Document:

Second Amended and Restated Senior Note due 2010

 Exhibit 4.2 
  

THIS SECURITY HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE, AND HAS BEEN ISSUED IN RELIANCE UPON AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE PLEDGED, OFFERED, SOLD HYPOTHECATED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH APPLICABLE STATE SECURITIES OR BLUE SKY LAWS.

  
 SECOND AMENDED AND RESTATED IDT SPECTRUM, INC.

  
 7% Senior Secured Note 
  
 Due January 31, 2010 
  
 No. ___ 
  
 Newark, NJ 
  
 November 11, 2005 
  
 FOR VALUE RECEIVED, the undersigned, IDT SPECTRUM, INC., a Delaware corporation (the “Borrower”), hereby promises to pay to Winstar
Holdings LLC, or Winstar Holdings LLC’s registered assigns (the “Lender”), the principal sum of ten million Dollars ($10,000,000), or so much thereof as shall not have been prepaid, on January 31, 2010 (the
“Maturity Date”), with interest (computed on the basis of a 360-day year of twelve 30-day months) on the principal amount hereof from time to time outstanding and unpaid, payable as provided in the next succeeding paragraph hereof, at the
rate of 7% per annum from the date of issuance hereof (being the date first above written), or the most recent date to which interest has been paid hereon, to but excluding, the date on which said principal amount shall be paid in full.

  

	 	1.	 Payment of Interest. Borrower shall pay interest (i) on each Quarterly Date (as hereinafter defined) until the date on which the principal of and
all accrued and unpaid interest on this Note shall be paid in full, in cash, commencing on the first such Quarterly Date occurring after the date of issuance hereof, (ii) on the Maturity Date, and (iii) upon the payment or prepayment of
any principal owing under this Note (but only on the principal amount so prepaid or paid). For purposes of this Note, the term “Quarterly Date” shall mean the last day of each March, June, September and December; provided that if any such
day is not a day 

  

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on which the majority of banks in New Jersey are open for business (a “Business Day”), then such Quarterly Date shall be the next succeeding
Business Day and interest shall accrue by reason of such extension. 

  

	 	2.	Prepayment. The principal of the Note may be prepaid, in whole or in part, at any time upon not less than five (5) days’ prior written notice to the Lender,
together with all interest then accrued and unpaid thereon (or on the portion thereof being so prepaid, as the case may be), but without premium or penalty. 

  

	 	3.	Events of Default. If, while any part of the principal of or interest and expenses on this Note remains unpaid, any one of the following “Events of Default” shall
occur: 

  

	 	a.	the failure by the Borrower to pay the principal of or interest and expenses on this Note when such payment is due, whether on demand or otherwise; 

  

	 	b.	a default by the Borrower with respect to any indebtedness of the Borrower that results in the acceleration of such indebtedness; 

  

	 	c.	the Borrower shall (i) have a receiver, trustee, or liquidator appointed for it or for all or a substantial part of its assets; (ii) from this date forward, admit in
writing to its inability to pay its debts as they mature; (iii) make a general assignment for the benefit of creditors; (iv) be adjudicated bankrupt or insolvent; (v) file a voluntary petition in bankruptcy or a petition or an answer
seeking reorganization or an arrangement with creditors to take advantage of any insolvency law; (vi) file any answer admitting the material allegations of a petition filed against it in any bankruptcy, reorganization, or insolvency proceeding
or fail to dismiss such petition within sixty (60) days after the filing thereof; or (vii) take any action for the purpose of effecting any of the foregoing; 

  

	 	d.	an order, judgment, or decree shall be entered by any court of competent jurisdiction, approving a petition seeking reorganization or liquidation of the Borrower, or appointing a
receiver, trustee, or liquidator of the Borrower of all or a substantial part of its assets, which such order, judgment, or decree has not been effectively stayed within fifteen (15) days after entry; 

  

	 	e.	the Borrower or any of its subsidiaries shall file a certificate of dissolution under applicable state law or shall be liquidated, dissolved or wound-up or shall commence or have
commenced against it any action or proceeding for dissolution, winding-up or liquidation; 

  
 then, and upon the occurrence of any such event, the Lender may, with or without notice to the Borrower, declare the entire unpaid principal balance of
this Note and any accrued and unpaid interest and expenses thereon immediately due and 

  

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payable, whereupon such Note and all amounts owing thereunder shall forthwith become due and payable without presentment, demand, protest, or further notice
of any kind, all of which are expressly waived by the Borrower; provided, however, that upon the happening of any event under subsections c or d of this Section 3, then this Note shall, without the taking of any action by the
Lender, immediately become due and payable. Upon the occurrence of an Event of Default, the Lender shall then, or at any time thereafter, have all of the rights and remedies accorded a secured party under the applicable Uniform Commercial Code and
all other rights and remedies accorded under all other applicable law. All such rights and remedies are cumulative and none is exclusive. In the event that the Lender or any subsequent holder of this Note shall exercise or endeavor to exercise any
of its remedies under this Note, the Borrower shall pay on demand all reasonable costs and expenses incurred in connection therewith including, without limitation, reasonable attorneys’ fees, and the Lender may seek judgment for all such
amounts in addition to all other sums due hereunder. The Borrower hereby agrees not to take any action to obstruct, impede, or infringe upon the Lender’s enforcement of their rights, benefits, and remedies under this Note and to cooperate fully
with any and all actions taken by any Lender pursuant to this Note or in the exercise of any rights granted to any Lender thereunder or under applicable law. 
  

	 	4.	Security Agreement. Borrower’s obligations hereunder are secured pursuant to the terms set forth in the Security Agreement between Borrower and Lender dated as of the
date hereof. 

  

	 	5.	Payment. All payments of principal of and interest on this Note shall be in such coin or currency of the United States of America as at the time of payment shall be legal
tender for payment of public and private debts. 

  

	 	6.	Governing Law. This Note shall be governed by and construed in accordance with the laws of the State of New Jersey. 

  

	 	7.	Amendment and Restatement. This Note amends and restates the $10,000,000 7% Senior Secured Note first made by the Company in favor of Winstar Holdings, LLC, dated as of
January 31, 2005 and amended and restated on August 18, 2005. 

  
 [REMAINDER INTENTIONALLY BLANK] 
  

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 IN WITNESS WHEREOF, the Borrower has caused this Note to be executed by its duly authorized
representative as of the date first above written. 
  

					
	 	 	IDT SPECTRUM, INC.
		
	 By
	 	/s/ John C. Petrillo
	 	 	 Name:
	 	John C. Petrillo
	 	 	 Title:
	 	Chairman and Chief Executive Officer

  

 4Second Amended and Restated Indemnification Agreement

 Exhibit 10.12 
  
 Second Amended and Restated 
 Indemnification Agreement 
  
 This Second Amended and Restated Indemnification Agreement (this “Agreement”) is entered into as of the 14th day of November, 2005 between IDT Corporation, a Delaware corporation (“IDT”); and IDT Spectrum, Inc., a Delaware corporation (“IDT Spectrum”). 
  
 R E C I T A L S 
  
 WHEREAS, in December 2004 and January 2005 certain subsidiaries of IDT
transferred certain assets (the “Transferred Assets”) and liabilities to IDT Spectrum and a subsidiary of IDT Spectrum; 
  
 WHEREAS, it is in IDT’s best interest to relieve IDT Spectrum from certain potential liabilities related to the such Transferred Assets and
liabilities; 
  
 WHEREAS, IDT and IDT Spectrum entered into an
Amended and Restated Indemnification Agreement, dated as of August 1, 2005 (the “Prior Indemnification Agreement”), pursuant to which IDT agreed to indemnify IDT Spectrum with respect to certain liabilities, including liabilities
which have not been assigned to, or assumed by, IDT Spectrum; and 
  
 WHEREAS, IDT and IDT Spectrum now wish to amend and restate the Prior Indemnification Agreement as set forth herein. 
  
 NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, IDT and IDT Spectrum hereby agree as
follows: 
  
 1. Indemnification. 
  
 From and after the date hereof, IDT shall indemnify and hold harmless IDT
Spectrum and its officers, directors, employees, affiliates, stockholders and controlling persons (the “Indemnified Parties”) for, and will pay to the Indemnified Parties the amount of, any losses, claims, damages (including
incidental and consequential damages), expenses (including attorneys’ fees and all other costs, expenses and obligations incurred in connection with investigating, defending a witness in or participating in (including on appeal), or preparing
to defend, be a witness in or participate in, any action, suit, proceeding, alternative dispute resolution mechanism, hearing, inquiry or investigation), liabilities, judgments, fines, penalties and amounts paid in settlement of any third-party
claim, and any federal, state, local or foreign taxes imposed on such Indemnified Parties as a result of the actual or deemed receipt of any payments under this Agreement, whether or not involving a third-party claim (any and all of the foregoing
being referred to hereafter as “Damages”), including all interest, assessments and other charges paid or payable in connection with or in respect of such Damages, to the fullest extent permitted by law, in each case arising from the
matters set forth in Schedule A hereto, whether or not such Damages were incurred prior to or after the date of this Agreement. Such payment of Damages shall be made by IDT as soon as practicable but in any event no later than ten
(10) days after written demand by an Indemnified Party therefor is presented to IDT. 
  
 To the extent that IDT sells Winstar Holdings, LLC or its assets, it will use commercially reasonable efforts to ensure that any indemnification from the buyer thereof related to 

 
activities of the transferred entity or assets following the closing of such transaction inure to the benefit of the Indemnified Parties as well. 

 
 2. Damages; Indemnification Procedure. 
  
 (a) Advancement of Expenses. If any of the Indemnified Parties was or
is or becomes a party to or witness or other participant in, or is threatened to be made a party to or witness or other participant in, any threatened, pending or completed action, suit, proceeding or alternative dispute resolution mechanism,
whether civil, criminal, administrative, investigative or other, in each case for which it is entitled to indemnification pursuant to Section 1, or any hearing, inquiry or investigation that IDT Spectrum in good faith believes might lead to the
institution of any such action, suit, proceeding or alternative dispute resolution mechanism, IDT shall advance all expenses incurred by an Indemnified Party in connection therewith. The advances to be made hereunder shall be paid by IDT to such
Indemnified Party as soon as practicable but in any event no later than ten (10) days after written demand by an Indemnified Party therefor to IDT. 
  
 (b) Notice/Cooperation by IDT Spectrum. Each Indemnified Party shall give IDT notice in writing as soon as practicable of any third-party claim
made against such Indemnified Party for which indemnification will be sought under this Agreement. In addition, each Indemnified Party shall give IDT such information and cooperation as it may reasonably require and as shall be within such
Indemnified Party’s power. 
  
 3. Termination. IDT and
IDT Spectrum acknowledge that this Agreement is being entered into in anticipation of the completion of a public offering of common stock of IDT Spectrum and IDT’s desire to facilitate that process and ensure the success of that transaction.
Accordingly, this Agreement and the parties’ obligations hereunder shall terminate if such offering shall not have been consummated on or prior to January 31, 2006. 
  
 4. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall constitute an
original. 
  
 5. Binding Effect; Successors and Assigns.
This Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and their respective successors, assigns, including any direct or indirect successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of IDT. IDT shall require and cause any successor (whether direct or indirect by purchase, merger, consolidation or otherwise) to all, substantially all, or a substantial part, of the business and/or
assets of IDT, by written agreement in form and substance satisfactory to each Indemnitee, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that IDT would be required to perform if no such succession
had taken place. 
  
 6. Attorneys’ Fees. In the event
that any action is instituted by any Indemnified Party under this Agreement or under any liability insurance policies maintained by IDT to enforce or interpret any of the terms hereof or thereof, such Indemnified Party shall be entitled to be paid
all Damages incurred by such Indemnified Party with respect to such action, regardless of whether such Indemnified Party is ultimately successful in such action, and shall be entitled to the advancement of expenses with respect to such action,
unless, as a part of such action, a court of competent jurisdiction over such action determines that each of the material assertions made by such Indemnified Party as a basis for such action was not made in good faith or was frivolous. In the event
of an action instituted by or in the name of IDT under this Agreement to enforce or interpret any of the terms of this Agreement, each Indemnified Party shall be entitled to be paid all expenses incurred by such Indemnified Party in defense of such
action (including expenses incurred with 

  

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respect to Indemnitee counterclaims and cross-claims made in such action), and shall be entitled to the advancement of expenses with respect to such action,
unless, as a part of such action, a court having jurisdiction over such action determines that each of such Indemnitee’s material defenses to such action was made in bad faith or was frivolous. 
  
 7. Notice. All notices and other communications required or permitted
hereunder shall be in writing and shall be effective upon the earlier of receipt or (a) five (5) days after deposit with the U.S. Postal Service or other applicable postal service, if delivered by first class mail, postage prepaid,
(b) upon delivery, if delivered by hand, (c) one business day after the business day of deposit with Federal Express or similar overnight courier, freight prepaid, or (d) one business day after the day of delivery by facsimile
transmission, if deliverable by facsimile transmission, with copy by first class mail, postage prepaid, and shall be addressed if to an Indemnified Party c/o IDT Spectrum at IDT Spectrum’s address as set forth on the signature page to this
Agreement, and if to IDT at the address of its principal corporate offices (attention: Legal Department) or at such other address as such party may designate by ten days’ advance written notice to the other party hereto. 
  
 8. Consent to Jurisdiction. IDT and IDT Spectrum (on behalf of itself
and each other Indemnified Party) each hereby irrevocably consent to the jurisdiction of the courts of the State of New Jersey for all purposes in connection with any action or proceeding which arises out of or relates to this Agreement. 

 
 9. Severability. The provisions of this Agreement shall be
severable in the event that any of the provisions hereof (including any provision within a single section, paragraph or sentence) are held by a court of competent jurisdiction to be invalid, void or otherwise unenforceable, and the remaining
provisions shall remain enforceable to the fullest extent permitted by law. Furthermore, to the fullest extent possible, the provisions of this Agreement (including, without limitations, each portion of this Agreement containing any provision held
to be invalid, void or otherwise unenforceable, that is not itself invalid, void or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held invalid, illegal or unenforceable. 
  
 10. Choice of Law. This Agreement shall be governed by and its
provisions construed and enforced in accordance with the laws of the State of New Jersey, as applied to contracts between New Jersey residents, entered into and to be performed entirely within the State of New Jersey, without regard to the conflict
of laws principles thereof. 
  
 11. Subrogation. In the
event of payment under this Agreement, IDT shall be subrogated to the extent of such payment to all of the rights of recovery of each Indemnified Party, who shall execute all documents reasonably required and shall do all acts that may be reasonably
necessary to secure such rights and to enable IDT effectively to bring suit to enforce such rights. 
  
 12. Amendment and Termination. No amendment, modification, termination or cancellation of this Agreement shall be effective unless it is in writing
signed by all parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar) nor shall such waiver constitute a continuing waiver. 

 
 13. Integration and Entire Agreement. This Agreement sets forth the
entire understanding between the parties hereto and supersedes and merges all previous written and oral negotiations, commitments, understandings and agreements relating to the subject matter hereof between the parties hereto. 
  

 -3- 

 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

  

			
	IDT CORPORATION
	 a Delaware corporation

		
	By:	 	 /s/ Ira Greenstein

	 Name:
	 	 Ira Greenstein

	 Title:
	 	 President

	
	IDT SPECTRUM, INC.
	 A Delaware corporation

		
	By:	 	 /s/ John C. Petrillo

	 Name:
	 	 John C. Petrillo

	 Title:
	 	 Chairman and Chief Executive Officer

 SCHEDULE A 
 to the 
 Second Amended and Restated 
 Indemnification Agreement 
 Dated as of November 14th, 2005 
 by and between 
 IDT CORPORATION 
 and 
 IDT SPECTRUM, INC. 
  

	1.	The dispute between Lucent Technologies, Inc. (“Lucent”) and Winstar Holdings, LLC (together with its affiliates and subsidiaries, “Winstar’), or any of their
affiliates, relating to whether or not Winstar acquired the right to use the software embedded in the Lucent switch equipment acquired by Winstar from Winstar Communications, Inc. and its various affiliates. 

  

	2.	Claims asserted by the General Services Administration arising from or related to the operations of Winstar Government Solutions LLC and its affiliates and subsidiaries, other than
the operations of IDT Spectrum, Inc. 

  

	3.	Claims asserted by AT&T Corp. against IDT and a number of its affiliates and subsidiaries, including Winstar and IDT Spectrum, arising from or related to, among other things,
the alleged use of a number of AT&T Corp.’s circuits and other services without payment. 

  

	4.	Claims and potential claims from MFN Communications related to the operations of Winstar. 

  

	5.	Claims related to the ownership or operation by IDT and/or any of its affiliates of the Transferred Assets prior to the dates of the instruments transferring such Transferred Assets
to IDT Spectrum. 

  

	6.	Any other claim related to the operations of Winstar either prior to, or following, the date of the Agreement (unless IDT Corporation shall no longer control Winstar and the claim
arises from the operation of Winstar after the cessation of IDT Corporation’s control). 

  

	7.	The transfer by Winstar of Winstar’s FCC licenses and other assets to IDT Spectrum, Inc. and any of IDT Spectrum’s subsidiaries.

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