Exhibit 2.1
AMENDMENT NO. 5 TO
AGREEMENT AND PLAN OF MERGER
This AMENDMENT NO.
5, dated as of February 25, 2008 (this “
Amendment ”), to the Agreement and Plan of Merger, dated as
of January 15, 2007, as amended (the “ Merger
Agreement ”), by and among VERIZON COMMUNICATIONS INC., a
Delaware corporation (“ Verizon ”), NORTHERN NEW
ENGLAND SPINCO INC., a Delaware corporation (“ Spinco
”), and FAIRPOINT COMMUNICATIONS, INC., a Delaware
corporation (the “ Company ”), is entered into
by and among Verizon, Spinco and the Company. Capitalized
terms used but not defined herein shall have the meanings given to
such terms in the Merger Agreement, and all references to Recitals,
Articles and Sections herein are references to Recitals, Articles
and Sections of the Merger Agreement.
WHEREAS, Verizon
has exercised its right under Section 2.4(e) of the
Distribution Agreement, dated as of January 15, 2007, by and
between Verizon and Spinco (as amended, the “ Distribution
Agreement ”) to cause certain changes to be made to the
structure of the transactions contemplated by the Distribution
Agreement;
WHEREAS, certain
amendments to the Merger Agreement are required to reflect the
amended structure of the transactions contemplated by the
Distribution Agreement; and
WHEREAS, the
Company, Verizon and Spinco desire to extend the term of the Merger
Agreement.
NOW THEREFORE, in
consideration of the premises and the mutual promises herein made,
and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties, intending
to be legally bound hereby, agree as follows:
1.
Amendments to Recitals . The Recitals are hereby amended and
restated in their entirety to read as follows:
“WHEREAS,
Spinco is a newly formed, wholly-owned, direct Subsidiary of
Verizon and, immediately prior to the Distribution Date, shall be a
wholly-owned, direct Subsidiary of Verizon New England Inc., a New
York corporation (“ Verizon New England
”);
WHEREAS, on or
prior to the Distribution Date (as such term, and each other
capitalized term used herein and not defined, is defined in
Article I hereof), and subject to the terms and conditions set
forth in the Distribution Agreement entered into by and between
Verizon and Spinco on the date hereof (the “ Distribution
Agreement ”), Verizon New England, which is a
wholly-owned, direct Subsidiary of NYNEX Corporation, a Delaware
corporation (“ NYNEX ”), which is a
wholly-owned, direct Subsidiary of Verizon, will cause the
formation of Northern New England Telephone Operations LLC (“
ILEC Spinco Subsidiary ”), which will be a
wholly-owned direct Subsidiary of Verizon New England;
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WHEREAS, on or
prior to the Distribution Date, Verizon New England will transfer
to ILEC Spinco Subsidiary certain Spinco Assets and Spinco
Liabilities in the manner set forth in the Distribution
Agreement;
WHEREAS, on or
prior to the Distribution Date, certain Subsidiaries of Verizon
will transfer to Verizon, via intercompany dividends or sales or
otherwise, certain Spinco Assets and Spinco Liabilities relating to
the non-ILEC portion of the Spinco Business in the manner set forth
in the Distribution Agreement (the “ Internal
Restructuring ”);
WHEREAS, on or
prior to the Distribution Date, (a) Spinco will issue to
Verizon New England shares of the Spinco Common Stock (as defined
in the Distribution Agreement) and distribute to Verizon New
England the Spinco Securities (as defined in the Distribution
Agreement) and pay to Verizon New England the Special Payment (as
defined in the Distribution Agreement), all of which will occur in
exchange for Verizon New England transferring to Spinco the
membership interests of ILEC Spinco Subsidiary in the manner set
forth in the Distribution Agreement (the transactions described in
clause (a) of this recital, collectively, the “
Internal Contribution ”) and (b) Verizon New
England will thereafter distribute all Spinco Common Stock to NYNEX
(such distribution, together with the Internal Contribution, the
“ First Internal Spinoff ”), which in turn will
distribute all Spinco Common Stock to Verizon (the “
Second Internal Spinoff ” and, together with the First
Internal Spinoff, the “ Internal Spinoffs
”);
WHEREAS, upon the
terms and subject to the conditions set forth in the Distribution
Agreement, on the Distribution Date following the Second Internal
Spinoff, Verizon will ( a ) contribute to Spinco
certain Spinco Assets and Spinco Liabilities relating to the
non-ILEC portion of the Spinco Business (the “
Contribution ” and, together with the Internal
Contribution, the “ Contributions ”), all of
which will be immediately contributed by Spinco to its wholly-owned
subsidiary, Enhanced Communications of Northern New England Inc., a
Delaware corporation, and ( b ) distribute all of the
issued and outstanding shares of Spinco Common Stock to the
Distribution Agent for the benefit of the holders of the
outstanding Verizon Common Stock (the “ Distribution
”);
WHEREAS, at the
Effective Time, the parties will effect the merger of Spinco with
and into the Company, with the Company continuing as the surviving
corporation, all upon the terms and subject to the conditions set
forth herein;
WHEREAS, (
a ) the Board of Directors of the Company ( i
) has determined that the Merger and this Agreement are
advisable, fair to, and in the best interests of, the Company and
its stockholders and has approved this Agreement and the
transactions contemplated thereby, including the Merger, and the
issuance of shares of Company Common Stock pursuant to the Merger,
and ( ii ) has recommended the adoption by the
stockholders of the Company of this Agreement and the approval of
the transactions contemplated hereby, and ( b ) the
stockholders of the Company have adopted this Agreement and
approved the transactions contemplated hereby;
WHEREAS, (
a ) the Board of Directors of Spinco has ( i
) determined that the Merger and this Agreement are advisable,
fair to and in the best interests of Spinco and
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its sole
stockholder, and has approved this Agreement and the Distribution
Agreement and the transactions contemplated hereby and thereby,
including the Contributions, the Debt Exchange (as defined in the
Distribution Agreement), the Distribution and the Merger, and (
ii ) recommended the adoption by its sole stockholder
of this Agreement and the approval of the transactions contemplated
hereby, and ( b ) the sole stockholder of Spinco has
adopted this Agreement and approved the transactions contemplated
hereby;
WHEREAS, the Board
of Directors of Verizon has approved this Agreement and the
Distribution Agreement and the transactions contemplated hereby and
thereby, including the Internal Spinoffs, the Internal
Restructuring, the Contributions, the Distribution, the Debt
Exchange and the Merger;
WHEREAS, prior to
the execution of this Agreement, as an inducement to
Verizon’s willingness to enter into this Agreement and incur
the obligations set forth herein, the Company’s stockholders
who are parties to the Nominating Agreement have entered into the
Termination Agreement, dated as of January 15, 2007 (the
“ Termination Agreement ”), pursuant to which
such stockholders have agreed, among other things, to cause their
designees to the Board of Directors of the Company to resign by no
later than immediately prior to the Effective Time and to terminate
the Nominating
Agreement effective immediately prior to the Effective Time
;
WHEREAS, the
parties to this Agreement intend that ( i ) the First
Internal Spinoff qualify as a reorganization under
Section 368(a)(1)(D) of the Internal Revenue Code of
1986, as amended (the “ Code ”) and a
distribution eligible for nonrecognition under Sections
355(a) and 361(c) of the Code; ( ii ) the
Second Internal Spinoff qualify as a distribution eligible for
nonrecognition under Sections 355(a) and 355(c) of the
Code; ( iii ) the Contribution, together with the
Distribution, qualify as a tax-free reorganization under
Section 368(a)(1)(D) of the Code; ( iv ) the
Distribution qualify as a distribution of Spinco stock to Verizon
stockholders eligible for nonrecognition under Sections
355(a) and 361(c) of the Code; ( v )
no gain or loss be
recognized by Verizon or Verizon New England for federal income tax
purposes in connection with the receipt of the Spinco Securities or
the consummation of the Debt Exchange ; ( vi ) the Special Payment
qualify as money transferred to creditors or distributed to
shareholders in connection with the reorganization within the
meaning of Section 361(b)(1) of the Code, to the extent
that Verizon New England distributes the Special Payment to its
creditors and/or shareholders in connection with the Internal
Contribution; ( vii ) the Merger qualify as a tax-free
reorganization pursuant to Section 368 of the Code; and (
viii ) no gain or loss be recognized as a result of
such transactions for federal income tax purposes by any of
Verizon, Spinco, and their respective stockholders and Subsidiaries
(except to the extent of cash received in lieu of fractional
shares) ;
and
WHEREAS
, the parties to this
Agreement intend that throughout the internal restructurings taken
in contemplation of this Agreement, including the Internal Spinoffs
and Internal Restructuring, the Contributions and the Distribution,
and throughout the Merger, the Spinco Employees shall maintain
uninterrupted continuity of employment, compensation and benefits,
and also for union represented employees, uninterrupted
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continuity of
coverage under their collective bargaining agreements, in each case
as described in the Employee Matters Agreement .
NOW, THEREFORE, in
consideration of these premises, the representations, warranties,
covenants and agreements set forth in this Agreement, and for other
good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties, intending to be legally
bound hereby, agree as follows:”
2.
Amendments to Article I .
(a)
Section 1.59 is hereby amended and restated in its entirety to
read as follows:
“‘
Distribution Tax Opinion ’ means a written opinion of
Verizon Tax Counsel, addressed to Verizon and Spinco and dated as
of the Distribution Date, in form and substance reasonably
satisfactory to Verizon and (solely with respect to issues as to
whether Spinco recognizes gain or loss) the Company, to the effect
that ( i ) each of the Internal Spinoffs will qualify
as a distribution eligible for nonrecognition under Sections
355(a), 355(c) and/or 361(c) of the Code, as applicable,
( ii ) the Distribution will qualify as a distribution
of Spinco stock to the stockholders of Verizon eligible for
nonrecognition under Sections 355(a) and 361(c) of the
Code, pursuant to which no gain or loss will be recognized for
federal income tax purposes by any of Verizon, Spinco or the
stockholders of Verizon, except as to cash received in lieu of
fractional shares by the stockholders of Verizon, and ( iii
) neither Verizon nor Verizon New England will recognize
gain or loss for federal income tax purposes in connection with the
receipt of the Spinco Securities or the consummation of the Debt
Exchange .”
(b)
Section 1.94 is hereby amended and restated in its entirety to
read as follows:
“‘ IRS Ruling ’ means a private letter
ruling from the IRS to the effect that ( i ) the First
Internal Spinoff will qualify as a reorganization under
Section 368(a)(1)(D) of the Code and a distribution
eligible for nonrecognition under Sections 355(a) and
361(c) of the Code; ( ii ) the Second Internal
Spinoff will qualify as a distribution eligible for nonrecognition
under Sections 355(a) and 355(c) of the Code; (
iii ) the Contribution, together with the Distribution,
will qualify as a tax-free reorganization under
Section 368(a)(1)(D) of the Code; ( iv ) the
Distribution will qualify as a distribution of Spinco stock to
Verizon stockholders eligible for nonrecognition under Sections
355(a) and 361(c) of the Code; ( v
) neither Verizon nor Verizon New England will recognize
gain or loss for federal income tax purposes in connection with the
receipt of the Spinco Securities or the consummation of the Debt
Exchange ; (
vi ) the Special Payment will qualify as money
transferred to creditors or distributed to shareholders in
connection with the reorganization within the meaning of
Section 361(b)(1) of the Code, to the extent that
Verizon New
England distributes
the Special Payment to its creditors and/or shareholders in
connection with the Internal Contribution; and ( vii
) no gain or loss will be recognized as a result of such
transactions for federal income tax purposes by any of
Verizon,
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Spinco, and
their respective stockholders and Subsidiaries (except to the
extent of cash received in lieu of fractional
shares).”
(c)
Section 1.61 is hereby amended and restated in its entirety to
read as follows:
“‘
Distribution Transfer Taxes ’ means any sal
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