FairPoint Communications 2009 Annual Report Download - page 12

Table of Contents
or a subsidiary that is held directly or indirectly by a controlled foreign corporation or (y) any subsidiary that is prohibited by applicable law from
guaranteeing the obligations under the Exit Facility and/or providing any security therefor without the consent of a PUC (together with the Exit
Borrowers, collectively, the "Exit Financing Loan Parties"). The Exit Facility will be secured by first priority liens upon substantially all existing and
after-acquired assets of the Exit Financing Loan Parties.
The Exit Facility Loan Agreement will contain certain representations, warranties and affirmative covenants. In addition, the Exit Facility Loan
Agreement will contain restrictive covenants that limit, among other things, the ability of the Exit Financing Loan Parties to incur indebtedness, create
liens, engage in mergers, consolidations and other fundamental changes, make investments or loans, engage in transactions with affiliates, pay
dividends, make capital expenditures and repurchase capital stock. The Exit Facility Loan Agreement will also contain minimum interest coverage and
maximum total leverage financial maintenance covenants. The Exit Facility Loan Agreement will contain certain events of default, including failure to
make payments, breaches of covenants and representations, cross defaults to other material indebtedness, unpaid and uninsured judgments, changes of
control and bankruptcy events of default. The Exit Facility Lenders' commitments to fund amounts under the Exit Facility on or following the Effective
Date will be subject to certain customary conditions as well as confirmation of the Plan.
A copy of the form of the Exit Facility Loan Agreement is attached to the Plan Supplement, which is available at www.fprestructuring.com under
the "Court Filings" link.
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In connection with the Plan, the Company is expected to adopt a Ninth Amended and Restated Certificate of Incorporation of FairPoint
Communications, Inc. (the "Amended Charter"), which is expected to become effective on the Effective Date. The Amended Charter will authorize the
Company to issue up to 5,000,000 shares of preferred stock and up to 75,000,000 shares of New Common Stock. In addition, in connection with the
Plan, the Company is expected to adopt Second Amended and Restated By-Laws (the "Amended By-Laws").
A copy of the form of Amended Charter and Amended By-Laws are attached to the Plan Supplement, which is available at
www.fprestructuring.com under the "Court Filings" link.
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As of the Effective Date, the reorganized Company is expected to have a newly appointed seven person board of directors (the "New Board").
Selected biographical information for each of the seven proposed new board members is attached to the Plan Supplement, which is available at
www.fprestructuring.com under the "Court Filings" link. In accordance with the Amended By-Laws, the initial members of the New Board are
expected to hold office until the first annual meeting of stockholders which will be held following the one year anniversary of the Effective Date.
Thereafter, members of the board of directors of the Company are expected to have one-year terms so that their terms will expire at each annual meeting
of stockholders.
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As contemplated by the Plan, on the Effective Date, the Company will be deemed to have adopted the FairPoint Communications, Inc. 2010 Long
Term Incentive Plan (the "New Long Term Incentive Plan") and the FairPoint Communications, Inc. 2010 Success Bonus Plan (the "Success Bonus
Plan") without any further action by the Company. Each of the New Long Term Incentive Plan and the Success Bonus Plan was attached to the Plan
Supplement, and may be accessed at www.fprestructuring.com under the "Court Filings" link.
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