Exhibit 10.1
 
FORBEARANCE AGREEMENT
 
FORBEARANCE AGREEMENT, dated of as May 5, 2009, by and among (i) MobilePro Corp.
a Delaware corporation (the “Company”), (ii) each subsidiary and affiliate of
the Company listed on Schedule 1 attached hereto (the “Subsidiaries,” and
collectively with the Company, the “Grantors”) and YA Global Investments, L.P.
f/k/a Cornell Capital Partners, LP (“YA Global”).  All capitalized terms used
herein shall have the respective meanings assigned thereto in the Transaction
Documents (as defined below) unless otherwise defined herein.
 
W I T N E S S E T H:
 
WHEREAS, reference is made to those certain financing arrangements and other
documents, instruments and agreements set forth on Schedule A attached hereto
and referred to herein as the “Transaction Documents”  pursuant to which, YA
Global is the holder of the following secured convertible debenture (the
“Debenture”) issued by the Company:
 
Debenture Description
Principal Outstanding
Accrued and Unpaid Interest
Secured Convertible Debenture (MOBL5-1) issued by the Company to YA Global on
June 30, 2008 in the original principal amount of $13,391,174.54
$13,029,125
$130,551.79

 
The amounts referenced in this chart above are as of the close of business on
April 30, 2009 and do not include any additional costs, charges, expenses, or
liquidated damages.
 
WHEREAS, the Maturity Date of the Debenture is May 1, 2009.
 
WHEREAS, the Company has requested that YA Global forbear from enforcing its
rights and remedies against the Obligations (as defined below) under the
Transaction Documents as a result of the Maturity of the Debenture for a period
of 30 days from the Maturity Date in order to allow the Company an opportunity
to repay or propose a plan to restructure the Debenture and YA Global has agreed
to so forbear, but only upon the terms and conditions expressly set forth
herein.
 
NOW, THEREFORE, in consideration of the foregoing, and the respective
agreements, warranties and covenants contained herein, the parties hereto agree,
covenant and warrant as follows:
 
 
1.
ACKNOWLEDGMENTS OF INDEBTEDNESS. The Grantors each hereby acknowledge and agree
that, in accordance with the terms and conditions of the Transaction Documents,
they are jointly and severally liable to YA Global under the Debenture and
Transaction Documents for the amounts set forth in the first Whereas clause
above, for all interest accruing on the principal balance of the Debenture from
and after April 30, 2009, and for all fees, redemption premiums, liquidated
damages, costs, expenses, and costs of collection (including attorneys’ fees and
expenses) heretofore or hereafter accrued or incurred by the YA Global in
connection with the Transaction Documents (collectively, the “Obligations”).

 

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2.
WAIVER OF CLAIM.  The Grantors hereby acknowledge and agree that they have no
offsets, defenses, claims, or counterclaims against YA Global or YA Global’s
officers, directors, employees, attorneys, representatives, predecessors,
successors, and assigns with respect to the Obligations, the Transaction
Documents, or otherwise, and that if any Grantor now has, or ever did have, any
offsets, defenses, claims, or counterclaims against YA Global or YA Global’s
officers, directors, employees, attorneys, representatives, predecessors,
successors, and assigns, whether known or unknown, at law or in equity, from the
beginning of the world through this date and through the time of execution of
this Agreement, all of them are hereby expressly WAIVED, and the Grantors each
hereby RELEASE YA Global and YA Global’s officers, directors, employees,
managers, partners, attorneys, representatives, predecessors, successors, and
assigns from any liability therefore.

 
 
3.
RATIFICATION OF TRANSACTION DOCUMENTS; CONFIRMATION OF COLLATERAL;
CROSS-COLLATERALIZATION; FURTHER ASSURANCES.  The Grantors jointly and
severally:

 
 
a.
Hereby ratify, confirm, and reaffirm all and singular the terms and conditions
of the Transaction Documents to which each is a party.  The Grantors further
acknowledge and agree that except as specifically modified in this Agreement,
all terms and conditions of those documents, instruments, and agreements shall
remain in full force and effect.

 
 
b.
Agree that (i) the obligations secured by the Transaction Documents include,
without limitation, the Obligations, and any future modifications, amendments,
substitutions or renewals thereof, and (ii) all collateral, whether now existing
or hereafter acquired, granted to YA Global pursuant to the Transaction
Documents, this Agreement, or otherwise shall secure all of the Obligations
until full and final payment of the Obligations.

 
 
c.
Shall, from and after the execution of this Agreement, execute and deliver to YA
Global whatever additional documents, instruments, and agreements that YA Global
may require in order to correct any document deficiencies, or to vest or perfect
the Transaction Documents and the collateral granted therein more securely in YA
Global and/or to otherwise give effect to the terms and conditions of this
Agreement, and hereby authorize YA Global to file any financing statements
(including financing statements with a generic description of the collateral
such as “all assets”), and take any other normal and customary steps, YA Global
deems necessary to perfect or evidence its security interests and liens in any
such collateral.  In connection with the forgoing, within five business days of
the date hereof, the Grantors shall take all steps necessary to (i) cause MWS
Newco, Inc., a Delaware corporation (“MWS”) to join in the Transaction Document
including without limitation, becoming a party to the Global Security Agreement,
Global Pledge Agreement, and Global Guaranty, (ii) provide a perfection
certificate from MWS indicating the type of, and location of, all the assets of
MWS, and (iii) enter into Account Control Agreements, Collateral Access
Agreements, and such other documents or agreements required to perfect YA
Global’s security interest in the collateral of MWS.

 
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d.
Hereto acknowledge, confirm and agree that: (a) each of the Transaction
Documents to which it is a party has been duly executed and delivered to YA
Global by such Grantor, and each is in full force and effect as of the date
hereof, (b) the agreements and obligations of the Grantors contained in such
documents and in this Agreement constitute the legal, valid and binding
obligations of the Grantors, enforceable against each in accordance with their
respective terms, and the Grantors have no valid defenses to the enforcement of
such obligations, and (c) YA Global is and shall be entitled to the rights,
remedies and benefits provided for in the Transaction Documents and applicable
law, without setoff, defense or counterclaim of any kind, nature or descriptions
whatsoever.

 
 
4.
FORBEARANCE OF EXERCISING RIGHTS AND REMEDIES.

 
 
a.
Acknowledgement of Maturity.  The Company hereby acknowledges and agrees that
the Maturity Date of the Debenture is May 1, 2009, that as of the date hereof it
has not, and on the Maturity Date it will not be able to, repay the Obligation,
and such event will entitle YA Global to exercise its rights and remedies under
the Transaction Documents, applicable law or otherwise.  The Grantors jointly
and severally represent and warrant that as of the date hereof, except for the
event described in the preceding sentence, no Event of Default under the
Transaction Documents exist.  YA Global has not waived, presently does not
intend to waive and may never waive any events of default and nothing contained
herein or the transactions contemplated hereby shall be deemed to constitute any
such waiver.  The Grantors hereby acknowledge and agree that upon the Maturity
Date the Obligations will be immediately due and payable under the terms of the
Transaction Documents, but for the agreement to forbear as set forth herein.

 
 
b.
Forbearance.

 
 
i.
In reliance upon the representations, warranties and covenants of the Grantors
contained in this Agreement, and subject to the terms and conditions of this
Agreement and any documents or instruments executed in connection herewith, YA
Global agrees to forbear from exercising its rights and remedies under the
Transaction Documents or applicable law, subject to the conditions, amendments
and modifications contained herein until June 1, 2009 (the “Forbearance Period”)
so long as the following conditions are met: (i) the Company strictly complies
with the terms of this Agreement, and (ii) there is no occurrence or existence
of any Event of Default except for the non-payment of Obligations as of the
Maturity Date.

 
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ii.
Upon the termination or expiration of the Forbearance Period, the agreement of
YA Global to forbear shall automatically and without further action terminate
and be of no force and effect, it being expressly agreed that the effect of such
termination will be to permit YA Global to exercise such rights and remedies
immediately, including, but not limited to, the acceleration of all of the
Obligations without any further notice, passage of time or forbearance of any
kind.  This Agreement shall be deemed to satisfy any and all requirements by YA
Global to provide notice to the Grantors before exercising any such rights.

 
 
c.
No Other Waivers; Reservation of Rights.

 
 
i.
YA Global has not waived, is not by this Agreement waiving, and has no
intentions of waiving, any Events of Default which may be continuing on the date
hereof or any Events of Default which may occur after the date hereof, and YA
Global has not agreed to forbear with respect to any of its rights or remedies
concerning any Events of Default, which may have occurred or are continuing as
of the date hereof or which may occur after the date hereof.

 
 
ii.
Subject to Section 4(b) above (solely with respect to the Maturity Date), YA
Global reserves the right, in its discretion, to exercise any or all of its
rights and remedies under the Transaction Documents as a result of any Events of
Default which may be continuing on the date hereof or any Events of Default
which may occur after the date hereof, and YA Global has not waived any of such
rights or remedies, and nothing in this Agreement, and no delay on its part in
exercising any such rights or remedies, should be construed as a waiver of any
such rights or remedies.

 
 
d.
Interest.  During the Forbearance Period interest shall continue to accrue on
the outstanding principal balance of the Obligations at the normal rate set
forth in the Debenture.  The Company shall pay to YA Global all accrued and
unpaid interest under the Debenture as of the close of business on April 30,
2009 of 130,551.79 by paying $65,275 by May 11, 2009, and the balance of
$65,276.79 by May 25, 2009.

 
 
e.
Costs. The Grantors shall jointly and severally reimburse YA Global on demand
for any and all unreimbursed costs, expenses, and costs of collection (including
attorneys’ fees and expenses) heretofore or hereafter incurred by YA Global in
connection with the protection, preservation, and enforcement by YA Global of
its rights and remedies under the Transaction Documents and/or this Agreement,
including, without limitation, the negotiation and preparation of this
Agreement.

 
 
5.
DUE DILIGENCE.  The Grantors have represented to YA Global that they intend to
consider certain transactions involving certain assets pledged to YA Global or
may otherwise require the consent of YA Global in order to assist in the
satisfaction of the Obligation or in connection with a plan to restructure the
repayment of the Obligations. In connection therewith:

 
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a.
The Grantors will provide YA Global with information regarding any potential
transactions proposed by the Grantors in its efforts to satisfy the Obligations.

 
 
b.
The Grantors shall retain a consultant, to the sole satisfaction of YA Global,
to conduct due diligence and an investigation into the business and prospects of
any of the Grantors.  The Grantors shall pay all expenses and fees of such
consultant in an amount not to exceed $15,000.

 
 
c.
The Grantors agree that in all events, and regardless of whether any transaction
is consummated, all Obligations shall be paid in full in good and collected
funds by federal funds wire transfer on or before the termination or expiration
of the Forbearance Period, unless otherwise indicated in writing by YA Global.

 
 
d.
The Grantors acknowledge and agree that nothing contained in this Section is
intended to be, nor shall be construed as, an agreement by YA Global to extend
the Forbearance Period, consent by YA Global to any particular transaction, or
an agreement to release any security interest of assets held by YA Global except
for payment in full of all the Obligations.

 
 
6.
WAIVERS AND OTHER AGREEMENTS.

 
 
a.
Non-Interference.  From and after the termination of the Forbearance Period, the
Grantors jointly and severally agree not to interfere with the exercise by YA
Global of any of its rights and remedies.  The Grantors further jointly and
severally agree that it shall not seek to restrain or otherwise hinder, delay,
or impair YA Global’s efforts to realize upon any collateral granted to YA
Global, or otherwise to enforce its rights and remedies pursuant to the
Transaction Documents.  The provisions of this Paragraph shall be specifically
enforceable by YA Global.

 
 
b.
Mutual Waiver of Jury Trial.  BECAUSE DISPUTES ARISING IN CONNECTION WITH
COMPLEX FINANCIAL TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN
EXPERIENCED AND EXPERT PERSON AND THE PARTIES WISH APPLICABLE STATE AND FEDERAL
LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES DESIRE THAT THEIR
DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS.  THEREFORE, TO
ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OF
ARBITRATION, THE PARTIES HERETO WAIVE ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION,
SUIT OR PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE, WHETHER ARISING IN CONTRACT,
TORT OR OTHERWISE BETWEEN THE PARTIES ARISING OUT OF, CONNECTED WITH, RELATED OR
INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS
AGREEMENT OR ANY OF THE OTHER FACTORING DOCUMENTS OR THE TRANSACTIONS RELATED
THERETO

 
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c.
Cross Default.  The Grantors hereby acknowledges and agrees that any default or
Event of Default under this Agreement or under any Transaction Document shall
constitute a default or an Event of Default under each other Transaction
Document.

 
 
7.
REPRESENTATIONS AND WARRANTIES.  Each Grantor hereby represents and warrants to
YA Global as follows:

 
 
a.
Attached hereto as Schedule 7.a. is a true, correct, and complete organizational
chart displaying exact legal name, principal place of business, jurisdiction of
incorporation, organization, or formation, and organizational identification
number of the Company and each direct and indirect subsidiary of the Company and
for each Grantor.

 
 
b.
Each Grantor’s current Deposit Accounts are set forth on Schedule 7.b. attached
hereto and constitute all such Deposit Accounts of the Grantors. Each Deposit
Account listed on the schedule to the Global Security Agreement and not listed
on Schedule 7.b. has been closed and at the time of such closure, all proceeds
remaining in such Deposit Accounts were disposed of in accordance with the
Global Security Agreement.

 
 
c.
Attached hereto as Schedule 7.c. is a true, correct, and complete list of all
United States Patents, Patent Licenses, United States Copyright registrations,
and Copyright Licenses to which each Grantor is a party.

 
 
8.
GOVERNING LAW.  This Agreement shall be interpreted according to the laws of the
State of New Jersey and shall inure to the benefit of and be binding upon the
parties hereto and their respective successors and assigns.  Any notices,
demands, consents, other writings or communications permitted or required by
this Agreement shall be given in the manner and to the address as set forth in
the Transaction Documents.

 

 
[SIGNATURE PAGE IMMEDIATELY TO FOLLOW]
 
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IN WITNESS WHEREOF, this Agreement is executed and delivered as of the day and
year first above written.
 
Grantors:
 
MOBILEPRO CORP., a Delaware corporation
 
By: /s/ Jay Wright
Name: Jay Wright
Title:  Chairman and CEO
 
PROGAMES NETWORK, INC., a Delaware corporation
 
By:  /s/ Jay Wright
Name: Jay Wright
Title:   Chairman
     
DAVEL FINANCING COMPANY, L.L.C., a Delaware limited liability company
 
By: /s/ Tammy Martin
Name: Tammy Martin
Title:   Secretary
 
DAVEL COMMUNICATIONS GROUP, INC., an Illinois corporation
 
By: /s/ Tammy Martin
Name: Tammy Martin
Title:   Secretary
     
TELALEASING ENTERPRISES, INC., an Illinois corporation
 
By: /s/ Tammy Martin
Name: Tammy Martin
Title:   Secretary
 
PEOPLES TELEPHONE COMPANY, INC., a New York corporation
 
By: /s/ Tammy Martin
Name: Tammy Martin
Title:   Secretary
     
PHONETEL TECHNOLOGIES, INC., an Ohio corporation
 
By: /s/ Tammy Martin
Name: Tammy Martin
Title:   Secretary
 
DAVEL ACQUISITION CORP., a Delaware corporation
 
By: /s/ Tammy Martin
Name: Tammy Martin
Title:   Secretary
     
DAVEL COMMUNICATIONS, INC., a Delaware corporation
 
By:  /s/ Tammy Martin
Name: Tammy Martin
Title:   Secretary
 
CLOSECALLAMERICA, INC., a Delaware corporation
 
By: /s/ Doug Bethell
Name: Doug Bethell
Title:   President

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MWS Newco, Inc., a Delaware corporation
 
By:  /s/ Tammy Martin
Name:  Tammy Martin
Title:  Secretary
 
AMERICAN FIBER NETWORK, INC., a Delaware corporation
 
By: /s/ Doug Bethell
Name: Doug Bethell
Title:   President

 
 
 

 
YA GLOBAL INVESTMENTS, L.P.
 
By: Yorkville Advisors, LLC,
its Investment Manager
 
By: /s/ Troy Rillo
Name: Troy Rillo
Title:   Senior Managing Director

 
 
 
 
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