Exhibit 99.2
[LOGO]
CLEARLAKE CAPITAL
650 Madison Avenue,
23rd Floor
New York, New York 10022
Tel 212.610.9000
September 12, 2007
PERSONAL AND CONFIDENTIAL
GoAmerica, Inc.
433 Hackensack Avenue,
Hackensack, NJ 07601
Attn: Daniel R. Luis, Chief Executive Officer
Re: Amended and Restated Second Lien Debt Commitment Letter
Ladies and Gentlemen:
You have advised Clearlake Capital Group, LP (together with the funds and
accounts managed or advised by it, "Clearlake") that GoAmerica, Inc. (together
with its subsidiaries, the "Company") (A) intends to acquire all or
substantially all of the assets of the Tele Relay Services division of Verizon
Communications Inc. (the "TRS Division" and such acquisition, the "TRS
Acquisition") pursuant to a definitive asset purchase agreement for the TRS
Acquisition (the "TRS Acquisition Agreement"), (B) intends to acquire Hands On
Video Relay Services, Inc., a Delaware corporation, and its subsidiaries
(collectively, "HOVRS" and such acquisition, the "HOVRS Acquisition") pursuant
to a definitive merger agreement for the HOVRS Acquisition (the "HOVRS
Acquisition Agreement") and (C) desires to procure financing for additional
working capital purposes and to finance the HOVRS Acquisition. Upon the terms,
and subject to satisfaction of the conditions, set forth herein, CCP A, L.P., a
fund managed by Clearlake, hereby commits to provide certain debt financing for
the Company for the Company's working capital purposes and to finance the HOVRS
Acquisition. The requested financing will be structured as a $40 million second
lien term loan or note issuance (the "Second Lien Debt Financing") having the
terms set forth in Annex A, and will be subject to the conditions set forth in
this letter and in the attached Annexes A and B hereto (collectively, the
"Amended and Restated Commitment Letter"). This Amended and Restated Commitment
Letter amends and restates that certain Second Lien Debt Commitment Letter,
dated as of August 1, 2007, by and between the Company and CCP A, L.P.
On the date hereof, the parties hereto (or their affiliates) are entering into
(x) that certain Amended and Restated Stock Purchase Agreement related to the
purchase of 7,446,809 shares of the Company's Series A Preferred Stock (the
"7,446,809 Share Stock Purchase Agreement"), and (y) that certain Amended and
Restated First Lien Debt Commitment Letter (the "First Lien Debt Commitment
Letter"). On August 1, 2007, the parties hereto (or their affiliates) entered
into (i) that certain $3,500,000 Credit
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September 12, 2007
Page 2
Agreement (the "Bridge Credit Agreement") and (ii) that certain $1,500,000 Stock
Purchase Agreement (the "$1,500,000 Stock Purchase Agreement" and together with
the First Lien Debt Commitment Letter, the 7,446,809 Share Stock Purchase
Agreement and the Bridge Credit Agreement, the "Other Financing Documents").
1. Indemnification; Exclusivity; Commitment Fee.
(a) The Company agrees to the provisions with respect to Clearlake's indemnity
and other matters set forth in Annex B, which is incorporated by reference into
this Amended and Restated Commitment Letter.
(b) Except as expressly permitted by Section 10.5 of the 7,446,809 Share Stock
Purchase Agreement, the Company hereby agrees to exclusively negotiate the
Second Lien Debt Financing with Clearlake in good faith and will not enter into
any discussions with third parties with respect to the Second Lien Debt
Financing or any other financing for any proposed investment or acquisition
(other than the financings contemplated by the Other Financing Documents) until
the earlier of (A) the execution of definitive agreements evidencing the Second
Lien Debt Financing, and (B) the date this Amended and Restated Commitment
Letter is terminated.
(c) The Company hereby agrees to pay Clearlake a commitment fee of $664,000.00
(the "Commitment Fee"), which shall be due and payable in full on the date
hereof. The Company hereby acknowledges and agrees that the Commitment Fee shall
be fully earned and non-refundable on such date and shall be in addition to any
other fees payable by the Company in connection with the Second Lien Debt
Financing.
2. Closing; Obligations.
Subject to the satisfaction of the conditions set forth in this Amended and
Restated Commitment Letter, the closing of the Second Lien Debt Financing would
occur no later than the closing of the HOVRS Acquisition. Clearlake's obligation
under this Amended and Restated Commitment Letter (but not under the Definitive
Agreement described below) will terminate upon the earliest of (a) the
termination of the 7,446,809 Share Stock Purchase Agreement by the Company
pursuant to Section 11.1(d)(ii) thereof, (b) the termination of the HOVRS
Acquisition Agreement, and (c) the later of (i) one day following Clearlake's
delivery to the Company of written notice (which notice (a "Termination Notice")
may be delivered at any time on or after February 28, 2008) that Clearlake
desires to terminate its obligation to close the Second Lien Debt Financing, or
(ii) the date that is specifically set forth as the termination date for this
Amended and Restated Commitment Letter in such Termination Notice.
3. Conditions.
Clearlake's obligation to provide the Second Lien Debt Financing is subject to
the following conditions:
(a) The Company and Clearlake shall have negotiated, executed and
delivered (or, in the case of clause (3) below, the Company shall
have provided) (1) a definitive debt issuance and sale document with
respect to the Second Lien Debt Financing (the "Definitive
Agreement"), (2) all documents related to the Definitive Agreement,
including without
GoAmerica, Inc.
September 12, 2007
Page 3
limitation legal opinions, a solvency certificate from the Company
and officers' certificates, and (3) corporate records, customary
documents from public officials and customary evidence that the
collateral agent shall have a valid and perfected first priority
lien and security interest in the collateral (the documents referred
to in this paragraph, collectively, the "Second Lien Debt Financing
Documents"), which Second Lien Debt Financing Documents shall be in
form and substance acceptable to Clearlake and its counsel (such
acceptance not to be unreasonably withheld or delayed) and shall be
based upon the Bridge Credit Agreement and the Loan Documents
referenced therein; provided, however, the parties agree that the
terms of the Second Lien Debt Financing Documents will contain
looser "carve-outs" to the covenants to be agreed upon by the
parties;
(b) The closing of the TRS Acquisition in accordance with the TRS
Acquisition Agreement (except to the extent that the TRS Acquisition
Agreement is subsequently amended or any term or condition thereof
waived without Clearlake's consent, such consent not to be
unreasonably withheld or delayed) shall have occurred concurrently
with the closing of the First Lien Debt Financing;
(c) The Company shall have received not less than $38,500,000 in gross
cash proceeds from the Investors under and as defined in the
7,446,809 Share Stock Purchase Agreement as a result of the
consummation of the transactions contemplated thereby, including
receipt of shareholder approval for such share issuances (unless the
Investors are in material breach of their obligations under the
7,446,809 Share Stock Purchase Agreement);
(d) There shall exist no action, suit, investigation, litigation or
proceeding pending or threatened that is for the purpose of
enjoining or preventing the Second Lien Debt Financing;
(e) The closing of the HOVRS Acquisition in accordance with the HOVRS
Acquisition Agreement (except to the extent that the HOVRS
Acquisition Agreement is subsequently amended or any term or
condition thereof waived without Clearlake's consent, such consent
not to be unreasonably withheld or delayed) shall have occurred
concurrently with the closing of the Second Lien Debt Financing;
(f) In respect of HOVRS Acquisition-related documents entered into on or
before the date hereof or attached as exhibits to agreements entered
into on or before the date hereof, there shall have been no
amendment to any such HOVRS Acquisition-related documents other than
amendments in form and substance acceptable to Clearlake (such
acceptance not to be unreasonably withheld or delayed), and in
respect of other HOVRS Acquisition-related documents, the Company
shall have executed and delivered any such HOVRS Acquisition-related
documents in form and substance acceptable to Clearlake (such
acceptance not to be unreasonably withheld or delayed); and
(g) The Company, Verizon Communications Inc., HOVRS and Clearlake shall
have received all necessary and material state and federal
regulatory approvals (other than approvals that the Company and
Clearlake agree should be waived, the consent to such waiver not to
be unreasonably withheld or delayed) for the Second Lien Debt
Financing, the TRS
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September 12, 2007
Page 4
Acquisition and the HOVRS Acquisition, the Company's shareholders
shall have approved the transactions contemplated by the 7,446,809
Share Stock Purchase Agreement in accordance with applicable law and
the rules of Nasdaq, and the Company, Verizon Communications Inc.
and HOVRS shall have received all other material consents required
to consummate the TRS Acquisition, the HOVRS Acquisition and the
Second Lien Debt Financing.
Miscellaneous.
Except for the integration of Section 10.5 of the 7,446,809 Share Stock Purchase
Agreement, the provisions of Sections 1 and 4 hereof shall remain in full force
and effect unless otherwise specifically stated in the definitive documentation
for the Second Lien Debt Financing that is executed and delivered, and
notwithstanding the termination of this Amended and Restated Commitment Letter
or any commitment or undertaking hereunder.
This Amended and Restated Commitment Letter shall not be assignable by the
Company without Clearlake's prior written consent (and any purported assignment
without such consent shall be null and void), is intended to be solely for the
benefit of the parties hereto and is not intended to confer any benefits upon,
or create any rights in favor of, any person other than the parties hereto. This
Amended and Restated Commitment Letter may not be amended or any term or
provision hereof waived or modified except by an instrument in writing signed by
each of the parties hereto.
This letter agreement shall be governed by the internal laws of the State of New
York, without regard to conflict of laws principles, except for applicable
Federal law.
EACH OF THE PARTIES TO THIS LETTER AGREEMENT HEREBY AGREES TO WAIVE ITS
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF THIS LETTER AGREEMENT OR ANY DEALINGS BETWEEN THEM RELATING TO
THE SUBJECT MATTER OF THIS LETTER AGREEMENT.
Clearlake hereby notifies the Company that pursuant to the requirements of the
USA PATRIOT Act, Title III of Pub. L. 107-56 (signed into law October 26, 2001)
(the "Act"), Clearlake and each other investor party (each an "Investor") to the
definitive Second Lien Debt Financing Documents are required to obtain, verify
and record information that identifies the Company, which information includes
the Company's name and address and other information that will allow Clearlake
and the Investors to identify the Company in accordance with the Act. This
notice is given in accordance with the requirements of the Act and is effective
for Clearlake and each other Investor.
Please note that neither Clearlake nor any of its affiliates provides
accounting, tax or legal advice. Notwithstanding anything herein to the
contrary, Clearlake (and each of its members, officers, directors, employees,
affiliates, agents, advisors and attorneys) may disclose to any and all persons,
without limitation of any kind, the tax treatment and tax structure of this
potential transaction and all materials of any kind (including tax opinions or
other tax analyses) that are provided to Clearlake relating to such tax
treatment and tax structure. However, the foregoing sentence shall not apply to
any information relating to the tax treatment or tax structure to the extent
nondisclosure of such information is reasonably necessary to enable any person
to comply with applicable securities laws. For this purpose, "tax
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September 12, 2007
Page 5
treatment" means U.S. federal income tax treatment, and "tax structure" is
limited to any facts relevant to the U.S. federal tax treatment of the Second
Lien Debt Financing.
This Amended and Restated Commitment Letter may be executed in any number of
counterparts, each of which when executed shall be an original, and all of
which, when taken together, shall constitute one agreement. Delivery of an
executed counterpart of a signature page of this Amended and Restated Commitment
Letter by facsimile transmission shall be effective as delivery of a manually
executed counterpart hereof. This Amended and Restated Commitment Letter is the
only agreement that has been entered into among the parties hereto with respect
to the Second Lien Debt Financing and sets forth the entire understanding of the
parties with respect thereto and supersedes any prior written or oral agreements
among the parties hereto with respect to the Second Lien Debt Financing.
THIS COMMITMENT LETTER REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
THE PARTIES.
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Please confirm that the foregoing is in accordance with your understanding by
signing and returning to Clearlake the enclosed copy of this Amended and
Restated Commitment Letter, whereupon this Amended and Restated Commitment
Letter shall become a binding agreement between us. Notwithstanding the
foregoing, this letter shall be void if not signed and returned by you by 11:59
pm New York time on September 12, 2007. We look forward to working with you on
this assignment.
Very truly yours,
CCP A, L.P.
By: Clearlake Capital Partners, LLC
Its: General Partner
By: CCG Operations, LLC
Its: Managing Member
By: /s/ Behdad Eghbali
-----------------------------------
Name: Behdad Eghbali
Title: Authorized Signatory
Accepted as of the date above:
GOAMERICA, INC.
By: /s/ Daniel R. Luis
-------------------------------
Name: Daniel R. Luis
Title: Chief Executive Officer
ANNEX A
GOAMERICA, INC.
SUMMARY OF TERMS AND CONDITIONS
This Summary of Terms and Conditions of the Proposed Second Lien Debt Financing
does not purport to summarize all the terms, conditions, representations,
warranties and other provisions with respect to the transactions referred to
herein. Certain capitalized terms used herein are defined in the Amended and
Restated Commitment Letter.
Terms of the Second Lien Debt
Financing
Issuer: GoAmerica, Inc. ("GOAM", or the "Issuer").
Guarantors: All of GOAM's direct and indirect domestic
subsidiaries, other than non-material subsidiaries
(determined on a basis consistent with the terms
of the Bridge Credit Agreement).
Notes/Loan: Senior secured notes or a senior secured loan in
the principal amount of $40,000,000 (the "Second
Lien Debt").
Security: The Second Lien Debt will be secured by perfected
second priority pledges of all of the equity
interests of GOAM's direct and indirect domestic
subsidiaries other than the non-material
subsidiaries referenced above (GOAM and such
subsidiaries, collectively, the "Loan Parties"),
and perfected second priority security interests
in and mortgages on all tangible and intangible
assets (including, without limitation, accounts
receivable, inventory, equipment, general
intangibles, intercompany notes, insurance
policies (other than directors and officers
liability insurance policies), investment
property, intellectual property, real property,
cash and proceeds of the foregoing) of the Loan
Parties, wherever located, now or hereafter owned,
subject to such exceptions as are agreed.
Proposed Closing Date: Closing of the HOVRS Acquisition.
Maturity: One week before the date that is five years from
the closing of the Second Lien Debt Financing.
Interest Rate: LIBOR + 900 bps per annum, payable quarterly in
cash.
Ranking: GOAM will ensure that its obligations with respect
to the Second Lien Debt will at all times
constitute general, direct,
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unsubordinated and unconditional obligations of
the Loan Parties ranking at all times at least
pari passu in priority of payment, and senior in
right of security and in all other respects, with
other senior indebtedness of GOAM now or hereafter
outstanding; provided that the Second Lien Debt
will be subordinated in right of security only to
the indebtedness contemplated by the First Lien
Debt Commitment Letter pursuant to an
intercreditor agreement in form and substance
reasonably satisfactory to the Lenders.
Amortization: None, bullet at Maturity.
Prepayment Premium: 102% during year 1 following issuance; 101% during
years 2 through 4 following issuance; and no
prepayment premium thereafter.
Covenants: The type of covenants will be customary for
transactions of this nature, including, but not
limited to, a limitation on debt incurrence,
limitation on sale of assets, restricted payments
and investments, consolidations, mergers and
change of control, issuance of subsidiary
securities, joint ventures and transactions with
affiliates.
The documents governing the Second Lien Debt will
also contain covenants requiring that the Company
maintain:
o Minimum Liquidity of $5 million at all times;
o Maximum CapEx in any fiscal year (excluding
capitalized labor) of 30% over a plan agreed
between the parties; and
o Maximum Total Leverage Ratio (Total Debt to
Pro-Forma Adjusted EBITDA) of 3.5x, which
covenant shall be tested quarterly from and
after Q1 2009 on a TTM basis.
Use of Proceeds: For the Company's working capital purposes and to
finance the HOVRS Acquisition
Governing Law: The agreements contemplated hereby shall be
governed by the internal laws of the State of New
York, without regard to conflicts of laws
principles.
Assignability: Clearlake and its assignees and transferees may
assign or transfer their interests in the Second
Lien Debt Financing at their discretion (i) to
Reservoir Capital Group, L.L.C. and its affiliates
and affiliates of Clearlake, without the consent
of GOAM, (ii) in connection with the primary
syndication of the Second Lien Debt Financing,
without the consent of GOAM
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(provided, however, that Clearlake shall remain
primarily and fully liable hereunder if the
conditions set forth herein are satisfied and, for
any reason, such syndication does not provide the
financing contemplated hereunder), and (iii)
otherwise, with the consent of GOAM, which consent
shall not be unreasonably withheld, conditioned or
delayed; provided that GOAM's consent to any such
assignment or transfer shall not be required
following the occurrence and during the
continuance of a default or event of default under
the Second Lien Debt Financing Documents.
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ANNEX B
In the event that Clearlake becomes involved involuntarily in any capacity in
any action, proceeding or investigation brought by or against any person,
including stockholders or other equity holders of the Company, in connection
with the transactions contemplated by this Amended and Restated Commitment
Letter (the "Letter"), the Company periodically will reimburse Clearlake for its
reasonable legal and other expenses (including the cost of any investigation and
preparation) incurred in connection therewith. The Company also will indemnify
and hold Clearlake harmless against any and all losses, claims, damages or
liabilities to any such person in connection with the transactions contemplated
by the Letter, and without regard to the exclusive or contributory negligence of
Clearlake or its affiliates, or the members, directors, agents, employees and
controlling persons (if any), as the case may be, of Clearlake and any such
affiliate, except to the extent that a court shall have found (in a judgment not
subject to further appeal or for which the time for appeal has expired) that any
such loss, claim, damage or liability results from the bad faith, gross
negligence or willful misconduct of Clearlake in performing obligations that are
the subject of the Letter. If for any reason the foregoing indemnification is
unavailable to Clearlake or is insufficient to hold it harmless, then the
Company shall contribute to the amount paid or payable by Clearlake as a result
of such loss, claim, damage or liability in such proportion as is appropriate to
reflect the relative economic interests of the Company and its stockholders or
other equity holders on the one hand and Clearlake on the other hand in the
matters contemplated by the Letter as well as the relative fault of the Company
and Clearlake with respect to such loss, claim, damage or liability and any
other relevant equitable considerations. The reimbursement, indemnity and
contribution obligations of the Company under this paragraph shall be in
addition to any liability which the Company may otherwise have, shall extend
upon the same terms and conditions to any affiliate of Clearlake and the
members, directors, agents, employees and controlling persons (if any), as the
case may be, of Clearlake and any such affiliate, and shall be binding upon and
inure to the benefit of any successors, assigns, heirs and personal
representatives of the Company, Clearlake, any such affiliate and any such
person. The Company also agrees that neither any indemnified party nor any of
such affiliates, partners, directors, agents, employees or controlling persons
shall have any liability based on its or their exclusive or contributory
negligence or otherwise to the Company or any person asserting claims on behalf
of or in right of the Company or any other person in connection with the
transactions contemplated by the Letter except to the extent that a court shall
have found (in a judgment not subject to further appeal or for which the time
for appeal has expired) that any losses, claims, damages, liabilities or
expenses incurred by the Company resulted from the bad faith, gross negligence
or willful misconduct of such indemnified party in performing the services that
are the subject of the Letter; provided, however, that in no event shall such
indemnified party or such other parties have any liability for any indirect,
consequential or punitive damages in connection with or as a result of such
indemnified party's or such other parties' activities related to the Letter.
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