hereto in the
percentages noted thereon
00 Xxxxxxx Xxxxxx
Xxxxx Xxxxxx, Xxx Xxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 37,855,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 31,410,000
----------------
Total: $113.52 $103.48 $217.00 100.00% 3,675,659
------- ------- ------- ---------
----------------
* The Northwestern Mutual Life Insurance Company, The Northwestern Mutual Life
Insurance Company for its Group Annuity Separate Account and Northwestern Mutual
Series Fund, Inc. for the High Yield Bond Portfolio are affiliated entities for
purposes of clauses (a) and (k) of Section 5 and clause (iii) of Section 6.
(1)The "Rights Exercise Commitment Amount", for each Standby Purchaser, shall
mean an amount equal to the product of (i) the Subscription Price (which is
subject to adjustment as provided in Section 4(f) of the Standby Commitment
Letter) and (ii) the number of Rights issuable in respect of an amount of
Allowed Unsecured Claims derived from the principal amount of 9 3/8% Notes and
the 10 1/2% Notes indicated under the Standby Purchaser's name on this Annex I
held by such Standby Purchaser on the date hereof. The dollar amounts set forth
under Column A are estimates provided for illustrative purposes only, based on
the assumptions that (x) there is a total of $475 million of Allowed Unsecured
Claims, (y) there is no Rights Reserve (as defined in the Plan) and (z) the
aggregate amount of Subordinated Noteholder Claims (as defined in the Plan) is
$441,819,762.
(2)The "Unexercised Rights Commitment Amount", for each Standby Purchaser, shall
mean an amount equal to (i) the Total Commitment Amount indicated in Column C
for such Standby Purchaser less (ii) the Rights Exercise Commitment Amount for
such Standby Purchaser. The dollar amounts set forth under Column B are
estimates provided for illustrative purposes only, based on the estimates set
forth in Column A.
SCHEDULE A
----------
(DOLLARS IN MILLIONS)
PERCENTAGE OF UNEXERCISED
TOTAL FACE RIGHTS EXERCISE RIGHTS TOTAL
FACE AMOUNT AMOUNT OF COMMITMENT COMMITMENT COMMITMENT COMMITMENT
ACCOUNT OF CLAIM CLAIM AMOUNT AMOUNT AMOUNT PERCENTAGE
---------------------------------------- ----------- -------------------- --------------- ----------- ------------- ----------
President & Fellows of Harvard College $18.60 26.85% $ 8.12 $ 4.91 $13.03 22.41%
The Rockefeller Foundation 6.79 9.81% 2.95 3.85 6.80 11.69%
Xxxx Partners II, L.P. 7.84 11.32% 3.40 4.25 7.65 13.15%
Xxxx Partners III, L.P. 20.47 29.55% 8.95 3.97 12.92 22.22%
Xxxx Partners IV, L.P. 5.52 7.97% 2.43 8.89 11.33 19.48%
Xxxx Offshore Fund Trust 9.99 14.42% 4.53 1.86 6.39 10.99%
The Whippoorwill Profit Sharing Plan 0.06 0.09% 0.03 - 0.03 0.05%
------ ------ ------ ------
TOTAL $69.27 100.00% $30.42 $27.72 $58.14 100.00%
====== ====== ====== ======
X.X. XXXX ASSET MANAGEMENT CO., L.L.C.
00 Xxxx Xxxxx, Xxxxx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
December 1, 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 (as
amended pursuant to the letter agreement dated September 3, 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 and third sentences of the first
---------------
paragraph of the Standby Commitment Letter are hereby amended in their 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 August 18, 1998 (as amended by the First Amendment thereto dated as of
September 3, 1998 and the Second Amendment thereto dated as of December 1,
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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 2
consistent with clause (e) of Section 5 hereto (such plan of reorganization
being referred to herein as the "Plan"), (i) cash and (ii) shares of its
Common Stock, par value $.01 per share ("Existing Arch Common Stock"); (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) an aggregate of 14,344,969
shares of Existing Arch Common Stock and (ii) rights to purchase ("Rights")
an aggregate of 108,500,000 shares of Existing Arch Common Stock ("Rights
Shares") for $2.00 per share in cash (the "Subscription Price"); (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 an
aggregate of 44,893,166 shares of Existing Arch Common Stock, and,
immediately following the Combination, Arch will issue 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"), 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 Rights Shares, to
the extent that the aggregate Subscription Price payable upon such exercise
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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 3
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) the Rights Shares underlying
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 the Rights Shares underlying such unexercised Rights.
-------
5. 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 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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 4
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) the Rights
Shares underlying 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 Right Shares 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 Rights Shares 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.
-------
6. Section 4(a). Section 4(a) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(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 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).
7. Section 4(b). Section 4(b) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(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 or shares of Arch Class B Common Stock, if applicable, (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 Participation
Warrants contemplated by Section 7 below.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 5
8. Section 4(e). Section 4(e) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(e) 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
than the product of (i) the number of shares of Existing Arch Common Stock
issued by Arch in connection with 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.
9. New Section 4(f). Section 4 of the Standby Commitment Letter is
----------------
hereby amended to add the following Section 4(f) of the end thereof:
(f) Notwithstanding anything to the contrary herein contained, if the Buyer
effects the reverse stock split contemplated by Section 4.5 of the Buyer
Disclosure Schedule (the "Reverse Stock Split") prior to or simultaneously
the Closing, (i)(A) the number of Plan Shares, (B) the number of Rights
Shares, and (C) the number of Arch Participation Warrants to be issued
pursuant to Section 7 below, will be adjusted, in each case, to a number
equal to the product of (x) the number provided therefor herein and (y) the
Adjustment Fraction and (ii) the Subscription Price will be adjusted to a
price equal to the product of (x) $2.00 and (y) the Inverse Adjustment
Fraction. For purposes of this Section 4(f) the term "Adjustment Fraction"
means a fraction, the numerator of which is the total number of shares of
Buyer Common Stock issued and outstanding immediately following the
effectiveness of the Reverse Stock Split and the denominator of which is
the total number of shares of Buyer Common Stock issued and outstanding
immediately prior to the effectiveness of the Reverse Stock Split, and the
term "Inverse Adjustment Fraction" means the fraction that is the inverse
of the Adjustment Fraction.
10. 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 and all
shares of Arch Class B Common Stock, if applicable, (ii) 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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 6
Participation Warrants (the securities referred to in the foregoing clauses
(i), (ii) and (iii) are referred to herein as the "Registrable
Securities");
11. 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 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;
12. Section 5(j). Section 5(j) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(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 and the shares of Arch Class B
Common Stock, if applicable, upon exercise of the Rights, (C) the issuance
to the Standby Purchaser of the shares of Existing Arch Common Stock and
the shares of Arch Class B Common Stock, if applicable, as contemplated by
Section 1 and Section 3 above and the Arch Participation Warrants as
contemplated by Section 7 below, and (D) the issuance of Existing Arch
Common Stock upon exercise of the Arch Participation Warrants 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;
13. Section 6. The proviso at the end of Section 6 of the Standby
---------
Commitment Letter is hereby amended in its entirety to read as follows:
provided, however, that the Standby Purchaser may not assert the condition
-------- -------
contained in this clause (iii) if each of the Unaffiliated Standby
Purchasers (other than Credit Suisse First Boston Corporation), acting in
good faith, shall have waived the condition in clause (iii) of Section 6 of
the Other Standby Purchase Commitment to which such Unaffiliated Standby
Purchaser is a party.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 7
14. Section 7. Section 7 of the Standby Commitment Letter is hereby
---------
amended in its entirety to read as follows:
7. Consideration for the Commitment. In consideration for the Commitment,
--------------------------------
on the Effective Date at the Closing the Standby Purchaser will receive the
number of Arch Participation Warrants specified in Column E of Annex I
-------
hereto.
15. Section 9(a)(x). Section 9(a)(x) of the Standby Commitment Letter is
---------------
hereby amended in its entirety to read as follows:
(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 and the shares of Arch Class B
Common Stock, if applicable, to be issued and delivered as contemplated by
Section 1 and Section 3 above and 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 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
16. Section 10. Section 10 of the Standby Commitment Letter is hereby
----------
amended to add Sections 10(g), 10(h) and 10(i) at the end thereof, with such
Sections 10(g), 10(h) and 10(i) to read in their entirety as follows:
(g) The Standby Purchaser will not, and will cause each of its respective
directors, officers, employees, representatives and agents not to, directly
or indirectly, solicit, initiate, engage or participate in or encourage
discussions or negotiations with any person or entity concerning any
Acquisition Proposals (other than with Arch or the Debtors concerning the
transactions contemplated hereby, including any modifications thereto).
The Standby Purchaser will immediately cease any and all existing
activities, discussions or negotiations with any person with respect to any
Acquisition Proposal (other than with Arch or the Debtors concerning the
transactions contemplated hereby, including any modifications thereto).
Notwithstanding anything to the contrary herein contained, the Standby
Purchaser may take any action in its capacity as a member of the Official
Committee of Unsecured Creditors appointed in connection with the Chapter
11 proceeding (the "Committee") that the Standby Purchaser determines, in
good faith, after consultation with counsel (which may be counsel to the
Committee), is required by its fiduciary duties as a member of the
Committee under applicable law.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 8
(h) Without intending to limit the generality or effect of Section 10(g)
above, the Standby Purchaser expressly covenants that it will not enter
into any agreement, arrangement or understanding (other than those set
forth in this letter agreement) with any party pursuant to which the
Standby Purchaser would, directly or indirectly, provide any financing in
connection with any Acquisition Proposal or any plan of reorganization of
the Debtors, whether filed by the Debtors or any other person; provided,
--------
however, that nothing herein contained will prevent the Standby Purchaser
-------
from accepting its pro rata portion of any distribution made to creditors
of the Debtors in connection with any such Acquisition Proposal or plan of
reorganization or from exercising any rights, warrants or options received
by the Standby Purchaser as part of such a pro rata distribution.
(i) The Standby Purchaser agrees that the waiver by Credit Suisse First
Boston Corporation of the conditions contained in clause (ii) of Section
5(a) and clause (ii) of Section 5(k) of the Other Standby Purchase
Commitment to which it is a party, pursuant to Section 10(i) of such Other
Standby Purchase Commitment, shall be deemed a good faith waiver for
purposes of Sections 5(a)(ii) and 5(k)(ii) above.
17. Section 12. Section 12 of the Standby Commitment Letter is hereby
----------
amended to delete the phrase "and the Confirmation Order is entered not later
than March 31, 1999".
18. New Section 13(c). Article 13 of the Standby Commitment Letter is
-----------------
hereby amended to add the following Section 13(c) of the end thereof:
(c) Each of the parties hereto acknowledges and agrees that,
notwithstanding anything to the contrary herein contained, the Standby
Purchaser may not waive, or otherwise abrogate its right to assert, the
conditions contained in clause (ii) of Section 5(a), clause (ii) of Section
5(k) and clause (iii) of Section 6 other than in connection with a
scheduled Closing.
19. Conclusion. The third sentence of the paragraph immediately following
----------
Section 17 of the Standby Commitment Letter is hereby amended to read in its
entirety as follows:
Once effective, this letter agreement will terminate on (i) June 30, 1999,
unless the effectiveness of the Plan occurs on or before such date, or (ii)
if not theretofore terminated pursuant to the foregoing clause, the date on
which the Merger Agreement is terminated in accordance with the terms
thereof.
20. Annex I. Annex I to the Standby Commitment Letter (as heretofore
-------
amended) is hereby further amended to read in its entirety as Annex I hereto.
-------
21. 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.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 9
22. 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-2 hereto, which amendments shall be
-----------
entered into simultaneously herewith, (b) consents to (i) the Second Amendment
dated as of December 1, 1998 to the Merger Agreement and each of the exhibits,
schedules and annexes attached thereto and (ii) the Third Amended Joint Plan of
Reorganization dated as of December 1, 1998 and each of the exhibits, schedules
and annexes attached thereto, and (c) agrees that the form and substance thereof
are reasonably satisfactory to the Standby Purchaser.
23. 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.
24. 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 10
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, whereupon this letter will become a valid and
binding obligation of each party hereto.
Very truly yours,
X. X. XXXX ASSET MANAGEMENT CO., L.L.C.
By: /s/ Xxxxx X. Xxxxx, Esq.
------------------------------
Name: Xxxxx X. Xxxxx, Esq.
Its: Attorney-in-Fact
Address: 00 Xxxx Xxxxx, 0xx Xxxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxx, Esq.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 11
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 a 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
ANNEX I
-------
COMMITMENT AMOUNTS
------------------
(dollars in millions)
Column A Column B Column C Column D Column E
---------------- ------------ ---------- ----------- -------------
Unexercised
Rights Exercise Rights Total
Commitment Commitment Commitment Commitment Participation
Name and Address of Standby Purchasers Amount (1) Amount (2) Amount Percentage Warrants
-------------------------------------- --------------- ----------- ---------- ---------- -------------
X.X. Xxxx Asset Management Co., L.L.C., $ 39.27 $ 35.80 $ 75.07 34.60% 1,704,006
as agent for its affiliates and
discretionary accounts
00 Xxxx Xxxxx, 0xx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 57,847,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 27,970,000
----------------
The Northwestern Mutual Life Insurance $ 10.95 $ 9.97 $ 20.92 9.64% 474,861
Company/1/
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 19,776,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 3,350,000
----------------
The Northwestern Mutual Life Insurance $ 2.65 $ 2.42 $ 5.07 2.34%/1/ 115,084
Company for its Group Annuity
Separate Account*
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ -0-
----------------
Stated Principal Amount of 10 1/2% Notes
$ 7,000,000
----------------
COMMITMENT AMOUNTS
------------------
(dollars in millions)
Column A Column B Column C Column D Column E
---------------- ------------ ---------- ----------- -------------
Unexercised
Rights Exercise Rights Total
Commitment Commitment Commitment Commitment Participation
Name and Address of Standby Purchasers Amount (1) Amount (2) Amount Percentage Warrants
-------------------------------------- --------------- ----------- ---------- ---------- -------------
Northwestern Mutual Series Fund, Inc. for $ .75 $ .69 $ 1.44 0.66% 32,686
the High Yield Bond Portfolio*
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ -0-
----------------
Stated Principal Amount of 10 1/2%
Notes:
$ 2,000,000
----------------
Credit Suisse First Boston Corporation $ 29.48 $ 26.88 $ 56.36 25.97% 29,309
00 Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 32,453,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 35,930,000
----------------
Whippoorwill Associates, Inc., as general $ 30.42 $ 27.72 $ 58.14 26.79% 1,319,713
partner and/or agent for the parties set
forth on Schedule A hereto in the
percentages noted thereon
00 Xxxxxxx Xxxxxx
Xxxxx Xxxxxx, Xxx Xxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 37,855,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 31,410,000
----------------
Total: $113.52 $103.48 $217.00 100.00% 3,675,659
------- ------- ------- ---------
----------------
* The Northwestern Mutual Life Insurance Company, The Northwestern Mutual Life
Insurance Company for its Group Annuity Separate Account and Northwestern Mutual
Series Fund, Inc. for the High Yield Bond Portfolio are affiliated entities for
purposes of clauses (a) and (k) of Section 5 and clause (iii) of Section 6.
(1)The "Rights Exercise Commitment Amount", for each Standby Purchaser, shall
mean an amount equal to the product of (i) the Subscription Price (which is
subject to adjustment as provided in Section 4(f) of the Standby Commitment
Letter) and (ii) the number of Rights issuable in respect of an amount of
Allowed Unsecured Claims derived from the principal amount of 9 3/8% Notes and
the 10 1/2% Notes indicated under the Standby Purchaser's name on this Annex I
held by such Standby Purchaser on the date hereof. The dollar amounts set forth
under Column A are estimates provided for illustrative purposes only, based on
the assumptions that (x) there is a total of $475 million of Allowed Unsecured
Claims, (y) there is no Rights Reserve (as defined in the Plan) and (z) the
aggregate amount of Subordinated Noteholder Claims (as defined in the Plan) is
$441,819,762.
(2)The "Unexercised Rights Commitment Amount", for each Standby Purchaser, shall
mean an amount equal to (i) the Total Commitment Amount indicated in Column C
for such Standby Purchaser less (ii) the Rights Exercise Commitment Amount for
such Standby Purchaser. The dollar amounts set forth under Column B are
estimates provided for illustrative purposes only, based on the estimates set
forth in Column A.
SCHEDULE A
----------
(DOLLARS IN MILLIONS)
PERCENTAGE OF UNEXERCISED
TOTAL FACE RIGHTS EXERCISE RIGHTS TOTAL
FACE AMOUNT AMOUNT OF COMMITMENT COMMITMENT COMMITMENT COMMITMENT
ACCOUNT OF CLAIM CLAIM AMOUNT AMOUNT AMOUNT PERCENTAGE
---------------------------------------- ----------- -------------------- --------------- ----------- ------------- ----------
President & Fellows of Harvard College $18.60 26.85% $ 8.12 $ 4.91 $13.03 22.41%
The Rockefeller Foundation 6.79 9.81% 2.95 3.85 6.80 11.69%
Xxxx Partners II, L.P. 7.84 11.32% 3.40 4.25 7.65 13.15%
Xxxx Partners III, L.P. 20.47 29.55% 8.95 3.97 12.92 22.22%
Xxxx Partners IV, L.P. 5.52 7.97% 2.43 8.89 11.33 19.48%
Xxxx Offshore Fund Trust 9.99 14.42% 4.53 1.86 6.39 10.99%
The Whippoorwill Profit Sharing Plan 0.06 0.09% 0.03 - 0.03 0.05%
------ ------ ------ ------
TOTAL $69.27 100.00% $30.42 $27.72 $58.14 100.00%
====== ====== ====== ======
WHIPPOORWILL ASSOCIATES, INC.
00 Xxxxxxx Xxxxxx
Xxxxx Xxxxxx, Xxx Xxxx 00000
December 1, 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 (as
amended pursuant to the letter agreement dated September 3, 1998, the "Standby
Commitment Letter"), among Arch Communications Group, Inc., MobileMedia
Communications, Inc. and Whippoorwill Associates, Inc. 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 and third sentences of the first
---------------
paragraph of the Standby Commitment Letter are hereby amended in their 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 August 18, 1998 (as amended by the First Amendment thereto dated as of
September 3, 1998 and the Second Amendment thereto dated as of December 1,
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,
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 2
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 and (ii) shares of its
Common Stock, par value $.01 per share ("Existing Arch Common Stock"); (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) an aggregate of 14,344,969
shares of Existing Arch Common Stock and (ii) rights to purchase ("Rights")
an aggregate of 108,500,000 shares of Existing Arch Common Stock ("Rights
Shares") for $2.00 per share in cash (the "Subscription Price"); (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 an
aggregate of 44,893,166 shares of Existing Arch Common Stock, and,
immediately following the Combination, Arch will issue 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"), 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 Rights Shares, to
the extent that the aggregate Subscription Price payable upon such exercise
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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 3
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) the Rights Shares
underlying 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 the Rights Shares underlying such unexercised Rights.
-------
5. 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 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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 4
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) the Rights
Shares underlying 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 Right Shares 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 Rights Shares 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.
-------
6. Section 4(a). Section 4(a) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(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 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).
7. Section 4(b). Section 4(b) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(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 or shares of Arch Class B Common Stock, if applicable, (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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 5
designees) certificates representing the Arch Participation Warrants
contemplated by Section 7 below.
8. Section 4(e). Section 4(e) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(e) 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
than the product of (i) the number of shares of Existing Arch Common Stock
issued by Arch in connection with 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.
9. New Section 4(f). Section 4 of the Standby Commitment Letter is
----------------
hereby amended to add the following Section 4(f) of the end thereof:
(f) Notwithstanding anything to the contrary herein contained, if the Buyer
effects the reverse stock split contemplated by Section 4.5 of the Buyer
Disclosure Schedule (the "Reverse Stock Split") prior to or simultaneously
the Closing, (i)(A) the number of Plan Shares, (B) the number of Rights
Shares, and (C) the number of Arch Participation Warrants to be issued
pursuant to Section 7 below, will be adjusted, in each case, to a number
equal to the product of (x) the number provided therefor herein and (y) the
Adjustment Fraction and (ii) the Subscription Price will be adjusted to a
price equal to the product of (x) $2.00 and (y) the Inverse Adjustment
Fraction. For purposes of this Section 4(f) the term "Adjustment Fraction"
means a fraction, the numerator of which is the total number of shares of
Buyer Common Stock issued and outstanding immediately following the
effectiveness of the Reverse Stock Split and the denominator of which is
the total number of shares of Buyer Common Stock issued and outstanding
immediately prior to the effectiveness of the Reverse Stock Split, and the
term "Inverse Adjustment Fraction" means the fraction that is the inverse
of the Adjustment Fraction.
10. 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 and all
shares of Arch Class B Common Stock, if applicable, (ii) all Arch
Participation Warrants received by the Standby Purchaser pursuant to this
letter agreement, and (iii) all
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 6
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
Participation Warrants (the securities referred to in the foregoing clauses
(i), (ii) and (iii) are referred to herein as the "Registrable
Securities");
11. 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 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;
12. Section 5(j). Section 5(j) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(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 and the shares of Arch Class B
Common Stock, if applicable, upon exercise of the Rights, (C) the issuance
to the Standby Purchaser of the shares of Existing Arch Common Stock and
the shares of Arch Class B Common Stock, if applicable, as contemplated by
Section 1 and Section 3 above and the Arch Participation Warrants as
contemplated by Section 7 below, and (D) the issuance of Existing Arch
Common Stock upon exercise of the Arch Participation Warrants 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;
13. Section 6. The proviso at the end of Section 6 of the Standby
---------
Commitment Letter is hereby amended in its entirety to read as follows:
provided, however, that the Standby Purchaser may not assert the condition
-------- -------
contained in this clause (iii) if each of the Unaffiliated Standby
Purchasers (other than Credit Suisse First Boston Corporation), acting in
good faith, shall have waived the condition in clause (iii) of Section 6 of
the Other Standby Purchase Commitment to which such Unaffiliated Standby
Purchaser is a party.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 7
14. Section 7. Section 7 of the Standby Commitment Letter is hereby
---------
amended in its entirety to read as follows:
7. Consideration for the Commitment. In consideration for the Commitment,
--------------------------------
on the Effective Date at the Closing the Standby Purchaser will receive the
number of Arch Participation Warrants specified in Column E of Annex I
-------
hereto.
15. Section 9(a)(x). Section 9(a)(x) of the Standby Commitment Letter is
---------------
hereby amended in its entirety to read as follows:
(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 and the shares of Arch Class B
Common Stock, if applicable, to be issued and delivered as contemplated by
Section 1 and Section 3 above and 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 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
16. Section 9(c). Section 9(c) of the Standby Commitment Letter is hereby
------------
amended to add the following sentence at the end thereof:
The Whippoorwill Accounts may from time to time agree to reallocate the
aggregate Unexercised Rights Commitment Amount set forth in Schedule A
among themselves as may be necessary for the Whippoorwill Accounts to
achieve compliance with regulatory requirements (including without
limitation requirements imposed by or related to FCC regulations) and
diversification requirements applicable to them, and the consent of Arch
and MobileMedia shall not be required in connection therewith; provided,
--------
however, that no reallocation that materially reduces the Unexercised
-------
Rights Commitment Amount of any of the three largest Whippoorwill Accounts
shall be made without the prior written consent of Arch and MobileMedia,
which consent shall not be unreasonably withheld, and, provided, however,
-------- -------
that no such reallocation shall be made if it has the effect of requiring
additional approvals from the FCC.
17. Section 10. Section 10 of the Standby Commitment Letter is hereby
----------
amended to add Sections 10(g), 10(h) and 10(i) at the end thereof, with such
Sections 10(g), 10(h) and 10(i) to read in their entirety as follows:
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 8
(g) The Standby Purchaser will not, and will cause each of its respective
directors, officers, employees, representatives and agents not to, directly
or indirectly, solicit, initiate, engage or participate in or encourage
discussions or negotiations with any person or entity concerning any
Acquisition Proposals (other than with Arch or the Debtors concerning the
transactions contemplated hereby, including any modifications thereto).
The Standby Purchaser will immediately cease any and all existing
activities, discussions or negotiations with any person with respect to any
Acquisition Proposal (other than with Arch or the Debtors concerning the
transactions contemplated hereby, including any modifications thereto).
(h) Without intending to limit the generality or effect of Section 10(g)
above, the Standby Purchaser expressly covenants that it will not enter
into any agreement, arrangement or understanding (other than those set
forth in this letter agreement) with any party pursuant to which the
Standby Purchaser would, directly or indirectly, provide any financing in
connection with any Acquisition Proposal or any plan of reorganization of
the Debtors, whether filed by the Debtors or any other person; provided,
--------
however, that nothing herein contained will prevent the Standby Purchaser
-------
from accepting its pro rata portion of any distribution made to creditors
of the Debtors in connection with any such Acquisition Proposal or plan of
reorganization or from exercising any rights, warrants or options received
by the Standby Purchaser as part of such a pro rata distribution.
(i) The Standby Purchaser agrees that the waiver by Credit Suisse First
Boston Corporation of the conditions contained in clause (ii) of Section
5(a) and clause (ii) of Section 5(k) of the Other Standby Purchase
Commitment to which it is a party, pursuant to Section 10(i) of such Other
Standby Purchase Commitment, shall be deemed a good faith waiver for
purposes of Sections 5(a)(ii) and 5(k)(ii) above.
18. Section 12. Section 12 of the Standby Commitment Letter is hereby
----------
amended to delete the phrase "and the Confirmation Order is entered not later
than March 31, 1999".
19. New Section 13(c). Article 13 of the Standby Commitment Letter is
-----------------
hereby amended to add the following Section 13(c) of the end thereof:
(c) Each of the parties hereto acknowledges and agrees that,
notwithstanding anything to the contrary herein contained, the Standby
Purchaser may not waive, or otherwise abrogate its right to assert, the
conditions contained in clause (ii) of Section 5(a), clause (ii) of Section
5(k) and clause (iii) of Section 6 other than in connection with a
scheduled Closing.
20. Conclusion. The third sentence of the paragraph immediately following
----------
Section 17 of the Standby Commitment Letter is hereby amended to read in its
entirety as follows:
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 9
Once effective, this letter agreement will terminate on (i) June 30, 1999,
unless the effectiveness of the Plan occurs on or before such date, or (ii)
if not theretofore terminated pursuant to the foregoing clause, the date on
which the Merger Agreement is terminated in accordance with the terms
thereof.
21. Annex I. Annex I to the Standby Commitment Letter (as heretofore
-------
amended) is hereby further amended to read in its entirety as Annex I hereto.
-------
22. 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.
23. 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-2 hereto, which amendments shall be
-----------
entered into simultaneously herewith, (b) consents to (i) the Second Amendment
dated as of December 1, 1998 to the Merger Agreement and each of the exhibits,
schedules and annexes attached thereto and (ii) the Third Amended Joint Plan of
Reorganization dated as of December 1, 1998 and each of the exhibits, schedules
and annexes attached thereto, and (c) agrees that the form and substance thereof
are reasonably satisfactory to the Standby Purchaser.
24. 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.
25. 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 10
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, whereupon this letter will become a valid and
binding obligation of each party hereto.
Very truly yours,
WHIPPOORWILL ASSOCIATES, INC.,
AS GENERAL PARTNER OF AND/OR AGENT FOR,
EACH WHIPPOORWILL ACCOUNT
By: /s/
---------------------------------
Name:
Its:
Address: 00 Xxxxxxx Xxxxxx
Xxxxx Xxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxxxxx
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 11
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 a 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
ANNEX I
-------
COMMITMENT AMOUNTS
------------------
(dollars in millions)
Column A Column B Column C Column D Column E
---------------- ------------ ---------- ----------- -------------
Unexercised
Rights Exercise Rights Total
Commitment Commitment Commitment Commitment Participation
Name and Address of Standby Purchasers Amount (1) Amount (2) Amount Percentage Warrants
-------------------------------------- --------------- ----------- ---------- ---------- -------------
X.X. Xxxx Asset Management Co., L.L.C., $ 39.27 $ 35.80 $ 75.07 34.60% 1,704,006
as agent for its affiliates and
discretionary accounts
00 Xxxx Xxxxx, 0xx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 57,847,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 27,970,000
----------------
The Northwestern Mutual Life Insurance $ 10.95 $ 9.97 $ 20.92 9.64% 474,861
Company/1/
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 19,776,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 3,350,000
----------------
The Northwestern Mutual Life Insurance $ 2.65 $ 2.42 $ 5.07 2.34%/1/ 115,084
Company for its Group Annuity
Separate Account*
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ -0-
----------------
Stated Principal Amount of 10 1/2% Notes
$ 7,000,000
----------------
COMMITMENT AMOUNTS
------------------
(dollars in millions)
Column A Column B Column C Column D Column E
---------------- ------------ ---------- ----------- -------------
Unexercised
Rights Exercise Rights Total
Commitment Commitment Commitment Commitment Participation
Name and Address of Standby Purchasers Amount (1) Amount (2) Amount Percentage Warrants
-------------------------------------- --------------- ----------- ---------- ---------- -------------
Northwestern Mutual Series Fund, Inc. for $ .75 $ .69 $ 1.44 0.66% 32,686
the High Yield Bond Portfolio*
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ -0-
----------------
Stated Principal Amount of 10 1/2%
Notes:
$ 2,000,000
----------------
Credit Suisse First Boston Corporation $ 29.48 $ 26.88 $ 56.36 25.97% 29,309
00 Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 32,453,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 35,930,000
----------------
Whippoorwill Associates, Inc., as general $ 30.42 $ 27.72 $ 58.14 26.79% 1,319,713
partner and/or agent for the parties set
forth on Schedule A hereto in the
percentages noted thereon
00 Xxxxxxx Xxxxxx
Xxxxx Xxxxxx, Xxx Xxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 37,855,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 31,410,000
----------------
Total: $113.52 $103.48 $217.00 100.00% 3,675,659
------- ------- ------- ---------
----------------
* The Northwestern Mutual Life Insurance Company, The Northwestern Mutual Life
Insurance Company for its Group Annuity Separate Account and Northwestern Mutual
Series Fund, Inc. for the High Yield Bond Portfolio are affiliated entities for
purposes of clauses (a) and (k) of Section 5 and clause (iii) of Section 6.
(1)The "Rights Exercise Commitment Amount", for each Standby Purchaser, shall
mean an amount equal to the product of (i) the Subscription Price (which is
subject to adjustment as provided in Section 4(f) of the Standby Commitment
Letter) and (ii) the number of Rights issuable in respect of an amount of
Allowed Unsecured Claims derived from the principal amount of 9 3/8% Notes and
the 10 1/2% Notes indicated under the Standby Purchaser's name on this Annex I
held by such Standby Purchaser on the date hereof. The dollar amounts set forth
under Column A are estimates provided for illustrative purposes only, based on
the assumptions that (x) there is a total of $475 million of Allowed Unsecured
Claims, (y) there is no Rights Reserve (as defined in the Plan) and (z) the
aggregate amount of Subordinated Noteholder Claims (as defined in the Plan) is
$441,819,762.
(2)The "Unexercised Rights Commitment Amount", for each Standby Purchaser, shall
mean an amount equal to (i) the Total Commitment Amount indicated in Column C
for such Standby Purchaser less (ii) the Rights Exercise Commitment Amount for
such Standby Purchaser. The dollar amounts set forth under Column B are
estimates provided for illustrative purposes only, based on the estimates set
forth in Column A.
SCHEDULE A
----------
(DOLLARS IN MILLIONS)
PERCENTAGE OF UNEXERCISED
TOTAL FACE RIGHTS EXERCISE RIGHTS TOTAL
FACE AMOUNT AMOUNT OF COMMITMENT COMMITMENT COMMITMENT COMMITMENT
ACCOUNT OF CLAIM CLAIM AMOUNT AMOUNT AMOUNT PERCENTAGE
---------------------------------------- ----------- -------------------- --------------- ----------- ------------- ----------
President & Fellows of Harvard College $18.60 26.85% $ 8.12 $ 4.91 $13.03 22.41%
The Rockefeller Foundation 6.79 9.81% 2.95 3.85 6.80 11.69%
Xxxx Partners II, L.P. 7.84 11.32% 3.40 4.25 7.65 13.15%
Xxxx Partners III, L.P. 20.47 29.55% 8.95 3.97 12.92 22.22%
Xxxx Partners IV, L.P. 5.52 7.97% 2.43 8.89 11.33 19.48%
Xxxx Offshore Fund Trust 9.99 14.42% 4.53 1.86 6.39 10.99%
The Whippoorwill Profit Sharing Plan 0.06 0.09% 0.03 - 0.03 0.05%
------ ------ ------ ------
TOTAL $69.27 100.00% $30.42 $27.72 $58.14 100.00%
====== ====== ====== ======
CREDIT SUISSE FIRST BOSTON CORPORATION
00 Xxxxxxx Xxxxxx, Xxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
December 1, 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 (as
amended pursuant to the letter agreement dated September 3, 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 and third sentences of the first
---------------
paragraph of the Standby Commitment Letter are hereby amended in their 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 August 18, 1998 (as amended by the First Amendment thereto dated as of
September 3, 1998 and the Second Amendment thereto dated as of December 1,
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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 2
being referred to herein as the "Plan"), (i) cash and (ii) shares of its
Common Stock, par value $.01 per share ("Existing Arch Common Stock"); (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) an aggregate of 14,344,969
shares of Existing Arch Common Stock and (ii) rights to purchase ("Rights")
an aggregate of 108,500,000 shares of Existing Arch Common Stock ("Rights
Shares") for $2.00 per share in cash (the "Subscription Price"); (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 an
aggregate of 44,893,166 shares of Existing Arch Common Stock, and,
immediately following the Combination, Arch will issue 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"), 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 Rights Shares, to
the extent that the aggregate Subscription Price payable upon such exercise
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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 3
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) the Rights Shares underlying
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 the Rights Shares underlying such unexercised Rights.
-------
5. 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 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
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 4
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) the Rights
Shares underlying 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 Right Shares 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 Rights Shares 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.
-------
6. Section 4(a). Section 4(a) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(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 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).
7. Section 4(b). Section 4(b) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(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 or shares of Arch Class B Common Stock, if applicable, (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 Participation
Warrants contemplated by Section 7 below.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 5
8. Section 4(e). Section 4(e) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(e) 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
than the product of (i) the number of shares of Existing Arch Common Stock
issued by Arch in connection with 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; provided, however, that the Standby Purchaser is required to
-------- -------
exercise its right under this Section 4(e) to reduce the number of Rights
Shares to be purchased by it in satisfaction of its Commitment under
Section 1(c) above by the lesser of (i) 5,000,000 Rights Shares (or, if the
Reverse Stock Split (as defined in Section 4(f) below) occurs prior to or
simultaneously with the Closing, a number of Rights Shares equal to the
product of (x) 5,000,000 and (y) the Adjustment Fraction (as defined in
Section 4(f) below)) and (ii) a number of Rights Shares equal to the
Maximum Reduction Number.
9. New Section 4(f). Section 4 of the Standby Commitment Letter is
----------------
hereby amended to add the following Section 4(f) of the end thereof:
(f) Notwithstanding anything to the contrary herein contained, if the Buyer
effects the reverse stock split contemplated by Section 4.5 of the Buyer
Disclosure Schedule (the "Reverse Stock Split") prior to or simultaneously
the Closing, (i)(A) the number of Plan Shares, (B) the number of Rights
Shares, and (C) the number of Arch Participation Warrants to be issued
pursuant to Section 7 below, will be adjusted, in each case, to a number
equal to the product of (x) the number provided therefor herein and (y) the
Adjustment Fraction and (ii) the Subscription Price will be adjusted to a
price equal to the product of (x) $2.00 and (y) the Inverse Adjustment
Fraction. For purposes of this Section 4(f) the term "Adjustment Fraction"
means a fraction, the numerator of which is the total number of shares of
Buyer Common Stock issued and outstanding immediately following the
effectiveness of the Reverse Stock Split and the denominator of which is
the total number of shares of Buyer Common Stock issued and outstanding
immediately prior to the effectiveness of the Reverse Stock Split, and the
term "Inverse Adjustment Fraction" means the fraction that is the inverse
of the Adjustment Fraction.
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 6
10. 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 and all
shares of Arch Class B Common Stock, if applicable, (ii) 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 Participation Warrants (the securities
referred to in the foregoing clauses (i), (ii) and (iii) are referred to
herein as the "Registrable Securities");
11. 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 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;
12. Section 5(j). Section 5(j) of the Standby Commitment Letter is hereby
------------
amended in its entirety to read as follows:
(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 and the shares of Arch Class B
Common Stock, if applicable, upon exercise of the Rights, (C) the issuance
to the Standby Purchaser of the shares of Existing Arch Common Stock and
the shares of Arch Class B Common Stock, if applicable, as contemplated by
Section 1 and Section 3 above and the Arch Participation Warrants as
contemplated by Section 7 below, and (D) the issuance of Existing Arch
Common Stock upon exercise of the Arch Participation Warrants 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;
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 7
13. Section 6. Section 6 of the Standby Commitment Letter is hereby
---------
amended in its entirety to read as follows:
6. [Intentionally omitted]
14. Section 7. Section 7 of the Standby Commitment Letter is hereby
---------
amended in its entirety to read as follows:
7. Consideration for the Commitment. In consideration for the Commitment,
--------------------------------
on the Effective Date at the Closing the Standby Purchaser will receive the
number of Arch Participation Warrants specified in Column E of Annex I
-------
hereto.
15. Section 9(a)(x). Section 9(a)(x) of the Standby Commitment Letter is
---------------
hereby amended in its entirety to read as follows:
(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 and the shares of Arch Class B
Common Stock, if applicable, to be issued and delivered as contemplated by
Section 1 and Section 3 above and 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 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
16. Section 10. Section 10 of the Standby Commitment Letter is hereby
----------
amended to add Sections 10(g), 10(h), 10(i) and 10(j) at the end thereof, with
such Sections 10(g), 10(h), 10(i) and 10(j) to read in their entirety as
follows:
(g) The Standby Purchaser will not, and will cause each of its respective
directors, officers, employees, representatives and agents not to, directly
or indirectly, solicit, initiate, engage or participate in or encourage
discussions or negotiations with any person or entity concerning any
Acquisition Proposals (other than with Arch or the Debtors concerning the
transactions contemplated hereby, including any modifications thereto).
The Standby Purchaser will immediately cease any and all existing
activities, discussions or negotiations with any person with respect to any
Acquisition Proposal (other than with Arch or the Debtors concerning the
transactions contemplated hereby, including any modifications thereto).
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 8
(h) Without intending to limit the generality or effect of Section 10(g)
above, the Standby Purchaser expressly covenants that it will not enter
into any agreement, arrangement or understanding (other than those set
forth in this letter agreement) with any party pursuant to which the
Standby Purchaser would, directly or indirectly, provide any financing in
connection with any Acquisition Proposal or any plan of reorganization of
the Debtors, whether filed by the Debtors or any other person; provided,
--------
however, that nothing herein contained will prevent the Standby Purchaser
-------
from accepting its pro rata portion of any distribution made to creditors
of the Debtors in connection with any such Acquisition Proposal or plan of
reorganization or from exercising any rights, warrants or options received
by the Standby Purchaser as part of such a pro rata distribution.
(i) Notwithstanding anything to the contrary herein contained, the Standby
Purchaser will be deemed to have waived (i) the condition contained in
clause (ii) of Section 5(a) above except in the event that any of the
Unaffiliated Standby Purchasers, other than in connection with a scheduled
Closing, has waived or otherwise abrogated its right to assert the
condition contained in clause (ii) of Section 5(a) of the Other Standby
Purchase Commitment to which such Unaffiliated Standby Purchaser is a party
and (ii) the condition contained in clause (ii) of Section 5(k) above
except in the event that any of the Unaffiliated Standby Purchasers, other
than in connection with a scheduled Closing, has waived or otherwise
abrogated its right to assert the condition contained in clause (ii) of
Section 5(k) of the Other Standby Purchase Commitment to which such
Unaffiliated Standby Purchaser is a party.
(j) As promptly as practicable following the approval of the Disclosure
Statement by the Bankruptcy Court, the Standby Purchaser will (a) deposit
or cause to be deposited with a financial institution reasonably acceptable
to Arch and the Standby Purchaser (the "Escrow Agent") $2,000,000 in cash,
to be held by the Escrow Agent for disbursement in accordance with an
escrow agreement to be negotiated in good faith by Arch and the Standby
Purchaser, (b) obtain a $2,000,000 letter of credit issued by a financial
institution reasonably acceptable to Arch (which may be an affiliate of the
Standby Purchaser) having terms reasonably satisfactory to the Standby
Purchaser and Arch, or (c) negotiate in good faith such alternative
arrangements as shall be mutually agreeable between the Standby Purchaser
and Arch; provided, however, that the Standby Purchaser and Arch may
-------- -------
mutually agree that there is no need for such deposit, letter of credit or
alternative arrangement, in which case this Section 10(j) will have no
further force or effect.
17. Section 12. Section 12 of the Standby Commitment Letter is hereby
----------
amended to delete the phrase "and the Confirmation Order is entered not later
than March 31, 1999".
Arch Communications Group, Inc.
MobileMedia Communications, Inc.
Page 9
18. Conclusion. The third sentence of the paragraph immediately following
----------
Section 16 of the Standby Commitment Letter is hereby amended to read in its
entirety as follows:
Once effective, this letter agreement will terminate on (i) June 30, 1999,
unless the effectiveness of the Plan occurs on or before such date, or (ii)
if not theretofore terminated pursuant to the foregoing clause, the date on
which the Merger Agreement is terminated in accordance with the terms
thereof.
19. Annex I. Annex I to the Standby Commitment Letter (as heretofore
-------
amended) is hereby further amended to read in its entirety as Annex I hereto.
-------
20. 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.
21. 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-2 hereto, which amendments shall be
-----------
entered into simultaneously herewith, (b) consents to (i) the Second Amendment
dated as of December 1, 1998 to the Merger Agreement and each of the exhibits,
schedules and annexes attached thereto and (ii) the Third Amended Joint Plan of
Reorganization dated as of December 1, 1998 and each of the exhibits, schedules
and annexes attached thereto, and (c) agrees that the form and substance thereof
are reasonably satisfactory to the Standby Purchaser.
22. 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.
23. 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 10
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, whereupon this letter will become a valid and
binding obligation of each party hereto.
Very truly yours,
CREDIT SUISSE FIRST BOSTON CORPORATION
By: /s/
-------------------------------
Name:
Its:
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 11
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 a 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
ANNEX I
-------
COMMITMENT AMOUNTS
------------------
(dollars in millions)
Column A Column B Column C Column D Column E
---------------- ------------ ---------- ----------- -------------
Unexercised
Rights Exercise Rights Total
Commitment Commitment Commitment Commitment Participation
Name and Address of Standby Purchasers Amount (1) Amount (2) Amount Percentage Warrants
-------------------------------------- --------------- ----------- ---------- ---------- -------------
X.X. Xxxx Asset Management Co., L.L.C., $ 39.27 $ 35.80 $ 75.07 34.60% 1,704,006
as agent for its affiliates and
discretionary accounts
00 Xxxx Xxxxx, 0xx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 57,847,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 27,970,000
----------------
The Northwestern Mutual Life Insurance $ 10.95 $ 9.97 $ 20.92 9.64% 474,861
Company/1/
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 19,776,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 3,350,000
----------------
The Northwestern Mutual Life Insurance $ 2.65 $ 2.42 $ 5.07 2.34%/1/ 115,084
Company for its Group Annuity
Separate Account*
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ -0-
----------------
Stated Principal Amount of 10 1/2% Notes
$ 7,000,000
----------------
COMMITMENT AMOUNTS
------------------
(dollars in millions)
Column A Column B Column C Column D Column E
---------------- ------------ ---------- ----------- -------------
Unexercised
Rights Exercise Rights Total
Commitment Commitment Commitment Commitment Participation
Name and Address of Standby Purchasers Amount (1) Amount (2) Amount Percentage Warrants
-------------------------------------- --------------- ----------- ---------- ---------- -------------
Northwestern Mutual Series Fund, Inc. for $ .75 $ .69 $ 1.44 0.66% 32,686
the High Yield Bond Portfolio*
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ -0-
----------------
Stated Principal Amount of 10 1/2%
Notes:
$ 2,000,000
----------------
Credit Suisse First Boston Corporation $ 29.48 $ 26.88 $ 56.36 25.97% 29,309
00 Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 32,453,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 35,930,000
----------------
Whippoorwill Associates, Inc., as general $ 30.42 $ 27.72 $ 58.14 26.79% 1,319,713
partner and/or agent for the parties set
forth on Schedule A hereto in the
percentages noted thereon
00 Xxxxxxx Xxxxxx
Xxxxx Xxxxxx, Xxx Xxxx 00000
Stated Principal Amount of 9 3/8% Notes:
$ 37,855,000
----------------
Stated Principal Amount of 10 1/2% Notes:
$ 31,410,000
----------------
Total: $113.52 $103.48 $217.00 100.00% 3,675,659
------- ------- ------- ---------
----------------
* The Northwestern Mutual Life Insurance Company, The Northwestern Mutual Life
Insurance Company for its Group Annuity Separate Account and Northwestern Mutual
Series Fund, Inc. for the High Yield Bond Portfolio are affiliated entities for
purposes of clauses (a) and (k) of Section 5 and clause (iii) of Section 6.
(1)The "Rights Exercise Commitment Amount", for each Standby Purchaser, shall
mean an amount equal to the product of (i) the Subscription Price (which is
subject to adjustment as provided in Section 4(f) of the Standby Commitment
Letter) and (ii) the number of Rights issuable in respect of an amount of
Allowed Unsecured Claims derived from the principal amount of 9 3/8% Notes and
the 10 1/2% Notes indicated under the Standby Purchaser's name on this Annex I
held by such Standby Purchaser on the date hereof. The dollar amounts set forth
under Column A are estimates provided for illustrative purposes only, based on
the assumptions that (x) there is a total of $475 million of Allowed Unsecured
Claims, (y) there is no Rights Reserve (as defined in the Plan) and (z) the
aggregate amount of Subordinated Noteholder Claims (as defined in the Plan) is
$441,819,762.
(2)The "Unexercised Rights Commitment Amount", for each Standby Purchaser, shall
mean an amount equal to (i) the Total Commitment Amount indicated in Column C
for such Standby Purchaser less (ii) the Rights Exercise Commitment Amount for
such Standby Purchaser. The dollar amounts set forth under Column B are
estimates provided for illustrative purposes only, based on the estimates set
forth in Column A.
SCHEDULE A
----------
(DOLLARS IN MILLIONS)
PERCENTAGE OF UNEXERCISED
TOTAL FACE RIGHTS EXERCISE RIGHTS TOTAL
FACE AMOUNT AMOUNT OF COMMITMENT COMMITMENT COMMITMENT COMMITMENT
ACCOUNT OF CLAIM CLAIM AMOUNT AMOUNT AMOUNT PERCENTAGE
---------------------------------------- ----------- -------------------- --------------- ----------- ------------- ----------
President & Fellows of Harvard College $18.60 26.85% $ 8.12 $ 4.91 $13.03 22.41%
The Rockefeller Foundation 6.79 9.81% 2.95 3.85 6.80 11.69%
Xxxx Partners II, L.P. 7.84 11.32% 3.40 4.25 7.65 13.15%
Xxxx Partners III, L.P. 20.47 29.55% 8.95 3.97 12.92 22.22%
Xxxx Partners IV, L.P. 5.52 7.97% 2.43 8.89 11.33 19.48%
Xxxx Offshore Fund Trust 9.99 14.42% 4.53 1.86 6.39 10.99%
The Whippoorwill Profit Sharing Plan 0.06 0.09% 0.03 - 0.03 0.05%
------ ------ ------ ------
TOTAL $69.27 100.00% $30.42 $27.72 $58.14 100.00%
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