|
EXHIBIT
10.10
FORM
OF
WARRANT REDEMPTION
PAYMENT AGREEMENT
THIS WARRANT REDEMPTION
PAYMENT AGREEMENT (the “Agreement”) is entered into as
of the 2nd day of June, 2008, by and between TELETOUCH
COMMUNICATIONS, INC., a Delaware corporation (the
“Company”), on the one hand, and
(the “Warrant Holder”), a holder of the Company’s
Common Stock Purchase Warrant bearing Certificate Number
dated December 12, 2002 (collectively the
“Warrant”), on the other hand. All capitalized terms
used in this Agreement that are not defined shall have the meaning
ascribed to them in the Warrant.
W I T N E S S E T
H:
WHEREAS , the Company
issued the Warrant pursuant to the terms and provisions of the
Restructuring Agreement dated May 17, 2002;
WHEREAS , the Warrant
contains redemption provisions which enable the holder under
certain terms and conditions to request that the Warrant be
redeemed by the Company;
WHEREAS , the Warrant
Holder has submitted a request to the Company to redeem such
Warrant in full; and
WHEREAS, as more fully
set forth later in this Agreement the Company and the Warrant
Holder have agreed to resolve any and all claims and differences
between them as follows: (i) the Warrants owned by the Warrant
Holder will be terminated and canceled, (ii) the Company will
make cash payments to the Warrant Holder in the amounts and at such
times as are more specifically set forth below, and (iii) the
Warrant Holder and the Company have agreed to enter into a mutual
release and covenant not to sue.
NOW, THEREFORE , in
consideration of the above premises and the mutual covenants
contained below and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, and
intending to be legally bound, the parties agree as
follows:
1. Payments .
Promptly, but in no event later than five (5) business days,
following the exchange of executed counterparts of this Agreement,
the Company shall pay the Warrant Holder, by wire transfer of
immediately available funds, $
(the “Initial Payment”). An additional amount of $
(the “Remaining Principal Balance”) is due to the
Warrant Holder, together with interest on the outstanding principal
balance of the Remaining Principal Balance at an annual simple
interest rate equal to twelve percent (12%), calculated on the
basis of a 360-day year and the actual number of days elapsed
through date of payment, shall be payable by the Company to the
Warrant Holder as follows:
(a) seventeen (17) equal
monthly principal payment installments (the “Installment
Payments”) in the amount of [
] Dollars ($
) [total Remaining Principal Balance divided by 60], plus the
computed interest amount on the unpaid principal amount of the
Remaining Principal Balance for each monthly period, shall be paid
by the Company to the Warrant Holder, on or before the tenth
(10 th ) day of each calendar month commencing with the first
full calendar month following the date hereof and continuing for a
period of seventeen (17) months; and
- 1 -
(b) a final single payment
(the “Final Payment”) of [
] Dollars ($
) [remaining principal amount of Remaining Principal Balance],
together with any interest accrued thereon, shall be paid by the
Company to the Warrant Holder on or before the tenth (10
th
) day of the eighteenth
(18 th ) month following the date hereof; and
(c) accordingly, such Initial
Payment, Remaining Principal Balance, Installment Payments and
Final Payment schedule are shown on Exhibit A attached to this
Agreement and incorporated by reference herein.
The obligation of the Company
to pay the Remaining Principal Balance, the Installment Payments
and the Final Payment and interest thereon as described herein
shall also be evidenced by that certain Promissory Note of even
date from the Company to Warrant Holder (the “Promissory
Note”).
Notwithstanding the
foregoing, in the event that prior to the Final Payment date the
Company closes a sale (a “Subject Sale”) of any of its
assets sold not in the ordinary course of business which sales
results in net proceeds to the Company in excess of Two Million
Dollars ($2,000,000), the Company shall use 50% of such proceeds in
excess of Two Million Dollars ($2,000,000) to make accelerated
payments (each an “Asset Sale Accelerated Payment”) on
the Remaining Principal Balance in whole or in part owed to the
Warrant Holder. The amount of the Asset Sale Accelerated Payment
shall be the Warrant Holder’s pro rata portion (based upon
the unpaid principal amount of the Remaining Principal Balance owed
by the Company to Warrant Holder divided by the total unpaid
principal balance of the Remaining Principal Balance owed by the
Company to all holders of the Warrants) of fifty (50%) percent
of the net proceeds of a Subject Sale, and in no event shall it
exceed the unpaid portion of the Remaining Principal Balance,
together with all accrued but unpaid interest thereon. Each Asset
Sale Accelerated Payment shall be made within five (5) days of
the closing of the Subject Sale.
Further, notwithstanding the
foregoing, in the event of a Change in Control (as defined herein),
the Company shall accelerate and prepay the entire unpaid principal
of the Remaining Principal Balance, together with all accrued but
unpaid interest thereon (the “Change in Control Accelerated
Payment”). The Change in Control Accelerated Payment shall be
made within five (5) days of the closing of the transaction
resulting in the Change in Control. For this purpose, “Change
in Control” means the occurrence of one or more of the
following events:
(a) any “person”,
as such term is used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934 (the “Exchange Act”) (other than
the Company, any trustee or other fiduciary holding securities
under an employee benefit plan of the Company or any corporation
owned, directly or indirectly, by the shareholders of the Company
in substantially the same proportions as their ownership of stock
of the Company), is or becomes the “beneficial owner”
(as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Company representing fifty percent
(50%) or more of the combined voting power of the
Company’s then outstanding securities; or
- 2 -
(b) the stockholders of the
Company approve a merger or consolidation of the Company with any
other person, other than a merger or consolidation which would
result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or being converted into voting securities for
the surviving entity) more than fifty percent (50%) of the
combined voting power of the voting securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation in substantially the same proportion as the ownership
of voting securities of the Company immediately prior thereto;
or
(c) the stockholders of the
Company approve a plan of complete liquidation of the Company or an
agreement for the sale or disposition by the Company of all or
substantially all of the Company’s assets (or any transaction
having a similar effect).
The Company may prepay the
unpaid principal of the Remaining Principal Balance in whole or in
part prior to the Final Payment, without penalty and in its sole
discretion, at any time during the term of this Agreement. The
entire amount of any such prepayment by the Company shall be
applied against the last payment first.
All payments from the Company
as herein described above, and all Interim Financial Statements and
Annual Financial Statements reporting as herein described below
shall be made to the Warrant Holder through, and will be deemed
accepted by, Aintree Capital, 40 Burton Hills Boulevard, Suite 350,
Nashville, Tennessee 37215, Attention: Mr. John
Maggart.
In the event of an occurrence
of any event of default specified below, the Company or Warrant
Holder, as the case may be, agrees to give the other prompt written
notice of such event. The Warrant Holder may, so long as such
condition exists and has not been cured during the applicable cure
period, declare the entire unpaid principal of the Remaining
Principal Balance and unpaid accrued interest thereon immediately
due and payable, by notice in writing to the Company. Further, upon
the occurrence of any event of default specified below, regardless
of whether the Warrant Holder has declared the entire unpaid
principal of the Remaining Principal Balance and unpaid accrued
interest thereon immediately due and payable, the unpaid principal
of the Remaining Principal Balance shall thereafter bear interest
at eighteen percent (18%) per annum.
The following shall
constitute an event of default:
(a) Failure by the Company to
make any payment (any of the Installment Payments, the Final
Payment, an Asset Sale Accelerated Payment or the Change in Control
Accelerated Payment) hereunder or under the Promissory Note when
due, which failure has not been cured within twenty (20) days
following such due date; or
(b) Failure by the Company to
perform any obligation of the Company hereunder, other than as set
forth in subparagraph (a) of this paragraph, which failure is
not cured within thirty (30) days following such default;
or
- 3 -
(c) The institution by the
Company of bankruptcy proceedings to be adjudicated by a court of
competent jurisdiction, or the consent by it to institution of
bankruptcy or insolvency proceedings against it or the filing by it
of a petition or answer or consent seeking reorganization or
release under the federal Bankruptcy Act, or any other applicable
federal or state law, or the consent by it to the filing of any
such petition or the appoin
| 
