Exhibit 10.43


 


EXECUTION COPY


 


REVOLVING CREDIT AGREEMENT


 


This Revolving Credit
Facility (“Agreement” or “Credit Facility”) is entered into as of
March 30, 2006 (“Effective Date”) by and between Vistula
Communications Services, Inc., a Delaware corporation (“Borrower”
or the “Company”) and Indigo Investments I LLC (“Lender”, or “Purchaser”).
Each of Borrower and Lender may be referred to herein individually as a “Party”
and collectively as the “Parties”.


 


W  I  T
N  E  S  S  E  T  H:


 


WHEREAS, the Company desires to sell and issue to the
Lender, and the Purchaser wishes to purchase from the Company, a Note in the
principal amount of up to five million United States dollars ($5,000,000).


 


NOW, THEREFORE, in consideration of the foregoing premises
and the covenants contained herein and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Parties
hereto agree as follows:


 


SECTION 1.  Initial Advance; Periodic
Loans. (a) From and after the date hereof through and until September 30,
2006, Lender hereby agrees to make periodic loans to the Borrower in an
aggregate principal amount at any one time outstanding, not to exceed $5,000,000
(“Maximum Amount”). Borrower shall execute a promissory note substantially
in the form of Exhibit A hereto evidencing its obligations
hereunder (the “Note”). On the Effective Date, up to $1,300,000 shall be
advanced to the Borrower for working capital and general corporate purposes
(the “Initial Advance”). For the avoidance of doubt, the first
$1,300,000 advanced to the Company pursuant to this Section 1(a),
regardless of when such advances are made, shall not be subject to the
requirements set forth in Section 1(b) below.


 


(b)                                 During
the Term (as defined below), from time to time, Borrower may notify the
Lender of its need to borrow additional funds pursuant to this Agreement.
Within ten (10) business days of receipt of such notice from the Borrower
seeking to borrow funds, the Lender shall forward to the Borrower the amount of
funds requested by Borrower in such notice, up to, but (together with the
Initial Advance) not in excess of, the Maximum Amount; provided, that Borrower
provides Lender with an officer’s certificate, the form and substance of
which must be satisfactory to Lender, certifying that at the time of such
notice: (i) Borrower is in
compliance with the covenants set forth in Section 7 of this Agreement; (ii) Borrower
has not violated any of the negative covenants set forth in Section 8 of
this Agreement; and (iii) such requested advance does not exceed 80% of
the Company’s Computer Directed Router Reports (“CDR”) detailing charges
to be billed to acceptable customers. Lender shall have the absolute right to
request additional evidence, as deemed necessary by the Lender in its sole
discretion, in support of such officer’s certificate.


 


SECTION 2.  Periodic Finance Charges;
Commitment Fee; Warrants. (a) All outstanding principal shall bear
interest at a rate of 1.5% per month simple interest. In an Event of 


 

















 


Default (as defined in Section 12)
the interest rate shall increase by an amount equal to the lesser of 2.5% per
month or the maximum amount permitted under applicable law (the “Default
Rate”).


 


(b)                                 In
addition, the Company shall pay the
Lender a 2.25% commitment fee on the entire amount of the Credit Facility (the “Commitment
Fee”) and shall grant Lender a five (5) year warrant to purchase up to
500,000 shares of the Company’s common stock at an exercise price equal to
$1.50 per share (the “Warrant”; and such shares the “Warrant Shares”).
The Warrant is attached hereto as Exhibit B. Lender may distribute
the Warrant Shares to its Members on a pro rata basis based on each Member’s
percentage interest in Lender.


 


SECTION 3.  Payments. All outstanding principal and interest on the
Credit Facility plus the Commitment Fee shall be due and payable on the earlier
of (i) the six (6) month anniversary of the Effective Date (“Maturity
Date”), or (ii) the closing of a Qualified Equity Financing (as
defined below); provided, that, in the event that a Qualified Equity Financing
closes prior to the Maturity Date, the Company shall pay the Lender an early
repayment fee equal to 2.25% of the total amount of the Credit Facility. For
purposes of this Agreement, “Qualified Equity Financing” shall mean the
sale of a minimum of $6,000,000 of equity securities of the Company.


 


SECTION 4.  Term. This Agreement
shall be effective from the date hereof and shall terminate on September 30,
2006, unless terminated earlier pursuant to the default provisions of this
Agreement (the “Term”).


 


SECTION 5.  Priority. The rights
of the Lender under the terms of this Agreement shall be junior to the Company’s
existing indebtedness.


 


SECTION 6.  Personal Guaranty. In
order to induce Lender to extend the Credit Facility to Borrower, the Company’s
President, Mr. Rupert Galliers-Pratt absolutely and unconditionally
guarantees to Lender, to the fullest extent permitted by applicable law and
pursuant to the terms of the Guaranty attached hereto as Exhibit C,
the payment by the Company when due of all amounts owing under the Credit
Facility and any and all other documents related thereto, including, without
limitation, all principal, interest, commitment fees, prepayment fees,
expenses, professional fees and other amounts now or hereafter owing in
connection with the Credit Facility.


 


SECTION 7.  Covenants of Borrower.
The Borrower agrees and covenants as follows:


 


(a)                                  Payment
of Principal and Interest and Fees. The Borrower shall promptly pay when
due the principal of and interest on the indebtedness evidenced by the Note
issued under this Agreement, and all other sums secured by this Agreement,
including but not limited to, the Commitment Fee.


 


(b)                                 Corporate
Existence. The Borrower is a corporation duly organized and existing under
the laws of the State of Delaware and is duly qualified in every other state in
which it is doing business except where the failure to be so qualified
would not have a Material Adverse 


 


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Effect on the Company. “Material
Adverse Effect” means any circumstance, change in, or effect on the Company
that, individually or in the aggregate with any other similar circumstances,
changes in, or effects on, the Company taken as a whole: (a) is, or is
reasonably expected to be, materially adverse to the business, operations,
assets, liabilities, employee relationships, customer or supplier
relationships, prospects, results of operations or the condition (financial or
otherwise) of the Company taken as a whole or (b) is reasonably expected
to adversely affect the ability of the Company to operate or conduct the
Company’s business in the manner in which it is currently operated or conducted
or proposed to be operated or conducted by the Company.


 


(c)                                  Corporate
Authority. The execution, delivery, and performance of this Agreement, and
the execution and payment of the Note issued pursuant to the terms hereof are
within Borrower’s corporate powers, have been duly authorized, and are not in
contravention of law or the terms of the Borrower’s
articles of incorporation and bylaws, or of any indenture, agreement, or
undertaking to which the Borrower is a party or by which it is bound.


 


SECTION 8.  Negative
Covenants. While loans are outstanding under this Agreement and the Note, the
Company shall not directly or indirectly:


 


(a)                                  Enter into any transaction not in the
ordinary and customary course of its business, including but not limited to the
sale, lease, license, disposal, movement, relocation or transfer, whether by
sale or otherwise, of any of its material assets other than sales of inventory
in the ordinary and customary course of its business, without the prior written
consent of Lender.


 


(b)                                 Make any distribution or pay any dividends
(in cash or in stock) on, or purchase, acquire, redeem or retire any of its
capital stock, of any class, or other securities not held by Lender whether now
or hereafter outstanding.


 


SECTION 9.  Taxes and Assessments.
The Borrower will pay or cause to be paid promptly when due all taxes and
assessments on this Agreement and the Note. The Borrower may, however, withhold
payment of any tax assessment or claim if a good faith dispute exists as to the
obligation to pay.


 


SECTION 10.  Application of Payments.
Unless applicable law provides otherwise, all payments received by the Lender
from the Borrower under the Note and this Agreement shall be applied by the
Lender in the following order of priority: 
(i) interest payable on the Note in the manner provided therein; (ii) principal
of the Note in the manner provided therein; and (iii) any other sums
secured by this Agreement in such order as the Lender, at the Lender’s option, may determine.


 


SECTION 11.
 Forbearance by
Lender Not a Waiver. Any forbearance by the Lender in exercising any right
or remedy hereunder, or otherwise afforded by applicable law, shall not be a
waiver of or preclude the exercise of any right or remedy. The acceptance by
the Lender of payment of any sum secured by this Agreement after the due date
of such payment shall not be a waiver of the Lender’s right to either require
prompt payment when due of all other sums so secured or to declare a default
for failure to make prompt payment. The procurement of insurance or the payment
of taxes, rents or other liens or charges by the Lender shall not be a waiver
of the 


 


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Lender’s right to
accelerate the maturity of the indebtedness secured by this Agreement, nor
shall the Lender’s receipt of any awards, proceeds or damages as provided in
this Agreement operate to cure or waive the Borrower’s default in payment of
sums secured by this Agreement.


 


SECTION 12.  Events of Default. The
Borrower shall be in default under this Agreement when any of the following
events or conditions occurs (each an “Event of Default”):


 


(a)                                  The
Borrower shall be in default under the Note beyond any applicable notice and
cure period(s).


 


(b)                                 The
Borrower fails to comply with any term, obligation, covenant, or condition
contained in this Agreement within ten (10) days after receipt of written
notice from the Lender demanding such compliance.


 


(c)                                  Any
warranty, or representation made to the Lender by the Borrower under this
Agreement, proves to have been false in any material respect when made or
furnished.


 


(d)                                 Any
event that results in acceleration of the maturity of any indebtedness of
Borrower in the outstanding principal amount of $10,000 or more, under any
note, indenture, contract, or agreement.


 


SECTION 13.  Acceleration. At the
option of the Lender, upon an Event of Default, after any applicable notice
period, all principal and any unpaid interest due hereunder shall become
immediately due and payable.


 


SECTION 14.  Borrower’s Insolvency.
If the Borrower voluntarily files a petition under the federal Bankruptcy Act,
as such Act may from time to time be amended, or under any similar or
successor federal statute relating to bankruptcy, insolvency, arrangements or
reorganizations, or under any state bankruptcy or insolvency act, or files an
answer in an involuntary proceeding admitting insolvency or inability to pay
debts, or if the Borrower is adjudged a bankrupt, or if a trustee or receiver
is appointed for the Borrower’s property, or if the Borrower makes an
assignment for the benefit of its creditors, or if there is an attachment,
receivership, execution or other judicial seizure, then the Lender may, at the
Lender’s option, declare all of the sums secured by this Agreement to be
immediately due and payable without prior notice to the Borrower, and the Lender
may invoke any remedies permitted by this Agreement. Any attorneys’ fees
and other expenses incurred by the Lender in connection with the Borrower’s
bankruptcy or any of the other events described in this Section shall be
additional indebtedness of the Borrower secured by this Agreement.


 


SECTION 15.  Waiver of Statute of
Limitations. Borrower hereby waives the right to assert any statute of
limitations as a bar to the enforcement of the lien of this Agreement or to any
action brought to enforce the Note or any other obligation secured by this
Agreement.


 


SECTION 16.
 Expense
Reimbursement. The Company shall
pay the reasonable fees and expenses of Indigo Ventures, LLC, the manager of
Lender (the “Manager”), incurred in connection with this Credit Facility
including, but not limited to, all reasonable legal fees, all 


 


4

















 


expenses related to the
formation of Indigo Investments I LLC and the filing of all necessary documents
and payment of all necessary fees (including local counsel fees) in connection
with the Lender’s perfection of a first priority security interest pursuant to
the terms of the Guaranty.


 


SECTION 17.  Remedies Cumulative.
Each remedy provided in this Agreement is distinct and cumulative to all other
rights or remedies under this Agreement or afforded by law or equity, and may be
exercised concurrently, independently, or successively, in any order
whatsoever.


 


SECTION 18.
 Notices. All
notices and other communications hereunder shall be in writing and shall be
deemed given if delivered personally, sent by overnight courier or telecopied
(with a confirmatory copy sent by overnight courier) to the Parties at the
following addresses (or at such other address for a Party as shall be specified
by like notice):


 


(a)                                  If to Borrower, to:


 


Vistula Communications
Services Inc.

405 Park Avenue

Suite 801

New York, NY 10022

Attention:
Rupert Galliers-Pratt


 


with
a copy to:


 


Foley
Hoag LLP


155
Seaport Boulevard


Boston,
MA  02210


Attention:  Paul Bork, Esq.


 


(b)                                 If to Lender, to:


 


Indigo
Investments I LLC


c/o Indigo Ventures LLC


780
Third Avenue


Suite 23B


New York, New York 10017


 


with a copy to:


 


Wollmuth Maher &
Deutsch LLP


500 Fifth Avenue


New York, NY 10110


Attention: Rory M. Deutsch, Esq.


 


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SECTION 19.
 Interpretation.
When a reference is made in this Agreement of a Section, such reference shall
be to a Section of this Agreement unless otherwise indicated, and the
words “hereof,” “herein” and “hereunder” and similar terms refer to this
Agreement as a whole and not to any particular provision of this Agreement,
unless the context otherwise requires. The table of contents and headings
contained in this Agreement are for reference purposes only and shall not
affect in any way the meaning or interpretation of this Agreement. Whenever the
words “include,” “includes” or “including” are used in this Agreement, they
shall be deemed to be followed by the words “without limitation.”


 


SECTION 20.  Counterparts. This
Agreement may be executed in counterparts, each of which shall be deemed an
original agreement, but all of which together shall constitute one and the same
instrument. Execution and delivery of this Agreement by facsimile transmission
(including the delivery of documents in Adobe PDF format) shall constitute
execution and delivery of this Agreement for all purposes, with the same force
and effect as execution and delivery of an original manually signed copy
hereof.


 


SECTION 21.
 Entire Agreement;
No Third-Party Beneficiaries. This Agreement, the Subscription Agreement, the
Guaranty and the Note, (i) constitutes the entire agreement between the Parties
hereto and supersedes all prior agreements and understandings,
both written and oral, among the Parties with respect to the subject matter
hereof and (ii) are not intended to confer upon any person other than the Parties
any rights or remedies hereunder.


 


SECTION 22.
 Governing Law. This
Agreement shall be governed by, and construed in accordance with, the laws of
the State of New York, regardless of the laws that might otherwise govern under
applicable principles of conflicts of laws thereof.


 


SECTION 23.
 Assignment. Neither
this Agreement nor any of the rights, interests or obligations hereunder shall
be assigned by operation of law or otherwise by any of the Parties without the
prior written consent of the other Party in its sole and absolute discretion,
and any such purported assignment without the express prior written consent of
the other Party shall be void ab initio. Subject to the preceding sentence,
this Agreement shall be binding upon, inure to the benefit of, and be
enforceable by, the Parties and their respective successors and assigns.


 


SECTION 24.
 Severability. If
any term or other provision of this Agreement is invalid, illegal or incapable
of being enforced by any rule of law, or public policy, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of the transactions
contemplated hereby are not affected in any manner materially adverse to any Party.
Upon such determination that any term or other provision is invalid, illegal or
incapable of being enforced, the Parties shall negotiate in good faith to
modify this Agreement so as to effect he original intent of the Parties as
closely as possible in a mutually acceptable manner in order that the
transactions be consummated as originally contemplated to the fullest extent
possible.


 


SECTION 25.
 Consent to
Jurisdiction. In the event that any legal proceedings are commenced in any
court with respect to any matter arising under this Agreement, the Parties
hereto specifically consent and agree that the courts of the State of New York
and/or the Federal 


 


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Courts located in the
State of New York shall have jurisdiction over each of the Parties hereto and
over the subject matter of any such proceedings, and the venue of any such
action shall be in New York County, New York and/or the U.S. District Court for
the Southern District of New York.


 


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IN WITNESS WHEREOF,
Borrower and Lender have executed this Agreement as of the date first written
above.


 


 


	
   

  	
  INDIGO
  INVESTMENTS I LLC

  
	
   

  	
   

  
	
   

  	
  By: Indigo Ventures,
  LLC, as Manager

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Eric Brachfeld

  	
   

  
	
   

  	
  Name:

  	
  Eric Brachfeld

  	
   

  
	
   

  	
  Title:

  	
  Managing Member

  	
   

  
	
   

  	
   

  
	
   

  	
  VISTULA
  COMMUNICATIONS SERVICES, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Rupert
  Galliers-Pratt

  	
   

  
	
   

  	
  Name:

  	
  Rupert
  Galliers-Pratt

  	
   

  
	
   

  	
  Title:

  	
  President &
  Chief Executive Officer

  	
   

  



 


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