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Exhibit 99.2
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
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In re: :
: Chapter 7 Case
WORLD ACCESS, INC. :
:
: NO. 01-1286 (MFW)
:
:
Debtor. :
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STIPULATION AND CONSENT ORDER, PURSUANT TO
11 U.S.C. SS. 303(F) AND 105(A), AMONG INFORMAL
COMMITTEE OF HOLDERS OF DEBTOR'S 13.25% SENIOR
NOTES DUE 2008, PETITIONING CREDITORS, AND
DEBTOR, CONDITIONALLY EXTENDING TIME DURING
WHICH DEBTOR MUST RESPOND TO PETITION,
AND ESTABLISHING OPERATING PROTOCOL
WHEREAS, World Access, Inc. (the "Debtor") is a provider of
international telecommunication services and is incorporated in Delaware; and
WHEREAS, in connection with the Debtor's 1999 acquisition of
FaciliCom International, Inc. ("FaciliCom"), the Debtor commenced and completed
an exchange offer whereby, subject to certain terms and conditions, the holders
of notes issued by FaciliCom exchanged such notes for certain of the Debtor's
13.25% Senior Notes due 2008 (the "Notes"), issued pursuant to the Indenture,
dated as of December 7, 1999 (the "Indenture"), by and between the Debtor and
First Union National Bank, as trustee (the "Indenture Trustee"); and
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WHEREAS, on April 4, 2001, by notice to the Debtor, the
Indenture Trustee declared certain Events of Default under the Indenture and
accelerated maturity of the payment of the principal, premium (if any), and
accrued interest due under the Notes; and
WHEREAS, an informal committee (the "Committee")(1) of entities
holding or managing on behalf of certain accounts that hold or beneficially own
in excess of 66% of the outstanding principal amount of the Notes has been
formed; and
WHEREAS, certain members of the Committee commenced this
chapter 7 liquidation case against the Debtor by filing an involuntary petition
for relief (the "Petition") under chapter 7 of title 11 of the United States
Bankruptcy Code, 11 U.S.C. SS. 101-1330 (as amended, the "Bankruptcy Code"); and
WHEREAS, the parties have agreed to stay the bankruptcy case
by, among other things, extending the time under the Federal Rules of Bankruptcy
Procedure (the "Bankruptcy Rules") and the Bankruptcy Code for the Debtor to
respond to the Petition, subject to the terms and conditions set forth in this
Stipulation;
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(1) The Committee comprises the following six (6) Noteholders, acting in
their capacity as holders or managers for holders or owners of the Notes: DDJ
Capital Management LLC; J. & W. Seligman & Co., Inc.; Morgan Stanley Dean Witter
Advisors, Inc.; R(2) Investments, LDC; SunAmerica Investments, Inc.; and Whitney
& Co.
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NOW, THEREFORE, in consideration of the mutual covenants and
consideration contained herein, the Debtor and the Committee, by and through
their respective undersigned counsel, stipulate and agree as follows:
1. The Debtor may immediately pay or cause to be paid
(the "TelDaFax Payment") the sum of 30 million Deutsche Marks (approximately
US$13.7 million) to Deutsche Telekom, a creditor of TelDaFax Aktiengesellschaft
(Germany) ("TelDaFax").
2. From and after the date hereof, pending further order
of this Court or the prior written consent of the Committee, the Debtor shall
not, and shall cause each of its direct and indirect subsidiaries (excluding
TelDaFax, the "Subsidiaries") not to, (i) take any action that would not be
permitted under Section 363 of the Bankruptcy Code, (ii) grant any security
interests or liens upon any of their respective assets except on reasonable
terms and conditions and in the ordinary course of business consistent with the
Debtor's past practices but in no event on account of antecedent debt, (iii)
enter into any credit, lending or investing agreement other than to incur or
extend normal trade credit on reasonable terms consistent with the Debtor's past
practices, (iv) enter into or submit to a transaction involving or contemplating
the merger, recapitalization, acquisition, amalgamation, sale, lease, transfer
or disposition of the Debtor, any of its Subsidiaries or
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substantially all of any of their respective assets, (v) declare or pay any
dividend on, repurchase, redeem, retire, or make any payment or distribution in
respect of any securities issued by the Debtor or any of its Subsidiaries, (vi)
enter into any employment contract or consulting arrangement (other than
professionals, including legal counsel, accountants and financial advisors for
the Debtor) providing for compensation or consideration in excess $150,000, but
in all events on market terms, or (vii) except for payroll, utilities and other
reasonable, essential and actual expenses incurred and payable in the ordinary
course of business, disburse or transfer any cash, securities or other assets or
property. On or before April 13, 2001, the Debtor and the Committee shall agree
upon a working capital and cash flow budget forecasting revenues and
disbursements on a weekly basis through the end of June 30, 2001.
Notwithstanding anything in this paragraph 2 to the contrary, the Debtor may (i)
sell its stock in BATM Communications, Ltd. through open market transactions at
market prices; provided, however, that, pending further order of this Court or
the prior written consent of the Committee, the proceeds from such sale (x)
remain in a segregated account held by the seller of such securities and (y)
shall not be used for any purpose and (ii) transfer on reasonable terms and in
the ordinary course of its business no more than $1 million in the aggregate to
any of its
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non-U.S. or Canadian subsidiaries (exclusive of the TelDaFax Payment) pending
further order of this Court or the prior written consent of the Committee.
3. The Debtor hereby (i) waives its right to judgment
(if any) under section 303(i) of the Bankruptcy Code and (ii) releases any and
all claims or rights it may have against the petitioning creditors, the members
of the Committee, or their attorneys and advisors that in any way relate to the
commencement of this case.
4. The Debtor's time to answer, move, respond or
otherwise contest the Petition under the Bankruptcy Code or the Bankruptcy Rules
is extended through the later to occur of (i) April 24, 2001, or (ii) the
effective date of the Termination Notice (defined below). Except as provided in
paragraph 2, the Debtor agrees that it shall not seek any relief from the Court,
including without limitation, seeking the dismissal or abstention of this case,
or the transfer of the venue of this case, until the earlier to occur of (i) the
effective date of the Termination Notice or (ii) the entry of the order for
relief. The Committee agrees not to seek an interim trustee or any other relief
prior to the date of the Termination Notice.
5. The Debtor hereby agrees that it shall meet with the
Committee and/or its advisors, as and at the times reasonably requested by the
Committee, to discuss the Debtor's business or
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restructuring plan, financial projections, or other matters the Committee may
wish to discuss. The Debtor further agrees that it shall pay, within five days
of submission of an invoice, the actual fees and expenses of legal counsel and a
financial advisor to the Committee incurred at any time prior to the effective
date of the Termination Notice. Legal co-counsel to the committee are Milbank,
Tweed, Hadley & McCloy LLP ("Milbank") and Morris Nichols Arsht & Tunnell.
Within one business day hereof, the Debtor shall wire transfer the sum of
$100,000 to Milbank, as a general retainer against fees and expenses incurred in
connection with its representation of the Committee. Milbank shall be entitled
to reduce the retainer as necessary to satisfy its reasonable fees and expenses
and, upon submission of an invoice to the Debtor, the Debtor shall replenish,
within 5 days of the date of the invoice, the retainer so as to maintain its
original amount. Within two business days of receipt of an invoice, the Debtor
shall pay Sullivan & Cromwell the amount of such invoice not to exceed $150,000
and, within two business days from the date hereof, the Debtor shall pay KPMG
the amount of $100,000, both in connection with their prior service on behalf of
certain members of the Committee. KPMG and Sullivan & Cromwell retain and may
pursue any claim against the Debtor for payment of additional amounts. The
Debtor shall be entitled to retain, pay customary and reasonable retainers to,
and pay the actual and
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reasonable fees and expenses of its legal counsel, accountants and financial
advisors. None of the payments made to the advisors for the Committee or the
Debtor shall be avoidable or disgorgable under section 549 of the Bankruptcy
Code, any other section of the Bankruptcy Code or applicable law. Nothing herein
shall preclude legal counsel or any financial advisor to the Committee from
being retained under section 1103(b) of the Bankruptcy Code or compensated under
section 328, 330 or 331 of the Bankruptcy Code.
6. The Debtor or the Committee may terminate the rights
and obligations under paragraph 2 hereof on five calendar days' prior written
notice to the other party (the "Termination Notice").
7. The United States Bankruptcy Court for the District
of Delaware shall have the sole and exclusive jurisdiction over this Stipulation
and any disputes or enforcement actions relating thereto.
8. Except to the extent set forth herein, the Debtor,
the Committee, and each of the members of the Committee expressly reserve any
and all rights each may have in any capacity under the Bankruptcy Code, the
Bankruptcy Rules, or applicable law.
9. Subject to paragraph 10 hereof, the time between the
date hereof and the effective date of the Termination Notice and the agreements
contained herein shall not constitute want of
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prosecution or support dismissal of the case under section 303(j) of the
Bankruptcy Code or constitute the grounds for denial of any relief any party may
seek.
10. If the Debtor materially breaches any of its
covenants in paragraphs 2 and 5 prior to the effective date of the Termination
Notice, the Court upon the request of the Committee shall immediately enter the
order for relief and the Debtor waives its right to contest same.
11. The parties hereto represent and warrant to each
other that the signatories to this Stipulation are authorized to execute this
Stipulation; that each has full power and authority to enter into this
Stipulation; that this Stipulation is duly executed and delivered, and
constitutes a valid, binding agreement in accordance with its terms.
12. This Stipulation shall be binding on the parties from
the date of its execution by the parties.
13. If this Stipulation is not approved by the Court or
overturned or modified on appeal, this Stipulation shall be of no further force
and effect, and neither this Stipulation nor any negotiations and writings in
connection with this Stipulation shall in any way be construed as or deemed to
be evidence or admission on behalf of the parties.
14. This Stipulation may not be amended or otherwise
modified without the prior written consent of the parties.
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15. This Stipulation may be executed in one or more
counterparts, which may be transmitted by facsimile or otherwise, all of which
shall be considered one and the same agreement, and shall become effective when
one or more such counterparts have been signed by each of the parties and
delivered to the other party.
16. All notices described herein to the parties hereto
shall be sent both by facsimile and overnight delivery to the counsel for such
party set forth below.
Dated: Wilmington, DE MILBANK, TWEED, HADLEY & McCLOY LLP
April 6, 2001 Dennis F. Dunne (DD 7543)
Daniel J. Guyder (DG 6515)
1 Chase Manhattan Plaza
New York, New York 10005
(212) 530-5000
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MORRIS, NICHOLS, ARSHT & TUNNELL
By: /s/ Robert J. Dehney
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Robert J. Dehney (No. 3578)
1201 North Market Street
Level 18
Wilmington, Delaware 19801
(302) 658-9200
Co-Counsel for the Informal
Committee of 13.25% Senior
Noteholders due 2008 and
Petitioning Creditors
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Dated: Wilmington, DE LONG ALDRIDGE & NORMAN LLP
April 6, 2001 Mark S. Kaufman (No. 409194)
J. Michael Levengood (No. 447934)
303 Peachtree Street, Suite 5300
Atlanta, Georgia 30308
(404) 527-4000
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THE BAYARD FIRM
By: /s/ Michael L. Vild
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Michael L. Vild (No.3042)
222 Delaware Ave. 9th Floor
P.O. Box 25130
Wilmington, Delaware 19899
(302) 655-5000
Co-Counsel to World Access, Inc.,
Debtor herein
Date: Wilmington, Delaware
April __, 2001
SO ORDERED:
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UNITED STATES BANKRUPTCY JUDGE
STIPULATION AND CONSENT ORDER, PURSUANT TO
11 U.S.C. SS. 303(f) AND 105(a), AMONG INFORMAL
COMMITTEE OF HOLDERS OF DEBTOR'S 13.25% SENIOR
NOTES DUE 2008, PETITIONING CREDITORS, AND
DEBTOR, CONDITIONALLY EXTENDING TIME DURING
WHICH DEBTOR MUST RESPOND TO PETITION,
AND ESTABLISHING OPERATING PROTOCOL
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SERVICE LIST
VIA HAND DELIVERY
Michael L. Vild, Esquire
The Bayard Firm
222 Delaware Ave. 9th Floor
P.O. Box 25130
Wilmington, DE 19899
VIA FIRST CLASS MAIL
Maria D. Giannirakis, Esquire
Office of the United States Trustee
Curtis Center - 950 West
601 Walnut Street
Philadelphia, PA 19106
Mark S. Kaufman, Esquire
J. Michael Levengood, Esquire
Long Aldridge & Norman LLP
303 Peachtree Street, Suite 5300
Atlanta, GA 30308