<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
(MARK ONE)
X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
---- SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1996
OR
---- TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM __________ TO __________
COMMISSION FILE NUMBER: 0-27442
OMNIPOINT CORPORATION
(Exact Name of Registrant as specified in its charter)
DELAWARE 04-2969720
(State or other jurisdiction of (IRS employer
incorporation or organization) identification No.)
2000 NORTH 14TH STREET, SUITE 550 22201
ARLINGTON, VA (Zip Code)
(Address of principal executive office)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (703) 522-7778
SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
Name of Each Exchange
Title of Each Class: on which Registered:
-------------------- ---------------------
COMMON STOCK, PAR VALUE NASDAQ NATIONAL MARKET
$0.01 PER SHARE
SECURITIES REGISTERED PURSUANT TO SECTION 12 (G) OF THE ACT:
NONE
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
--- ---
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, the Company has duly caused this Report to be
signed on its behalf by the undersigned, thereunto duly authorized, in
Arlington, Commonwealth of Virginia, on the 10th of February, 1998.
OMNIPOINT CORPORATION
By:/s/ Edwin M. Martin, Jr.
------------------------
Edwin M. Martin, Jr.
Secretary
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this Report has been signed below by the following persons on behalf of
the Company in the capacities and on the date indicated.
Each person whose signature appears below in so signing also makes,
constitutes and appoints Douglas G. Smith and Edwin M. Martin, Jr., and each of
them acting alone, his true and lawful attorney-in-fact, with full power of
substitution, for him in any and all capacities, to execute and cause to be
filed with the Securities and Exchange Commission any and all amendments and
post-effective amendments to this Report, with exhibits thereto and other
documents in connection therewith, and hereby ratifies and confirms all that
said attorney-in-fact or his substitute or substitutes may do or cause to be
done by virtue hereof.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
----------------- ------------------------------ --------------
<S> <C> <C> <C>
/s/ * President, Chief Executive February 10, 1998
- ---------------------- Officer, Chairman of the
Douglas G. Smith Board and Director (Principal
Executive Officer)
/s/ * Executive Vice President and February 10, 1998
- ---------------------- Director; President of
George F. Schmitt Omnipoint Communications Inc.
</TABLE>
/s/ * Chief Financial Officer February 10, 1998
- ---------------------- (Principal Financial and
Bradley E. Sparks Accounting Officer)
/s/ * Director and Vice Chairman February 10, 1998
- ---------------------- of the Board
James J. Ross
/s/ * Director February 10, 1998
- ----------------------
Evelyn Goldfine
* Power of Attorney by
/s/ Edwin M. Martin, Jr.
- ------------------------
Edwin M. Martin, Jr.
Secretary
<PAGE>
/s/ * Director February 10, 1998
- ------------------------
Richard L. Fields
/s/ * Director February 10, 1998
- ------------------------
Paul J. Finnegan
/s/ * Director February 10, 1998
- ------------------------
James N. Perry, Jr.
/s/ * Director February 10, 1998
- ------------------------
Arjun Gupta
<PAGE>
OMNIPOINT CORPORATION
___________________
FORM 10-K/A
___________________
EXHIBIT INDEX
EXHIBIT DESCRIPTION SEQUENTIAL PAGE NO.
- ------- ----------- -------------------
10.32 Amended and Restated Loan Agreement, dated
August 7, 1996, by and between Omnipoint
Communications Inc. and Northern Telecom, Inc. *****
10.33 Loan Agreement, dated August 7, 1996, by and
between Omnipoint Communications Inc. and
Ericsson Inc., as amended. *****
***** Certain information in this Exhibit has been omitted and filed
separately with the Secretary of the Commission pursuant to the
Registrant's Application Requesting Confidential Treatment under Rule
24b-2 under the Exchange Act of 1934, filed .
<PAGE>
Exhibit 10.32
---------------------------------------------
| Confidential treatment has been |
|requested for portions of this exhibit. The|
|copy filed herewith omits the information |
|subject to the confidentiality request. |
|Omissions are designated as *****. A |
|complete version of this exhibit has been |
|filed separately with the Securities and |
|Exchange Commission. |
---------------------------------------------
AMENDED AND RESTATED LOAN AGREEMENT
-----------------------------------
This AMENDED AND RESTATED LOAN AGREEMENT is made as of the 7th day of
August, 1996, by and among (a) OMNIPOINT COMMUNICATIONS INC. (the "Borrower"), a
Delaware corporation having its principal place of business at 2000 North 14th
Street, Suite 550, Arlington, Virginia 22201, (b) NORTHERN TELECOM INC., a
Delaware corporation having a principal place of business at 200 Athens Way,
Nashville, Tennessee 37228 as administrative agent for itself and the other
Lenders party hereto and (c) the Lenders. This Amended and Restated Loan
Agreement amends and restates the original Loan Agreement between Borrower and
Northern Telecom Inc. dated as of July 21, 1995 in its entirety.
(S)I. DEFINITIONS AND RULES OF INTERPRETATION.
---------------------------------------
(S)A. Definitions.
-----------
The following terms shall have the meanings set forth in this (S)1 or
elsewhere in the provisions of this Loan Agreement referred to below:
Accounts. As defined in the Borrower Security Agreement.
--------
Accounts Receivable. As defined in the Borrower Security Agreement.
-------------------
Additional Commitments. (1) Loan Commitments, (2) Equity Commitments,
----------------------
(3) Borrower's Working Capital; (4) the then undrawn amount of any loan from an
AC Lender pursuant to loan documentation that is finalized and in place; and (5)
the then undrawn amount of any equity line from an AC Equity Investor pursuant
to equity investment agreements that are finalized and in place. The aggregate
of items (1) through (5) (after eliminating any duplication among such items)
shall be in an amount that will be sufficient to cover (a) all operational cash
requirements of Borrower shown as "cash from operations before cap/ex financing"
on the Approved Full-Term Operating Business Plan, including, without limitation
all interest payable to the FCC with respect to the License for the New York PCS
Network for the period commencing on the measuring date in question (as
specified in (S)7.12 hereof) and continuing until Borrower's EBTDA is positive
(as shown on such Approved Full-Term Operating Business Plan), and (b) all
principal payments on the Indebtedness to the FCC for the purchase price for the
License for the New York PCS Network, provided that with respect to the
--------
principal due to the FCC on account of the purchase price for the New York PCS
Network License, the operational cash requirements shall only include all
principal due to the FCC on the New York PCS Network License for the twelve (12)
months succeeding such measuring date.
<PAGE>
Adjusted Borrower's Equity. For any period, the sum of (i) Borrower's
--------------------------
Equity and (to the extent not otherwise included), (ii) Subordinated Debt and
(iii) $95,194,000 (representing the difference between the price paid for a so-
called "B Band" PCS License for the New York MTA ($442,712,00) and Borrower's
cost of the License for the New York MTA ($347,518,000), less the cumulative
amount of retained earnings (or deficit) of Borrower as determined in accordance
with GAAP.
Adjusted EBITDA. For any period the sum of (i) EBITDA and (ii) Contributed
---------------
Capital infused into Borrower in the current calendar quarter.
Adjusted Indebtedness. For any period, Borrower's Indebtedness less
---------------------
Subordinated Debt owing to Parent or Grand Parent or any other Affiliate.
Adjusted Total Debt. Borrower's Indebtedness less Subordinated Debt.
-------------------
Adjusted Working Capital. The difference from year to year between
------------------------
Borrower's "current assets" and "current liabilities" as shown on the audited
balance sheet of Borrower (delivered pursuant to (S)7.18D); provided that in
calculating Adjusted Working Capital hereunder the following shall be excluded:
(i) all receivables outstanding more than 60 days past invoice date; (ii) all
inventories that otherwise would be included as current assets under such
balance sheet; and (iii) the current portion of long-term debt, in each case
consistently applied.
Administrative Agent. Northern Telecom Inc. and each successor
--------------------
Administrative Agent appointed pursuant to (S)13.9 hereof.
Administrative Agent's Office. The Administrative Agent's office set forth
-----------------------------
in the preamble hereof and upon the appointment of a successor Administrative
Agent pursuant to (S)13.9 hereof such address as shall be provided by such
successor Administrative Agent.
Administrative Agent's Special Counsel. Hale and Dorr.
--------------------------------------
Affiliate. As to any Person, any other Person which, directly or
---------
indirectly, is in control of, is controlled by, or is under common control with
such person. For purposes of this definition, control of a Person shall include
the power, direct or indirect, (i) to vote 50% or more of the securities or
other interests having ordinary voting power for the election of directors or
other managing Persons of such Person or (ii) to direct or cause direction of
the management and policies of such Person whether by contract or otherwise.
Applicable Commitment. Each Lender's commitment to make Tranche A Loans,
---------------------
Tranche B Loans and Tranche C Loans.
<PAGE>
Applicable Lending Period. For Tranche A Loans and Tranche B Loans, the
-------------------------
period beginning with the Closing Date and ending on the Tranche A and B
Commitment Termination Date (inclusive), and for Tranche C Loans, the period
beginning with the Closing Date and ending on the Tranche C Final Repayment
Date.
Applicable Margin. For LIBOR Rate Tranche A Loans, 4.45% per annum; for
-----------------
LIBOR Rate Tranche B Loans and LIBOR Rate Tranche C Loans, 5.5% per annum.
Approved Annual Operating Business Plan. See (S)7.18B.
---------------------------------------
Approved Full Term Operating Business Plan. See (S)7.18A.
------------------------------------------
Assignment and Acceptance. See (S)17.1.
-------------------------
Assignment and Acceptance Agreement. An assignment and acceptance
-----------------------------------
agreement executed by an assignor and an assignee pursuant to which the
assignor, subject to and in accordance with the terms hereof, assigns to
assignee all or any portion of such assignor's Notes and Commitments,
substantially in the form of Exhibit D.
------- -
BTA. The unit of division (of which there are 493) for the United States
---
of America, devised by Rand McNally based upon geography, population and other
factors, which units form the basis for the auction of PCS Licenses by the FCC.
Balance Sheet Date. December 31, 1995.
------------------
Base LIBOR Rate. For any Interest Period, the rate which appears on Page
---------------
3750 of the Dow Jones & Company Telerate screen or any successor page as the
composite offered rate for London interbank deposits in an amount approximately
equal to the amount of the requested Loan for a three-month period, as shown
under the heading "USD" as of 11:00 a.m. (London time), two (2) LIBOR Business
Days before the first day of such Interest Period provided, that, in the event
--------
no such rate is available, the rate shall be the rate per annum equal to the
arithmetic mean of the rates shown on the LIBO page of Reuters Money Service at
approximately 11:00 a.m. (London time) as of such day in an amount
approximately equal to the amount of the requested Loan as of the first day of
the relevant Interest Period.
Base Rate. For Tranche A Loans for the applicable Interest Period, the per
---------
annum rate equal to the sum of (i) the Prime Rate in effect on the first
Business Day of the applicable Interest Period and (ii) 1.70%.
For Tranche B and C Loans for the applicable Interest Period, the per annum
rate equal to the sum of (i) the Prime Rate in effect on the first Business Day
of the applicable
<PAGE>
Interest Period and (ii) 2.75%.
For all Base Rate Loans, the Base Rate, once determined, shall remain
unchanged during the applicable Interest Period.
Base Rate Loans. Loans bearing interest calculated by reference to the
---------------
Base Rate.
Borrower. As defined in the preamble hereto.
--------
Borrower Security Agreement. That certain Amended and Restated Borrower
---------------------------
Security Agreement in substantially the form of Exhibit E attached hereto, among
---------
Borrower, the Collateral Agent, the Nortel Administrative Agent and the Ericsson
Administrative Agent of even date, as may be amended, restated, modified or
supplemented and in effect from time to time.
Borrower's Equity. The amount of shareholder equity shown on Borrower's
-----------------
balance sheet prepared in accordance with GAAP.
Borrower's Obligations. All indebtedness, obligations and liabilities of
----------------------
Borrower to the Administrative Agent and the Lenders, arising or incurred under
this Loan Agreement or any of the other Loan Documents or in respect of any of
the Loans made or any of the Notes or other instruments at any time evidencing
any thereof, existing on the date of this Loan Agreement or arising thereafter,
direct or indirect, joint or several, absolute or contingent, matured or
unmatured, liquidated or unliquidated, secured or unsecured, arising by
contract, operation of law or otherwise.
Breakage Costs. Any loss, cost or expense (including loss of anticipated
--------------
profit) that any Lender or the Administrative Agent may sustain or incur as a
consequence of (a) a default by Borrower in payment of the principal amount of
or any interest on any LIBOR Rate Loans as and when due and payable, including
any such loss or expense arising from interest or fees payable by such Lender or
the Administrative Agent to lenders of funds obtained by it in order to make its
LIBOR Rate Loans or (b) the making of any payment of a LIBOR Rate Loan on a day
that is not the last day of the applicable Interest Period with respect thereto,
including interest or fees payable by such Lender or the Administrative Agent to
lenders of funds obtained by it in order to maintain any such Loans.
Business Day. Any day other than a Saturday, a Sunday or a day on which
------------
commercial banks located in New York City are authorized or required by law or
other governmental action to close.
Capital Assets. Fixed assets, both tangible (such as land, buildings,
--------------
fixtures, machinery and equipment) and intangible
<PAGE>
(such as patents, copyrights, trademarks, franchises, Licenses and good will);
provided that Capital Assets shall not include any item customarily charged
- --------
directly to expense or any item the entire useful life of which is depreciated
over a period of twelve (12) months or less in accordance with generally
accepted accounting principles.
Capital Expenditures. Amounts paid or Indebtedness incurred by Borrower in
--------------------
connection with the purchase or lease by Borrower of Capital Assets that would
be required to be capitalized and shown on the balance sheet of such Person in
accordance with generally accepted accounting principles.
Capitalized Leases. Leases under which Borrower is the lessee or obligor,
------------------
the discounted future rental payment obligations under which are required to be
capitalized on the balance sheet of the lessee or obligor in accordance with
generally accepted accounting principles.
Cash. For any period, the sum of (i) Borrower's cash, (ii) Borrower's
----
Investments to the extent they are permitted by (S)8.4 (b) through (e) below,
(iii) Loan Commitments, the proceeds of which are available to be used for
general business purposes of Borrower including the payment of interest owed
with respect to Indebtedness permitted by Section 8.1., (iv) the portion of the
Tranche C Commitment then remaining undrawn, (v) Equity Commitments and (vi)
until June 30, 1998, the greater of (a) zero and (b)(1) the lesser of
$25,000,000 and the then remaining undrawn amount of the Tranche A Advance
Commitments (as defined in the Ericsson Loan Agreement) minus (2) the aggregate
amount of interest accrued on advances (whether or not paid) under the Ericsson
Loan Agreement.
Change in Control. The acquisition by any Person, or two or more Persons
-----------------
acting in concert (a "group"), of beneficial ownership (within the meaning of
-----
Rule 13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934) of 50% or more of the outstanding shares of Voting Stock
of Borrower, provided, however, that if a change of ownership which would
--------
otherwise constitute a Change in Control results from a publicly underwritten
offering of Borrower's, securities and the proceeds of such public offering are
used to create a reserve sufficient in amount to pay all Indebtedness owing with
respect to Borrower's FCC Licenses and other Capital Expenditures (other than
Capital Expenditures financed by this Loan Agreement) for the amortization
period of the FCC Licenses, then such change of ownership shall not by itself
constitute a Change in Control.
Closing Date. The first date on which the conditions set forth in (S)9
------------
have been satisfied or waived through written acknowledgment of Administrative
Agent.
Collateral. All of the property, rights and interests of
----------
<PAGE>
Borrower and Parent that are or are intended to be subject to the security
interests created by the Borrower Security Agreement and the Pledge Agreement.
Collateral Agent. Mellon Bank, N.A. or any successor thereto appointed
----------------
pursuant to (S)6.5 of the Intercreditor Agreement.
Collateral Documents. The Borrower Security Agreement and the Pledge
--------------------
Agreement.
Commitment. The obligation of the Lenders to make Loans to Borrower,
----------
subject to the terms and conditions hereof, in an aggregate outstanding
principal amount not exceeding $382,500,000.
Commitment Percentage. The percentages in which the Lenders are bound to
---------------------
make Loans to the Borrower under the Commitment. Prior to the occurrence of an
Assignment and Acceptance of any portion of NTI's Commitment, NTI's Commitment
Percentage shall be 100%.
Communications Act. The Communications Act of 1934, as amended, and the
------------------
rules and regulations issued thereunder, as from time to time in effect.
Compliance Certificate. As defined in (S)7.18E and in substantially the
----------------------
form set forth in Exhibit C attached hereto.
---------
Contingent Obligation. As to any Person, any obligation of such Person
---------------------
guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends or
other obligations ("primary obligations") of any other Person (the "primary
------------------- -------
obligor") in any manner, whether directly or indirectly, including, without
- -------
limitation, any obligation of such Person, whether or not contingent, (a) to
purchase any such primary obligation or any Property constituting direct or
indirect security therefor, (b) to advance or supply funds (i) for the purchase
or payment of any such primary obligation or (ii) to maintain working capital or
equity capital of the primary obligor or otherwise to maintain net worth,
solvency or other financial statement condition of the primary obligor, (c) to
purchase Property, securities or services primarily for the purpose of assuring
the beneficiary or holder of any such primary obligation of the ability of the
primary obligor to make payment of such primary obligation or (d) otherwise to
assure, protect from loss, or hold harmless the beneficiary or holder of such
primary obligation against loss in respect thereof; provided, however, that the
term Contingent Obligation shall not include the indorsement of instruments for
deposit or collection in the ordinary course of business. The term Contingent
Obligation shall also include the liability of a general partner in respect of
the recourse liabilities of the partnership in which it is a general partner.
The amount of any Contingent Obligation of a Person shall be deemed to be an
amount equal to the stated or determinable amount of the primary obligation in
respect of which such
<PAGE>
Contingent Obligation is made or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof as determined by such Person
in good faith.
Contributed Capital. The sum of (i) proceeds from the sale of Borrower's
-------------------
equity securities received during the applicable period, plus (ii) Subordinated
Debt incurred by Borrower during the applicable period and interest which has
accrued thereon and which remains unpaid.
Debt Service. For any period, the aggregate amount of interest and
------------
principal required to be paid by Borrower during such period on all Indebtedness
of Borrower outstanding during all or any part of such period (excluding (a) the
amount of any Net Funds Payment required to be paid during such period pursuant
to (S)3.2.B hereof, (b) the amount of any prepayment required to be paid during
such period pursuant to (S)3.C hereof or (S)3.02(a) or (b) of the Ericsson Loan
Agreement and (c) interest capitalized under loans where such loans provide for
the funding of interest costs), whether such interest and principal was or is
required to be reflected as an item of expense or capitalized, including
scheduled payments in respect of Capitalized Leases and including commitment
fees, agency fees, facility fees, origination fees, balance deficiency fees and
similar fees or expenses in connection with Indebtedness.
Default. Any of the events or circumstances specified in (S)11.1, whether
-------
or not any requirement for the giving of notice, the lapse of time, or both, or
any other condition, has been satisfied.
Distribution. The declaration or payment of any cash dividend, dividend in
------------
kind or cash equity distributions on or in respect of any shares of any class of
capital Stock of Borrower, other than dividends payable solely in shares of
common Stock of Borrower; the purchase, redemption, or other retirement of any
shares of any class of capital Stock of Borrower; the return of capital by
Borrower to its shareholders as such; or any other distribution on or in respect
of any shares of any class of capital Stock of Borrower.
Dollars or $. Dollars in lawful currency of the United States of America.
------------
Domestic Lending Office. In respect of any Lender, initially, the office
-----------------------
or offices of such Lender in the United States designated as such on Schedule
--------
1.1; or thereafter, such other office, if any, of such Lender through which it
- ---
shall be making or maintaining Base Rate Loans, as reported by such Lender in
the United States to the Administrative Agent and the Borrower.
Draw Request. See (S)2.8.
------------
Drawdown Date. The date on which any Loan is made or is
-------------
<PAGE>
to be made. Notwithstanding the foregoing, if the applicable Drawdown Date would
occur on a day which is not a Business Day, the Drawdown Date shall be the next
Business Day.
Drawdown Report and Certificate. A report signed by the Borrower's Chief
-------------------------------
Financial Officer or other authorized officer of the Borrower and submitted to
Administrative Agent with each Tranche B Draw Request certifying that the
proceeds of the prior month's Tranche B Loans were used to pay those Tranche B
Eligible Expenses for which such Tranche B Loans were requested (except to the
extent that Borrower disputes in good faith its obligation to pay a Tranche B
Eligible Expense), a list of all Tranche B Eligible Expense payments made,
showing the identity of the Person paid, the amount and the reasons for such
payment, a list of all Persons who were scheduled to be paid or who were paid
$100,000 or more during the prior month together with satisfactory evidence of
payment, and a list of all Tranche B Eligible Expenses which are in dispute;
provided that if Borrower asserts that it is barred from providing certain of
the supporting documentation required hereunder by reason of a confidentiality
agreement with any vendor, Borrower shall be required, as a condition of
receiving the payment therefor, to provide Administrative Agent with (a) a copy
of the confidentiality agreement in question (b) a description of the particular
items associated with such vendor, and (c) such other information as
Administrative Agent reasonably believes is necessary (consistent with the
confidentiality agreement) to substantiate the applicable Tranche B Eligible
Expenses.
EBITDA. For any period, Net Income (or loss) of the Borrower for such
------
period plus, to the extent deducted or accrued in determining Net Income, the
sum of each of the following for such period: (i) depreciation, amortization
and other non-cash charges; (ii) income tax expense; and (iii) Total Interest
Expense.
EBTDA. For any period, Net Income (or loss) of the Borrower for such
-----
period plus, to the extent deducted or accrued in determining Net Income, the
sum of each of the following for such period: (i) depreciation, amortization
and other non-cash charges; (ii) income tax expense; and (iii) cash interest not
being paid as an express feature of the related debt instrument.
Eligible Assignee. See (S)17.1.
-----------------
Employee Benefit Plan. Any employee benefit plan within the meaning of
---------------------
(S)3(3) of ERISA maintained or contributed to by any of Borrower or any ERISA
Affiliate, other than a Multiemployer Plan.
Environmental Laws. Any federal, state or local law, statute, rule or
------------------
regulation or the common law relating to the environment or occupational health
and safety, including without limitation any statute, regulation or order
pertaining to (i) treatment, storage, disposal, generation and transportation of
<PAGE>
industrial, toxic or hazardous substances or solid or hazardous waste; (ii) air,
water or noise pollution; (iii) groundwater and soil contamination; (iv) the
release or threatened release into the environment of industrial, toxic or
hazardous substances, or solid or hazardous waste, including without limitation
emissions, discharges, injections, spills, escapes or dumping of pollutants,
contaminants or chemicals; (v) the protection of wildlife, marine sanctuaries
and wetlands, including without limitation all endangered and threatened
species; (vi) underground and other storage tanks or vessels, abandoned,
disposed or discarded barrels, containers and other closed receptacles; (vii)
health and safety of employees and other persons; and (viii) manufacture,
processing, use, distribution, treatment, storage, disposal, transportation or
handling of pollutants, contaminants, chemicals or industrial, toxic or
hazardous substances or oil or petroleum products or solid or hazardous waste,
including, without limitation, (a) the Comprehensive Environmental Response.
Compensation and Liability Act, as amended, 42 USCA (S)9601 et seq. ("CERCLA");
------ ------
(b) the Resource Conservation and Recovery Act of 1976, as amended, 42 USCA
(S)6901 et. seq. ("RCRA"); (c) the Toxic Substance Control Act, as amended, 15
-------
USCA (S)2601 et seq.; (d) the Water Pollution Control Act, as amended, 33 USCA
------
(S)1251 et seq.; (e) the Clean Air Act, as amended 42 USCA (S)7401 et seq.; (f)
------ ------
the Hazardous Material Transportation Act, as amended, 49 USCA (S)1801 et seq.
------
(g) the Superfund Amendments and Reauthorization Act of 1986 ("SARA"), and (h)
all rules, regulations judgments decrees injunctions and restrictions thereunder
and any analogous state law. As used above, the terms "release," "threatened
release," "hazardous substance" and "environment" shall have the meaning set
forth in CERCLA, and the terms "solid waste" and "dispose" (or "disposal") shall
have the meaning set forth in the RCRA.
Environmental Permits. See (S)6.25(d).
---------------------
Equipment. As defined in the Borrower Security Agreement.
---------
Equity Commitment. Binding written commitment(s) (not in default) for the
-----------------
making of a cash equity investment in Borrower from a Person or entity (the "AC
Equity Investor") which (I) in the sole judgment of the Required Lenders has the
financial resources and capability of performing the commitment and making the
equity investment or (II) is from Parent or Grand Parent if and to the extent
such Person is holding cash, securities for which there is a readily available
market on established stock exchanges including over-the-counter exchanges or
other permitted Investments under (S)8.4(b) through (e) equal to or in excess of
the amount of the Equity Commitment in question (and which equity investment is
to be made in the form of Subordinated Debt or equity), which equity commitment
(w) is complete, with all schedules, (x) is in the form customarily utilized by
institutional venture capital firms for binding written commitments that have
passed all internal credit reviews, (y) has been fully executed by the AC Equity
investor and
<PAGE>
Borrower and (z) makes the AC Equity Investor's obligation to make the equity
investment subject only to (i) credit verification of the Borrower showing no
material adverse change in the financial condition of Borrower since the date of
the credit review (on which the equity commitment was predicated) and (ii)
completion and delivery of documentation and other documents, certificates and
opinions customarily required by institutional equity investors satisfactory to
AC Equity Investor's counsel.
Ericsson Loan Agreement. The Loan Agreement dated as of August 7, 1996
-----------------------
among the Borrower, Ericsson, Inc., as Administrative Agent and the lenders
parties thereto, as the same may be amended from time to time in compliance with
the Intercreditor Agreement.
ERISA. The Employee Retirement Income Security Act of 1974, as amended
-----
from time to time, and the rules and regulations issued thereunder as from time
to time in effect.
ERISA Affiliate. Any Person which is treated as a single employer with
---------------
Borrower under (S)414 of the IRC.
ERISA Event. With respect to Borrower or any ERISA Affiliate, (a) a
-----------
Reportable Event, (b) the withdrawal of Borrower or any ERISA Affiliate from a
Plan during a plan year in which it was a "substantial employer" as defined in
Section 4001 (a)(2) of ERISA, (c) the filing of a notice of intent to terminate
a Plan for a distress termination of the Plan under (S)4041(c) of ERISA, or the
treatment of a Plan amendment as a termination under Section 4041 of ERISA, (d)
the institution of proceedings to terminate a Plan by the PBGC under Section
4042 of ERISA, or (e) any other event or condition which might reasonably be
expected to constitute grounds under Section 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, any Plan or to cause the
imposition of any liability (other than PBGC premiums due but not delinquent
under Section 4007 of ERISA) in excess of $250,000 under Title IV of ERISA.
Event of Default. Any of the events specified in (S)11.1, provided,
----------------
however, that any requirement for the giving of notice, or the lapse of time, or
both, or any other condition, event or act has been satisfied.
Excess Amount. See (S)7.6.
-------------
Expense Allocation Agreement. That certain Expense Allocation Agreement
----------------------------
among Borrower, Parent and Grand Parent dated as of July 21, 1995, which
provides for the allocation of expenses and overhead among Borrower, Parent,
Grand Parent and their Affiliates satisfactory to Administrative Agent and the
Required Lenders (as may be amended from time to time, but only if approved by
the Administrative Agent and the Required Lenders).
<PAGE>
FCC. The Federal Communications Commission or any Governmental Body
---
succeeding to the functions thereof.
Full Term Operating Business Plan. See (S)7.18A.
---------------------------------
GAAP or generally accepted accounting principles. Whether directly or
------------------------------------------------
indirectly through reference to a capitalized term used therein, means (i)
principles that are consistent with the principles promulgated or adopted by the
Financial Accounting Standards Board and its predecessors, in effect for the
fiscal year ended on the Balance Sheet Date, and (ii) to the extent consistent
with such principles, the accounting practice of Borrower reflected in its
financial statements for the year ended on the Balance Sheet Date, provided that
--------
if such Board after the date hereof shall promulgate or adopt accounting
principles that materially differ over the term of this Loan Agreement from
those in effect on the Balance Sheet Date, Borrower and the Administrative Agent
will endeavor in good faith to amend (i) the definition of GAAP to include such
different principles and (ii) the covenants contained in (S)7.19 hereof in order
to reflect in substance the same limitations and restrictions as in effect prior
to such amendment to the definition of GAAP, it being understood that until the
Administrative Agent and Borrower shall reach agreements on such new covenants,
the covenants contained in (S)7.19 hereof continue to be effective, and (b) when
used in general, other than as provided above, means principles that are (i)
consistent with the principles promulgated or adopted by the Financial
Accounting Standards Board and its predecessors, as in effect from time to time,
and (ii) consistently applied with past financial statements of Borrower
adopting the same principles, provided that in each case referred to in this
--------
definition of "generally accepted accounting principles" a certified public
accountant would, insofar as the use of such accounting principles is pertinent,
be in a position to deliver an unqualified opinion (other than a qualification
regarding changes in generally accepted accounting principles) as to financial
statements in which such principles are presented fairly in all material
respects in conformity with such principles applied on a consistent basis.
General Intangibles. As defined in the Borrower Security Agreement.
-------------------
Governmental Body. Any nation or government, any state or other political
-----------------
subdivision thereof, any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government and any
court or arbitrator.
Grand Parent. Omnipoint Corporation, a Delaware corporation.
------------
Grants of Security Interests. As defined in the Borrower Security
----------------------------
Agreement.
<PAGE>
Guaranteed Pension Plan. Any employee pension benefit plan within the
-----------------------
meaning of (S)3(3) of ERISA maintained or contributed to by any of Borrower or
any ERISA Affiliate the benefits of which are guaranteed on termination in full
or in part by the PBGC pursuant to Title IV of ERISA, other than a Multiemployer
Plan.
Guaranty Agreement. That certain Limited Recourse Guaranty Agreement of
------------------
even date, substantially in the form attached hereto as Exhibit F-1 executed by
Parent in favor of the Administrative Agent and Lenders as the same may be
amended, restated, modified or supplemented in accordance with the Loan
Documents and in effect from time to time.
Highest Lawful Rate. As to any Lender the maximum rate of interest, if
-------------------
any, that at any time or from time to time may be contracted for, taken, charged
or received by such Lender on the Notes held thereby, as the case may be, or
which may be owing to such Lender pursuant to this Loan Agreement and the other
Loan Documents under the laws applicable to such Lender and this transaction.
IRC. The Internal Revenue Code of 1986, as amended.
---
Indebtedness. As to any Person, at a particular time, all items which
------------
constitute, without duplication, (i) indebtedness for borrowed money or the
deferred purchase price of Property (other than trade payables incurred in the
ordinary course of business), (ii) indebtedness evidenced by notes, bonds,
debentures or similar instruments, (iii) obligations with respect to any
conditional sale or title retention agreement, (iv) indebtedness arising under
acceptance facilities and the amount available to be drawn under all letters of
credit issued for the account of such Person and, without duplication, all
drafts drawn thereunder to the extent such Person shall not have reimbursed the
issuer in respect of the issuer's payment of such drafts, (v) all liabilities
secured by any Lien on any Property owned by such Person even though such
Person has not assumed or otherwise become liable for the payment thereof (other
than carriers', warehousemen's, mechanics', repairmen's or other like non-
consensual Liens arising in the ordinary course of business), (vi) obligations
under Capitalized Leases, (vii) amounts owed to the FCC on the FCC License for
the New York PCS Network, (viii) all Contingent Obligations and (ix) interest
that is accreted or otherwise accrued and unpaid on Subordinated Debt.
Indebtedness Cap. In the aggregate, at any one time outstanding, One
----------------
Billion Dollars ($1,000,000,000); provided, however, that such amount shall be
(a) decreased to the extent that Borrower sells, in compliance with applicable
law and with all Necessary Authorizations, any portion of the License for the
New York PCS Network and (b) increased if and to the extent Borrower acquires
additional Licenses for other PCS Networks, in each case
<PAGE>
with the adjustment (upward or downward) to be calculated on the basis of $37.50
times the total number of persons in the United States population ("POP's") in
the FCC licensed area sold (or acquired) as the case may be and provided further
that no adjustment of the Indebtedness Cap shall be made for actual changes in
the POP's in the absence of any purchase or sale transaction.
Information. Collectively, the information which Borrower or Parent has
-----------
previously provided or caused to be provided to Administrative Agent relating to
Borrower's and Parent's business and operations and other information which is
available generally and of which Administrative Agent is aware relating to
Borrower's and Parent's business and operations.
Insolvent or Insolvency. With respect to any Person on a particular date,
--------- ----------
the condition that on such date, (i) the present fair salable value of the
assets of such Person is less than the amount that will be required to pay the
probable liabilities of such Person as and when they become due including,
without limitation, Contingent Obligations, of such Person, or (ii) such Person
is not generally paying its debts as and when they become due, or (iii) such
Person is engaged in business or a transaction, or is about to engage in
business or a transaction, for which such Person's Property would constitute an
unreasonably small amount of capital. With respect to determining in (i) the
fair salable value of an FCC License during the initial three year period in
which transfers are restricted by the FCC, the effect of such a transfer
restriction shall be ignored.
Intellectual Property. All copyrights, Trademarks, service marks, Patents,
---------------------
trade names and service names, Licenses and the like.
Intercreditor Agreement. See (S)8.2.
-----------------------
Interest Payment Date. The last day of any Interest Period.
---------------------
Interest Period. With respect to each Loan, (a) initially, the period
---------------
commencing on the Drawdown Date of such Loan (inclusive) and ending on the last
day of the sooner of March, June, September or December (inclusive); and (b)
thereafter, each period commencing on the first day after the end of the
immediately preceding Interest Period (inclusive) and ending on the last day of
the sooner of March, June, September or December (inclusive). Interest shall be
due and payable with respect to any Loan as provided in (S)2.6 and other
applicable provisions hereof. Notwithstanding the foregoing:
(A) if any Interest Period with respect to a LIBOR Rate Loan would
otherwise end on a day that is not a LIBOR Business Day, that Interest Period
shall end on the immediately preceding LIBOR Business Day (inclusive);
<PAGE>
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|Confidential treatment has been requested |
|with respect to the omitted portions. |
---------------------------------------------
(B) if any Interest Period with respect to a Base Rate Loan would end
on a day that is not a Business Day, that Interest Period shall end on the
immediately preceding Business Day (inclusive); and
(C) with respect to Tranche A Loans or Tranche B Loans, any Interest
Period that would otherwise end after the Tranche A and B Maturity Date shall
end on the Tranche A and B Maturity Date (inclusive); and
(D) with respect to Tranche C Loans, any Interest Period that would
otherwise end after the Tranche C Final Repayment Date shall end on the Tranche
C Final Repayment Date (inclusive).
Interest Rate Election Notice. See (S)2.6A(b).
-----------------------------
Investments. All expenditures made and all liabilities incurred
-----------
(contingently or otherwise) for the acquisition of stock or Indebtedness of, or
for loans, advances, capital contributions or transfers of property to, or in
respect of any guaranties (or other commitments as described under Contingent
Obligations), or obligations of, any Person. In determining the aggregate
amount of Investments outstanding at any particular time: (a) the amount of any
Investment represented by a guaranty shall be taken at not less than the
principal amount of the obligations guaranteed and still outstanding; (b) there
shall be included as an Investment all interest accrued with respect to
Indebtedness constituting an Investment unless and until such interest is paid;
(c) there shall be deducted in respect of each such Investment any amount
received as a return of capital (but only by repurchase, redemption, retirement,
repayment, liquidating dividend or liquidating distribution); (d) there shall
not be deducted in respect of any Investment any amounts received as earnings on
such Investment, whether as dividends, interest or otherwise, except that
accrued interest included as provided in the foregoing clause (b) may be
deducted when paid; and (e) there shall not be deducted from the aggregate
amount of Investments any decrease in the value thereof.
Key Barometers. For any quarterly period, the number of cell sites
--------------
constructed, the total number of customers, the number of new customers
acquired, the number of customers who terminated and the average monthly charges
billed to customers during the applicable quarter.
Lender. NTI and any other Person which becomes a Lender by reason of an
------
Assignment and Acceptance in accordance with the terms of this Loan Agreement
after the Closing Date.
Lenders' Tranche A Commitment. The obligation for the Lenders to make
-----------------------------
Tranche A loans to Borrower, subject to the terms and conditions hereof, in an
aggregate outstanding principal amount not exceeding ****** or if such
commitment is terminated
<PAGE>
---------------------------------------------
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|has been omitted and filed separately with |
|the Securities and Exchange Commission. |
|Confidential treatment has been requested |
|with respect to the omitted portions. |
---------------------------------------------
pursuant to the provisions hereof, zero.
Lenders' Tranche B Commitment. The obligations of the Lenders to make
-----------------------------
Tranche B Loans to Borrower, subject to the terms and conditions hereof, in an
aggregate outstanding principal amount not exceeding ****** or if such
commitment is terminated pursuant to the provisions hereof, zero.
Lenders' Tranche C Commitment. The obligation of the Lenders to make
-----------------------------
Tranche C Loans to Borrower, subject to the terms and conditions hereof, in an
aggregate outstanding principal amount not exceeding ****** or if such
commitment is terminated pursuant to the provisions hereof, zero.
LIBOR Business Day. Any day on which commercial banks are open for
------------------
international business (including dealings in Dollar deposits) in London.
LIBOR Lending Office. In respect of any Lender, initially, the office or
--------------------
branch of such Lender designated as such on Schedule 1.1 (or, if no such office
-------- ---
or branch is specified, its Domestic Lending Office); or thereafter, such other
office or branch, if any, of such Lender which shall be making or maintaining
LIBOR Rate Loans, as reported by such Lender to the Administrative Agent and the
Borrower.
LIBOR Rate. For the applicable Interest Period, a simple per annum
----------
interest rate (rounded upward, if necessary, to the nearest one-hundredth
(1/100th) of one percent) equal to the sum of (a) the quotient of (i) the Base
LIBOR Rate divided by (ii) one minus the LIBOR Reserve Rate, stated as a
decimal, plus (b) the Applicable Margin. The LIBOR Rate, once determined, shall
remain unchanged during the applicable Interest Period, except for changes to
reflect adjustments in the LIBOR Reserve Rate.
LIBOR Rate Loans. Loans bearing interest calculated by reference to the
----------------
LIBOR Rate.
LIBOR Reserve Rate. With respect to the Interest Period for any LIBOR Rate
------------------
Loan, the maximum rate (expressed as a decimal) applicable during such Interest
Period at which any Lender subject thereto would be required to maintain
reserves under Regulation D of the Board of Governors of the Federal Reserve
System (or any successor or similar regulations relating to such reserve
requirements) against "Eurocurrency Liabilities" (as that term is used in
Regulation D), if such liabilities were outstanding and having a term equal to
such Interest Period in an amount comparable to the amount of such LIBOR Rate
Loan. The LIBOR Rate shall be adjusted automatically on and as of the effective
date of any change in the LIBOR Reserve Rate.
Licenses. Any mobile telephone, cellular telephone, microwave, paging or
--------
other license, authorization, certificate of compliance, franchise, approval or
permit, whether for the
<PAGE>
construction or the operation of any PCS System, granted or issued by the FCC
and any other federal Governmental Bodies and held by the Borrower. The initial
list of Licenses of Borrower as of the Closing Date are identified on Schedule
--------
1.2 attached hereto.
- ---
Lien. Any mortgage, pledge, hypothecation, assignment, deposit or
----
preferential arrangement, encumbrance, lien (statutory or other), or other
security agreement or security interest of any kind or nature whatsoever,
including, without limitation, any conditional sale or other title retention
agreement and any Capital Lease or other financing lease having substantially
the same economic effect as any of the foregoing.
Loan Agreement. That certain Loan Agreement dated as of July 21, 1995
--------------
among the Borrower, the Administrative Agent and the lenders party thereto, as
amended and restated in its entirety by this Amended and Restated Loan
Agreement, including the Schedules and Exhibits hereto, as the same may be
amended, restated, modified or supplemented and in effect from time to time.
Loan Commitment. Binding written commitment(s) (not in default) for the
---------------
making of a loan (in cash) to Borrower that is Subordinated Debt from a Person
or entity (the "AC Lender") which has, in the sole judgment of the Required
Lenders, the financial resources and capability of performing the commitment and
making the loan, which loan commitment (w) is complete with all schedule(s), (x)
is in the form customarily utilized by institutional lenders for binding written
loan commitments that have received all internal credit approvals, (y) has been
fully executed by the AC Lender and Borrower and (z) makes the AC Lender's
obligation to lend subject only to (i) credit verification of Borrower showing
no material adverse change in the financial condition of Borrower since the date
of the credit review (on which the loan commitment was predicated) and (ii)
completion and delivery of loan documentation and other documents, certificates,
and opinions customarily required by institutional lenders satisfactory to the
AC Lender's counsel.
Loan Documents. This Loan Agreement, the Notes, the Borrower Security
--------------
Agreement, the Pledge Agreement, the Guaranty Agreement, the Subordination
Agreement (Parent), the Subordination Agreement (Grand Parent), the Mortgage,
the Intercreditor Agreement, the Draw Requests, any mortgage or deed of trust
entered into pursuant to (S)7.20, any option entered into pursuant to
(S)8.2(g)(II) and any other agreements or documents contemplated hereby or
thereby and all schedules, exhibits and annexes thereto.
Loans. Collectively, the Tranche A Loans, the Tranche B Loans and the
-----
Tranche C Loans.
MTA. Any "major trading area" as set forth on the Rand McNally 1992
---
Commercial Atlas & Marketing Guide, 123rd Edition, at pages 38-39 ("BTA/MTA
Map") and utilized by the FCC in dividing the
<PAGE>
50 states, the District of Columbia and United States territories into 51 MTAs
for the purpose of licensing PCS Systems.
Material Adverse Effect. An effect resulting from any circumstance or
-----------------------
event of whatever nature (including, without limitation, any adverse
determination in any litigation) which does, or could reasonably be expected to,
materially and adversely (i) impair the validity or enforceability of any of the
Loan Documents, (ii) impair the ability of the Borrower to pay the Borrower's
Obligations in accordance with their terms, (iii) cause a Default, (iv) affect
the business, property, operations, or financial or other condition of Borrower
or Parent, or (v) impair or affect the Collateral or Lender's Liens on the
Collateral or the priority of such Liens.
Material Contract. With respect to any Person, each contract to which such
-----------------
Person is a party involving aggregate consideration payable to or by such Person
of $5,000,000 or more in any 12-month period or otherwise material to the
business, condition (financial or otherwise), operations, performance,
properties or prospects of such Person.
Material Employment Agreements. The material employment and similar
------------------------------
contracts and agreements for the categories of officer and employment
responsibilities set forth on Schedule 1.3 as the same may be amended,
-------- ---
supplemented or otherwise modified from time to time, and any agreements entered
into with successor employees and officers relating to the same categories of
responsibilities.
Materials of Environmental Concern. Any chemicals, pollutants or
----------------------------------
contaminants, hazardous substances (as such term is defined under CERCLA), solid
wastes and hazardous wastes (as such terms are defined under the RCRA), toxic
materials, oil or petroleum and petroleum products, or any other material
subject to regulation under any Environmental Laws.
Maturity Date. For Tranche A and Tranche B Loans, the Tranche A and B
-------------
Maturity Date; for Tranche C Loans, the Tranche C Final Repayment Date.
Mortgage. The Purchase Money Commercial Mortgage and Security Agreement
--------
dated as of November 1, 1995 in favor of Lender, as amended and assigned to the
Collateral Agent by Amendment and Assignment dated August 7, 1996, and as
further amended from time to time in compliance with the Loan Documents.
Multiemployer Plan. A "multiemployer plan" as defined in Sections
------------------
4001(a)(3) and 3(37)(A) of ERISA, and to which Borrower or any ERISA Affiliate
is making, or is obligated to make, contributions or has made, or been obligated
to make, contributions.
NTI. Northern Telecom Inc., a Delaware corporation.
---
<PAGE>
Necessary Authorizations. All approvals and licenses from, and all filings
------------------------
and registrations with, any governmental or other regulatory authority,
including, without limitation, the Licenses and all grants, approvals, licenses,
filings and registrations under the Communications Act, necessary in order to
enable Borrower to own, construct, maintain and operate PCS Systems and to make
and hold investments in other Persons who own, construct, maintain and operate
PCS Systems.
Net Cash Proceeds. With respect to any transaction by any Person, the
-----------------
aggregate amount of cash received from time to time by or on behalf of such
Person in connection with such transaction, after deducting therefrom only
(a) reasonable and customary brokerage commissions, underwriting fees
and discounts, legal fees, finder's fees and other similar fees and
commissions, and
(b) the amount of taxes payable in connection with or as a result of
such transaction,
in each case to the extent, but only to the extent, that the amounts so deducted
are, at the time of receipt of such cash, actually paid to a Person that is not
an Affiliate of the Borrower and are properly attributable to such transaction
or to the asset that is the subject thereof.
Net Funds Amount. With respect to any date of determination, the sum of
----------------
(a) EBTDA for the most recent completed fiscal year of the Borrower preceding
such date of determination (the "Prior Fiscal Year"), plus (b) to the extent
deducted in calculating Net Income for the Prior Fiscal Year, the aggregate
amount of interest payments made by Borrower in respect of Subordinated Debt
owing to Parent or Grand Parent less (without duplication) the following: (i)
taxes actually paid during the Prior Fiscal Year, (ii) Capital Expenditures, net
of proceeds of new financing(s) for all or any portion of such Capital
Expenditures made during the Prior Fiscal Year, (iii) the aggregate amount of
scheduled principal payments required under this Loan Agreement or on
Indebtedness owed to an Other Lender as well as to holders of Indebtedness
allowed under Sections 8.1(c) and (g) during the Prior Fiscal Year, and during
the fiscal year of the Borrower in which such date of determination falls, (iv)
the aggregate amount of mandatory prepayments (other than mandatory prepayments
under (S)3.2C hereunder or (S)3.02(b) of the Ericsson Loan Agreement or an
equivalent mandatory prepayment on Indebtedness owed to an Other Lender) made
under this Loan Agreement, the Ericsson Loan Agreement or on Indebtedness owed
to an Other Lender for the Prior Fiscal Year, (v) Adjusted Working Capital
during the Prior Fiscal Year and (vi) scheduled principal payments actually made
by Borrower with respect to the FCC License for the New York PCS Network.
<PAGE>
Net Funds Payment. See (S)3.2.C.
-----------------
Net Income. For any period, net income determined in accordance with GAAP.
----------
New York PCS Network. A PCS Network in the New York MTA pursuant to an FCC
--------------------
License awarded to Borrower.
Note Record. A Record with respect to a Note.
-----------
Notes. The Tranche A Notes, the Tranche B Notes, and/or the Tranche C
-----
Notes, as the case may be.
Operating Cash Flow. EBITDA after eliminating any extraordinary gains and
-------------------
losses, including gains and losses from the sale of assets not in the ordinary
course of business.
Orbitel. Orbitel Mobile Communications, Ltd.
-------
Origination Fee. $7,500,000.
---------------
Other Lender. See (S)8.2.
------------
Outstanding Amount. With respect to the Loans, the aggregate unpaid
------------------
principal thereof as of any date of determination.
PBGC. The Pension Benefit Guaranty Corporation created by (S)4002 of
----
ERISA, or any Governmental Body succeeding to the functions thereof.
PCS. The business of providing mobile communications services through the
---
use of microcells on microwave broadband frequencies with numerous low-power
transmitters, each serving a small area, but excluding cellular telephone
services.
PCS System. A PCS radio telephone system constructed and operated in a BTA
----------
or an MTA (or any successor territorial designation) pursuant to an FCC License
therefor.
Parent. Omnipoint PCS, Inc., a Delaware corporation.
------
Patents. As defined in the Security Agreement.
-------
Payment Date. See (S)3.1A.
------------
Permitted Liens. Liens, security interests and other encumbrances
---------------
permitted by (S)8.2.
Person. Any natural person, corporation, firm, joint venture, limited
------
liability company, partnership, association, enterprise, trust or other entity
or organization, or any government or political subdivision or any agency,
department or
<PAGE>
instrumentality thereof.
Plan. With respect to Borrower or any ERISA Affiliate, at any time, an
----
employee pension benefit plan as defined in Section 3(2) of ERISA (other than a
Multiemployer Plan) that is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the IRC and is maintained for the
employees of Borrower or any ERISA Affiliate.
Pledge Agreement. That certain Amended and Restated Pledge Agreement of
----------------
even date in substantially the form attached hereto as Exhibit F executed among
---------
Parent, Collateral Agent, the Nortel Administrative Agent and the Ericsson
Administrative Agent, as may be amended, restated, modified or supplemented in
accordance with the Loan Documents and in effect from time to time.
Pledged Collateral. As defined in the Pledge Agreement.
------------------
Pledged Shares. As defined in the Pledge Agreement.
--------------
Prime Rate. The rate of interest quoted at such time by the Toronto-
----------
Dominion Bank, New York Branch as its "base rate" or "prime rate" provided,
--------
that, in the event no such rate is available, the rate shall be the rate of
interest quoted in The Wall Street Journal's "Money Rates" section as the prime
-----------------------
rate. The Prime Rate is not necessarily the lowest rate of interest charged to
borrowers at any applicable time.
Proceeds. As defined in the Borrower Security Agreement and Pledge
--------
Agreement, respectively.
Property. All types of real, personal, tangible, intangible or mixed
--------
property, including, without limitation, all FCC Licenses.
Purchaser. Omnipoint Communications Inc., a Delaware corporation, in its
---------
capacity as a purchaser under the Supply Agreement.
Rate Hedging Agreements. (i) any and all agreements, devices or
-----------------------
arrangements designed to protect at least one of the parties thereto from the
fluctuations of interest rates, exchange rates or forward rates applicable to
such party's assets, liabilities or exchange transactions, including, but not
limited to dollar-denominated or cross-currency interest rate exchange
agreements, forward currency exchange agreements, interest rate cap or dollar
protection agreements, forward rate currency or interest rate options, puts and
warrants, and (ii) any and all cancellations, buy backs, reversals, terminations
or assignments of any of the foregoing.
Real Estate. Any parcel of real property or any facility currently (or for
-----------
purposes of compliance with Environmental Laws, formerly) owned, operated or
controlled by the Borrower.
<PAGE>
Record. The grid attached to a Note, or the continuation of such grid, or
------
any other similar record, including computer records, maintained by the Lender
with respect to any Loan referred to in such Note.
Register. See (S)17.3.
--------
Reportable Event. Any of the events set forth in Section 4043(b) of ERISA
----------------
or the regulations thereunder.
Required Lenders. (i) unless and until an Assignment and Acceptance occurs
----------------
in accordance with the terms of this Loan Agreement, NTI, and (ii) upon the
occurrence of an Assignment and Acceptance by NTI in accordance with the terms
of this Loan Agreement (a) at any time that there exists no Default hereunder,
Lenders the total of whose portion of the Commitment equals or exceeds fifty-one
percent (51%), or (b) at any time that there exists a Default hereunder, Lenders
the total of whose Loans outstanding equals or exceeds fifty-one percent (51%)
of the total Outstanding Amount of the Loans.
Revenue. For any period, the sum of (a) gross billings to subscribers, net
-------
of taxes and other direct pass-through charges, (b) net revenue from the sale of
equipment, (c) so-called roamer revenue, net of direct pass-through charges and
(d) other revenue of Borrower (in the case of resales net of associated direct
costs), in each case as determined in accordance with GAAP (less all revenues
from Affiliates (except where the Affiliate is acting as a reseller of goods or
services for the Borrower)).
Solvent. With respect to any Person on a particular date, the condition
-------
that on such date, (i) the present fair salable value of the assets of such
Person is greater than the total amount that will be required to pay the
probable liabilities of such Person as and when they become due, including,
without limitation, Contingent Obligations, of such Person, (ii) such Person is
paying, and believes that it will be able to pay in the future, its debts
generally as and when they become due, or (iii) such Person is not engaged in
business or a transaction, or is not about to engage in business or a
transaction, for which such Person's Property would constitute an unreasonably
small amount of capital. With respect to determining in (i), above, the fair
salable value of an FCC License during the initial three year period in which
transfers are restricted by the FCC, the effect of such a transfer restriction
shall be ignored.
Stock. Any and all shares, interests, participations, warrants or other
-----
equivalents (however designated) of corporate stock.
Subordinated Debt. Indebtedness of Borrower the payment of which is
-----------------
subordinated to the prior payment in full in cash of
<PAGE>
the Loans as to which the holder thereof has executed a Subordination Agreement.
Subordination Agreement. With respect to any Person that certain
-----------------------
Subordination Agreement in substantially the form attached hereto as Exhibit J.
---------
Subsidiary. As to any Person, any corporation, association, partnership,
----------
joint venture or other business entity of which such Person and/or any
Subsidiary of such Person, directly or indirectly, either (i) in respect of a
corporation, owns or controls more than 50% of the outstanding Stock having
ordinary voting power to elect a majority of the board of directors or similar
managing body, irrespective of whether a class or classes shall or might have
voting power by reason of the happening of any contingency, or (ii) in respect
of an association, partnership, joint venture or other business entity, is
entitled to share in more than 50% of the profits and losses, however
determined.
Supplier. Northern Telecom Inc., a Delaware Corporation, in its capacity
--------
as a supplier under the Supply Agreement.
Supply Agreement. That certain Personal Communications Systems Supply
----------------
Agreement dated September 22, 1994, as amended by Amendment No. 1 dated as of
July 21, 1995, between Borrower and the Supplier and as may be further amended,
restated, modified or supplemented and in effect from time to time.
Total Interest Expense. For any period, the aggregate amount of interest
----------------------
required to be accrued by Borrower during such period on all Indebtedness of
Borrower outstanding during all or any part of such period, whether such
interest was or is required to be reflected as an item of expense or
capitalized, including payments consisting of interest in respect of Capitalized
Leases and including arrangement fees, commitment fees, agency fees, facility
fees, origination fees (provided that, if the origination fees are paid from the
-------- ----
proceeds of financing, such origination fees will be treated as amortized evenly
over the term of the financing and provided further that the cash origination
fees payable pursuant to Section 2.03(a) of the Ericsson Loan Agreement shall be
treated as incurred in the period when such fees are payable), balance
deficiency fees and similar fees or expenses in connection with the borrowing of
money, all as determined in accordance with generally accepted accounting
principles.
Total Lender Commitment. The sum of the Commitments of the Lenders, as a
-----------------------
whole, as in effect from time to time.
Total Loan Commitment. $382,500,000.
---------------------
Trademarks. As defined in the Borrower Security Agreement.
----------
<PAGE>
---------------------------------------------
| ****** Certain information on this page|
|has been omitted and filed separately with |
|the Securities and Exchange Commission. |
|Confidential treatment has been requested |
|with respect to the omitted portions. |
---------------------------------------------
Tranche. Any or all, as applicable, of Tranche A Loans, Tranche B Loans or
-------
Tranche C Loans.
Tranche A and B Commitment Termination Date. The earlier of (a) December
-------------------------------------------
31, 1999, or (b) the termination of the Tranche A and B Commitments pursuant to
(S)11.1.
Tranche A and B Maturity Date. The earlier of (a) December 31, 2004, and
-----------------------------
(b) the acceleration of the Loans pursuant to (S)11.1.
Tranche A Commitment. An amount equal to US ****** or if such
--------------------
commitment is terminated pursuant to the provisions hereof, zero.
Tranche A Draw Date. See (S)2.8A.
-------------------
Tranche A Draw Request. See (S)2.8A.
----------------------
Tranche A Loans. Loans made under Tranche A.
---------------
Tranche A Notes. The promissory notes of Borrower substantially in the
---------------
form of Exhibit A-1 evidencing the Tranche A Loans.
-----------
Tranche B Advance Schedule. That certain schedule of Tranche B Eligible
--------------------------
Expenses attached hereto as Schedule 2.4 to be updated (with the approval of the
-------- ---
Administrative Agent in its sole and absolute discretion) and delivered annually
to Administrative Agent prior to December 1 of each calendar year through
calendar year 1998. Such schedule shall be made on both a quarterly and
cumulative basis and shall be in reasonable detail. The Tranche B Advance
Schedule may be updated, amended or modified, from time to time, with the
approval of the Administrative Agent in its sole and absolute discretion.
Tranche B Balance Requirement. Effective as of the Tranche C Final
-----------------------------
Repayment Date, the requirement that, as of each June 30 and December 31 through
the Tranche A and B Commitment Termination Date, the Outstanding Amount of
Tranche B Loans not exceed 50% of the sum of Outstanding Amount of Tranche A
Loans plus the amount of unfilled purchase orders under the Supply Agreement.
Tranche B Commitment. An amount equal to the difference between US
--------------------
****** and the Outstanding Amount of Tranche C Loans as the same may be
reduced from time to time; or if such commitment is terminated pursuant to the
provisions hereof, zero.
Tranche B Draw Request. See (S)2.8B.
----------------------
Tranche B Eligible Expenses. Expenses incurred by Borrower to pay for (i)
---------------------------
costs incurred in connection with the construction, engineering, design and site
acquisition for the New
<PAGE>
---------------------------------------------
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|has been omitted and filed separately with |
|the Securities and Exchange Commission. |
|Confidential treatment has been requested |
|with respect to the omitted portions. |
---------------------------------------------
York PCS Network, (ii) the actual costs of physically relocating existing
microwave installations which are incompatible with the New York PCS Network,
(iii) costs incurred to vendors of equipment to build the New York PCS Network
from Persons other than the Supplier, and (iv) on the Tranche C Final Repayment
Date, the Outstanding Amount of Tranche C Loans, in each case with respect to
items (i), (ii) and (iii) above, to the extent and for the amounts provided for
in the Approved Annual Operating Business Plan or the Approved Full Term
Operating Business Plan, (whichever may apply for the applicable period).
Tranche B Loans. Loans made under Tranche B.
---------------
Tranche B Notes. The promissory notes of Borrower substantially in the
---------------
form of Exhibit A-2, evidencing the Tranche B Loans.
-----------
Tranche C Advance Schedule. That certain schedule of Tranche C Eligible
--------------------------
Expenses attached hereto as Schedule 2.5. Such schedule shall be made on both a
-------- ---
quarterly and cumulative basis and shall be in reasonable detail. The Tranche C
Advance Schedule may be amended or modified, from time to time, with the
approval of the Administrative Agent in its sole and absolute discretion.
Tranche C Commitment: An amount equal to US ******
--------------------
Tranche C Draw Request. See (S)2.8C.
----------------------
Tranche C Eligible Expenses. Expenses incurred by Borrower to pay for (i)
---------------------------
interest on the Loans, (ii) those certain pre-closing expenses set forth on
Schedule 1.4, (iii) operating and start-up expenses of Borrower consistent with
- -------------
the Approved Annual Operating Business Plan and relating exclusively to the
operation of the New York PCS Network, (iv) intercompany expenses and overhead
charged to Borrower by Parent or Grand Parent pursuant to the Expense Allocation
Agreement, in each case with respect to items (iii) and (iv) above, to the
extent and for the amounts provided for in the Approved Annual Operating
Business Plan or the Approved Full Term Operating Business Plan, (whichever may
apply for the applicable period).
Tranche C Final Repayment Date. The earlier to occur of (a) June 30, 1997
------------------------------
and (b) the acceleration of the Loans pursuant to (S)11.1.
Tranche C Loans. Loans made under Tranche C.
---------------
Tranche C Notes. The promissory notes of Borrower, substantially in the
---------------
form of Exhibit A-3, evidencing the Tranche C Loans.
-----------
Type. As to any Loan, its nature as a Base Rate Loan, or a LIBOR Rate
----
Loan.
<PAGE>
Voting Stock. Stock or similar interests, of any class or classes
------------
(however designated), the holders of which are at the time entitled, as such
holders, to vote for the election of a majority of the directors (or persons
performing similar functions) of the corporation, association, trust or other
business entity involved, whether or not the right so to vote exists by reason
of the happening of a contingency.
Working Capital. The difference between Borrower's "current assets"
---------------
and "current liabilities" as certified at each measuring date by the Chief
Financial Officer of Borrower in accordance with GAAP, consistently applied.
(S)B. Rules of Interpretation.
-----------------------
a. A reference to any document or agreement shall include such
document or agreement as amended, modified or supplemented from time to time in
accordance with its terms and the terms of this Loan Agreement. In accordance
with the foregoing, the parties hereto agree that with respect to Exhibits A-1,
A-2, A-3, B-1, B-2, B-3, C, and D, the forms of those Exhibits as attached to
the original Loan Agreement dated as of July 21, 1995 are incorporated herein by
reference and all references in (x) such Exhibits to the "Loan Agreement" and
(y) the originals of such instruments, shall be deemed to be references to the
Loan Agreement as defined in this Amended and Restated Loan Agreement
b. The singular includes the plural and the plural includes the
singular.
c. A reference to any law includes any amendment or modification to
such law.
d. A reference to any Person includes its permitted successors and
permitted assigns.
e. Accounting terms not otherwise defined herein have the meanings
assigned to them by generally accepted accounting principles applied on a
consistent basis by the accounting entity to which they refer.
f. The words "include", "includes" and "including" are not
limiting.
g. All terms not specifically defined herein or by generally
accepted accounting principles, which terms are defined in the Uniform
Commercial Code as in effect in the State of New York, have the meanings
assigned to them therein.
h. Reference to a particular "(S)" refers to that section of this
Loan Agreement unless otherwise indicated.
<PAGE>
i. The words "herein", "hereof", "hereunder" and words of like
import shall refer to this Loan Agreement as a whole and not to any particular
section or subdivision of this Loan Agreement.
(S)II. THE LOANS.
---------
(S)A. Commitment To Lend.
------------------
Subject to the terms and conditions set forth in this Loan
Agreement, the Lender agrees to lend to Borrower from time to time during the
Applicable Lending Period under the terms and conditions set forth herein, such
sums as are requested by Borrower up to a maximum aggregate amount (after giving
effect to all amounts requested) at any one time equal to the Total Loan
Commitment and the Lender's Commitment applicable to each Tranche of Loans.
Subject to (S)2.9, all Loans shall be made pro rata in accordance with each
--------
Lender's Commitment Percentage. Notwithstanding any provision of this Loan
Agreement to the contrary, all Loans and any unpaid Borrower Obligations under
or pursuant to the Loan Documents shall constitute one obligation of Borrower to
the Lenders.
(S)B. The Notes.
---------
The Loans shall be evidenced by the Notes in
substantially the forms of Exhibits A-1 through A-3 hereto dated as of the
------------ ---
Closing Date and completed with appropriate insertions. One Tranche A Note,
Tranche B Note and Tranche C Note shall be payable to the order of each Lender
in a principal amount equal to such Lender's Applicable Commitment or, if less,
the amount of all Outstanding Tranche A, B or C Loans made by such Lender, plus
interest accrued thereon. Borrower irrevocably authorizes each Lender to make or
cause to be made, an appropriate notation on such Lender's Note Record
reflecting the making of Loans or (as the case may be) the receipt of payments.
The amount of the Loans set forth on such Lender's outstanding Note Record shall
be prima facie evidence of the principal amount thereof owing and unpaid to such
-----------
Lender, but the failure to record, or any error in so recording, any such amount
on such Lender's Note Record shall not limit or otherwise affect the Borrower's
Obligations hereunder or under the Notes to make payments of principal of or
interest on the Notes when due.
(S)C. Tranche A Loan Amounts.
----------------------
Tranche A Loans shall be available solely for the purpose of
paying amounts due to Supplier under the Supply Agreement, including, without
limitation, sales taxes thereon to the extent applicable, and the Origination
Fee. The Outstanding Amount of Tranche A Loans at any one time may not exceed
the Tranche A Commitment. Borrower shall not be entitled to make a Tranche A
borrowing if it has terminated the Supply Agreement for any reason
<PAGE>
whatsoever; provided that, Borrower may make a Tranche A borrowing in an amount
-------- ----
sufficient to cover those purchase orders that are outstanding at the time of
the termination of the Supply Agreement which, but for such termination,
Borrower would be entitled to borrow under this (S)2.3.
(S)D. Tranche B Loan Amounts.
----------------------
Tranche B Loans shall be available solely for the purpose of
paying Tranche B Eligible Expenses. The amount of Tranche B Loans shall not
exceed the Tranche B Commitment. The amount of Tranche B Loans available for
borrowing during any fiscal quarter may not exceed the sum of:
(i) cumulative amount of Tranche B Eligible Expenses as shown
on the Tranche B Advance Schedule as of the applicable fiscal quarter less the
total amount of all Tranche B Loans previously made for Tranche B Eligible
Expenses; and
(ii) the amount of Tranche B Eligible Expenses budgeted for the
next succeeding fiscal quarter as shown on the Tranche B Advance Schedule.
No Tranche B Loan shall be available if on any June 30 or
December 31 after the Tranche C Final Repayment Date, (after giving effect to
the requested Tranche B Loan), Borrower would not be in compliance with the
Tranche B Balance Requirement. The amount of available Tranche B Loans at any
time shall be reduced by an amount equal to Tranche B Eligible Expenses for
which a Tranche B Loan has been made and such an expense has not been paid by
Borrower. Upon payment of such amount to the appropriate Person for such an
expense the amount of Tranche B Loans available for borrowing shall be restored
to the amount otherwise available. Borrower shall not be entitled to make a
Tranche B borrowing if it has terminated the Supply Agreement for any reason
whatsoever; provided that, Borrower may make a Tranche B borrowing in an amount
-------- ----
sufficient to cover those Tranche B Eligible Expenses reflected in purchase
orders that are outstanding at the time of the termination of the Supply
Agreement which, but for such termination, Borrower would be entitled to borrow
under this (S)2.4.
(S)E. Tranche C Loan Amounts.
----------------------
Tranche C Loans shall be available solely for the purpose of
paying Tranche C Eligible Expenses. The amount of Tranche C Loans shall not
exceed the Tranche C Commitment. The amount of Tranche C Loans available for
borrowing during any fiscal quarter may not exceed the sum of:
(a)(i) the cumulative amount of Tranche C Eligible Expenses as
shown on the Tranche C Advance Schedule as of the applicable fiscal quarter less
the total amount of all Tranche C Loans previously made (exclusive of interest
on the Loans) for
<PAGE>
Tranche C Eligible Expenses; and
(ii) the amount of Tranche C Eligible Expense budgeted for the
next succeeding fiscal quarter as shown on the Tranche C Advance Schedule; and
(b) the amount, if not otherwise paid by Borrower, required to
make interest payments when due under this Loan Agreement.
The amount of available Tranche C Loans at any time shall be
reduced by an amount equal to Tranche C Eligible Expenses for which a Tranche C
Loan has been made and which Tranche C Eligible Expenses have not been paid.
Upon payment of such amount to the appropriate Person for such an expense the
available amount of Tranche C Loans available for borrowing shall be restored to
the amount otherwise available. Borrower shall not be entitled to make a Tranche
C borrowing if it has terminated the Supply Agreement for any reason whatsoever;
provided that, Borrower may make a Tranche C borrowing in an amount sufficient
- -------- ----
to cover Tranche C Eligible Expenses that are the subject of binding commitments
to non-affiliates and are outstanding at the time of the termination of the
Supply Agreement which, but for such termination, Borrower would be entitled to
borrow under this (S)2.5.
Notwithstanding the above, Borrower shall not be entitled to
make a Tranche C borrowing unless it has hired permanent employees to fill those
job functions listed on Schedule 7.17 within the time periods set forth
-------------
thereon.
(S)F. Interest on Loans.
-----------------
Except as otherwise provided in (S)4.10, and provided that in no
event shall the interest rate payable in respect hereof exceed the Highest
Lawful Rate:
1. Rate.
-----
a. Initial Interest Period. For all Loans the Drawdown
-----------------------
Dates for which are on or before September 30, 1995, the interest rate for the
initial Interest Period on the Outstanding Amount of such Loans shall be a
simple per annum interest rate equal to the sum of (i) 5.875% per annum, plus
(ii) the Applicable Margin. Interest on all Loans shall be calculated on the
basis of a 360-day year and the actual number of days elapsed.
b. Subsequent Interest Periods. For all Interest Periods
---------------------------
beginning after September 30, 1995, at Borrower's election, the interest rate on
all Outstanding Loans shall be the then applicable (i) Base Rate or (ii) LIBOR
Rate. Borrower shall give the Administrative Agent at least three (3) Business
Days' irrevocable notice (each, an "Interest Rate Election Notice") prior to
each Interest Payment Date stating which interest rate it shall elect for the
next Interest Period following such Interest Payment
<PAGE>
Date. The type of interest rate elected shall apply to the Outstanding Amount of
all Loans for the term of the applicable Interest Period. For any Interest
Period prior to which Borrower fails to timely submit an Interest Rate Election
Notice to Administrative Agent, the LIBOR Rate in effect two (2) LIBOR Business
Days prior to the beginning of the next Interest Payment Date shall apply in the
next Interest Period. Interest on all Loans shall be calculated on the basis of
a 360-day year and the actual number of days elapsed. Each Base Rate Loan and
LIBOR Rate Loan shall bear interest for the period commencing with the Drawdown
Date thereof and ending on the last day of the Interest Period (inclusive) with
respect thereto at the rate per annum equal to the Base Rate or LIBOR Rate, as
elected.
2. Time for Payment.
----------------
Interest on the unpaid principal balance of all Loans under all
Tranches shall be due and payable quarterly in arrears on each Interest Payment
Date.
3. Manner of Payment.
-----------------
On each Interest Payment Date which occurs prior to the Tranche C
Final Repayment Date, unless otherwise paid by Borrower, the Lenders shall make
a Tranche C Loan for the amount owing for interest on the Outstanding Amount of
Loans, provided, that no Default or Event of Default has occurred and is
--------
continuing. Borrower irrevocably instructs the Administrative Agent to disburse
Tranche C borrowings to pay interest on the Outstanding Amount of Loans directly
to the Lenders. If interest is paid other than by a Tranche C Loan, the payment
shall be made when due in immediately available funds at the office of the
Administrative Agent for the ratable benefit of the Lenders.
4. Statement from Administrative Agent.
-----------------------------------
Prior to the end of each Interest Period, Administrative Agent
will endeavor to provide a statement to Borrower listing the amount of interest
Administrative Agent estimates Borrower will owe on the Outstanding Amount of
Loans on the upcoming Interest Payment Date. The failure of Administrative Agent
to provide such a statement, or any error made by Administrative Agent on the
statement shall not limit or otherwise affect Borrower's Obligations hereunder
or under the Notes to make payments of interest in the correct amount as and
when due.
(S)G. Borrowings and Drawdown Period.
------------------------------
Each Lender's Commitment to make Loans under the Loan Agreement
shall terminate at the end of the Applicable Lending Period and shall be
suspended during any time that an event or circumstance that constitutes a
Default has occurred and is continuing under the Loan Agreement.
<PAGE>
Notwithstanding the foregoing, so long as the Required Lenders
agree, in writing, the Lenders may (a) make Tranche A Loans to pay for
equipment, goods and services under the Supply Agreement and (b) Tranche C Loans
to pay accrued but unpaid interest on the Outstanding Amount of Loans
notwithstanding the occurrence and continuance of an event or circumstance that
constitutes a Default.
If, prior to the end of the Applicable Lending Period, the Borrower
submits a Draw Request for which the applicable Drawdown Date (five Business
Days after the receipt of such request by Administrative Agent) would occur
after the termination of the Applicable Lending Period, the Lenders and the
Administrative Agent will use reasonable commercial efforts to fund the
requested amount prior to the termination of the Applicable Lending Period,
provided that, all other conditions to borrowing have been satisfied. In no
- -------------
event will the Administrative Agent and the Lenders make a Loan or be obligated
to make a Loan after the termination of the Applicable Lending Period.
(S)H. Requests for Loans.
------------------
Promptly upon receipt of any request for a borrowing under any
Tranche in accordance with the terms below (each, a "Draw Request"), the
Administrative Agent shall notify each of the Lenders of the Draw Request and
the date that the Administrative Agent intends to make a Loan pursuant to such
Draw Request. Each Draw Request shall be irrevocable and binding on Borrower,
and shall obligate Borrower to accept the Loan requested from the Lenders on the
Drawdown Date.
1. Tranche A Draw Requests.
-----------------------
Each request for borrowings under Tranche A (a "Tranche A Draw
Request") must be received by the Administrative Agent not less than five (5)
Business Days prior to the Drawdown Date requested in the Tranche A Draw
Request. Each Tranche A Draw Request must be signed by an authorized officer of
Borrower and be substantially in the form of Exhibit B-1. Borrowings under
-----------
Tranche A may be made no more frequently than two times per month (each, a
"Tranche A Draw Date"). The amount of each Tranche A borrowing shall equal the
amount then due under the Supply Agreement as of the Tranche A Draw Date.
Notwithstanding anything to the contrary contained herein,
nothing contained herein shall be deemed to alter or affect the rights and
obligations of the Purchaser and Supplier arising under or pursuant to the
Supply Agreement.
2. Tranche B Draw Requests.
-----------------------
Each request for borrowings under Tranche B (the
<PAGE>
"Tranche B Draw Request") must be received by the Administrative Agent not less
than five (5) Business Days prior to the Drawdown Date requested in the Tranche
B Draw Request. Each Tranche B Draw Request shall be signed by an authorized
officer of Borrower and be substantially in the form of Exhibit B-2. Tranche B
-----------
Draw Requests may not be submitted more frequently than two (2) times per month.
Lender may reject a Tranche B Draw Request if the amount requested is more than
the amount available for borrowing under (S)2.4 as of the proposed Drawdown Date
or if the Drawdown Report and Certificate submitted with the Tranche B Draw
Request is unsatisfactory to the Administrative Agent in any material respect.
3. Tranche C Draw Requests.
-----------------------
Each request for borrowings under Tranche C, except for a Tranche
C Loan the proceeds of which will be used to pay interest on the Loans, must (i)
be accompanied by a properly completed Tranche C draw request (a "Tranche C Draw
Request") and (ii) be received by the Administrative Agent not less than five
(5) Business Days prior to the Drawdown Date requested in the Tranche C Draw
Request. Each Tranche C Draw Request must be signed by an authorized officer of
Borrower and be substantially in the form of Exhibit B-3. Tranche C Draw
-----------
Requests may not be submitted more frequently then two (2) times per quarter.
Tranche C Loans to pay interest on the Loans shall be made in the amounts and at
the times specified in (S)2.6 above.
(S)I. Funds for Loans.
---------------
1. Unless and until an Assignment and Acceptance occurs in accordance
with the terms of this Loan Agreement, prior to 3:00 p.m. (New York time) on the
Drawdown Date, the Lender shall, subject to the satisfaction of the conditions
set forth in this Loan Agreement disburse the amount of such Loan by (a)
transferring the amount of such Loan to the Borrower by wire transfer pursuant
to the Borrower's instructions in the Draw Requests, or (b) if such Loan is a
Tranche A Loan to be used to pay the purchase price of equipment, software or
services and the applicable sales taxes thereon, if any, by the Borrower under
the Supply Agreement, crediting such payment of such purchase price by wire
transfer pursuant to the terms of the Tranche A Draw Request. The Lender will
endeavor to disburse the appropriate amount of a Loan to the Borrower by 1:00
p.m. (New York time) rather than 3:00 p.m. (New York time) on the Drawdown Date
but is in no respect obligated to do so.
2. a. Following the occurrence of an Assignment and Acceptance in
accordance with the terms of this Loan Agreement, upon receipt of a Draw Request
from the Borrower, the Administrative Agent shall promptly notify each Lender by
telephone or telecopy of the Draw Request. Each Lender shall, not later than
11:00 a.m. (New York time) on the Drawdown Date make available to the
Administrative Agent at the Administrative Agent's Office or at
<PAGE>
such other location as the Administrative Agent shall designate, the amount of
such Lender's ratable portion of such Loan in immediately available funds. Prior
to 3:00 p.m. (New York time) on the Drawdown Date, the Administrative Agent
shall, subject to the satisfaction of the conditions set forth in this Loan
Agreement, disburse the amounts made available to it by the Lenders in like
funds by (i) transferring the amounts so made available by wire transfer
pursuant to the Borrower's instructions, or (ii) if such Loan is a Tranche A
Loan to be used to pay the purchase price of equipment, software or services and
the applicable sales taxes thereof, if any by the Borrower under the Supply
Agreement, crediting such portion to payment of such purchase price by wire
transfer pursuant to the terms thereof. The Administrative Agent will endeavor
to disburse the appropriate amount of a Loan to the Borrower by 1:00 p.m. (New
York time) rather than 3:00 p.m. (New York time) on the Drawdown Date but is in
no respect obligated to do so.
b. If the Administrative Agent shall not have received from a
Lender prior to 2:00 p.m. (New York time) on any Drawdown Date such Lender's
ratable portion of such Loan, either (but not both) the Administrative Agent or
NTI (if NTI is not the Administrative Agent and has agreed with the
Administrative Agent to do so in the stead of the Administrative Agent), shall
make available to the Borrower on such date (in addition to its pro rata share
of the Loan made in its capacity as a Lender) the full amount of the portion of
the Loan not received by the Administrative Agent from such Lender. If and to
the extent the Administrative Agent or NTI so funds a portion of a Loan on
behalf of a Lender, such Lender shall repay to the Administrative Agent or NTI
(whichever one paid such Lender's portion) on demand such corresponding amount
together with interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid to the
Administrative Agent or NTI, at the applicable interest rate.
c. If such Lender shall repay to the Administrative Agent or NTI
such corresponding amount, such amount so repaid shall thereafter constitute
such Lender's portion of the applicable Loan for purposes of this Loan
Agreement. The failure of any Lender to fund its ratable portion of any Loan
shall not relieve (i) either (but not both) the Administrative Agent or NTI (if
NTI is not the Administrative Agent and has agreed with Administrative Agent to
fund in the stead of the Administrative Agent), of its obligation to fund the
full amount of the Loan or (ii) any other Lender of its obligation hereunder to
fund its respective portion of the Loan on the date of such borrowing, but no
Lender (other than the Administrative Agent or NTI (if NTI is not the
Administrative Agent and has agreed with Administrative Agent to do so), but not
both) shall be responsible for any such failure of any other Lender.
d. In the event that, at any time when the
<PAGE>
Borrower is not in Default and has satisfied all applicable conditions set forth
in (S)10, a Lender for any reason fails or refuses to fund its portion of an
Loan, then, until such time as such Lender has funded its portion of such Loan,
or all other Lenders have received payment in full (whether by repayment or
prepayment) of the principal and interest due in respect of such Loan, such non-
funding Lender shall not have the right (i) to vote or consent regarding any
issue on which voting or consenting is required or advisable under this Loan
Agreement or any other Loan Document and the amount of the Loan or Commitment
held by such Lender shall not be counted as outstanding for purposes of
determining "Required Lenders" hereunder, or (ii) to receive payments of
principal, interest or fees from the Borrower in respect of its unfunded portion
of Loans (but instead such payments shall be made to either the Administrative
Agent or NTI (whichever one paid such Lender's portion) in respect to the
portion of such Loans funded by it pursuant to this (S)2.9).
(S)III. REPAYMENT OF THE LOANS.
----------------------
(S)A. Term/Amortization.
-----------------
1. Tranche A and B.
---------------
The Outstanding Amount of Tranche A and Tranche B Loans shall
be repayable over five (5) years, in twenty consecutive quarterly payments
commencing March 31, 2000 and continuing on the last day of each June,
September, December and March thereafter to and including the Tranche A and B
Maturity Date (each, a "Payment Date"). On the Tranche A and B Maturity Date,
Borrower shall pay all of the Outstanding Amount of Tranche A Loans and Tranche
B Loans, together with any and all accrued and unpaid interest thereon. Prior to
the Tranche A and B Maturity Date, the Outstanding Amount of Tranche A and
Tranche B Loans as of the Tranche A and B Commitment Termination Date shall be
paid in accordance with the following schedule:
From March 31, 2000 to and
including December 31, 2001 3.75% of the Outstanding
Amounts of Tranche A and
Tranche B Loans as of the
Tranche A and B Commitment
Termination Date per
Payment Date
From March 31, 2002 to and
including December 31, 2002 5.0% of the Outstanding
Amounts of Tranche A and
Tranche B Loans as of the
Tranche A and B Commitment
Termination Date per
Payment Date
<PAGE>
From March 31, 2003 to and
including December 31, 2004 6.25% of the Outstanding
Amounts of Tranche A and
Tranche B Loans as of the
Tranche A and B Commitment
Termination Date per
Payment Date
2. Tranche C.
---------
Principal under Tranche C shall be repayable on the Tranche C
Final Repayment Date.
(S)B. Mandatory Prepayments of Loans.
------------------------------
1. Excess Borrowings.
-----------------
If at any time the Outstanding Loans for any Tranche exceeds the
maximum Commitment for such Tranche, then Borrower shall within three (3)
Business Days of the date the Administrative Agent so notifies the Borrower in
writing pay to the Administrative Agent the amount of such excess for the
respective accounts of the Lenders. Each repayment under this subparagraph shall
be allocated among the Lenders, in proportion, as nearly as practicable, to the
respective Outstanding Amounts under the appropriate Tranche in inverse order of
maturity, with adjustments to the extent practicable to equalize any prior
payments or repayments not exactly in proportion.
2. Sales of Assets.
---------------
No later than three Business Days after its receipt of any Net
Cash Proceeds from the sale of any assets described below the Borrower will
prepay the interest and the Outstanding Amount of Tranche C Loans, and if there
is no Outstanding Amount of Tranche C Loans then to interest and Outstanding
Amount of Tranche B Loans, and if there is no Outstanding Amount of Tranche B
Loans then to interest and Outstanding Amount of Tranche A Loans in an amount
equal to (i) the Net Cash Proceeds from the direct or indirect sale of any
assets of the Borrower (other than the Borrower's inventory and other goods sold
in the ordinary course of the Borrower's business) that is otherwise permitted
under this Agreement, during any calendar year, to the extent such aggregate Net
Cash Proceeds received during such calendar year shall exceed $5,000,000,
multiplied by (ii) a fraction, (A) the numerator of which is the aggregate
principal amount of the Outstanding Amount outstanding at the time of such sale,
and (B) the denominator of which is such aggregate principal amount, plus the
aggregate principal amount of all Indebtedness outstanding at the time of such
sale under the Ericsson Loan Agreement, plus the aggregate principal amount of
equivalent Loans owing to Other Lenders, with an equivalent mandatory prepayment
provision, outstanding at the time of such sale. All payments hereunder
applicable to principal
<PAGE>
shall be applied in inverse order of maturity. Each repayment hereunder shall be
allocated among the Lenders, as nearly as practicable, to the respective
Outstanding Amounts under the applicable Tranche, with adjustments to the extent
practicable to equalize any prior payments or repayments not exactly on
proportion. All prepayments required in this (S)3.2B shall be accompanied by
such additional amounts as are sufficient to pay the Lenders' Breakage Costs
associated with such prepayments.
3. Net Funds Payment.
-----------------
On or before the one-hundred-and-twentieth day of each year
commencing in the year 2001, and each year for so long as Tranche B Loans remain
outstanding, Borrower shall pay to Administrative Agent an amount equal to the
Net Funds Amount multiplied by a fraction (i) the numerator of which is the
aggregate principal amount of Tranche B Loans then outstanding at the time of
such date of determination and (ii) the denominator of which is such aggregate
principal amount plus the aggregate principal amount of the Tranche B Advances
(as defined in the Ericsson Loan Agreement) then outstanding under the Ericsson
Loan Agreement, plus the aggregate principal amount of equivalent loans owing to
Other Lenders with such an equivalent mandatory prepayment provision and then
outstanding if the loan agreement for such Other Lender provides for mandatory
prepayments from the Net Funds Amount and such mandatory prepayment is permitted
under the Intercreditor Agreement (the "Net Funds Payment"). The Net Funds
Payment shall be applied against interest and then Outstanding Amount of Tranche
B Loans in inverse order of maturity. Each repayment hereunder shall be
allocated among the Lenders, as nearly as practicable, to the respective
Outstanding Amount under the applicable Tranche, with adjustments to the extent
practicable to equalize any prior payments or repayments not exactly in
proportion. The Borrower shall not be required to pay to the Administrative
Agent any Breakage Costs with respect to any Net Funds Payment.
4. Deficiencies in Tranche B Balance Requirement.
---------------------------------------------
Within 30 days after written notice from Administrative Agent,
Borrower shall make any prepayments which may be required to cure any deficiency
in the Tranche B Balance Requirement. The amount so paid will be applied against
the Outstanding Amount of Tranche B Loans in inverse order of maturity.
(S)C. Optional Prepayments of Loans.
-----------------------------
Borrower shall have the right, at its election, to prepay the
Outstanding Amount of Loans under any Tranche, as a whole or in part, at any
time without penalty or premium, provided that any full or partial prepayment of
--------
the Outstanding Amount of any LIBOR Rate Loans pursuant to this (S)3.3 may be
made only on the last day of the Interest Period relating thereto unless such
prepayments are
<PAGE>
accompanied by such additional amounts as are sufficient to pay the Lender's
Breakage Costs associated with such prepayments. Borrower shall give the
Administrative Agent, no later than 10:00 a.m., New York time, at least three
(3) Business Days' prior written notice of any proposed prepayment pursuant to
this (S)3.3 of Base Rate Loans, and four (4) LIBOR Business Days' notice of any
proposed prepayment pursuant to this (S)3.3 of LIBOR Rate Loans, in each case
specifying the proposed date of prepayment of Loans, the principal amount to be
prepaid and which Tranche shall be prepaid. Each partial prepayment of the Loans
(i) shall be in a minimum amount of $1,000,000 and in integral multiples of
$100,000, (ii) shall be accompanied by the payment of accrued interest on the
principal prepaid to the date of prepayment, (iii) shall be accompanied by the
payment of the appropriate Breakage Costs, if any, and (iv) shall be applied to
installment payments of principal in direct order of maturity on the applicable
Tranche. In the absence of instruction by Borrower, the prepayment shall be
first applied to interest and installment payments of principal outstanding
under Tranche C, then to interest and installment payments of principal
outstanding under Tranche B. Each partial prepayment shall be allocated among
the Lenders, in proportion, as nearly as practicable, to the respective
Outstanding Amount under the appropriate Tranche, with adjustments to the extent
practicable to equalize any prior repayments not exactly in proportion.
Tranche A Loans which are prepaid may be reborrowed, provided such
reborrowing is made in accordance with all terms and conditions applicable to
borrowings under Tranche A.
Amounts of Tranche B Loans which are prepaid may not be reborrowed.
Amounts of Tranche C Loans which are prepaid will be added to and made
available for one-time borrowing under Tranche B, provided that such Tranche B
borrowing is made in accordance with all terms and conditions applicable to
Tranche B borrowings.
(S)IV. CERTAIN GENERAL PROVISIONS.
--------------------------
(S)A. Origination Fee.
---------------
Borrower shall pay to the Administrative Agent on the Closing Date the
Origination Fee which shall be paid with the proceeds of a Tranche A Loan, as
provided above. (Administrative Agent acknowledges that this fee has been paid
prior to the date hereof).
(S)B. Funds for Payments.
------------------
1. All payments of principal (including the Origination Fee),
interest, expenses and any other amounts due hereunder or under any of the other
Loan Documents shall be made to the Administrative Agent, for the respective
accounts of the Lenders
<PAGE>
and the Administrative Agent, at the Administrative Agent's Office or at such
other location as the Administrative Agent may from time to time designate, in
each case in immediately available funds.
2. All payments by Borrower hereunder and under any of the other Loan
Documents shall be made without setoff or counterclaim and free and clear of and
without deduction for any taxes, levies, imposts, duties, charges, fees,
deductions, withholdings, compulsory loans, restrictions or conditions of any
nature now or hereafter imposed or levied by any jurisdiction or any political
subdivision thereof or taxing or other authority therein unless Borrower is
compelled by law to make such deduction or withholding within thirty (30) days
from the date the Administrative Agent makes written demand therefor. Subject
to the provisions of (S)4.6, if any such obligation is imposed upon Borrower
with respect to any amount payable by them hereunder or under any of the other
Loan Documents, Borrower shall pay to the Administrative Agent, for the account
of the Lenders or (as the case may be) the Administrative Agent, on the date on
which such amount is due and payable hereunder or under such other Loan
Document, such additional amount in Dollars as shall be necessary to enable the
Lenders or the Administrative Agent to receive the same net amount which the
Lenders or the Administrative Agent would have received on such due date had no
such obligation been imposed upon Borrower. Borrower shall deliver promptly to
the Administrative Agent certificates or other valid vouchers for all taxes or
other charges deducted from or paid with respect to payments made by Borrower
hereunder or under such other Loan Document.
(S)C. Computations.
------------
All computations of interest on the Loans and of fees, or other
expenses shall, unless otherwise expressly provided herein, shall be based on a
360-day year and paid for the actual number of days elapsed. Except as otherwise
provided in the definition of the term "Interest Period" with respect to LIBOR
Rate Loans, whenever a payment hereunder or under any of the other Loan
Documents becomes due on a day that is not a Business Day, the due date for such
payment shall be extended to the next succeeding Business Day, and interest
shall accrue at the then applicable interest rate during such extension. The
Outstanding Amount of the Loans as reflected on the Note Records from time to
time shall be prima facie evidence of the Outstanding Amount of the Loans,
-----------
unless within ten (10) Business Days after receipt of any notice by the
Administrative Agent or any of the Lenders of such Outstanding Amount, the
Administrative Agent or such Lender shall notify Borrower to the contrary.
(S)D. Inability to Determine LIBOR Rate or Prime Rate.
-----------------------------------------------
In the event, prior to the commencement of any Interest Period
relating to any LIBOR Rate Loan, the Administrative Agent
<PAGE>
shall determine that adequate and reasonable methods do not exist for
ascertaining the LIBOR Rate that would otherwise determine the rate of interest
to be applicable to any LIBOR Rate Loan during any Interest Period, the
Administrative Agent shall forthwith give notice of such determination (which
shall be conclusive and binding on Borrower and the Lenders) to Borrower and the
Lenders. In such event (a) any Draw Request with respect to LIBOR Rate Loans
shall be automatically withdrawn and shall be deemed a request for Base Rate
Loans, (b) each LIBOR Rate Loan will automatically, on the last day of the then
current Interest Period relating thereto, become a Base Rate Loan, and (c) the
obligations of the Lenders to make LIBOR Rate Loans shall be suspended until the
Administrative Agent determines that the circumstances giving rise to such
suspension no longer exist, whereupon the Administrative Agent shall so notify
Borrower and the Lenders.
In the event prior to the commencement of any Interest Period relating
to any Base Rate Loan, the Administrative Agent shall determine that adequate
and reasonable methods do not exist for ascertaining the Prime Rate that would
otherwise determine the rate of interest to be applicable to any Base Rate Loan
during any Interest Period, the Administrative Agent shall forthwith give notice
of such determination (which shall be conclusive and binding on the Borrower and
the Lenders) to the Borrower and the Lenders. In such event (a) any Draw Request
with respect to Base Rate Loans shall be automatically withdrawn and shall be
deemed a request for LIBOR Rate Loans, (b) each Base Rate Loan will
automatically, on the last day of the then current Interest Period relating
thereto, become a LIBOR Rate Loan, and (c) the obligations of the Lenders to
make Base Rate Loans shall be suspended until the Administrative Agent
determines that the circumstances giving rise to such suspension no longer
exist, whereupon the Administrative Agent shall so notify the Borrower and the
Lenders.
(S)E. Illegality.
----------
Notwithstanding any other provisions herein, if any present or future
law, regulation, treaty or directive or the interpretation or application
thereof shall make it unlawful for any Lender to make or maintain LIBOR Rate
Loans, such Lender shall forthwith give notice of such circumstances to
Borrower, the Administrative Agent and the other Lenders and thereupon (a) the
Commitment of such Lender to make LIBOR Rate Loans shall forthwith be suspended
until such notifying Lender shall have notified the Administrative Agent and the
Borrower that the circumstance giving rise to such determination no longer
exists (and if such notifying Lender shall determine that such circumstance no
longer exists it shall so notify the Administrative Agent and the Borrower
promptly after determining the same) and (b) the Outstanding Amount of such
Lender's LIBOR Rate Loans, if any, shall be converted automatically to Base Rate
Loans on the last day of each Interest Period applicable to such LIBOR Rate
Loans or within such earlier period as may be required by law. Borrower hereby
agrees to pay the
<PAGE>
Administrative Agent for the account of such Lender, within ten (10) Business
Days of receipt by the Borrower of a statement from Lender, any additional
amounts necessary to compensate such Lender for any costs incurred by such
Lender in making any conversion in accordance with this (S)4.5, including any
interest or fees payable by such Lender to lenders of funds obtained by it in
order to make or maintain its LIBOR Rate Loans hereunder. Any such statement
shall disclose the amounts in reasonable detail. Before giving any notice
pursuant to this (S)4.5, the affected Lender shall use reasonable commercial
efforts to designate a new LIBOR Lending Office if such designation will avoid
the need for giving such notice or making such demand and will not, in the
judgment of such Lender, subject such Lender to additional costs or otherwise be
disadvantageous to such Lender.
(S)F. Additional Costs, Etc.
---------------------
If any present or future applicable law, which expression, as used
herein, includes statutes, rules and regulations thereunder and interpretations
thereof by any competent court or by any governmental or other regulatory body
or official charged with the administration or the interpretation thereof and
requests, directives, instructions and notices at any time or from time to time
hereafter made upon or otherwise issued to any Lender or the Administrative
Agent by any central bank or other fiscal, monetary or other authority (whether
or not having the force of law), shall:
a. Subject any Lender or the Administrative Agent to any tax,
levy, impost, duty, charge, fee, deduction or withholding of any nature with
respect to this Loan Agreement, the other Loan Documents, such Lender's
Commitment or the Loans (other than taxes based upon or measured by the income
or profits of such Lender or the Administrative Agent), or
b. Materially change the basis of taxation (except for changes
in taxes on income or profits) of payments to any Lender of the principal of or
the interest on any Loans or any other amounts payable to any Lender or the
Administrative Agent under this Loan Agreement or any of the other Loan
Documents, or
c. Impose or increase or render applicable (other than to the
extent specifically provided for elsewhere in this Loan Agreement) any special
deposit, reserve, assessment, liquidity, capital adequacy or other similar
requirements (whether or not having the force of law) against assets held by, or
deposits in or for the account of, or loans by, or commitments of an office of
any Lender, or
d. Impose on any Lender or the Administrative Agent any other
conditions or requirements with respect to this Loan Agreement, the other Loan
Documents, such Lender's Commitment, or any class of loans, or commitments of
which any of the Loans or
<PAGE>
such Lender's Commitment forms a part, and the result of any of the foregoing is
I. to increase the cost to any Lender of making, funding,
issuing, renewing, extending or maintaining any of the Loans or such Lender's
Commitment, or
II. to reduce the amount of principal, interest, or other
amount payable to such Lender or the Administrative Agent hereunder on account
of such Lender's Commitment, or any of the Loans, or
III. to require such Lender or the Administrative Agent to
make any payment or to forego any interest or other sum payable hereunder, the
amount of which payment or foregone interest or other sum is calculated by
reference to the gross amount of any sum receivable or deemed received by such
Lender or the Administrative Agent from Borrower hereunder by an amount deemed
material by such Lender, then, and in each such case, such Lender or the
Administrative Agent may notify Borrower of such fact. Borrower and such Lender
or (as the case may be) the Administrative Agent shall thereafter attempt to
negotiate in good faith, within fifteen (15) days of the day on which Borrower
receive such notice, an adjustment payable hereunder that will adequately
compensate such Lender or the Administrative Agent in light of these
circumstances. Notice from such Lender or Administrative Agent shall include a
certificate or statement as to such increased cost incurred as a result of any
of the above mentioned events in clauses (a), (b), (c), or (d) prepared in
reasonable detail, which shall include the method employed by such Lender or
Administrative Agent in determining the allocation of such costs to the
Borrower. If Borrower and such Lender or the Administrative Agent are unable to
agree to such adjustment within fifteen (15) days of the date on which Borrower
receive such notice, then commencing on the date of such notice (but not earlier
than the effective date of any such additional cost, reduction, payment or
foregone interest or other sum), the fees payable hereunder shall increase by an
amount that will, in such Lender's or the Administrative Agent's reasonable
determination, provide adequate compensation for the portion of the affected
Lender's additional costs determined in accordance with this (S)4.6. Each Lender
and the Administrative Agent shall allocate such cost increases in good faith
and on an equitable basis.
Each Lender that is organized under the laws of any jurisdiction other
than the United States shall deliver to the Administrative Agent for
transmission to the Borrower, on or prior to the Closing Date (in the case of
each Lender listed on the signature pages hereof) or on the effective date of
the Assignment and Acceptance Agreement pursuant to which it becomes a Lender
(in the case of each other Lender), and at such other times as may be necessary
in the determination of the Borrower or the
<PAGE>
Administrative Agent (each in the reasonable exercise of its discretion
including, without limitation, if at any time such Lender shall change its then
current lending office or select an additional lending office), such
certificates, documents or other evidence, properly completed and duly executed
by such Lender (including, without limitation, Internal Revenue Service Form
1001 or Form 4224 or any other certificate or statement of exemption required by
Treasury Regulations Section 1.1441(a) or Section 1.1441-6(c) or any successor
thereto) to establish that such Lender is not subject to deduction or
withholding of United States federal income tax under Section 1441 or 1442 of
the Code or otherwise (or under any comparable provisions of any successor
statute) with respect to any payments to such Lender of principal, interest,
fees or other amounts payable under any of the Loan Documents. Borrower shall
not be required to pay any additional amount to any such Lender under this
(S)4.6 if such Lender shall have failed to satisfy the requirements of the
immediately preceding sentence; provided that if such Lender shall have
satisfied such requirements on the Closing Date (in the case of each Lender
listed on the signature pages hereof) or on the effective date of the Assignment
and Acceptance Agreement pursuant to which it became a Lender (in the case of
each other Lender), nothing in this subsection shall relieve Borrower of its
obligation to pay any additional amounts pursuant to this (S)4.6 in the event
that, as a result of any change in applicable law, such Lender is no longer
properly entitled to deliver certificates, documents or other evidence at a
subsequent date establishing the fact that such Lender is not subject to
withholding as described in the immediately preceding sentence.
e. The agreements in this (S)4.6 shall survive the
termination of the Commitments and the payment of all amounts payable under the
Loan Documents.
(S)G. Capital Adequacy.
----------------
If any present or future law, governmental rule, regulation, policy,
guideline or directive (whether or not having the force of law) or the
interpretation thereof by a court or governmental authority with appropriate
jurisdiction affects the amount of capital required or expected to be maintained
by any Lender or the Administrative Agent or any corporation controlling such
Lender or the Administrative Agent and such Lender or the Administrative Agent
determines that the amount of capital required to be maintained by it is
increased by or based upon the existence of such Lender's or the Administrative
Agent's commitment with respect to any Loans, which has or would have the effect
of reducing the return on the Lender's or Administrative Agent's capital to a
level below that which the Lender or Administrative Agent could have achieved
(taking into consideration the Lender's or Administrative Agent's then existing
policies with respect to capital adequacy and assuming full utilization of the
Lender's or Administrative Agent's capital) but for such adoption, change or
<PAGE>
compliance, by an amount deemed by the Lender to be material, then such Lender
or the Administrative Agent shall promptly notify Borrower of such fact. Such a
notice shall be accompanied by a certificate which will set forth in reasonable
detail the nature of the occurrence giving rise to such compensation and the
additional amount or amounts to be paid to it hereunder. To the extent that the
costs of such increased capital requirements are not reflected in the Base Rate
or LIBOR Rate, as the case may be, (if relating to Loans), Borrower and such
Lender or (as the case may be) the Administrative Agent shall thereafter attempt
to negotiate in good faith, within fifteen (15) days of the day on which
Borrower receives such notice, an adjustment payable hereunder that will
adequately compensate such Lender or the Administrative Agent in light of these
circumstances. If Borrower and such Lender or the Administrative Agent are
unable to agree to such adjustment within fifteen (15) days of the date on which
Borrower receive such notice, then commencing on the date of such notice (but
not earlier than the effective date of any such increased capital requirement),
the fees payable hereunder shall increase by an amount that will, in such
Lender's or the Administrative Agent's reasonable determination, provide
adequate compensation. Each Lender and the Administrative Agent shall allocate
such cost increases in good faith and on an equitable basis.
(S)H. Certificate.
-----------
The Administrative Agent or any Lender will promptly notify Borrower
of the amounts it seeks to recover as indemnification from Borrower pursuant to
(S)4.9 hereof. Such a notice will set forth in reasonable detail the amount and
nature of the occurrence giving rise to indemnification thereof. The
aforementioned certificates setting forth any additional amounts payable
pursuant to this (S)4.8, (S)4.6 or (S)4.7, submitted by any Lender or the
Administrative Agent to Borrower, shall be conclusive, absent manifest error,
that such amounts are due and owing. Borrower shall pay to Administrative Agent
the amounts set forth in such certificates within fifteen (15) days of receiving
the same. By making such payments, Borrower is not waiving its right to contest
that the amounts set forth in the certificates are based on manifest error.
(S)I. Indemnity.
---------
Borrower agrees to indemnify each Lender and the Administrative Agent
and to hold each Lender and the Administrative Agent harmless from and against
any loss, cost or expense (including loss of anticipated profits) that such
Lender or the Administrative Agent may sustain or incur as a consequence of (a)
a default by Borrower in making a borrowing after Borrower has given (or is
deemed to have given) a Draw Request relating thereto in accordance with
(S)(S)2.8A, B or C, or (b) the incurrence of Breakage Costs.
<PAGE>
(S)J. Interest After Default.
----------------------
Overdue principal and (to the extent permitted by applicable law)
interest on the Loans and all other overdue amounts payable hereunder or under
any of the other Loan Documents shall bear interest compounded monthly and
payable on demand at a rate per annum equal to four percent (4%) above the then
applicable Base Rate or LIBOR Rate, until such amount shall be paid in full
(after as well as before judgment), provided that, in no event shall the
-------- ----
interest payable in respect hereof exceed the Highest Lawful Rate.
(S)K. No Force Majeure, Disputes.
--------------------------
Borrower's obligation to pay all amounts due under the Loans shall not
be affected by any circumstance whatsoever, including, without limitation: (i)
any set-off, counterclaim, recoupment, deduction, abatement, suspension,
diminution, reduction, defense or other right which Borrower may have against
Supplier for any reason whatsoever arising under or pursuant to the Supply
Agreement or otherwise relating to the purchase of goods and services from the
Supplier, (ii) any defect in the condition, design, operation or fitness for use
of, or any damage to or loss or destruction of, any equipment or material
provided by Supplier, (iii) any insolvency, bankruptcy, reorganization or
similar proceedings by or against Borrower or Parent, or affecting any of the
assets of any of the foregoing, (iv) any action of any governmental authority or
any damage to or destruction of or any taking of Borrower's property or any part
thereof, (v) any change, waiver, extension, indulgence or failure to perform or
comply with, or other action or omission herein or in the Loan Documents (except
for express written modifications to this Loan Agreement or other Loan Documents
as and in the manner permitted under this Loan Agreement or the other Loan
Documents), (vi) any dissolution of Borrower or Parent, (vii) any inability or
illegality with respect to the use or ownership of Borrower's property, (viii)
any failure to obtain, or expiration, suspension or other termination of, or
interruption to, any required licenses, permits, consents, authorizations,
approvals or other legal requirements, (ix) the invalidity or unenforceability
of the Loan Documents or any other infirmity therein or any lack of power or
authority of Lender or Borrower, or (x) any other event or circumstance
whatsoever, whether or not similar to any of the foregoing and whether or not
Borrower shall have notice or knowledge of any of the foregoing, it being the
intention of the Lender and Borrower that the obligations of Borrower shall be
absolute and unconditional and shall be separate and independent covenants and
agreements and shall continue unaffected unless the requirements to pay or
perform the same shall have been terminated pursuant to an express provision
hereof or of the Loan Documents.
(S)V. COLLATERAL SECURITY.
-------------------
The Borrower's Obligations shall be secured pursuant to the Borrower
Security Agreement and the Pledge Agreement.
<PAGE>
(S)VI. REPRESENTATIONS AND WARRANTIES.
------------------------------
Borrower represents and warrants to the Lenders and the Administrative
Agent as follows:
(S)A. Corporate Authority.
-------------------
1. Incorporation; Good Standing.
----------------------------
Borrower (i) is a corporation duly organized, validly
existing and in good standing under the laws of its state of incorporation, (ii)
has all requisite corporate power to own its Property and conduct its business
as now conducted and as presently contemplated, and (iii) is in good standing as
a foreign corporation and is duly authorized to do business in each jurisdiction
where such qualification is necessary in order to conduct its business as now
conducted except where a failure to be so qualified would not have a Material
Adverse Effect.
2. Authorization.
-------------
The execution, delivery and performance of this Loan
Agreement and the other Loan Documents to which Borrower is or is to become a
party and the transactions contemplated hereby and thereby (i) are within the
corporate authority of Borrower, (ii) have been duly authorized by all necessary
corporate proceedings, (iii) do not conflict with or result in any breach or
contravention of any provision of law, statute, rule or regulation to which
Borrower is subject or any judgment, order, writ, injunction, license or permit
applicable to Borrower or its Property, and (iv) do not conflict with any
provision of the corporate charter or bylaws of, or any agreement or other
instrument binding upon, Borrower or its Property.
3. Enforceability.
--------------
The execution and delivery of this Loan Agreement and the
other Loan Documents to which Borrower is or is to become a party will result in
valid and legally binding obligations of Borrower enforceable against it in
accordance with the respective terms and provisions hereof and thereof, except
as enforceability is limited by bankruptcy, insolvency, reorganization,
moratorium or other laws relating to or affecting generally the enforcement of
creditors' rights and except to the extent that availability of the remedy of
specific performance or injunctive relief is subject to the discretion of the
court before which any proceeding therefor may be brought.
(S)B. Governmental Approvals.
----------------------
The execution, delivery and performance by Borrower of this Loan
Agreement and the other Loan Documents to which Borrower
<PAGE>
is or is to become a party and the transactions contemplated hereby and thereby
do not require the approval or consent of, or filing with (other than UCC-1
financing statements required to be filed in the appropriate public records with
respect thereto), any governmental agency or authority other than those already
obtained.
(S)C. Title to Properties; Leases.
---------------------------
Except as indicated on Schedule 6.3 hereto, Borrower owns all of
------------
the assets reflected in the balance sheet of Borrower as at the Balance Sheet
Date or acquired since that date (except property and assets sold or otherwise
disposed of in the ordinary course of business since that date), subject to no
rights of others, including any mortgages, leases, conditional sales agreements,
title retention agreements, liens or other encumbrances except Permitted Liens.
(S)D. Financial Statements.
--------------------
There has been furnished the Administrative Agent the audited
balance sheet of Borrower, as at the Balance Sheet Date, and the audited
statement of income and cash flow statement of Borrower for the fiscal year then
ended, and such balance sheet and statement of income and cash flow have been
certified by Borrower's independent certified public accountants and accompanied
by an unqualified opinion of such accountants. Such balance sheet and statement
of income and cash flow have been prepared in accordance with generally accepted
accounting principles and fairly present the financial condition of Borrower as
at the close of business on the date thereof and the results of operations for
the fiscal year then ended. There are no Contingent Obligations of Borrower as
of such date involving material amounts, known to the officers of Borrower,
which were not disclosed in such balance sheet and the notes related thereto.
(S)E. No Material Adverse Effect, Etc.
-------------------------------
Since the Balance Sheet Date there has occurred no Material Adverse Effect.
Since the Balance Sheet Date, except as permitted hereunder Borrower has not
made any Distribution.
(S)F. Franchises, Patents, Copyrights, Etc.
------------------------------------
Borrower possesses all franchises, patents, copyrights, trademarks, trade
names, and rights in respect of the foregoing shown on Schedule 6.6, adequate
------------
for the conduct of its business as now conducted or as presently contemplated
without known conflict with any rights of others.
(S)G. Licenses, Etc.
--------------
Except as set forth on Schedule 6.7 attached hereto, Borrower has
------------
secured (a) with respect to the construction,
<PAGE>
installation and development of facilities for the New York PCS Network, all
Licenses and material Necessary Authorizations appropriate to the level of
development theretofore achieved and sufficient to avoid noncompliance with the
then applicable minimum build-out requirements under the FCC License, and (b)
with respect to the operation of those portions of the New York PCS Network the
development of which has theretofore been completed, all Licenses and material
Necessary Authorizations sufficient to operate such completed portions. Neither
any License nor any material Necessary Authorization needed to comply with the
foregoing provisions of this (S)6.7 is the subject of any pending or, to the
best of Borrower's knowledge, threatened revocation.
(S)H. Litigation.
----------
Except as set forth in Schedule 6.8 hereto, there are no actions,
------------
suits, proceedings or investigations of any kind pending or, to the best of
Borrower's knowledge, threatened against Borrower before any court, tribunal or
administrative agency or board (including the FCC) that, if adversely
determined, might, either in any case or in the aggregate, have a Material
Adverse Effect or materially impair the right of Borrower, to carry on business
substantially as now conducted, or result in any substantial and material
liability not adequately covered by insurance, or for which adequate reserves
are not maintained on the balance sheet of Borrower, or which questions the
validity of this Loan Agreement or any of the other Loan Documents, or any
action taken or to be taken pursuant hereto or thereto.
(S)I. No Materially Adverse Contracts, Etc.
------------------------------------
Borrower is not subject to any charter, corporate or other legal
restriction, or any judgment, decree, order, rule or regulation that has or is
expected in the future to have a Material Adverse Effect. Borrower is not a
party to any contract or agreement that has or is expected, in the judgment of
such Borrower's officers, to have any Material Adverse Effect.
(S)J. Compliance With Other Instruments, Laws, Etc.
--------------------------------------------
Borrower is not in violation of any provision of its charter
documents, bylaws, or any agreement or instrument to which it may be subject or
by which it or any of its Properties may be bound or any decree, order,
judgment, statute, license, rule or regulation, in any of the foregoing cases in
a manner that could result in the imposition of substantial penalties or have a
Material Adverse Effect.
(S)K. Tax Status.
----------
Borrower (a) has made or filed all federal and state income and all
other tax returns, reports and declarations required by any jurisdiction to
which it is subject or filed extensions
<PAGE>
therefor, (b) has paid all taxes and other governmental assessments and charges
shown or determined to be due on such returns, reports and declarations, except
those being contested in good faith and by appropriate proceedings, and (c) has
set aside on its books provisions reasonably adequate for the payment of all
taxes for all elapsed periods subsequent to the periods to which such returns,
reports or declarations apply. There are no unpaid taxes in any material amount
claimed to be due by the taxing authority of any jurisdiction, and the officers
of Borrower know of no basis for any such claim.
(S)L. No Event of Default.
-------------------
No event or circumstance which constitutes a Default or Event of
Default has occurred under the Loan Documents and is continuing.
(S)M. Holding Company and Investment Company Acts.
-------------------------------------------
Borrower is not a "holding company", or a "subsidiary company" of a
"holding company", or an affiliate" of a "holding company", as such terms are
defined in the Public Utility Holding Company Act of 1935; nor is it an
"investment company", or an "affiliated company" or a "principal underwriter" of
an "investment company", as such terms are defined in the Investment Company Act
of 1940.
(S)N. Absence of Financing Statements, Etc.
-------------------------------------
Except with respect to Permitted Liens, there is no financing
statement, security agreement, chattel mortgage, real estate mortgage or other
document filed or recorded with any filing records, registry or other public
office, that purports to cover, affect or give notice of any present or possible
future lien on, or security interest in, any assets or Property of Borrower or
any rights relating thereto.
(S)O. FCC Matters.
-----------
Except for the filing of tariffs with the FCC, the Borrower has duly
and timely filed all filings which are required to be filed by it under the
Communications Act, the failure to file which could reasonably be expected to
have a Material Adverse Effect and is in all material respects in compliance
with the Communications Act, including, without limitation, the rules and
regulations of the FCC applicable to it, the failure to be in compliance with
which could reasonably be expected to have a Material Adverse Effect.
(S)P. Tariffs.
-------
No action to change, alter, rescind or otherwise terminate the
tariffs containing service regulations or any rates
<PAGE>
and charges for commercial mobile radio services which, if adversely determined,
would have a Material Adverse Effect, is pending or known by Borrower to be
under consideration.
(S)Q. Disclosure.
----------
This Loan Agreement and the statements and documents referred to
herein or delivered to the Administrative Agent and/or the Lenders by or on
behalf of Borrower pursuant hereto taken together, contain no untrue statement
of a material fact or fail to state a material fact which would be necessary to
make the statements (taken as a whole) herein and therein not misleading at such
time.
(S)R. Burdensome Obligations.
----------------------
Borrower is not a party to or bound by any franchise, agreement,
deed, lease or other instrument, or subject to any legal restriction which, in
the opinion of the management of Borrower, is so unusual or burdensome, in the
context of its business, as in the foreseeable future might materially and
adversely affect or impair the revenue of the Borrower, or Operating Cash Flow,
or the ability of the Borrower to perform obligations under the Loan Documents.
Borrower does not presently anticipate that future expenditures by Borrower
needed to meet the provisions of federal or state statutes, orders, rules or
regulations will be so burdensome as to affect or impair, in a materially
adverse manner, the business or condition, financial or otherwise, of Borrower.
(S)S. Solvency.
--------
Borrower is, and after giving effect to the incurrence of all
Indebtedness as and when contemplated by the Loan Documents will be, Solvent.
(S)T. Security Interests.
------------------
Subject to (i) the possession by the Collateral Agent of the Pledged
Collateral, (ii) the filing of UCC-1 financing statements with respect to Parent
and Borrower in the applicable filing offices, the payment of the fees in
respect thereof and the filing of continuation statements when required by
applicable law, (iii) the filing of the Grants of Security Interests in the
United States Patent and Trademark Office with respect to trademarks and
patents, and (iv) the execution and filing of an assignment of copyrights for
filing with the Copyright Office with respect to copyrights, the security
interests granted under the Collateral Documents will constitute valid, binding
and continuing duly perfected first priority Liens in and to the Collateral,
except for Permitted Liens, in favor of the Collateral Agent, for its benefit
and for the ratable benefit of the lenders and agents parties to the
Intercreditor Agreement.
<PAGE>
(S)U. Certain Transactions.
--------------------
Except as set forth in Schedule 6.21 hereto, none of the officers,
-------------
directors, or employees of Borrower is presently a party to any transaction with
Borrower (other than for services as employees, officers and directors),
including any contract, agreement or other arrangement providing for the
furnishing of services to or by, providing for rental of real or personal
property to or from, or otherwise requiring payments to or from any officer,
director or such employee or, to the knowledge of such Borrower, any
corporation, partnership, trust or other entity in which any officer, director,
or any such employee has a substantial interest or is an officer, director,
trustee or partner. Borrower, Parent and Grand Parent have entered into an
Expense Allocation Agreement that has been previously delivered to
Administrative Agent on behalf of the Lenders. To the extent Intellectual
Property of Parent or Grand Parent is licensed to Borrower, the terms of such
license(s) and the fee charged to Borrower relating thereto shall be subject to
the Required Lenders' reasonable approval.
(S)V. Business Plans.
--------------
The Approved Full-Term Operating Business Plan and each Approved
Annual Operating Business Plan have been prepared in all material respects in
accordance with GAAP concepts, consistently applied to projections.
(S)W. Employee Benefit Plans.
----------------------
1. In General.
----------
Each Employee Benefit Plan and each Plan has been maintained and
operated in compliance in all material respects with the provisions of ERISA
and, to the extent applicable, the IRC, including but not limited to the
provisions thereunder respecting prohibited transactions. Borrower has made all
required contributions to each Employee Benefit Plan and each Multiemployer
Plan. To the extent applicable, Borrower has heretofore delivered to the
Administrative Agent the most recently completed annual report, Form 5500, with
all required attachments, and actuarial statement required to be submitted under
(S)103(d) of ERISA, with respect to each Guaranteed Pension Plan.
2. Terminability of Welfare Plans.
------------------------------
Under each Employee Benefit Plan which is an employee welfare
benefit plan within the meaning of (S)3(1) or (S)3(2)(b) of ERISA, no benefits
are due unless the event giving rise to the benefit entitlement occurs prior to
plan termination (except as required by Title I, Subtitle B, Part 6 of ERISA). A
Borrower or an ERISA Affiliate, as appropriate, may terminate each such Plan at
any time (or at any time subsequent to the expiration of any applicable
bargaining agreement) in the discretion of any of
<PAGE>
Borrower or such ERISA Affiliate without liability to any Person.
3. Guaranteed Pension Plans.
------------------------
Each contribution required to be made to a Guaranteed Pension
Plan, whether required to be made to avoid the incurrence of an accumulated
funding deficiency, the notice or lien provisions of (S)302(f) of ERISA, or
otherwise, has been timely made. No waiver of an accumulated funding deficiency
or extension of amortization periods has been received with respect to any
Guaranteed Pension Plan. No liability to the PBGC (other than required insurance
premiums, all of which have been paid) has been incurred by Borrower or any
ERISA Affiliate with respect to any Guaranteed Pension Plan and there has not
been any ERISA Reportable Event, or any other event or condition which presents
a material risk of termination of any Guaranteed Pension Plan by the PBGC.
Neither Borrower nor any ERISA Affiliate has instituted or intends to institute
proceedings to terminate a Guaranteed Pension Plan. No event requiring notice to
the PGBC under Section 302(f)(4)(A) of ERISA has occurred with respect to any
Guaranteed Pension Plan and no amendment with respect to which security is
required under Section 307 of ERISA has been made or is reasonably expected to
be made to any Guaranteed Pension Plan. Based on the latest valuation of each
Guaranteed Pension Plan (which in each case occurred within twelve months of the
date of this representation), and on the actuarial methods and assumptions
employed for that valuation, the aggregate benefit liabilities of all such
Guaranteed Pension Plans within the meaning of (S)4001 of ERISA did not exceed
the aggregate value of the assets of all such Guaranteed Pension Plans,
disregarding for this purpose the benefit liabilities and assets of any
Guaranteed Pension Plan with assets in excess of benefit liabilities.
4. Multiemployer Plans.
-------------------
Neither Borrower nor any ERISA Affiliate has incurred or expects
to incur any material liability (including secondary liability) to any
Multiemployer Plan as a result of a complete or partial withdrawal from such
Multiemployer Plan under (S)4201 of ERISA or as a result of a sale of assets
described in (S)4204 of ERISA. Neither Borrower nor any ERISA Affiliate has been
notified that any Multiemployer Plan is in reorganization or insolvent under and
within the meaning of (S)4241 or (S)4245 of ERISA or that any Multiemployer Plan
intends to terminate or has been terminated under (S)4041A of ERISA.
(S)X. Regulations U and X.
-------------------
No portion of any Loan shall be used or obtained for the purpose of
purchasing or carrying any "margin security" or "margin stock" as such terms are
used in Regulations U and X of the Board of Governors of the Federal Reserve
System, 12 C.F.R. Parts 221 and 224.
<PAGE>
(S)Y. Environmental Compliance.
------------------------
Borrower has taken all necessary steps to investigate the past and
present condition and usage of its Real Estate and the operations conducted
thereon and, based upon such diligent investigation, makes the following
representations to its best knowledge:
a. Borrower has complied with all applicable Environmental Laws
relating to the operation of its business and the use and occupancy of any Real
Estate. There is no pending or threatened civil or criminal litigation, written
notice of violation, formal administrative proceeding, or investigation, inquiry
or information request by any governmental entity relating to any Environmental
Law involving the Borrower.
b. Except as set forth in Schedule 6.25 hereto, there have been
-------------
no releases of any Materials of Environmental Concern into the environment at
any parcel of Real Estate or any facility formerly or currently owned, operated
or controlled by the Borrower. With respect to any such releases of any
Materials of Environmental Concern, the Borrower has given all required notices
to government entities. The Borrower is not aware of any releases of Materials
of Environmental Concern at parcels of Real Estate or facilities other than
those owned, operated or controlled by the Borrower that could reasonably be
expected to have an impact on the Real Estate or facilities owned, operated or
controlled by the Borrower.
c. Set forth in Schedule 6.25 is a list of all environmental
-------------
reports, investigations and audits relating to premises currently or previously
owned or operated by the Borrower (whether conducted by or on behalf of the
Borrower or a third party, and whether done at the initiative of the Borrower or
directed by a governmental entity or other third party) which the Borrower has
in its possession or to which it has access, complete and accurate copies of
each such report, or the results of each such investigation or audit, have been
provided to the Administrative Agent on behalf of the Lenders.
d. Borrower has filed all reports and returns required to be
filed by the Borrower under any Environmental Laws. The business of the Borrower
is being conducted in compliance with all Environmental Laws applicable to the
Borrower or its business or Properties. The Borrower is in compliance with all
licenses, permits, registrations, certificates, consents, approvals or
authorizations (collectively, "Environmental Permits") required by all
applicable Environmental Laws. No event has occurred and is continuing which
permits, or after notice or lapse of time or both would permit, any modification
or termination of any Environmental Permit. Borrower (i) has not received any
notice asserting the absence of any Environmental Permit and (ii) has no
knowledge of any environmental law proposed or under consideration, which, if
<PAGE>
effective, could have a Material Adverse Effect.
e. Neither Borrower nor any of the Real Estate is subject to
any applicable Environmental Laws requiring the performance of site assessments
for Materials of Environmental Concern, or the removal or remediation of
Materials of Environmental Concern, or the giving of notice to any governmental
agency or the recording or delivery to other Persons of an environmental
disclosure document or statement by virtue of the transactions set forth herein
and contemplated hereby, or as a condition to the effectiveness of any
transactions contemplated hereby.
(S)A. Subsidiaries, Etc.
------------------
Borrower has no Subsidiaries. Except as set forth on Schedule 6.26
-------------
hereto, Borrower is not engaged in any joint venture or partnership with any
other Person.
(S)AA. Managerial Personnel.
---------------------
Borrower has and shall maintain adequate managerial personnel to
implement and execute Borrower's business operations as set forth in the
Approved Full Term Operating Business Plan.
(S)VII. AFFIRMATIVE COVENANTS OF BORROWER.
---------------------------------
Borrower covenants and agrees that, so long as any Loan or Note is
outstanding or any Lender has any obligation to make any Loans:
(S)A. Punctual Payment.
----------------
Borrower shall duly and punctually pay or cause to be paid as and
when due the principal of and interest on the Loans, the Origination Fee and all
other amounts and expenses provided for in this Loan Agreement and the other
Loan Documents to which Borrower is a party, all in accordance with the terms of
this Loan Agreement and such other Loan Documents.
(S)B. Maintenance of Office.
---------------------
Borrower shall maintain its chief executive office set forth in the
recitals of this Loan Agreement or at such other place in the United States of
America as Borrower shall designate upon written notice to (1) the
Administrative Agent, and (2) the Collateral Agent in accordance with the terms
of the Borrower Security Agreement, where notices, presentations and demands to
or upon Borrower in respect of the Loan Documents to which Borrower is a party
may be given or made.
(S)C. Records and Accounts.
--------------------
<PAGE>
Borrower shall (a) keep true and accurate records and books of account in
which full, true and correct entries shall be made in accordance with generally
accepted accounting principles and (b) maintain adequate accounts and reserves
for all taxes (including income taxes), depreciation, depletion, obsolescence
and amortization of its Properties, contingencies, and other reserves.
(S)D. Corporate Existence; Maintenance of Licenses.
--------------------------------------------
Borrower shall do or cause to be done all things necessary to
preserve and keep in full force and effect its corporate existence. Borrower
shall maintain in full force and effect, (a) with respect to the construction,
installation and development of facilities for the New York PCS Network, all
Licenses and material Necessary Authorizations appropriate to the level of
development theretofore achieved and sufficient to avoid noncompliance with the
then applicable minimum build-out requirements under the FCC License, and (b)
with respect to the operation of those portions of the New York PCS Network the
development of which has theretofore been completed, all material Licenses,
copyrights, patents, franchises, Necessary Authorizations and other rights as
are necessary and sufficient to operate such completed portions. Upon securing
each of the additional Licenses and Necessary Authorizations listed on Schedule
--------
6.7 attached hereto, Borrower shall maintain them in full force and effect,
- ----
where the failure to do so would have a Material Adverse Effect.
(S)E. Maintenance of Properties.
-------------------------
Borrower shall do or cause to be done all things necessary to
preserve and keep in full force and effect its franchises, employment contracts
and permits. The Borrower (a) shall cause all of its Properties used or useful
in the conduct of its business to be maintained and kept in good condition,
repair and working order (ordinary wear and tear excepted) and supplied with all
necessary equipment, (b) shall cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
Borrower may be necessary so that the business carried on in connection
therewith may be properly and advantageously conducted at all times, (c) shall
continue to engage primarily in the businesses now conducted by it and in
related businesses, and (d) shall continue in full force and effect all
authorizations and approvals required to conduct its business as appropriate to
the then level of construction, development and operation of the New York PCS
Network; provided that nothing in this (S)7.5 shall prevent Borrower from
--------
discontinuing the operation and maintenance of any of its Properties (other than
its FCC Licenses and Licenses) if such discontinuance is, in the judgment of
Borrower, desirable in the conduct of its business and that does not have a
Material Adverse Effect.
(S)F. Insurance.
---------
<PAGE>
Borrower shall maintain with financially sound and reputable
insurers insurance with respect to its Properties and business against such
casualties and contingencies as shall be in accordance with the general
practices of businesses engaged in similar activities in similar geographic
areas and in amounts, containing such terms customarily required by
institutional lenders, including, without limitation, naming Collateral Agent as
an additional insured and loss payee as its interests may appear, and providing
for at least thirty (30) days' written notice to Collateral Agent of
cancellation or diminishment in such forms and for such periods as may be
reasonable and prudent and in accordance with the terms of the Borrower Security
Agreement.
(S)G. Taxes.
-----
Borrower shall duly pay and discharge, or cause to be paid and
discharged, before the same shall become overdue, all taxes, assessments and
other governmental charges imposed upon it (including, without limitation, all
amounts due and owing to the FCC under Borrower's pioneer License) and its Real
Estate, sales and activities, or any part thereof, or upon the income or profits
therefrom, as well as all claims for labor, materials, or supplies that if
unpaid might by law become a lien or charge upon any of its Property; provided
--------
that any such tax, assessment, charge, levy or claim need not be paid if the
validity or amount thereof shall currently be contested in good faith by
appropriate proceedings and if Borrower has set aside on its books adequate
reserves with respect thereto; and provided further that Borrower will pay all
-----------------
such taxes, assessments, charges, levies or claims forthwith upon the
commencement of proceedings to foreclose any lien that may have attached as
security therefor.
(S)H. Inspection of Properties and Books.
----------------------------------
a. Borrower shall permit the Lenders, through the
Administrative Agent or any of the Lenders' other designated representatives, to
visit and inspect any of the Properties of Borrower, to examine the books of
account of Borrower (and to make copies thereof and extracts therefrom), and to
discuss the affairs, finances and accounts of Borrower with, and to be advised
as to the same by, its officers, all at such reasonable times and intervals as
the Administrative Agent or any Lender may reasonably request provided that the
-------------
Administrative Agent and each Lender shall use reasonable commercial efforts not
to interfere with Borrower's business.
b. Borrower authorizes the Administrative Agent and, if
accompanied by the Administrative Agent, the Lenders to communicate directly
with such Borrower's independent certified public accountants and authorizes
such accountants to disclose to the Administrative Agent and the Lenders any and
all financial statements and other supporting financial documents and schedules
<PAGE>
including copies of any management letter with respect to the business,
financial condition and other affairs of Borrower. At the reasonable request of
the Administrative Agent, Borrower shall deliver a letter addressed to such
accountants instructing them to comply with the provisions of this (S)7.8(b).
The Administrative Agent agrees to use commercially reasonable efforts to
coordinate the communications and disclosures to and from the accountants and
the Lenders.
(S)I. Compliance with Laws, Contracts, Licenses, and Permits.
------------------------------------------------------
Borrower shall comply in all material respects with (a) the
applicable laws and regulations wherever its business is conducted, including,
without limitation, all Environmental Laws, all Environmental Permits, all ERISA
laws, the IRC, the Communications Act, and all FCC rules and regulations, (b)
the provisions of its charter documents and by-laws, (c) all material agreements
and instruments to which it is a party and by which it or any of its Properties
may be bound, including, without limitation all those agreements listed on
Schedule 1.3 hereto, (d) all obligations with respect to any Employee Benefit
- ------------
Plan or Multiemployer Plan, and (e) all applicable decrees, orders, and
judgments. If any authorization, consent, approval, permit or license from any
officer, agency or instrumentality of any government shall become necessary or
required in order that Borrower may fulfill any of its Obligations hereunder or
any of the other Loan Documents to which Borrower is a party, Borrower shall
immediately take or cause to be taken all reasonable steps within the power of
Borrower to obtain such authorization, consent, approval, permit or license and
furnish the Administrative Agent on behalf of the Lenders with evidence thereof.
(S)J. Further Assurances.
------------------
Borrower shall cooperate with the Lenders, the Collateral Agent and
the Administrative Agent and shall execute and pay for the filing of all such
further instruments and documents, including without limitation, UCC financing
statements and other security documents, as the Lenders, the Collateral Agent or
the Administrative Agent shall reasonably deem appropriate at such time in order
to effectuate the security interests to Collateral Agent and the Lenders and to
carry out to their satisfaction the transactions contemplated by the Loan
Documents.
(S)K. Tranche B Balance Requirement.
-----------------------------
Borrower shall satisfy the Tranche B Balance Requirement.
(S)L. Additional Commitments.
----------------------
1. Borrower shall obtain and deliver to Administrative Agent
original counterparts (or copies thereof certified as true and correct by the
Chief Financial Officer of Borrower) of the
<PAGE>
Additional Commitments on the following dates ("measuring dates"):
a. June 30, 1997; and
b. each December 31 and June 30 thereafter until (i) the payment
in full of all principal and interest due with respect to Indebtedness owing on
the purchase price for the New York PCS Network License and (ii) Borrower's
EBTDA exceeds zero.
2. Borrower shall provide to the Administrative Agent on or before
March 31, 1997 a statement, certified as true and correct by the Chief Financial
Officer of Borrower, as to the total amount of principal and interest due and
payable to the FCC on account of the Indebtedness owing on the purchase price
for the New York PCS Network License for the period December 14, 1994 through
June 30, 1998.
(S)M. Authorization from Landlord/Mortgagee, Etc.
------------------------------------------
Borrower shall request that any landlord, mortgagee and easement
grantor of Borrower agree to give the Administrative Agent and Collateral Agent,
on a best efforts basis, notice of any default by Borrower under the terms or
conditions of any agreement between Borrower and any landlord, mortgagee of any
such landlord or easement grantor, and allow Collateral Agent to inspect or
remove after the occurrence and continuance thereof of an Event of Default
hereunder or under any of the Collateral Documents.
(S)N. Attornment and Recognition Agreements.
-------------------------------------
Borrower shall obtain all attornment and recognition agreements from
any landlord or landlord's mortgagee of Real Estate leased or owned by Borrower
upon which any Collateral (with a fair value in excess of $50,000) is stored or
located, in form and substance reasonably satisfactory to Collateral Agent.
Borrower shall use its best efforts to obtain all attornment and
recognition agreements from any landlord or landlord's mortgagee of Real Estate
leased or owned by Borrower upon which all other Collateral not covered by the
immediately preceding paragraph is stored or located, in form and substance
reasonably satisfactory to Collateral Agent.
(S)O. Expense Allocation Agreement.
----------------------------
Borrower shall comply with the terms of the Expense Allocation
Agreement and not consent to any waiver, modification or amendment thereto.
(S)P. Tranche A Draw Request.
----------------------
Borrower shall submit Tranche A Draw Requests to the Administrative
Agent at such times and in such amounts so that
<PAGE>
payments to Supplier will timely occur pursuant to the terms of the Supply
Agreement.
(S)Q. Reserved.
--------
(S)R. Reporting Requirements; Notices.
-------------------------------
Borrower shall deliver or cause to be delivered to the
Administrative Agent on behalf of the Lenders (and if specifically required
below, to the Collateral Agent) the following:
1. Approved Full Term Operating Business Plan.
------------------------------------------
a. Prior to the Closing Date, Borrower shall submit to the
Administrative Agent on behalf of the Lenders for the Administrative Agent's
review and approval a proposed operating business plan for its business and
operations for the term of the Loan Agreement, such operating business plan (and
all line items thereof) (x) to be consistent with the financial covenants in
(S)7.19 hereof and (y) to be prepared on a month by month basis through calendar
year 1996, quarterly through calendar year 1999, and annually thereafter (the
"Full Term Operating Business Plan"). The Full Term Operating Business Plan
shall be based on assumptions and expectations which are reasonable and prudent
under the circumstances. (Administrative Agent acknowledges satisfaction of the
requirements of this clause (a) prior to the date hereof).
b. The Full Term Operating Business Plan shall contain (i)
internally prepared statements of income and expense of Borrower in reasonable
detail for the term of the Loan Agreement prepared in accordance with generally
accepted accounting principles (except for the absence of footnotes) (ii) a
schedule of all Capital Expenditures estimated to be made during the term of the
Loan Agreement, (iii) a statement of the amounts and times by which Borrower
needs to raise additional capital to meet its obligations when due during the
term of the Loan Agreement, (iv) a projected balance sheet of Borrower, (v) a
projected cash flow statement of Borrower, and (vi) a statement listing all
assumptions which formed the basis for (i) through (v), each together with
supporting schedules in sufficient detail as needed and in all material aspects
in accordance with GAAP applied on a consistent basis. Upon approval at the
Closing Date by Administrative Agent, the proposed Full Term Operating Business
Plan shall become the Approved Full Term Operating Business Plan of Borrower
(the "Approved Full Term Operating Business Plan"). Borrower may deliver, from
time to time, to Administrative Agent an updated proposed full term operating
business plan which the Administrative Agent, in its sole discretion, may or may
not approve. If Administrative Agent approves such proposed plan, the plan shall
thereafter constitute the "Approved Full Term Operating Business Plan."
c. If as and when the proposed plan required to be
<PAGE>
delivered to the Administrative Agent pursuant to this (S)7.18A hereunder is
approved by Administrative Agent, said plan shall be deemed to be in compliance
with this (S)7.18A.
2. Approved Annual Operating Business Plan.
---------------------------------------
a. Prior to the Closing Date, Borrower shall also submit to the Agent on behalf
of the Lenders for the Administrative Agent's approval a proposed operating
business plan for the period from January 1, 1995, through calendar year 1996,
such operating business plan to be prepared on a month by month basis and based
on assumptions and expectations which are reasonable and prudent under the
circumstances. (Administrative Agent acknowledges satisfaction of the
requirements of this clause (a) prior to the date hereof).
b. The proposed annual operating business plan shall contain (i) internally
prepared statements of income and expense of Borrower in reasonable detail for
the applicable period prepared in all material aspects in accordance with
generally accepted accounting principles (except for the absence of footnotes),
(ii) a schedule of all Capital Expenditures estimated to be made during the
period, (iii) a statement of the amounts and times by which Borrower needs to
raise additional capital to meet its obligations when due during the period,
(iv) a projected balance sheet of Borrower, (v) a projected cash flow statement
of Borrower, and (vi) a statement listing all assumptions which formed the basis
for (i) through (v), each together with supporting schedules in sufficient
detail as needed and in all material aspects in accordance (x) in the case of
the proposed initial approved operating business plan, with GAAP (except for the
absence of footnotes) and (y) thereafter, with the Initial Approved Annual
Operating Business Plan, and on a consistent basis. Upon approval at the Closing
Date by the Administrative Agent, the proposed initial annual operating business
plan shall become the initial approved operating business plan of Borrower (the
"Initial Approved Annual Operating Business Plan" and, so long as it is in
effect, the "Approved Annual Operating Business Plan").
c. Commencing in 1996, prior to December 1 of each calendar year until the
later of (x) the Tranche A and B Commitment Termination Date, and (y) the date
on which Borrower's EBTDA is greater than zero for two successive fiscal
quarters, Borrower shall submit to the Administrative Agent on behalf of the
Lenders for Administrative Agent's review and approval a proposed annual
operating business plan containing the statements listed in (b)(i) through (vi)
and all exhibits required thereto as set forth in (S)7.18B(b) for the next
succeeding calendar year which the Administrative Agent, in its sole discretion,
may or may not approve. If the Administrative Agent approves the proposed new
annual operating business plan, the plan shall thereafter constitute the
"Approved Annual Operating Business Plan."
d. Commencing in 1996, on or prior to August 14 of
<PAGE>
each calendar year, Borrower shall submit to Administrative Agent on behalf of
the Lenders a report certified as true and correct by the Chief Financial
Officer of Borrower which shows in reasonable detail, variances, if any, between
the actual operating performance of Borrower and what was estimated for the
first six months of the calendar year in the Approved Annual Operating Business
Plan (or the Approved Full Term Operating Business Plan if the Administrative
Agent refuses to approve a plan delivered pursuant to (S)7.18B(c) hereof) and
explains in reasonable detail in form satisfactory to Administrative Agent the
reasons for the discrepancies between the two, if any.
e. If as and when the proposed plan required to be delivered to
the Administrative Agent under this (S)7.18B hereunder is approved by
Administrative Agent, said plan shall be deemed to be in compliance with this
(S)7.18B.
3. Quarterly Financial Statements.
------------------------------
As soon as practicable, but in any event not later than forty-
five (45) days after the end of each of the first three (3) fiscal quarters of
each fiscal year of Borrower, copies of the internally prepared unaudited
balance sheet of Borrower, as at the end of such quarter, and the related
statement of income and statement of cash flow for the portion of Borrower's
fiscal year then elapsed, all in reasonable detail and each setting forth in
comparative form (x) the figures for the prior year's corresponding fiscal
quarter and (y) so long as Borrower is required to deliver an Approved Annual
Operating Business Plan pursuant to (S)7.18B hereof, any variances from the
Approved Annual Operating Business Plan (or the Approved Full Term Operating
Business Plan, if applicable), if any, prepared in all material aspects in
accordance with generally accepted accounting principles, together with a
certification by the principal financial or accounting officer of Borrower that
the information contained in such financial statements fairly presents the
financial position of Borrower on the date thereof (subject to year-end
adjustments).
4. Annual Financial Statements.
---------------------------
As soon as practicable, but in any event no later than one
hundred twenty (120) days after the end of each fiscal year of Borrower, the
audited balance sheet of Borrower as at the end of such year, and the related
audited statement of income and audited statement of cash flow for such year
prepared in accordance with GAAP, and so long as Borrower is required to deliver
an Approved Annual Operating Business Plan pursuant to (S)7.18B hereof, a
separate variance analysis setting forth in comparative form the figures for the
previous fiscal year and any variances from the applicable period of the
Approved Annual Operating Business Plan in reasonable detail. Such balance
sheet, statement of income and statement of cash flow shall contain a certified
audit report of a nationally recognized independent certified public accounting
firm
<PAGE>
satisfactory to Administrative Agent, which report shall contain an unqualified
opinion of such accounting firm, and an "agreed upon procedures" report pursuant
to which the accountants (aa) review Borrower's statement that Borrower is in
compliance with the provisions of the Expense Allocation Agreement, (bb) perform
the agreed upon review procedures applicable thereto and (cc) confirm that in
examining the financial statements of Borrower they have not become aware of any
Default or Event of Default with respect to the Expense Allocation Agreement,
or, if such accountants shall have obtained knowledge of any then existing
Default or Event of Default they shall disclose in such report any such Default
or Event of Default; provided that such accountants shall not be liable to the
--------
Lenders for failure to obtain knowledge of any Default or Event of Default. The
annual financial statements shall also be accompanied by a management letter of
Borrower's accountants (only to the extent otherwise obtained by Borrower).
Notwithstanding the above, if NTI or an Affiliate of NTI has assigned all or a
part of its rights and obligations under the Loan Documents in accordance with
the terms hereof, then all annual financial statements, variance reports,
officer's certificates and accompanying documentation shall thereafter be due
within ninety (90) days from the end of each fiscal year;
5. Compliance Certificate.
----------------------
Simultaneously with the delivery of the financial statements
referred to in subsections (C) and (D) above, a statement certified by the
principal financial or accounting officer of Borrower (the "Compliance
Certificate") in substantially the form of Exhibit C hereto and setting forth in
---------
reasonable detail computations evidencing compliance with the financial
covenants contained in (S)7.19 and (if applicable) reconciliations to reflect
changes in generally accepted accounting principles since the Balance Sheet
Date;
6. Quarterly Key Barometer Report.
------------------------------
Until such time as Borrower's EBTDA has exceeded zero for two
successive fiscal quarters, forty-five (45) days after each quarter, Borrower
shall deliver to Administrative Agent on behalf of the Lenders, a report of Key
Barometers dated as of the last day of the previous quarter, together with a
report showing variances from the estimates previously provided to
Administrative Agent and each Lender in the Annual Approved Operating Business
Plan, along with an explanation of discrepancies between the actual numbers and
the estimated numbers.
7. Securities and Exchange Commission Reports.
------------------------------------------
Within three (3) Business Days after the filing or mailing
thereof, copies of all materials of a financial nature (x) filed with the
Securities and Exchange Commission by Borrower, Parent or Grand Parent, (y)
information sent to the stockholders of
<PAGE>
Borrower or to banks and other lenders of Borrower (exclusive of proprietary
information) and (z) information and reports directly and materially related to
the Borrower or the New York PCS Network which Parent or Grand Parent would be
required to file with the Securities and Exchange Commission ("SEC") pursuant to
the Securities Exchange Act of 1934, if Parent or Grand Parent were public
companies subject to the reporting requirements of such Act; provided that, if
--------
the information or reports covered by this clause (z) contain proprietary
information, Borrower shall not be obligated to provide the proprietary
information hereunder unless (a) the Person (i.e., Parent or Grand Parent) that
is the source of the information or reports is a public company and (b) such
Person would then be required to file such proprietary information with the SEC.
8. Accounts Receivable Aging Report.
--------------------------------
Within forty-five (45) days after the end of each fiscal quarter an
Accounts Receivable aging report;
9. Other Financial Information.
---------------------------
From time to time such other financial data and information as the
Administrative Agent may reasonably request.
10. Defaults.
--------
Written notice within three (3) Business Days thereof of the occurrence
and continuance of an event or circumstance that constitutes a Default or the
occurrence and continuance of an Event of Default under the Loan Documents or of
the Borrower first becoming aware of such occurrence, whichever date is later.
If any Person shall give any notice or take any other action in respect of a
claimed default (whether or not constituting an Event of Default) under this
Loan Agreement or any other note, evidence of indebtedness, indenture or other
obligation to which or with respect to which Borrower is a party or obligor,
whether as principal, guarantor, surety or otherwise, which could result in the
party to whom such indebtedness is owed having the right under its governing
documents to accelerate such indebtedness, and such acceleration would have a
Material Adverse Effect, Borrower shall forthwith give written notice thereof to
the Administrative Agent, describing the notice or action and the nature of the
claimed default.
11. Environmental Events.
--------------------
As soon as possible, and in any event within ten (10) Business Days,
written notice to the Administrative Agent on behalf of the Lenders (i) of any
violation of any Environmental Law that Borrower reports in writing or is
reportable by such Person in writing (or for which any written report
supplemental to any oral report is made) to any federal, state or local
environmental agency
<PAGE>
and (ii) upon becoming aware thereof, of any inquiry, proceeding, investigation,
or other action, including a notice from any agency of potential environmental
liability, or any federal, state or local environmental agency or board, that,
has the potential to materially affect the assets, liabilities, financial
conditions or operations of Borrower or the security interests for the benefit
of the Lenders pursuant to the Borrower Security Agreement.
12. ERISA Events.
------------
As soon as possible, and in any event within ten (10) days after
Borrower or any ERISA Affiliate knows or has reason to know or believes that any
ERISA Affiliate knows or has reason to know or believes that any ERISA Event has
occurred, Borrower shall and shall cause such ERISA Affiliate to deliver to the
Administrative Agent a statement of the chief financial officer of Borrower or
such ERISA Affiliate describing such ERISA Event, together with any
correspondence with, or filings made with, the PBGC or Department of Labor, and
the action, if any, which Borrower or such ERISA Affiliate proposes to take with
respect thereto.
13. Employee Benefit Plans.
----------------------
Borrower shall (i) promptly upon filing the same with the Department of
Labor or Internal Revenue Service, furnish to the Administrative Agent (x) a
copy of its initial actuarial statement required to be submitted under (S)103(d)
of ERISA and Annual Report, Form 5500, with all required attachments, in respect
of each Guaranteed Pension Plan, and (y) a notice of all subsequent filings
(with copies to be provided upon request of the Administrative Agent), (ii)
promptly upon receipt or dispatch, furnish to the Administrative Agent any
notice, report or demand sent or received in respect of a Guaranteed Pension
Plan under (S)(S)302, 4041, 4042, 4043, 4063, 4065, 4066 and 4068 of ERISA, or
in respect of a Multiemployer Plan, under (S)(S)4041A, 4202, 4219, 4242, or 4245
of ERISA, and (iii) promptly upon becoming aware of the occurrence thereof,
furnish notice to the Administrative Agent of: (a) any transaction which could
result in the imposition of a penalty under Section 502(i) of ERISA or an excise
tax under Section 4975 against Borrower or an ERISA Affiliate; (b) any partial
or complete withdrawal from a Multiemployer Plan by any of Borrower or an ERISA
Affiliate; (c) a failure by any of Borrower or an ERISA Affiliate to make a
payment to a Plan required to avoid imposition of a lien under Section 302(f) of
ERISA; (d) the adoption of an amendment to a Guaranteed Pension Plan requiring
the provision of security under Section 307 of ERISA; and (e) any change in the
actuarial assumptions funding methods used for any Guaranteed Pension Plan,
where the effect of such change is to materially increase the unfunded benefit
liability or materially reduce the obligation to make periodic contributions.
14. Notification of Claims Against Collateral.
-----------------------------------------
Written notice to the Administrative Agent and the
<PAGE>
Collateral Agent, within three (3) Business Days of becoming aware of any
setoff, claims (including, with respect to the Real Estate, environmental
claims), withholdings or other defenses to which any of the Collateral, or the
Collateral Agent's and Lenders' rights with respect to the Collateral, are
subject.
15. Notice of Litigation and Judgments.
----------------------------------
Written notice within ten (10) days of becoming aware of any litigation
or proceedings threatened in writing or any pending litigation and proceedings
affecting Borrower or to which Borrower is or becomes a party that could
reasonably be expected to have a Material Adverse Effect and stating the nature
and status of the proceedings. Borrower shall give notice to the Administrative
Agent, in writing, in form and detail satisfactory to the Administrative Agent,
within ten (10) days of any judgment not covered by insurance, final or
otherwise, against Borrower in an amount in excess of $1,000,000.
16. Calculation of Net Funds Payment.
--------------------------------
Annually, commencing in the year 2001, and for so long as Tranche B
Loans remain outstanding, a report of Borrower that includes true and accurate
calculations of Borrower's Net Funds Payment for that year, if any, within one
hundred twenty (120) days from the end of the fiscal year, certified as true and
correct by Borrower's Chief Financial Officer.
17. FCC Notices.
-----------
Within three (3) Business Days thereof, submit copies of all material
notices and correspondence received from or sent to the FCC relating to the New
York PCS Network License.
18. Change in Corporate Name; Location of Collateral.
------------------------------------------------
Not later than thirty (30) days prior thereto, written notice to the
Collateral Agent and the Administrative Agent of a change in (i) the business or
corporate name of Borrower or Parent, (ii) the location of the Collateral of
Borrower (subject to (S)6(a) of the Borrower Security Agreement) or (iii)
Borrower's chief executive office or other locations or the location where
Borrower's books and records are kept.
19. Other Information.
-----------------
Borrower shall provide the Administrative Agent on behalf of the
Lenders such other information concerning its business, operations or financial
condition as shall be reasonably requested. Upon the Administrative Agent's
receipt of any and all financial and other information furnished by the Borrower
pursuant to this (S)7.18 the Administrative Agent shall promptly deliver copies
thereof to each Lender.
<PAGE>
(S)S. Financial Covenants of Borrower.
-------------------------------
Borrower covenants and agrees that, so long as any Loan, Note or other
of Borrower's Obligations are outstanding or any Lender has any obligation to
make any Loans, Borrower shall:
1. Revenue Covenant:
----------------
Have earned for each fiscal quarter during the periods set forth on
Schedule 7.19A, Revenue of not less than the applicable amount shown on Schedule
- -------------- --------
7.19A.
- -----
Notwithstanding the requirement set forth above, Borrower will not be
required to meet the Revenue Test in this Section 7.19A for any fiscal quarter
ending after the Borrower's EBTDA has exceeded zero for two successive fiscal
quarters.
2. Minimum Cash Test:
-----------------
Maintain or cause to be maintained as of the last day of each fiscal
quarter, a ratio of Cash to EBTDA (for the quarter then ending) of not less than
1.25:1. For purposes of calculating the ratio in this (S)7.19B, negative EBTDA
shall be treated as if it were a positive number.
Notwithstanding the requirement set forth above, Borrower will not be
required to meet the Minimum Cash Test in this (S)7.19B (x) for any quarter in
which EBTDA is positive or (y) for any fiscal quarter ending after Borrower's
EBTDA has exceeded zero for two successive quarters.
3. Indebtedness Test:
-----------------
Have as of the last day of each fiscal quarter during the term of this
Loan Agreement, Adjusted Indebtedness of not more than the Indebtedness Cap.
4. Ratio of Adjusted Total Debt to Adjusted Borrower's Equity:
----------------------------------------------------------
Beginning with the first quarter of calendar year 1996, maintain or
cause to be maintained as of the last day of each fiscal quarter through the
Tranche A and B Maturity Date, a ratio of Adjusted Total Debt to Adjusted
Borrower's Equity of not more than (a) beginning on the Closing Date through
December 31, 1996, 4:1, and (b) thereafter, 3:1.
5. Adjusted EBITDA Test:
--------------------
Have for each fiscal quarter during the periods set forth on Schedule
7.19E, Adjusted EBITDA of not less than the amounts shown on such Schedule 7.19E
--------------
for the applicable period.
<PAGE>
(S)T. Mortgage Liens:
--------------
If the Borrower shall use the proceeds of any loan under any Permitted
Loan Agreement to acquire any Real Estate at the time of such acquisition it
will grant to the Collateral Agent a first-mortgage lien in form and substance
satisfactory to the Required Lenders on such Real Estate. Such Lien shall
provide that it shall be released upon the refinancing of any such loan.
(S)VIII. CERTAIN NEGATIVE COVENANTS OF BORROWER.
--------------------------------------
Borrower covenants and agrees that, so long as any Loan or Note or
other fees or expenses are outstanding or any Lender has any obligation to make
any Loans:
(S)A. Restrictions on Indebtedness.
----------------------------
Borrower shall not create, incur, assume, guarantee or be or remain
liable, contingently or otherwise, with respect to any Indebtedness other than:
a. Subject to the Indebtedness Cap, Indebtedness to the Lenders
and the Administrative Agent arising under any of the Loan Documents;
b. Subject to the Indebtedness Cap, Indebtedness to the Parent
or Grand Parent, provided that such Indebtedness is on terms which are no better
-------------
than those available on arm's length terms and, provided that, any such
-------------
Indebtedness shall be subordinated to the prior payment in full in cash of the
Outstanding Amount of Loans and all other Indebtedness permitted and owing to
any Person hereunder pursuant to a Subordination Agreement except that, so long
as no Default has occurred and is continuing under any of the Loan Documents,
Borrower is allowed (I) to pay interest only (but not principal) to Parent or
Grand Parent on such Indebtedness at market rates and (II) to pay an amount to
Parent or Grand Parent equal to that which Borrower would otherwise be permitted
to distribute to Parent in accordance with the terms of (S)8.5 hereof in lieu of
making such Distribution. Borrower shall also be allowed to pay Parent or Grand
Parent prior to paying the Borrower's Obligations hereunder for Indebtedness
which:
(i) (v) was incurred by Borrower to pay (and was in fact used
to pay) (I) expenses for which a Tranche A borrowing is permitted under this
Loan Agreement, or (II) a Tranche B Eligible Expense or (III) a Tranche C
Eligible Expense, or
(w) is to be paid out of the proceeds of Indebtedness to
a non-affiliated third party (other than the Lenders), and such non-affiliated
third party has executed a Subordination Agreement, or
<PAGE>
(x) was incurred to pay for permitted Capital
Expenditures relating to the New York PCS Network and will be paid out of the
proceeds of Indebtedness to be borrowed from an Other Lender lending on a pari
passu basis in accordance with an Intercreditor Agreement, or
(y) was incurred to pay for costs for which Liens are
permitted under clauses (a), (b) and (c) of (S)8.2 below, and is to be paid to
Parent or Grand Parent out of the proceeds of such Indebtedness to an Other
Lender which has executed an Intercreditor Agreement permitted pursuant to
(S)8.1(e) below, or
(z) was incurred to pay for Borrower's cash flow/working
capital requirements pursuant to a revolving loan agreement which [as long as it
remains in place] allows Borrower to borrow and reborrow amounts from time to
time (up to, at any one time in the aggregate, $5,000,000), and is to be paid
out of the proceeds of Indebtedness to a non-affiliated third party (other than
the Lenders) which is permitted pursuant to (S)8.1(g) below; and
(ii) no Default has occurred and is continuing under any of
the Loan Documents.
c. Subject to the Indebtedness Cap, (i) purchase money
Indebtedness, (ii) Capital Lease obligations, and (iii) Indebtedness incurred in
the acquisition of Real Estate (w) in an amount not to exceed at any one time
outstanding in the aggregate Ten Million Dollars ($10,000,000), (x) in amounts
not to exceed the fair value of the property being acquired, and (y) in the case
of purchase money Indebtedness and Capital Lease obligations (considered
together) in an aggregate amount outstanding at any one time not to exceed Five
Million Dollars ($5,000,000) and in each case a refinancing of such Indebtedness
or Capital Lease Obligation in an amount not to exceed the amount to be
refinanced and such refinancing is provided by a nonaffiliated Lender and the
amount of such refinancing shall be counted in the $10,000,000 cap;
d. Subject to the Indebtedness Cap, additional unsecured
Indebtedness, provided that, any such Indebtedness shall be subordinated to the
-------------
prior payment in full in cash of the Outstanding Amount of Loans pursuant to a
Subordination Agreement;
e. Subject to the Indebtedness Cap, Indebtedness secured by
Liens permitted pursuant to clauses (a) and (c) of Section 8.2 below including
Indebtedness owing with respect to the Ericsson Loan Agreement;
f. Indebtedness the proceeds of which are used solely for
working-capital purposes, so long as, with respect to each of the two most
recent complete fiscal quarters of the Borrower, preceding the date on which
such Indebtedness is to be
<PAGE>
incurred
(i) the amount equal to
(A) the Borrower's EBTDA for such fiscal quarter minus
(B) the amount of interest that would have accrued on
such Indebtedness during such fiscal quarter if such
Indebtedness had been outstanding for all of such
fiscal quarter and such interest had accrued at the
rate per annum applicable at the time of incurrence,
shall have exceeded zero, and
(ii) the ratio of
(A) the aggregate principal amount of all Indebtedness
of the Borrower outstanding on such date, after
giving effect to such Indebtedness, to
(B) EBITDA for each such fiscal quarter,
shall not exceed 7.5:1;
g. Subject to the Indebtedness Cap, Indebtedness to a
nonaffiliated working capital lender for cash flow/working capital secured by
Accounts Receivable not to exceed in the aggregate, Five Million Dollars
($5,000,000.00);
h. Indebtedness owing to the FCC in an amount not greater than
the purchase price payable for the FCC License for the New York PCS Network;
i. Indebtedness owing under the Ericsson Loan Agreement.
j. Subject to the Indebtedness Cap, Purchase Money Indebtedness
(in addition to any purchase money Indebtedness described in (S)8.1(c) above)
incurred in order to acquire inventory (other than in respect of handsets and
accessories thereto manufactured or supplied by Ericsson or Orbitel or their
respective Affiliates).
Indebtedness of Borrower to the Parent or Grand Parent shall only be
permitted hereunder pursuant to (S)8.1(b), above.
(S)B. Restrictions on Liens.
---------------------
Borrower shall not (A) create or incur or suffer to be
<PAGE>
created or incurred or to exist any Lien, encumbrance, mortgage, pledge, charge,
restriction or other security interest of any kind upon any of its Property or
assets of any character whether now owned or hereafter acquired, or upon the
income or profits therefrom; (B) transfer any of such Property or assets or the
income or profits therefrom for the purpose of subjecting the same to the
payment of Indebtedness or performance of any other obligation in priority to
payment of its general creditors; (C) acquire, or agree or have an option to
acquire, any property or assets upon conditional sale or other title retention
or purchase money security agreement, device or arrangement; (D) suffer to exist
for a period of more than thirty (30) days after the same shall have been
incurred any Indebtedness or claim or demand against it that if unpaid might by
law or upon bankruptcy or insolvency, or otherwise, be given any priority
whatsoever over its general creditors; or (E) sell, assign, pledge or otherwise
transfer any accounts, contract rights, general intangibles, chattel paper or
instruments, with or without recourse; provided that Borrower may create or
--------
incur or suffer to be created or incurred or to exist (collectively "Permitted
Liens"):
a. Liens securing any and all other vendor financing for the supply
and installation of equipment to be used in the New York PCS Network to be
supplied by third party nonaffiliated suppliers for amounts not in excess of the
fair value of the property being acquired and related services associated with
the equipment (and the refinancing and refunding of such Indebtedness, so long
as such refinancing and refunding is done through nonaffiliated third parties)
provided that, with respect to any nonaffiliated Person who has not signed an
- -------------
Intercreditor Agreement prior to obtaining such Lien, the amount secured by such
Liens by all such nonaffiliated Persons pursuant to (S)(S)8.2(a) and (b) hereof
shall not exceed in the aggregate at any one time $5,000,000;
b. Liens securing purchase money Indebtedness permitted under
(S)8.1(c) above, provided that such Liens cover only the property so acquired
-------------
and for amounts not in excess of the fair value of the property being acquired
(and the refinancing and refunding of such Indebtedness, so long as such
refinancing and refunding is done through nonaffiliated third parties) provided
--------
that, with respect to any nonaffiliated Person who has not signed an
- ----
Intercreditor Agreement prior to obtaining such Lien, the amount secured by such
Liens by all such nonaffiliated Persons pursuant to (S)(S)8.2(a) and (b) hereof
shall not exceed in the aggregate at any one time $5,000,000;
c. Liens securing Indebtedness incurred, and the proceeds of which
are used to pay (i) Tranche C Loans, in whole or in part, (ii) up to $15,000,000
of Tranche C Loans due under the Ericsson Loan Agreement and (iii) the portion
of Tranche A Loans drawn under the Ericsson Loan Agreement, the proceeds of
which were used to pay interest due under the Ericsson Loan Agreement provided
--------
<PAGE>
that, the maturity date of any such Indebtedness shall not occur earlier than
- ----
the Tranche A and B Commitment Termination Date (and the refinancing and
refunding of such Indebtedness, so long as such refinancing and refunding is
done through nonaffiliated third parties);
d. Liens to secure taxes, assessments and other government charges
in respect of obligations not overdue or Liens on Properties to secure claims
for labor, material or supplies in respect of obligations not overdue;
e. deposits or pledges made in connection with, or to secure payment
of, workmen's compensation, unemployment insurance;
f. Liens of carriers, warehousemen, mechanics and materialmen, and
other like liens on properties, in existence less than 120 days from the date of
creation thereof in respect of obligations not overdue;
g. encumbrances on Real Estate consisting of:
(I) easements, rights of way, zoning restrictions, restrictions
on the use of real property and defects and irregularities in the title thereto,
landlord's or lessor's liens under leases to which such Borrower is a party, and
other minor liens or encumbrances none of which in the opinion of Borrower
interferes materially with the use of the property affected in the ordinary
conduct of the business of Borrower, which defects do not individually or in the
aggregate have a Material Adverse Effect on the business of Borrower; and
(II) mortgage (or deed of trust) liens (collectively "Mortgage
Liens") to secure the payment of borrowed money to acquire Real Estate, provided
(i) the amount secured by any Mortgage Lien shall not exceed the sum of (w) the
acquisition cost of the Real Estate acquired by Borrower and (x) the cost of any
improvements constructed thereon; and (ii) Borrower shall simultaneously with
the acquisition of the Real Estate in question either (A) if the amount of the
Mortgage Lien has been advanced from funds of Borrower or under one or more
Permitted Loan Agreements, grant to the Collateral Agent a first mortgage or
deed of trust or (B) otherwise (y) grant to the Collateral Agent a second
mortgage (or deed of trust) in form and substance satisfactory to the Required
Lenders subordinate only to the Mortgage Lien, and securing the obligations of
the Borrower owing to lenders that are parties to the Intercreditor Agreement or
(z) cause the lender in whose favor the Mortgage Lien is to be made to execute
and deliver to the Collateral Agent an option to purchase the Mortgage Lien,
substantially in the form of Exhibit K attached hereto; provided that if
---------
Borrower proceeds under Clause (ii)(A) of this Section 8.2(g)(II), Borrower
shall have the right to refinance the Mortgage Lien with a different lender in
which event Borrower
<PAGE>
shall deliver to the Collateral Agent, simultaneously with such financing, the
documentation required under clause (B) hereof;
h. Liens existing on the date hereof and listed on Schedule 8.2
------------
hereto;
i. Liens in favor of the Collateral Agent for the benefit of the
lenders and agents parties to the Intercreditor Agreement securing the
obligations permitted to be secured under the Intercreditor Agreement;
j. Liens to secure Indebtedness permitted under (S)8.1(f),
above;
k. Liens on Accounts Receivable to secure Indebtedness permitted
under (S)8.1(g), above;
l. Deposits to secure the performance of bids, trade contracts
(other than for Guaranteed money, leases, statutory obligations, surety and
appeal bonds, performance bonds, and other obligations of a like nature incurred
in the ordinary course of business not to exceed in the aggregate at any one
time $5,000,000; and
m. liens on inventory other than handsets and accessories
thereto manufactured by Ericsson, Inc., Orbitel and their respective Affiliates.
The Lenders will consent to and permit a pari passu sharing of
----------
collateral with one or more lenders who (i) have Indebtedness secured by liens
permitted by (a), (b), (c) and (f) and (i) of this (S)8.2, (ii) are eligible to
join in the Intercreditor Agreement (the "Intercreditor Agreement")dated August
7, 1996, by and among the Collateral Agent, the Ericsson Administrative Agent
and the Nortel Administrative Agent , and (iii) are not Affiliates of Borrower
(the "Other Lender"). The collateral pool that will be shared pari passu between
----------
Lender and the Other Lender shall consist of the collateral pledged to (i) the
Lender and (ii) the Other Lender.
All expenses of the Collateral Agent and all expenses, including legal
fees, incurred in connection with the preparation and negotiation of appropriate
collateral agent documentation shall be paid by the Borrower.
(S)C. No Contingent Obligations.
-------------------------
Borrower shall not create, incur, assume, guarantee or remain liable on
any Contingent Obligations other than (i) guarantees in favor of the Lenders or
their Affiliates and assigns, and (ii) those Contingent Obligations existing on
the date hereof and noted on Schedule 8.3 hereto.
------------
(S)D. Restrictions on Investments.
---------------------------
<PAGE>
Borrower shall not make or permit to exist or to remain outstanding any
Investment except:
a. Investments in Rate Hedging Agreements in a notional
principal amount on any date not to exceed the aggregate principal amount of
Indebtedness of the Borrower accruing interest at a floating rate, and only so
long as the purpose of such Investments shall be to hedge such floating-rate
interest and shall not be to speculate on interest rates;
b. Investments in commercial paper maturing in ninety (90) days
or less from the date of issuance which, at the time of acquisition by Borrower,
is accorded a rating of A1 or better by Standard & Poor's Corporation, or P1 or
better by Moody's Investors Service, Inc. or an equivalent rating by another
nationally recognized credit rating agency of similar standing;
c. Investments in (i) direct obligations of the United States of
America or any agency or guarantee of which constitutes a full faith and credit
obligation of the United States of America, in either case, maturing in twelve
months or less from the date of acquisition thereof, and (ii) repurchase
agreements fully secured by underlying securities of the type described in
clause (i) and issued by a bank or trust company meeting the requirements of
paragraph (d) of this 8.4;
d. Investments in certificates of deposit maturing within six
months from the date of issuance thereof (i) issued by a bank or trust company
organized under the laws of the United States or any state thereof, having
capital, surplus and undivided profits aggregating at least $500,000,000 and
whose long-term certificates of deposit are, at the time of acquisition thereof
by Borrower, rated AA or better by Standard & Poor's Corporation or Aa or better
by Moody's Investors Service, Inc., (ii) issued by any Lender, and (iii) issued
by a bank or trust company organized under law other than those of the United
States or any state thereof, having capital, surplus and undivided profits
aggregating at least $500,000,000 and having a credit rating of B/C or better
and a "legal rating" of 3 or better by IBCA Lendering Analysis Ltd.
e. Investments in money market funds (other than single state
funds) that make investments in accordance with the regulations of the
Securities and Exchange Commission under the Investment Company Act of 1940, as
amended; and
f. Loans or advances in the usual and ordinary course of
business to officers, directors and employees for expenses (including moving
expenses related to a transfer) incidental to carrying on the business of
Borrower;
(S)E. Distributions.
-------------
Except as permitted by the Expense Allocation Agreement,
<PAGE>
Borrower shall not make any Distributions (other than a dividend or other
distribution of any shares of capital stock of Borrower subject to the Parent's
pledge to the Lenders pursuant to the Pledge Agreement) without the prior
written consent of the Administrative Agent and the Required Lenders or make any
payment on account of allocated corporate charges or overhead which is not a
Tranche C Eligible Expense unless at the time of and after giving effect to such
Distribution:
(i) no Default shall have occurred and be continuing;
(ii) the Borrower shall have had EBTDA in excess of zero for
each of its four consecutive fiscal quarters ending with its fiscal quarter most
recently ended prior to the date of such Distribution (the "Preceding Fiscal
----------------
Quarter") and
- -------
(iii) the aggregate amount for all Distributions by the
Borrower during the fiscal year of the Borrower in which the date of such
Distribution occurs shall not exceed:
(A) Working Capital of the Borrower as of the last day
of the Preceding Fiscal Quarter, minus
(B) the aggregate amount of Debt Service payable by
the Borrower during the 12 calendar months next-following the
Preceding Fiscal Quarter, minus
(C) while any Tranche B Advance is outstanding, (1)
50%, multiplied by (2) 25%, multiplied by (3) the number of
Borrower's fiscal quarters that have begun on or before the
date of such Distribution during the Borrower's then-current
fiscal year, multiplied by (4) the Net Funds Amount in
respect of the Borrower's immediately preceding complete
fiscal year, minus
(D) the aggregate amount of any prepayment of
Indebtedness required to be made pursuant to (S)3.02(b) of
the Ericsson Loan Agreement and pursuant to (S)3.2C hereunder
during the Borrower's then-current fiscal year and that has
not theretofore been made.
(S)F. Merger, Consolidation and Disposition of Assets.
-----------------------------------------------
a. Borrower shall not become a party to any merger or
consolidation, shall not create any Subsidiaries or agree to or effect any asset
acquisition or stock acquisition (other than the acquisition of assets in the
ordinary course of business consistent with sound and prudent practices) and
shall not make any other fundamental changes in its business, operations or
corporate
<PAGE>
structure, including, but not limited to, changing its name or any trade name
used in its business, making non-ordinary course asset disposals or transfers,
including transactions with Affiliates, restructurings, issuing additional
capital stock, or changing the allocation of intercompany expenses among
Borrower and its corporate Affiliates from that set forth in the Expense
Allocation Agreement.
b. Borrower shall not become a party to or agree to or effect
any disposition of assets, other than (i) the disposition of assets in the
ordinary course of business, (ii) the disposition of obsolete assets or
equipment no longer necessary to the operation of the Borrower's business,
consistent with sound and prudent practices, and (iii) the disposition of asset
not covered by either of the foregoing exceptions in an amount not to exceed
$10,000,000 in the aggregate during the term of this Agreement.
(S)G. Sale and Leaseback.
------------------
Borrower shall not enter into any arrangement, directly or
indirectly, whereby Borrower shall sell or transfer any Property owned by it in
order then or thereafter to lease such Property or lease other property that
Borrower intends to use for substantially the same purpose as the Property being
sold or transferred.
(S)H. Compliance with Environmental Laws.
----------------------------------
Borrower shall not (a) use any of the Real Estate or any portion
thereof for the handling, processing, storage or disposal of Materials of
Environmental Concern, except in compliance with Environmental Laws, (b) cause
or permit to be located on any of the Real Estate any underground tank or other
underground storage receptacle for Materials of Environmental Concern, except in
compliance with Environmental Laws, (c) generate any Materials of Environmental
Concern on any of the Real Estate, except in compliance with Environmental Laws,
(d) conduct any activity at any Real Estate or use any Real Estate in any manner
so as to cause a release (i.e., releasing, spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, disposing or
dumping) or threatened release of Materials of Environmental Concern on, upon or
into the Real Estate except in compliance with Environmental Laws or (e)
otherwise conduct any activity at any Real Estate, except in compliance with
Environmental Laws, or use any Real Estate in any manner that would violate any
Environmental Law or bring such Real Estate in violation of any Environmental
Law.
(S)I. Employee Benefit Plans.
----------------------
Neither Borrower nor any ERISA Affiliate shall
a. engage in any "prohibited transaction" within the meaning
of (S)406 of ERISA or (S)4975 of the Code which could
<PAGE>
result in a material liability for Borrower; or
b. permit any Guaranteed Pension Plan to incur an "accumulated
funding deficiency", as such term is defined in (S)302 of ERISA, whether or not
such deficiency is or may be waived; or
c. fail to contribute to any Guaranteed Pension Plan to an
extent which, or terminate any Guaranteed Pension Plan in a manner which, could
result in the imposition of a lien or encumbrance on the assets of Borrower
pursuant to (S)302(f) or (S)4068 of ERISA; or
d. permit or take any action which would result in the aggregate
benefit liabilities (with the meaning of (S)4001 of ERISA) of all Guaranteed
Pension Plans exceeding the value of the aggregate assets of such Plans,
disregarding for this purpose the benefit liabilities and assets of any such
Plan with assets in excess of benefit liabilities.
e. fail to make when due any required contributions to a
Multiemployer Plan;
f. withdraw (completely or partially) from any Multiemployer
Plan where such withdrawal is likely to result in a material liability to
Borrower or an ERISA Affiliate;
g. terminate or institute proceedings to terminate, any
Guaranteed Pension Plan, where such termination is likely to result in a
material liability to any of Borrower or an ERISA Affiliate;
h. make any amendment to any Guaranteed Pension Plan with
respect to which security is required under Section 307 of ERISA; or
i. fail to give any and all notices and make all disclosures and
governmental filings required under ERISA or the IRC where such failure is
likely to result in material liability to Borrower or an ERISA Affiliate.
(S)J. Key Management Personnel Compensation.
-------------------------------------
Until such time as Borrower's EBTDA has exceeded zero for two
successive fiscal quarters, Borrower's compensation program for the categories
its key management personnel listed on Schedule 8.10 attached hereto shall not
-------------
provide for incentive-based cash compensation which is in excess of three (3)
times the applicable base salary.
(S)K. Reserved.
--------
(S)L. Transactions with Affiliates.
----------------------------
The Borrower shall not enter into
<PAGE>
a. any agreement or arrangement providing for the payment of any amounts
to any of its Affiliates, other than
I. (x) the Expense Allocation Agreement, and (y) only if the
Administrative Agent issues a formal approval in writing subsequent to the
date hereof, the Servicing Agreement dated as of the date hereof between
the Borrower and the Grand Parent,
II. a tax-sharing agreement or arrangement pursuant to which the
Borrower shall not make any payments or agree to make any payments in lieu
of income taxes unless the cumulative sum of such payments does not exceed
the cumulative sum of income taxes that the Borrower would have paid if the
Borrower had always filed income-tax returns as a separate entity and
III. a management, consulting or other agreement, but only if such
agreement either
(A) relates to providing management, consulting or other services
to an Affiliate operating BTA markets and
(1) is on terms that are fair and reasonable and no less
favorable to the Borrower than it would obtain in a comparable
arm's-length transaction with a Person not an Affiliate;
(2) does not provide for payments by the Borrower under
such agreement; and
(3) does not provide for the performance of services or
purchase or delivery of property by the Borrower in a manner
that, individually or together with all other such agreements
with Affiliates operating BTA markets, would have a material
adverse effect on the ability of the Borrower to build-out or
operate the New York MTA, or
(B) is approved in writing by the Required Lenders, or
(b) any other agreement, arrangement or transaction with any of its
Affiliates (whether or not providing for the payment of any amounts to any of
its Affiliates), except in the ordinary course of business and on terms that are
fair and reasonable and no less favorable to the Borrower than it would obtain
in a comparable arm's-length transaction with a Person not an Affiliate.
<PAGE>
(S)M. Change in Nature of Business.
----------------------------
The Borrower shall not make any fundamental change in its business as
carried on and as proposed to be carried on at the date hereof.
(S)N. Charter Amendments.
------------------
The Borrower shall not amend its certificate of incorporation or bylaws.
(S)O. Accounting Changes.
------------------
The Borrower shall not make or permit, or permit any of its Subsidiaries
to make or permit, any change in accounting policies or reporting practices,
except as required by GAAP, or change its fiscal year.
(S)P. Prepayments, Etc., of Indebtedness.
----------------------------------
The Borrower
a. shall not, and shall not permit any Affiliate to, prepay,
redeem, purchase, defease or otherwise satisfy prior to the scheduled
maturity thereof in any manner, or make any payment in violation of any
subordination terms of, any Indebtedness owing by the Borrower, other
than the prepayment of the Loan in accordance with the terms of this
Agreement or as the Required Lenders may otherwise agree, except for
prepayments, redemptions, purchases or other satisfactions by the
Borrower as to which lenders under Section 5.02 of the Intercreditor
Agreement are not required to pay any amount to other lenders party
thereto or Indebtedness owing to the FCC, and
b. shall not amend, modify or change in any manner any term or
condition of any Subordinated Debt or any other Indebtedness secured by
Liens in favor of the Collateral Agent, except for amendments,
modifications and changes that the lenders party to the Intercreditor
Agreement are permitted to enter into thereunder.
If on any date any amount shall be due and owing hereunder and under any other
Indebtedness of the Borrower and the Borrower shall not pay in full all such
amounts as are then due and owing, the Borrower shall not pay any such amounts
except ratably, in accordance with the respective amounts then due and owing
thereunder. If the Borrower shall take any action in violation of this Section
8.16, it irrevocably authorizes each lender to it that is a party to the
Intercreditor Agreement on its behalf to make any payment required under Section
5.02 or 5.03 of the Intercreditor Agreement and acknowledges that any amount so
paid by any such
<PAGE>
lender shall be deemed not to have been paid by the Borrower to such lender.
(S)Q. Amendment, Etc., of Material Contracts.
--------------------------------------
The Borrower shall not cancel or terminate any Material Contract or
consent to or accept any cancellation or termination thereof, amend or otherwise
modify any Material Contract or give any consent, waiver or approval thereunder,
waive any default under or breach of any Material Contract, agree in any manner
to any other amendment, modification or change of any term or condition of any
Material Contract, or take any other action in connection with any Material
Contract that, in any such case, could, at the time thereof, reasonably be
expected to have a material adverse effect on the Borrower's ability to perform
its obligations under this Agreement or any other Loan Document.
(S)R. Negative Pledge.
---------------
The Borrower shall not enter into or suffer to exist, or permit any of
its Subsidiaries to enter into or suffer to exist, any agreement prohibiting or
conditioning the creation or assumption of any Lien in favor of the Lenders or
the Collateral Agent upon any of its property or assets.
(S)S. Partnerships.
------------
The Borrower shall not become a general partner in any general or limited
partnership.
(S)IX. CLOSING CONDITIONS.
------------------
The obligations of the Lenders to make Loans shall be subject to the
satisfaction of the following conditions precedent on or prior to the Closing
Date:
(S)A. Loan Documents.
--------------
Each of the Loan Documents shall have been duly executed and delivered by
the respective parties thereto, shall be in full force and effect and shall be
in form and substance satisfactory to Administrative Agent, each of the Lenders
and their counsel. Each Lender and the Administrative Agent shall have received
a fully executed copy of each such document.
(S)B. Secretary's Certificate; Evidence of Action.
-------------------------------------------
Each of the Lenders and the Administrative Agent shall have received from
each of Borrower and Parent a Secretary's Certificate, dated as of the Closing
Date, signed by the Secretary or Assistant Secretary of Borrower and Parent, (i)
giving the name and bearing a specimen signature of each individual officer who
<PAGE>
shall be authorized: (a) to sign, in the name and on behalf of Borrower or
Parent, each of the Loan Documents to which Borrower or Parent is or is to
become a party; (b) to make Tranche A, B or C Drawdown Requests (with respect
to Borrower only); and (c) to give notices and to take other action on its
behalf under the Loan Documents; (ii) attaching (a) its charter or other
incorporation documents (and all amendments thereto) as in effect on the Closing
Date, (b) its by-laws (and all amendments thereto) as in effect on the Closing
Date, certified by the Secretary or Assistant Secretary of Borrower and Parent
as being true and complete on the Closing Date, and (c) a certificate of good
standing from the Secretary of State of the jurisdiction of its incorporation
and of each other jurisdiction in which it is qualified to do business, and
(iii) attaching a copy of all corporate action necessary for the valid
execution, delivery and performance by Borrower and Parent of each of the Loan
Documents to which it is or is to become a party, certified as true and correct
and in full force and effect as of the Closing Date by the Secretary or
Assistant Secretary of each of Borrower and Parent, respectively.
(S)C. Validity of Liens.
-----------------
The Borrower Security Agreement and the Pledge Agreement shall each be
effective to create in favor of the Collateral Agent for the benefit of the
Collateral Agent and the lenders and agents parties to the Intercreditor
Agreement a legal, valid and enforceable first (except for Permitted Liens
entitled to priority under applicable law) priority security interest in and
Lien upon the Collateral. All filings, recordings, deliveries of instruments
and other actions necessary or desirable in the opinion of the Collateral Agent
to protect and preserve such security interests shall have been duly effected
and all such documents shall have been duly executed by Borrower and Parent.
The Collateral Agent shall have received evidence thereof in form and substance
satisfactory to the Collateral Agent.
(S)D. Search Reports and Related Documents.
------------------------------------
The Administrative Agent shall have received (i) such UCC, tax, patent,
trademark and judgment lien search reports with respect to such applicable
public offices where Liens are filed, as shall be acceptable to the
Administrative Agent, disclosing that there are no Liens of record in such
official's office covering any Collateral or showing Borrower or Parent as a
debtor thereunder other than those Liens listed on Schedule 8.2, (ii) a
------------
certificate of the Borrower and Parent signed by an authorized officer of each
thereof, dated the Closing Date, certifying that, as of the Closing Date, there
will exist no Liens on the Collateral other than Permitted Liens, and (iii) duly
executed UCC-1 financing statements with respect to the Collateral (other than
Pledged Collateral), to be filed in each office as determined by the
Administrative Agent.
(S)E. Certificates of Insurance.
-------------------------
<PAGE>
The Collateral Agent shall have received on the Closing Date (a) a
certificate of insurance from an independent insurance broker dated as of the
Closing Date, identifying insurers, types of insurance, insurance limits, and
policy terms, and otherwise describing the insurance obtained in accordance with
the provisions of the Borrower Security Agreement and (S)7.6 of this Loan
Agreement and (b) copies of all policies evidencing such insurance (with copies
certified by the applicable insurer(s) to be delivered to Collateral Agent
within thirty (30) days after the Closing Date) which shall contain provisions
naming the Collateral Agent as an additional insured and loss payee on behalf of
the lenders and agents parties to the Intercreditor Agreement as their
respective interests may appear, and providing for 30 days' prior written notice
to Administrative Agent of cancellation or diminishment.
(S)F. Solvency Certificate.
--------------------
Each of the Lenders and the Administrative Agent shall have received an
officer's certificate of Borrower and Parent dated as of the Closing Date as to
the Solvency of Borrower and Parent following the consummation of the
transactions contemplated herein and in form and substance satisfactory to the
Administrative Agent and Lenders.
(S)G. Opinions of Counsel to Borrower.
-------------------------------
Each of the Lenders and the Administrative Agent shall have received a
favorable legal opinion of Borrower's counsel addressed to the Lenders and the
Administrative Agent, dated as of the Closing Date, in form and substance
satisfactory to the Lenders and the Administrative Agent and substantially in
the form of Exhibit G hereto, addressing such matters as, without limitation,
---------
corporate good standing, authority and capacity to enter into the Loan Documents
to which Borrower is or will become a party thereto, perfection of security
interests and pledges, and the validity, binding nature and enforceability of
the Loan Documents to which Borrower is or will become a party.
(S)H. Opinions of Counsel to Parent.
-----------------------------
Each of the Lenders and the Administrative Agent shall have received a
favorable legal opinion of Parent's counsel addressed to the Lenders and
Administrative Agent, dated as of the Closing Date, in form and substance
satisfactory to the Lenders and Administrative Agent and substantially in the
form of Exhibit H hereto, addressing such matters as, without limitation,
---------
corporate good standing, authority and capacity to enter into the Loan Documents
to which Parent is or will become a party thereto, perfection of security
interests and pledges, and the validity, binding nature and enforceability of
the Loan Documents to which Parent is or will become a party.
(S)I. Opinion of FCC Counsel.
----------------------
<PAGE>
IN WITNESS WHEREOF, the undersigned have duly executed this Loan Agreement as a
sealed instrument as of the date first set forth above.
BORROWER:
--------
OMNIPIOINT COMMUNICATIONS INC.
By:
--------------------------------
Name: Harry Plonskier
Title: Vice President, Finance
ADMINISTRATIVE AGENT:
--------------------
NORTHERN TELECOM INC.
By:
--------------------------------
Name:
Title:
THE LENDERS:
-----------
NORTHERN TELECOM INC.
By:
--------------------------------
Name:
Title:
<PAGE>
No Material Adverse Effect shall have occurred, or could be reasonably
anticipated to occur with respect to Borrower and Parent since (a) the Balance
Sheet Date and (b) from that described in the Information, and the
Administrative Agent and each of the Lenders shall receive a certificate of the
Chief Financial Officer of Borrower and Parent dated the Closing Date to that
effect.
(S)O. Delivery of Approved Operating Business Plans.
---------------------------------------------
Borrower shall have delivered to Administrative Agent and each Lender
each of its (i) Initial Approved Annual Operating Business Plan and its (ii)
Approved Full Term Operating Business Plan, along with a certificate of its
Chief Financial Officer dated the Closing Date certifying as to the
reasonableness of the assumptions and expectations contained in each of (i) and
(ii) when made, and as of the Closing Date, and certifying that there are
presently no known facts which would make (i) and (ii) misleading in any
material respect, and attaching a copy of resolutions of the Board of Directors
of Borrower approving each of (i) and (ii), certified as true and correct and in
full force and effect as of the Closing Date by the Secretary of Borrower.
(Administrative Agent acknowledges satisfaction of the requirements of this
(S)9.15 prior to the date hereof)
(S)P. Representations and Warranties.
------------------------------
All representations and warranties shall be true and correct as of the
Closing Date in all material respects and Administrative Agent and each Lender
shall have received a certificate of the Chief Financial Officer of Borrower
dated the Closing Date to that effect.
(S)Q. No Conflicts.
------------
The Administrative Agent and each of the Lenders shall have received a
certificate of an authorized officer of Borrower and Parent to the effect that
the execution, delivery or carrying out of the terms of the Loan Documents to
which they are a party or the Supply Agreement or any other agreement between
the parties will not constitute a Default under, conflict with, require any
consent under (other than consents which have been obtained) or result in the
creation or imposition of, or obligation to create, any Lien upon the Collateral
of the Borrower or the Parent pursuant to the terms of any mortgage, indenture,
contract, agreement, judgment, decree or order, which defaults, conflicts and
consents, if not obtained, separately or taken as a whole, could reasonably be
expected to have a Material Adverse Effect.
(S)R. Delivery of Pledged Shares.
--------------------------
The Parent shall have delivered to the Collateral Agent under the
Intercreditor Agreement all pledged stock certificates representing all of the
issued and outstanding Stock of the
<PAGE>
Borrower owned by Parent, which shall not be less than 95.6% of all of
Borrower's issued and outstanding shares, together with stock powers executed in
blank.
(S)S. Material Agreements.
-------------------
The Administrative Agent and each of the Lenders shall have received a
copy of each agreement set forth on Schedule 9.19 attached hereto, and all other
-------------
Material Employment Agreements set forth on Schedule 1.3 attached hereto, and
------------
similar contracts and agreements, including, without limitation, those with the
key management personnel and categories of key officers or employees to be hired
listed on Schedule 8.10, hereto, including all amendments thereto.
-------------
(S)T. No Change in Control.
--------------------
No Change in Control shall have occurred from the Closing Date.
(S)U. Supply Agreement.
----------------
All representations and warranties contained in the Supply Agreement
shall be true and correct in all material respects and no Event of Default,
Default or breach shall have occurred or be continuing thereunder, and the
Administrative Agent and each Lender shall have received a certificate of the
Borrower's Chief Financial Officer to that effect dated the Closing Date.
(S)V. Assignment of Intellectual Property.
-----------------------------------
Borrower shall provide Collateral Agent with evidence reasonably
satisfactory to Collateral Agent that all material Intellectual Property
required for Borrower to operate its business is assignable to Collateral Agent
on behalf of the lenders and agents party to the Intercreditor Agreement
(subject to customary fees and charges);
(S)W. Other Documents.
---------------
The Administrative Agent, Collateral Agent and each Lender shall receive
all other documents, instruments and opinions from Borrower and Parent
(including opinions of counsel for Borrower and Parent) as Administrative Agent,
Collateral Agent and each Lender may reasonably request, in form and substance
satisfactory to Administrative Agent, Collateral Agent and each Lender and their
counsel, and which shall be in full force and effect on the date of the initial
disbursement under this Loan Agreement.
(S)X. CONDITIONS TO ALL BORROWINGS.
----------------------------
The obligations of the Lenders to make any Loan, including the initial
Loan, whether on or after the Closing Date, shall also be subject to the
satisfaction of the following conditions precedent:
<PAGE>
(S)A. Draw Request.
------------
The Administrative Agent shall have received a properly completed Draw
Request.
(S)B. Representations True; No Event of Default.
-----------------------------------------
Each of the representations and warranties of Borrower contained in this
Loan Agreement, the other Loan Documents or in any document or instrument
delivered pursuant to or in connection with this Loan Agreement shall be true as
of the date as of which they were made and shall also be true at and as of the
time of the making of such Loan with the same effect as if made at and as of
that time (except to the extent of changes resulting from transactions
contemplated or permitted by this Loan Agreement and the other Loan Documents
and changes occurring in the ordinary course of business that singly or in the
aggregate are not materially adverse, and to the extent that such
representations and warranties relate expressly to an earlier date) and no
Default or Event of Default shall have occurred and be continuing. The
Administrative Agent shall have received a certificate of an authorized officer
of Borrower to such effect.
(S)C. No Legal Impediment.
-------------------
No change shall have occurred in any law or regulations thereunder or
interpretations thereof that in the reasonable opinion of any Lender would make
it illegal for such Lender to make such Loan and no order of any court or
Governmental Body has been entered prohibiting the consummation of the
transactions contemplated by the Loan Documents.
(S)D. Governmental Regulation.
-----------------------
Each Lender shall have received such statements in substance and form
reasonably satisfactory to such Lender as such Lender shall require for the
purpose of compliance with any applicable regulations of the Comptroller of the
Currency or the Board of Governors of the Federal Reserve System.
(S)E. Proceedings and Documents.
-------------------------
All proceedings in connection with the transactions contemplated by this
Loan Agreement, the other Loan Documents and all other documents incident
thereto shall be satisfactory in substance and in form to the Lenders, the
Collateral Agent, the Administrative Agent and the Administrative Agent's
Special Counsel, and the Lenders, the Collateral Agent, the Administrative Agent
and such counsel shall have received all information and such counterpart
originals or certified or other copies of such documents as the Administrative
Agent or the Collateral Agent may reasonably request.
<PAGE>
(S)XI. EVENTS OF DEFAULT; ACCELERATION; ETC.
------------------------------------
(S)A. Events of Default and Acceleration.
----------------------------------
Upon the occurrence and during the continuance of any of the following
events after any applicable cure period, if any:
a. Borrower shall fail to pay (i) any principal of the Loans or the
Origination Fee when the same shall become due and payable, (ii) any interest on
the Loans or other sums hereunder or under any of the other Loan Documents to
which it is a party as and when due, or (iii) any mandatory prepayment of the
principal required under (S)3.2 hereof as and when due, whether at the stated
date of maturity or any accelerated date of maturity or at any other date fixed
for payment if such failure continues for three (3) consecutive days;
b. Borrower shall fail to comply with any of the covenants contained
in (S)(S)7.6, 7.15, 7.16, 7.18J, 7.18K, 7.18L, 7.18M, 7.18O, 7.19, 7.20 and
(S)(S)8.1-8.10 of the Loan Agreement;
c. Borrower shall fail to perform any term, covenant or agreement
contained herein or in any of the other Loan Documents (other than those
specified elsewhere in this (S)11.1) and such failure shall continue for a
period of thirty (30) days;
d. any representation or warranty under the Loan Agreement or any of
the other Loan Documents or in any other document or instrument delivered
pursuant to or in connection with this Loan Agreement or any Loan Document shall
prove to have been false in any material respect upon the date when made or
deemed to have been made or repeated;
e. Borrower shall commit a breach or Default under the Supply
Agreement which would entitle the Supplier thereunder to exercise its remedies
under Section 12 thereunder and which is not cured within ten (10) Business Days
thereunder;
f. Borrower shall (i) make an assignment for the benefit of
creditors, or (ii) admit in writing its inability to generally pay or generally
fail to pay its debts as they mature or become due, or (iii) petition or apply
for the appointment of a trustee or other custodian, liquidator or receiver of
Borrower or of any substantial part of the assets of Borrower or (iv) shall
commence any case or other proceeding relating to Borrower under any bankruptcy,
reorganization, arrangement, insolvency, readjustment of debt, dissolution or
liquidation or similar law of any jurisdiction providing for the relief of
debtors, now or hereafter in effect, or (v) shall take any action to authorize
or in furtherance of any of the foregoing, or if any such petition or
application shall be filed or any such case or other proceeding shall be
commenced against Borrower and the Borrower shall indicate
<PAGE>
its approval thereof, consent thereto or acquiescence therein or shall not be
able to have such proceeding dismissed within thirty (30) days thereof;
g. a default or an event or circumstance which with notice or lapse
of time or both would become a default shall have occurred or an event or
circumstance which with notice of lapse of time or both would become a default
shall have occurred under any other obligation of Borrower for borrowed money
permitted hereunder for an amount in excess of $5 million, the result of which
is that the holder or holders to whom such Indebtedness is owed has the right
under the governing documents to accelerate such Indebtedness;
h. there shall remain in force, undischarged, unsatisfied and
unstayed, for more than thirty (30) consecutive days, any judgment against
Borrower that, exceeds $1,000,000 net of insurance proceeds, if any, or any such
judgment shall not have been bonded pending appeal within thirty (30) days of
the entry thereof;
i. any of the Loan Documents shall be cancelled, terminated, revoked
or rescinded otherwise than in accordance with the terms thereof or with the
express prior written agreement, consent or approval of the Lenders, or any
action at law, suit or in equity or other legal proceeding to cancel, revoke or
rescind any of the Loan Documents shall be commenced by or on behalf of the
Borrower or any of its stockholders, or any court or any other governmental or
regulatory authority or agency of competent jurisdiction shall make a
determination that, or issue a judgment, order, decree or ruling to the effect
that, any one or more of the Loan Documents is illegal, invalid or unenforceable
in accordance with the terms thereof;
j. with respect to any Guaranteed Pension Plan, an ERISA Event shall
have occurred and the Required Lenders shall have determined in their reasonable
discretion that such event reasonably could be expected to result in liability
of Borrower to the PBGC or such Guaranteed Pension Plan in an aggregate amount
exceeding $250,000 and such event in the circumstances occurring reasonably
could constitute grounds for the termination of such Guaranteed Pension Plan by
the PBGC or for the appointment by the appropriate United States District Court
of a trustee to administer such Guaranteed Pension Plan; or a trustee shall have
been appointed by the United States District Court to administer such Plan; or
the PBGC shall have instituted proceedings to terminate such Guaranteed Pension
Plan; or appointed a trustee to administer or liquidate any plan;
k. the Borrower shall be the subject of writs of attachment or
garnishment and the like that might have a Material Adverse Effect and that are
unstayed for a period of thirty (30) consecutive days or any such attachment
shall not have been bonded
<PAGE>
over within thirty (30) days of the entry thereof;
l. the Insolvency of Borrower or Parent;
m. the FCC or any other Governmental Body cancels, revokes or
suspends any of Borrower's material Licenses for the New York PCS Network or
fails to renew any such License or Licenses;
n. the FCC or any other Governmental Body commences any proceeding to
cancel, revoke or suspend any of Borrower's material Licenses for the New York
PCS Network which proceeding for the cancellation, revocation or suspension (i)
could reasonably be expected to have a Material Adverse Effect and (ii) has not
been stayed or enjoined by Borrower within five (5) business days of the
commencement of any such proceeding;
o. Borrower shall fail to pay when due amounts owing the FCC unless
(i) Borrower's failure to pay can reasonably be expected, in the sole judgment
of Administrative Agent, not to result in any cancellation, revocation or
suspension of Borrower's License for the New York PCS Network or (ii) Borrower
has obtained a stay or injunction against any action by the FCC to cancel,
revoke or suspend such License notwithstanding Borrower's failure to pay;
p. an Event of Default shall have occurred under the Notes, the
Security Agreement, the Pledge Agreement or any other Loan Document;
q. a Change in Control has occurred;
Then, and in any such event, so long as the same may be continuing, the
Administrative Agent may, and upon the request of the Required Lenders shall, by
notice in writing to Borrower (i) declare the obligation of each Lender to make
Loans to be terminated, whereupon the same shall forthwith terminate and/or (ii)
declare all amounts owing with respect to this Loan Agreement, the Notes and the
other Loan Documents to be, and they shall thereupon forthwith become,
immediately due and payable without presentment, demand, protest or other notice
of any kind, all of which are hereby expressly waived by Borrower; provided that
--------
in the event of any Event of Default specified in (S)11.1(f) all such amounts
shall become immediately due and payable automatically and without any
requirement of notice from the Administrative Agent or any Lender.
(S)B. Remedies.
--------
Upon the occurrence of an Event of Default under the Loan Documents, the
Collateral Agent, subject to the provisions of the Intercreditor Agreement shall
have the right to exercise its remedies under the Borrower Security Agreement,
the Pledge Agreement and the Guaranty Agreement, and/or as allowed under
applicable law.
<PAGE>
In case any one or more of the Events of Default shall have occurred and be
continuing, and whether or not the Required Lenders shall have accelerated the
maturity of the Loans pursuant to (S)11.1, each Lender, if owed any amount with
respect to the Loans may, with the consent of the Required Lenders but not
otherwise, proceed to protect and enforce its rights by suit in equity, action
at law or other appropriate proceeding, whether for the specific performance of
any covenant or agreement contained in this Loan Agreement and the other Loan
Documents or any instrument pursuant to which the Borrower's Obligations to such
Lender are evidenced, including as permitted by applicable law the obtaining of
the ex parte appointment of a receiver, and, if such amount shall have become
--------
due, by declaration or otherwise, proceed to enforce the payment thereof or any
other legal or equitable right of such Lender. No remedy herein conferred upon
any Lender or the Administrative Agent or the Collateral Agent or the holder of
any Note is intended to be exclusive of any other remedy and each and every
remedy shall be cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by statute or any
other provision of law.
(S)C. Distribution of Collateral Proceeds.
-----------------------------------
In the event that, following the occurrence or during the continuance of
any Default or Event of Default and subject to the provisions of any applicable
Intercreditor Agreement, the Administrative Agent or any Lender, as the case may
be, receives any monies in connection with the enforcement of the Borrower
Security Agreement, the Pledge Agreement and the Guaranty Agreement or otherwise
with respect to the realization upon any of the Collateral, such monies shall be
distributed for application as follows:
a. First, to the payment of, or (as the case may be) the
reimbursement of the Administrative Agent for or in respect of all reasonable
costs, expenses, disbursements and losses which shall have been incurred or
sustained by the Administrative Agent in connection with the collection of such
monies by the Administrative Agent, for the exercise, protection or enforcement
by the Administrative Agent of all or any of the rights, remedies, powers and
privileges of the Administrative Agent under this Loan Agreement or any of the
other Loan Documents or in respect of the Collateral or in support of any
provision of adequate indemnity to the Administrative Agent against any taxes or
liens which by law shall have, or may have, priority over the rights of the
Administrative Agent to such monies;
b. Second, to all other Borrower Obligations in such order or
preference as the Required Lenders may determine; provided, however, that
-------- -------
distributions in respect of such Borrower Obligations to the Lenders with
respect to each type of Borrower Obligation such as interest, principal, fees
and expenses, shall be
<PAGE>
made among the Lenders pro rata; and provided, further, that the Administrative
-------- -------- -------
Agent may in its discretion make proper allowance to take into account any
Borrower Obligations not then due and payable;
c. Third, upon payment and satisfaction in full or other
provisions for payment in full satisfactory to the Lenders and the
Administrative Agent of all of the Borrower Obligations, to the payment of any
obligations required to be paid pursuant to (S)9-504(1)(c) of the Uniform
Commercial Code of the State of New York; and
d. Fourth, the excess, if any, shall be returned to Borrower or
to such other Persons as are entitled thereto.
(S)XII. SETOFF.
------
Regardless of the adequacy of any Collateral, during the continuance of any
Event of Default, any deposits or other sums credited by or due from any of the
Lenders to Borrower and any securities or other property of Borrower in the
possession of such Lender may be applied to or set off by such Lender against
the payment of Borrower's Obligations and any and all other liabilities, direct,
or indirect, absolute or contingent, due or to become due, now existing or
hereafter arising, of such Borrower to such Lender. Each of the Lenders agrees
with each other Lender that (a) if an amount to be set off is to be applied to
Indebtedness of Borrower to such Lender, other than Indebtedness evidenced by
the Notes held by such Lender, such amount shall be applied ratably to such
other Indebtedness and to the Indebtedness evidenced by all such Notes held by
such Lender, and (b) if such Lender shall receive from Borrower, whether by
voluntary payment, exercise of the right of setoff, counterclaim, cross action,
enforcement of the claim evidenced by the Notes held by such Lender by
proceedings against Borrower at law or in equity or by proof thereof in
bankruptcy, reorganization, liquidation, receivership or similar proceedings, or
otherwise, and shall retain and apply to the payment of the Note or Notes held
by such Lender any amount in excess of its ratable portion of the payments
received by all of the Lenders with respect to the Notes held by such Lender
will make such disposition and arrangements with the other Lenders with respect
to such excess, either by way of distribution, pro tanto assignment of claims,
--- -----
subrogation or otherwise as shall result in each Lender receiving in respect of
the Notes held by it, its proportionate payment as contemplated by this Loan
Agreement; provided that if all or any part of such excess payment is thereafter
--------
recovered from such Lender, such disposition and arrangements shall be rescinded
and the amount restored to the extent of such recovery, but without interest.
(S)XIII. THE ADMINISTRATIVE AGENT.
------------------------
(S)A. Authorization.
-------------
<PAGE>
The Administrative Agent is authorized to take such action on behalf of
each of the Lenders and to exercise all such powers as are hereunder and under
any of the other Loan Documents and any related documents delegated to the
Administrative Agent, together with such powers as are reasonably incident
thereto, provided that no duties or responsibilities not expressly assumed
--------
herein or therein shall be implied to have been assumed by the Administrative
Agent and provided further that wherever the determination, consent or approval
-------- -------
(and the like) of the Administrative Agent is required by any of the Loan
Documents, the Administrative Agent may agree with the Lenders (which agreement
shall not modify the terms of this Loan Agreement or the other Loan Documents)
that Administrative Agent will make determinations or grant or deny such
consents or approvals as directed by the Required Lenders. The relationship
between the Administrative Agent and the Lenders is and shall be that of agent
and principal only, and nothing contained in this Loan Agreement or any of the
other Loan Documents shall be construed to constitute the Administrative Agent
as a trustee for any Lender.
(S)B. Employees and Administrative Agents.
-----------------------------------
The Administrative Agent may exercise its powers and execute its duties
by or through employees or agents and shall be entitled to take, and to rely on,
advice of counsel concerning all matters pertaining to its rights and duties
under this Loan Agreement and the other Loan Documents. The Administrative Agent
may utilize the services of such Persons as the Administrative Agent in its sole
discretion may reasonably determine and all reasonable fees and expenses of any
such Persons shall be paid by Borrower.
(S)C. No Liability.
------------
Neither the Administrative Agent nor any of its shareholders, directors,
officers or employees nor any other Person assisting them in their duties nor
any agent or employee thereof, shall be liable for any waiver, consent or
approval given or any action taken, or omitted to be taken, in good faith by it
or them hereunder or under any of the other Loan Documents, or in connection
herewith or therewith, or be responsible for the consequences of any oversight
or error of judgment whatsoever, except that the Administrative Agent or such
other Person, as the case may be, may be liable for losses due to its willful
misconduct or gross negligence.
(S)D. No Representations.
------------------
The Administrative Agent shall not be responsible for the execution or
validity or enforceability of this Loan Agreement, the Notes, any of the other
Loan Documents or any instrument at any time constituting, or intended to
constitute, collateral security for the Notes, or for the value of any such
collateral security or
<PAGE>
for the validity, enforceability or collectability of any such amounts owing
with respect to the Notes, or for any recitals or statements, warranties or
representations made herein or in any of the other Loan Documents or in any
certificate or instrument hereafter furnished to it by or on behalf of Borrower
or be bound to ascertain or inquire as to the performance or observance of any
of the terms, conditions, covenants or agreements herein or in any instrument at
any time constituting, or intended to constitute, collateral security for the
Notes or to inspect any of the properties, books or records of Borrower. The
Administrative Agent shall not be bound to ascertain whether any notice,
consent, waiver or request delivered to it by Borrower or any holder of any of
the Notes shall have been duly authorized or is true, accurate and complete. The
Administrative Agent has not made nor does it now make any representations or
warranties, express or implied, nor does it assume any liability to the Lenders,
with respect to the creditworthiness or financial conditions of Borrower. Each
Lender acknowledges that it has, independently and without reliance upon the
Administrative Agent or any other Lender, and based upon such information and
documents as it has deemed appropriate, made its own credit analysis and
decision to enter into this Loan Agreement.
(S)E. Payments.
--------
a. A payment by Borrower to the Administrative Agent hereunder or any
of the other Loan Documents for the account of any Lender shall constitute a
payment to such Lender. The Administrative Agent agrees promptly to distribute
to each Lender such Lender's pro rata share of payments received by the
--- ----
Administrative Agent for the account of the Lenders except as otherwise
expressly provided herein or in any of the other Loan Documents.
b. If in the reasonable opinion of the Administrative Agent the
distribution of any amount received by it in such capacity hereunder, under the
Notes or under any of the other Loan Documents might involve it in liability, it
may refrain from making distribution until its right to make distribution shall
have been adjudicated by a court of competent jurisdiction, or until the
Administrative Agent in its sole opinion determines that it is not subject to
liability. If a court of competent jurisdiction shall adjudge that any amount
received and distributed by the Administrative Agent is to be repaid, each
Person to whom any such distribution shall have been made shall either repay to
the Administrative Agent its proportionate share of the amount so adjudged to be
repaid or shall pay over the same in such manner and to such Persons as shall be
determined by such court. The Administrative Agent shall pay to the Lenders
interest at the rate calculated in accordance with (S)2.6 on such amounts that
were withheld promptly after the Administrative Agent receives payment in full
of such amounts.
c.
<PAGE>
Notwithstanding anything to the contrary contained in this Loan
Agreement or any of the other Loan Documents, any Lender that fails (i) to make
available to the Administrative Agent its pro rata share of any Loan or (ii) to
--------
comply with the provisions of (S)12 with respect to making dispositions and
arrangements with the other Lenders, where such Lender's share of any payment
received, whether by setoff or otherwise, is in excess of its pro rata share of
--------
such payments due and payable to all of the Lenders, in each case as, when and
to the full extent required by the provisions of this Loan Agreement, shall be
deemed delinquent (a "Delinquent Lender") and shall be deemed a Delinquent
Lender until such time as such delinquency is satisfied. A Delinquent Lender
shall be deemed to have assigned any and all payments due to it from Borrower,
whether on account of outstanding Loans, interest, fees or otherwise, to the
remaining nondelinquent Lenders for application to, and reduction of, their
respective pro rata shares of all outstanding Loans. The Delinquent Lender
--------
hereby authorizes the Administrative Agent to distribute such payments to the
nondelinquent Lenders in proportion to their respective pro rata shares of all
--------
outstanding Loans. A Delinquent Lender shall be deemed to have satisfied in full
a delinquency when and if, as a result of application of the assigned payments
to all outstanding Loans of the nondelinquent Lenders, the Lenders' respective
pro rata shares of all outstanding Loans have returned to those in effect
- --------
immediately prior to such delinquency and without giving effect to the
nonpayment causing such delinquency.
(S)F. Holders of Notes.
----------------
The Administrative Agent may deem and treat the payee of any Note as the
absolute owner or purchaser thereof for all purposes hereof until it shall have
been furnished in writing with a different name by such payee or by a subsequent
holder, assignee or transferee.
(S)G. Indemnity.
---------
The Lenders ratably agree hereby to indemnify and hold harmless the
Administrative Agent from and against any and all claims, actions and suits
(whether groundless or otherwise), losses, damages, costs, expenses (including
any expenses for which the Administrative Agent has not been reimbursed by
Borrower as required by (S)14), and liabilities of every nature and character
arising out of or related to this Loan Agreement, the Notes, or any of the other
Loan Documents or the transactions contemplated or evidenced hereby or thereby,
or the Administrative Agent's actions taken hereunder or thereunder, except to
the extent that any of the same shall be directly caused by the Administrative
Agent's willful misconduct or gross negligence.
(S)H. Administrative Agent as Lender.
------------------------------
In its individual capacity, NTI shall have the same
<PAGE>
obligations and the same rights, powers and privileges in respect to its
Commitment and the Loans made by it, and as the holder of any of the Notes, as
it would have were it not also the Administrative Agent.
(S)I. Resignation or Removal.
----------------------
The Administrative Agent may resign at any time by giving sixty (60)
days' prior written notice thereof to the Lenders and Borrower. Upon any such
resignation, the Required Lenders shall have the right to appoint a successor
Administrative Agent. Unless a Default or Event of Default shall have occurred
and be continuing, such successor Administrative Agent shall be reasonably
acceptable to Borrower. If no successor Administrative Agent shall have been so
appointed by the Required Lenders and shall have accepted such appointment
within thirty (30) days after the retiring Administrative Agent's giving of
notice of resignation, then the retiring Administrative Agent may, on behalf of
the Lenders, appoint a successor Administrative Agent, which shall be a
financial institution having a rating of not less than A-1 or its equivalent by
Standard & Poor's Corporation or P-1 Moody's Investors Services, Inc. Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent, such successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Administrative Agent, and the retiring Administrative Agent
shall be discharged from its duties and obligations hereunder. After any
retiring Administrative Agent's resignation, the provisions of this Loan
Agreement and the other Loan Documents shall continue in effect for its benefit
in respect of any actions taken or omitted to be taken by it while it was acting
as Administrative Agent. The Administrative Agent may be removed by the Required
Lenders for cause if the Administrative Agent shall fail in a material way to
perform its duties hereunder and the provisions of this (S)13.9 shall apply to
the appointment of a successor Administrative Agent.
(S)J. Notification of Defaults and Events of Default.
----------------------------------------------
Each Lender hereby agrees that, upon learning of the existence of a
Default or an Event of Default, it shall promptly notify the Administrative
Agent and the Collateral Agent thereof. The Administrative Agent hereby agrees
that upon receipt of any notice under this (S)13.10 it shall promptly notify the
other Lenders and the Collateral Agent of the existence of such Default or Event
of Default.
(S)K. Duties in the Case of Enforcement.
---------------------------------
Except to the extent otherwise provided for in the Intercreditor
Agreement, in case one of more Events of Default have occurred and shall be
continuing, and whether or not acceleration of the Borrower's Obligations shall
have occurred, the
<PAGE>
Administrative Agent shall, subject to the provisions of the Intercreditor
Agreement, the Borrower Security Agreement, the Pledge Agreement and the
Guaranty Agreement if (a) so requested by the Required Lenders and (b) the
Lenders have provided to the Administrative Agent such additional indemnities
and assurances against expenses and liabilities as the Administrative Agent may
reasonably request, proceed to enforce the provisions of the Borrower Security
Agreement, the Pledge Agreement or the Guaranty Agreement authorizing the sale
or other disposition of all or any part of the Collateral and exercise all or
any such other legal and equitable and other rights or remedies as it may have
in respect of such Collateral. Subject to the Intercreditor Agreement, the
Required Lenders may direct the Administrative Agent in writing as to the method
and the extent of any such sale or other disposition, the Lenders hereby
agreeing to indemnify and hold the Administrative Agent harmless from all
liabilities incurred in respect of all actions taken or omitted in accordance
with such directions, provided that the Administrative Agent need not comply
--------
with any such direction to the extent that the Administrative Agent reasonably
believes the Administrative Agent's compliance with such direction to be
unlawful or commercially unreasonable in any applicable jurisdiction.
(S)XIV. EXPENSES.
--------
Borrower agrees to pay (a) the costs of producing and reproducing this Loan
Agreement, the other Loan Documents and the other agreements and instruments
mentioned herein, (b) any taxes (including any interest and penalties in respect
thereto) payable by the Administrative Agent or any of the Lenders (other than
taxes based upon the Administrative Agent's or any Lender's net income) on or
with respect to the transactions contemplated by this Loan Agreement (Borrower
hereby agreeing to indemnify the Administrative Agent and each Lender with
respect thereto), (c) the reasonable fees, expenses and disbursements of the
Administrative Agent's Special Counsel or any counsel to the Administrative
Agent incurred in connection with the structuring, negotiation, drafting,
preparation, execution, delivery, administration and/or interpretation of the
Loan Documents and other instruments mentioned herein, each closing hereunder,
and all amendments, modifications, approvals, consents, waivers and other post-
closing matters or in the enforcement or protection of rights hereto or
hereunder, (d) the fees, expenses and disbursements of the Administrative Agent
incurred in connection with the structuring, negotiation, drafting, preparation,
execution, delivery, administration or interpretation of the Loan Documents and
other instruments mentioned herein, and all amendments, modifications,
approvals, consents, waivers and other post-closing matters, or in the
enforcement or protection of its rights, (e) all out-of-pocket expenses
(including without limitation reasonable attorneys' fees and costs, which
attorneys may be employees of any Lender or the Administrative Agent (provided
--------
that, such fees are reasonably comparable to fees customarily charged by outside
- ----
counsel) and
<PAGE>
reasonable consulting, accounting, appraisal, investment banking and similar
professional fees and charges) incurred by any Lender or the Administrative
Agent in connection with (i) the enforcement of or preservation of rights under
any of the Loan Documents against Borrower or the administration thereof after
the occurrence of a Default or Event of Default (including engineering,
appraiser and investment banking charges) and (ii) any litigation, proceeding or
dispute whether arising hereunder or otherwise, in any way related to any
Lender's or the Administrative Agent's relationship with Borrower, provided,
--------
however, that the Borrower will not be obligated to reimburse Lender or the
- -------
Administrative Agent under this subparagraph (e)(ii) to this (S)14, if and only
if, a court of competent jurisdiction enters a final nonappealable judgment
determining that the litigation, proceeding or dispute commenced by the Lender
or the Administrative Agent was not warranted by existing law or by a
nonfrivolous argument for the extension, modification or reversal of existing
law or the establishment of new law and that the factual allegations of the
Lender or the Administrative Agent did not and were not likely to have
evidentiary support after reasonable opportunity for further investigation or
discovery, and (f) all closing or signing costs, including stamp or registration
costs and related taxes and charges, and all fees, expenses and disbursements of
any Lender or the Administrative Agent incurred in connection with UCC and other
lien searches and UCC filings. The covenants of this (S)14 shall survive payment
or satisfaction of payment of amounts owing with respect to the Notes.
Borrower shall also pay all reasonable out-of-pocket costs and expenses
(including, without limitation, the reasonable fees and disbursements of counsel
to the Administrative Agent incurred by Administrative Agent and/or each Lender
in connection with (i) verification of the Information, and (ii) due diligence
with respect to Borrower and its Parent.
(S)XV. INDEMNIFICATION.
---------------
Borrower agrees to indemnify and hold harmless the Collateral Agent, the
Administrative Agent and the Lenders, the respective Affiliates of the
Collateral Agent, Administrative Agent and the Lenders, and the respective
officers, directors, employees, agents (including, without limitation each of
their counsel and with respect to the Collateral Agent, reasonable allocated
costs and expenses of in-house counsel and legal staff), and controlling persons
of the Collateral Agent, Administrative Agent and each Lender and each such
Affiliate (each, an "Indemnified Party") from and against any and all claims,
actions and suits whether groundless or otherwise, and from and against any and
all liabilities, losses, damages and costs and expenses (including, without
limitation, the reasonable fees and disbursements of counsel) of every nature
and character arising out of or in connection with any actual or threatened
claim, litigation, investigation or proceeding relating to this Loan Agreement
or any
<PAGE>
of the other Loan Documents or the transactions contemplated hereby excluding,
however, any such actions or expenses resulting from the gross negligence or
willful misconduct of the Collateral Agent, the Administrative Agent or the
Lenders, but including, without limitation, (a) any actual or proposed use by
Borrower of the proceeds of any of the Loans, (b) any actual or alleged
infringement of any patent, copyright, trademark, service mark or similar right
of Borrower comprised in the Collateral, (c) Borrower entering into or
performing this Loan Agreement or any of the other Loan Documents or (d) with
respect to Borrower and its properties and assets, the violation of any
Environmental Law, the presence, disposal, escape, seepage, leakage, spillage,
discharge, emission, release or threatened release of any Materials of
Environmental Concern or any action, suit, proceeding or investigation brought
or threatened with respect to any Materials of Environmental Concern (including,
but not limited to, claims with respect to wrongful death, personal injury or
damage to property), in each case including, without limitation, the reasonable
fees and disbursements of counsel and allocated costs of internal counsel
incurred in connection with any such investigation, litigation or other
proceeding whether or not such Indemnified Party is a party thereto, and
Borrower agrees to reimburse each Indemnified Party, upon demand, for all
out-of-pocket costs and expenses (including, without limitation, the reasonable
fees and disbursements of counsel) incurred in connection with any of the
foregoing. In litigation, or the preparation therefor, the Collateral Agent, the
Lenders and the Administrative Agent shall be entitled to select their own
counsel and, in addition to the foregoing indemnity, Borrower agrees to pay
promptly the reasonable fees and expenses of such counsel. If, and to the extent
that the obligations of Borrower under this (S)15 are unenforceable for any
reason, Borrower hereby agrees to make the maximum contribution to the payment
in satisfaction of such obligations which is permissible under applicable law.
Borrower shall not make any claim against any Indemnified Party for any
special, indirect or consequential damages in respect of any breach or wrongful
conduct (whether the claim therefor is based in contract, tort or duty imposed
by law) in connection with, arising out of or in any way related to the
transactions contemplated by, and the relationship established by, the Loan
Documents, or any act, omission or event occurring in connection therewith, and
Borrower and Parent hereby waive, release and agree not to sue upon any such
claim for any such damages, whether or not accrued and whether or not known or
suspected to exist in Borrower's or Parent's favor.
The covenants contained in this (S)15 shall survive payment or
satisfaction in full of all other of the Borrower's Obligations.
(S)XVI. SURVIVAL OF COVENANTS, ETC.
--------------------------
All covenants, agreements, representations and warranties made herein, in the
Notes, in any of the other Loan Documents or in any
<PAGE>
documents or other papers delivered by or on behalf of Borrower or Parent
pursuant hereto shall be deemed to have been relied upon by the Lenders and the
Administrative Agent, notwithstanding any investigation heretofore or hereafter
made by any of them, and shall survive the making by the Lenders of any of the
Loans, as herein contemplated, and shall continue in full force and effect so
long as any amount due under this Loan Agreement or the Notes or any of the
other Loan Documents remains outstanding or any Lender has any obligation to
make any Loans and for such further time as may be otherwise expressly specified
in this Loan Agreement. All statements contained in any certificate or other
paper delivered to any Lender or the Administrative Agent at any time by or on
behalf of Borrower or pursuant hereto or in connection with the transactions
contemplated hereby shall constitute representations and warranties by Borrower
or Parent hereunder.
(S)XVII. ASSIGNMENT AND PARTICIPATION.
----------------------------
(S)A. Conditions to Assignment by Lenders.
-----------------------------------
Except as provided herein, each Lender may assign to one or more
assignees (each, an "Eligible Assignee") all or a portion of its interests,
rights and obligations under this Loan Agreement (including all or a portion of
its Commitment Percentage and its Lender's Commitment and the same portion of
the Loans at the time owing to it and the Notes held by it); provided that:
--------
(a) each such assignment shall be of a constant, and not a varying, percentage
of all the assigning Lender's rights and obligations under this Loan Agreement,
(b) the parties to such assignment shall execute and deliver to the
Administrative Agent, for recording in the Register (as hereinafter defined), an
Assignment and Acceptance, substantially in the form of Exhibit D hereto (an
---------
"Assignment and Acceptance"), together with any Notes subject to such
assignment. At no time shall Administrative Agent or any Lender assign any of
their respective rights to a competitor of the Borrower. Upon such execution,
delivery, acceptance and recording, from and after the effective date specified
in each Assignment and Acceptance, which effective date shall be at least five
(5) Business Days after the execution thereof, (i) the assignee thereunder shall
be a party hereto and, to the extent provided in such Assignment and Acceptance,
have the rights and obligations of a Lender hereunder, and (ii) the assigning
Lender shall, to the extent provided in such assignment and upon payment to the
Administrative Agent of the registration fee referred to in (S)17.3, be released
from its obligations under this Loan Agreement and under the Intercreditor
Agreement accruing after the date of such assignment.
(S)B. Certain Representations and Warranties; Limitations; Covenants.
--------------------------------------------------------------
By executing and delivering an Assignment and Acceptance, the parties to
the assignment thereunder confirm to and agree with each
<PAGE>
other and the other parties hereto as follows: (a) other than the representation
and warranty that it is the legal and beneficial owner of the interest being
assigned thereby free and clear of any adverse claim, the assigning Lender makes
no representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Loan Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Loan Agreement, the other Loan
Documents or any other instrument or document furnished pursuant hereto; (b) the
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to the financial condition of Borrower or any other
Person primarily or secondarily liable in respect of any of the Borrower's
Obligations, or the performance or observance by Borrower or any other Person
primarily or secondarily liable in respect of any of the Borrower's Obligations
or any of their obligations under this Loan Agreement or any of the other Loan
Documents or any other instrument or document furnished pursuant hereto or
thereto; (c) such assignee confirms that it has received a copy of this Loan
Agreement and the Intercreditor Agreement, together with copies of the most
recent financial statements referred to in (S)6.4 and (S)7.18 and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Acceptance; (d) such
assignee will, independently and without reliance upon the assigning Lender, the
Administrative Agent or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Loan Agreement; (e)
such assignee represents and warrants that it is an Eligible Assignee; (f) such
assignee appoints and authorizes the Administrative Agent to take such action as
agent on its behalf and to exercise such powers under this Loan Agreement and
the other Loan Documents as are delegated to the Administrative Agent by the
terms hereof or thereof, together with such powers as are reasonably incidental
thereto; (g) such assignee agrees that it will perform in accordance with their
terms all of the obligations that by the terms of this Loan Agreement and the
Intercreditor Agreement are required to be performed by it as a Lender; and (h)
such assignee represents and warrants that it is legally authorized to enter
into such Assignment and Acceptance.
(S)C. Register.
--------
The Administrative Agent shall maintain a copy of each Assignment and
Acceptance delivered to it and a register or similar list (the "Register") for
the recordation of the names and addresses of the Lenders and the Commitment
Percentage of, and principal amount of the Loans owing to the Lenders from time
to time. The entries in the Register shall be conclusive, in the absence of
manifest error, and Borrower, the Administrative Agent and the Lenders may treat
each Person whose name is recorded in the Register as a Lender hereunder for all
purposes of this Loan
<PAGE>
Agreement. The Register shall be available for inspection by Borrower and the
Lenders at any reasonable time and from time to time upon reasonable prior
notice. Upon each such recordation, the assigning Lender agrees to pay to the
Administrative Agent a registration fee in the sum of $1,000.
(S)D. New Notes.
---------
Upon its receipt of an Assignment and Acceptance executed by the parties
to such assignment, together with each Note subject to such assignment, the
Administrative Agent shall (a) record the information contained therein in the
Register, and (b) give prompt notice thereof to Borrower and the Lenders (other
than the assigning Lender). Within five (5) Business Days after receipt of such
notice, Borrower, at its own expense, shall execute and deliver to the
Administrative Agent, in exchange for each surrendered Note, a new Note to the
order of such Eligible Assignee in an amount equal to the amount assumed by such
Eligible Assignee pursuant to such Assignment and Acceptance and, if the
assigning Lender has retained some portion of its obligations hereunder, a new
Note to the order of the assigning Lender in an amount equal to the amount
retained by it hereunder. Such new Notes shall provide that they are
replacements for the surrendered Note, shall be in an aggregate principal amount
equal to the aggregate principal amount of the surrendered Note, shall be dated
the effective date of such Assignment and Acceptance and shall otherwise be in
substantially the form of the assigned Notes. Within five (5) days of issuance
of any new Notes pursuant to this (S)17.4 Borrower shall deliver an opinion of
counsel, addressed to the Lenders and the Administrative Agent, relating to the
due authorization, execution and delivery of such new Notes and the legality,
validity and binding effect thereof, in form and substance satisfactory to the
Lenders. The surrendered Notes shall be cancelled and returned to Borrower.
(S)E. Participations.
--------------
Each Lender may sell participations to one or more banks or other
entities in all or a portion of such Lender's rights and obligations under this
Loan Agreement and the other Loan Documents; provided that (a) each such
--------
participation shall be in an amount of not less than $3,500,000, (b) any such
sale or participation shall not affect the rights and duties of the selling
Lender hereunder to Borrower, and (c) the only rights granted to the participant
pursuant to such participation arrangements with respect to waivers, amendments
or modifications of the Loan Documents shall be the rights to approve waivers,
amendments or modifications that would reduce the principal of or the interest
rate on any Loans, extend the term or increase the amount of the Commitment of
such Lender as it relates to such participant or extend any regularly scheduled
payment date for principal or interest.
(S)F. Disclosure.
----------
<PAGE>
Borrower agrees that in addition to disclosures made in accordance with
standard and customary banking practices any Lender may disclose information
obtained by such Lender pursuant to this Loan Agreement to assignees or
participants and potential assignees or participants hereunder; provided that
--------
such assignees or participants or potential assignees or participants shall
agree (a) to treat in confidence such information, (b) not to disclose such
information to a third party, and (c) not to make use of such information for
purposes of transactions unrelated to such contemplated assignment or
participation.
(S)G. Assignee or Participant Affiliated with any of Borrower.
-------------------------------------------------------
If any assignee Lender is an Affiliate of Borrower, then any such
assignee Lender shall have no right to vote as a Lender hereunder or under any
of the other Loan Documents for purposes of granting consents or waivers or for
purposes of agreeing to amendments or other modifications to any of the Loan
Documents or for purposes of making requests to the Administrative Agent
pursuant to (S)11.1 or (S)11.2, and the determination of the Required Lenders
shall for all purposes of this Agreement and the other Loan Documents be made
without regard to such assignee Lender's interest in any of the Loans. If any
Lender sells a participating interest in any of the Loans to a participant, and
such participant is a Borrower or an Affiliate of a Borrower, then such
transferor Lender shall promptly notify the Administrative Agent of the sale of
such participation. A transferor Lender shall have no right to vote as a Lender
hereunder or under any of the other Loan Documents for purposes of granting
consents or waivers or for purposes of agreeing to amendments or modifications
to any of the Loan Documents or for purposes of making requests to the
Administrative Agent pursuant to (S)11.1 or (S)11.2 to the extent that such
participation is beneficially owned by such Borrower or any Affiliate of such
Borrower, and the determination of the Required Lenders shall for all purposes
of this Agreement and the other Loan Documents be made without regard to the
interest of such transferor Lender in the Loans to the extent of such
participation.
(S)H. Miscellaneous Assignment Provisions.
-----------------------------------
If any assignee Lender is not incorporated under the laws of the United
States of America or any state thereof, it shall, prior to the date on which any
interest or fees are payable hereunder or under any of the other Loan Documents
for its account, deliver to Borrower and the Administrative Agent certification
as to its exemption from deduction or withholding of any United States federal
income taxes. Anything contained in this (S)17 to the contrary notwithstanding,
any Lender may at any time pledge all or any portion of its interest and rights
under this Loan Agreement (including all or any portion of its Notes) to any of
the twelve Federal Reserve Lenders organized under (S)4 of the Federal Reserve
Act, 12 U.S.C. (S)341. No such pledge or the enforcement thereof shall release
the pledgor Lender from its obligations hereunder or
<PAGE>
under any of the other Loan Documents.
(S)I. No Assignment by Borrower.
-------------------------
Borrower shall not assign or transfer any of its rights or obligations
under any of the Loan Documents.
(S)XVIII. LENDER'S AND ADMINISTRATIVE AGENT'S RELATIONSHIP TO BORROWER.
------------------------------------------------------------
Borrower (and not the Administrative Agent or any Lender) has the sole
responsibility for the operation, control and management of the business of the
Borrower, and the Administrative Agent's and each Lender's rights under the Loan
Documents are only those of Administrative Agent to the Lenders and a secured
creditor, respectively. The relationship created between each Lender, on the
one hand, and Borrower, on the other, is that of creditor and debtor, and each
Lender is not, nor shall it be deemed to be or treated as, a partner, joint-
venturer or co-venturer, with Borrower.
(S)XIX. NOTICES, ETC.
------------
Except as otherwise expressly provided in this Loan Agreement, all notices and
other communications made or required to be given pursuant to this Loan
Agreement or the Notes shall be in writing and shall be delivered in hand,
mailed by United States or Canadian registered or certified first class mail,
postage prepaid, sent by overnight courier, or sent by telegraph, telecopy,
facsimile or telex and confirmed by delivery via courier or postal service,
addressed as follows:
Borrower:
--------
Omnipoint Communications Inc.
49 Old Bloomfield Road
Mountain Lakes Corporate Center
Mountain Lakes, New Jersey 07046
Attn: Harry Plonskier
(fax no. (201) 257-2425)
with a copy to:
Piper & Marbury, L.L.P.
1200 19th Street, N.W.
Washington, DC 20036
Attn: Edwin Martin, Esq.
(fax no. (202) 861-6317)
Administrative Agent:
--------------------
Northern Telecom Inc.
200 Athens Way
<PAGE>
Nashville, Tennessee 37228
Attn: Roger A. Schechter, Esq.
(fax no. (615) 734-4067)
and
Northern Telecom Inc.
2221 Lakeside Blvd.
Richardson, Texas 75082
Attn: Adrian J. Donoghue
(fax no. (214) 684-3929); and
Attn: Paul Day
(fax no. (214) 684-3679)
with a copy to:
Hale and Dorr
60 State Street
Boston, Massachusetts 02109
Attn: Andrew H. Cohn, Esq.
(fax no. (617) 526-5000)
Collateral Agent:
----------------
Mellon Bank, N.A.
as Collateral Agent
701 Market Street
Philadelphia, PA 19106
Parent Guarantor:
----------------
Omnipoint Corporation
2000 North 14th Street
Suite 550
Arlington, Virginia 22201
Attn. Bradley E. Sparks
(fax no. (703) 522-0288)
with a copy to:
Piper & Marbury, L.L.P.
1200 19th Street, N.W.
Washington, DC 20036
Attn: Edwin Martin, Esq.
(fax no. (202) 861-6317)
If a notice should be sent to any other Lender, it shall be sent to such
address for notice as such Lender shall have last furnished in writing to the
Person giving the notice.
Any such notice or demand shall be deemed to have been duly given or made
and to have become effective (i) if delivered by hand, overnight courier or
facsimile to a responsible officer of
<PAGE>
the party to which it is directed, at the time of the receipt thereof by such
officer or the sending of such facsimile and (ii) if sent by registered or
certified first-class mail, postage prepaid, on the third Business Day following
the mailing thereof. The parties hereby deem all notices sent by telecopy or
facsimile original documents and all signatures on such notices, originals.
(S)XX. PROCESS AGENT.
-------------
Borrower hereby appoints Piper & Marbury, 1200 19th Street, N.W., Washington, DC
20036, Attn: Edwin Martin, Esq., as its legally authorized process agent to
accept service on behalf of Borrower.
(S)XXI. GOVERNING LAW.
-------------
THIS LOAN AGREEMENT AND, EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED THEREIN, EACH
OF THE OTHER LOAN DOCUMENTS ARE CONTRACTS UNDER THE LAWS OF THE STATE OF NEW
YORK AND SHALL FOR ALL PURPOSES BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE LAWS OF SAID STATE (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF
STATE LAW). BORROWER AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF THIS LOAN
AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS MAY BE BROUGHT IN THE COURTS OF THE
STATE OF NEW YORK OR ANY FEDERAL COURT SITTING THEREIN AND CONSENTS TO THE
NONEXCLUSIVE JURISDICTION OF SUCH COURT AND SERVICE OF PROCESS IN ANY SUCH SUIT
BEING MADE UPON SUCH BORROWER BY MAIL TO PIPER & MARBURY AT THE ADDRESS
SPECIFIED IN (S)20. BORROWER HEREBY WAIVES ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH COURT OR THAT SUCH SUIT
IS BROUGHT IN AN INCONVENIENT COURT.
(S)XXII. CERTIFICATES OF OFFICERS OF BORROWER.
------------------------------------
With respect to all certificates of officers of Borrower which Borrower is
obligated to deliver to Administrative Agent under the Loan Documents, the
officers signing such certificates will have no personal liability therefor
except with respect to fraud, gross negligence and intentional misconduct.
(S)XXIII. CONFIDENTIALITY.
---------------
Prior to disclosure to any Eligible Assignee, the Administrative Agent will
obtain a written confidentiality agreement from such Eligible Assignee with
respect to the following items: (i) the Approved Full Term Operating Business
Plan, (ii) the Approved Annual Operating Business Plan, (iii) the terms of the
Material Employment Agreements, and (iv) detailed pricing information and
variance analyses previously provided to the Administrative Agent. The
confidentiality agreement will contain terms providing for the protection to the
Borrower having terms substantially as set forth in the following paragraph and
shall survive the execution by an Eligible Assignee of an Assignment and
Acceptance Agreement. Notwithstanding anything to the contrary herein, the
Administrative Agent shall be permitted to summarize generally basic business
<PAGE>
information relating to the Borrower and its Affiliates to nonaffiliated third
parties and Eligible Assignees, such as information that is or would be of
public knowledge by reason of a public offering or otherwise.
The Administrative Agent and each Lender agree to keep the type of information
listed in (i) through (iv), above furnished by Borrower confidential except for
disclosure (i) to legal counsel, accountants, and other professional advisors to
Administrative Agent and each Lender, (ii) to bank and financial institution
regulatory officials with regulatory control over Lender, (iii) as requested
pursuant to or as required by law, regulation, or legal process, (iv) in
connection with any legal proceeding to which that Administrative Agent or any
Lender is a party, or (v) in connection with any court order.
(S)XXIV. CHANGES IN FCC PAYMENT SCHEDULES.
--------------------------------
In the event the FCC modifies Borrower's payment requirements relating to the
Borrower's FCC License so that such payment requirements materially differ from
that which were in effect as set forth in the Approved Full Term Operating
Business Plan, Borrower and the Administrative Agent will endeavor in good faith
to renegotiate the covenants contained in (S)7.19 hereof in order to reflect
such change, it being understood that until the Administrative Agent and
Borrower shall reach agreements on such new covenants, the covenants contained
in (S)7.19 hereof continue to be effective.
(S)XXV. HEADINGS.
--------
The captions in this Loan Agreement are for convenience of reference only and
shall not define or limit the provisions hereof.
(S)XXVI. COUNTERPARTS.
------------
This Loan Agreement and any amendment hereof may be executed in several
counterparts and by each party on a separate counterpart, each of which when so
executed and delivered shall be an original, and all of which together shall
constitute one instrument. In proving this Loan Agreement it shall not be
necessary to produce or account for more than one such counterpart signed by the
party against whom enforcement is sought.
(S)XXVII. ENTIRE AGREEMENT, ETC.
---------------------
The Loan Documents and any other documents executed in connection herewith
express the entire understanding of the parties with respect to the transactions
contemplated hereby. Neither this Loan Agreement nor any term hereof may be
changed, waived, discharged or terminated, except as provided in (S)29.
(S)XXVIII. WAIVER OF JURY TRIAL.
--------------------
<PAGE>
BORROWER HEREBY WAIVES ITS RIGHT TO A JURY TRIAL WITH RESPECT TO ANY ACTION OR
CLAIM ARISING OUT OF ANY DISPUTE IN CONNECTION WITH THIS LOAN AGREEMENT, THE
NOTES OR ANY OF THE OTHER LOAN DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR
THEREUNDER OR THE PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS. EXCEPT AS
PROHIBITED BY LAW, BORROWER HEREBY WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR
RECOVER IN ANY LITIGATION REFERRED TO IN THE PRECEDING SENTENCE ANY SPECIAL,
EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN
ADDITION TO, ACTUAL DAMAGES. BORROWER (A) CERTIFIES THAT NO REPRESENTATIVE,
ADMINISTRATIVE AGENT OR ATTORNEY OF ANY LENDER OR THE ADMINISTRATIVE AGENT HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH LENDER OR THE ADMINISTRATIVE
AGENT WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVERS AND (B) ACKNOWLEDGES THAT THE ADMINISTRATIVE AGENT AND THE LENDERS HAVE
BEEN INDUCED TO ENTER INTO THIS LOAN AGREEMENT, THE OTHER LOAN DOCUMENTS TO
WHICH IT IS A PARTY BY, AMONG OTHER THINGS, THE WAIVERS AND CERTIFICATIONS
CONTAINED HEREIN.
(S)XXIX. CONSENTS, AMENDMENTS, WAIVERS, ETC.
----------------------------------
Any consent or approval required or permitted by this Loan Agreement to be given
by the Lenders may be given, and any term of this Loan Agreement, the other Loan
Documents or any other instrument related hereto or mentioned herein may be
amended, and the performance or observance by Borrower of any terms of this Loan
Agreement, the other Loan Documents or such other instrument or the continuance
of any Default or Event of Default may be waived (either generally or in a
particular instance and either retroactively or prospectively) with, but only
with, the written consent of Borrower and the written consent of the
Administrative Agent and the Required Lenders. Notwithstanding the foregoing,
the rate of interest on the Notes, the term of the Notes, the amount of the
Commitments of the Lenders, and the amount of the Origination Fee may not be
changed without the written consent of Borrower and the written consent of each
Lender affected thereby; the definition of Required Lenders may not be amended
without the written consent of all of the Lenders; and the amount of the
Administrative Agent's Fee payable for the Administrative Agent's account and
(S)13 may not be amended without the written consent of the Administrative
Agent. No waiver shall extend to or affect any obligation not expressly waived
or impair any right consequent thereon. No course of dealing or delay or
omission on the part of the Administrative Agent or any Lender in exercising any
right shall operate as a waiver thereof or otherwise be prejudicial thereto. No
notice to or demand upon Borrower shall entitle Borrower to other or further
notice or demand in similar or other circumstances.
The Lenders will consider in good faith amendments proposed by the Borrower
that are intended to reconcile any apparent conflicts between the provisions of
(S)(S)3.2B, 3.2C, 7.19 and 8.1 through 8.5 of this Agreement and the related
provisions of the Ericsson Loan
<PAGE>
Agreement, provided that nothing herein shall obligate the Lenders to agree to
any such amendments.
(S)XXX. IMMUNITIES.
----------
The Borrower hereby waives any and all rights against immunity from
jurisdiction, attachment (both before and after judgment) and execution to which
it might be entitled.
(S)XXXI. MATTERS RELATING TO THE COLLATERAL AGENT.
----------------------------------------
The Borrower will pay the Collateral Agent a fee in an amount, computed as
provided and payable at the times separately agreed to by the Collateral Agent
and the Borrower. In addition, the Borrower will pay on demand all costs and
expenses of the Collateral Agent (with respect to the Collateral Agent,
including reasonable allocated costs and expenses of in-house counsel and legal
staff)in connection with the preparation, execution, delivery, performance,
administration, enforcement, modification and amendment of this Intercreditor
Agreement, the Borrower Security Agreement, the Parent Pledge Agreement and/or
any other Loan Document at any time, including without limitation the reasonable
fees and expenses of counsel (with respect to the Collateral Agent, including
reasonable allocated costs and expenses of in-house counsel and legal staff)and
the costs and expenses incurred by the Collateral Agent in the course of
performing its duties and obligations as Collateral Agent.
(S)XXXII. AMENDMENTS, ETC. TO INTERCREDITOR AGREEMENT.
-------------------------------------------
Neither the Administrative Agent nor the Lenders shall consent to any amendment
or modification of, supplement to or replacement of or substitution for the
Intercreditor Agreement unless either
(a) the Borrower shall have consented thereto in writing, or
(b) at the time at which such amendment, modification or waiver is
entered into a Default, or any event that, with the passage of time or giving of
notice or both would constitute an event of default under any other Permitted
Loan Agreement, shall have occurred and be continuing.
(S)XXXIII. SEVERABILITY.
------------
The provisions of this Loan Agreement are severable and if any one clause or
provision hereof shall be held invalid or unenforceable in whole or in part in
any jurisdiction, then such invalidity or unenforceability shall affect only
such clause or provision, or part thereof, in such jurisdiction, and shall not
in any manner affect such clause or provision in any other jurisdiction, or any
other clause or provision of this Loan Agreement in any jurisdiction.
<PAGE>
IN WITNESS WHEREOF, the undersigned have duly executed this Loan Agreement as a
sealed instrument as of the date first set forth above.
BORROWER:
--------
OMNIPOINT COMMUNICATIONS INC.
By:
----------------------------------------
Name: Harry Plonskier
Title: Vice President, Finance
ADMINISTRATIVE AGENT:
---------------------
NORTHERN TELECOM INC.
By:
----------------------------------------
Name:
Title:
THE LENDERS:
------------
NORTHERN TELECOM INC.
By:
----------------------------------------
Name:
Title:
<PAGE>
1 EXHIBIT 10.33
---------------------------------------------
| Confidential treatment has been |
|requested for portions of this exhibit. The|
|copy filed herewith omits the information |
|subject to the confidentiality request. |
|Omissions are designated as *****. A |
|complete version of this exhibit has been |
|filed separately with the Securities and |
|Exchange Commission. |
---------------------------------------------
================================================================================
LOAN AGREEMENT
dated as of August 7, 1996
among
OMNIPOINT COMMUNICATIONS INC.,
Borrower,
--------
ERICSSON INC.,
as Administrative Agent,
-----------------------
and
THE LENDERS NAMED HEREIN
<PAGE>
i
TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS AND RULES OF INTERPRETATION
1.01. Definitions........................................................... 1
1.02. Rules of Interpretation............................................... 22
1.03. Accounting Terms...................................................... 23
ARTICLE II
THE LOANS
2.01. Commitment to Lend.................................................... 24
2.02. Making the Advances................................................... 26
2.03. Fees ................................................................ 28
2.04. Interest.............................................................. 29
2.05. Interest Rate Determination........................................... 30
2.06. Optional Conversion of Advances....................................... 31
2.07. Payments and Computations............................................. 32
2.08. Sharing of Payments, Etc.............................................. 33
2.09. Use of Proceeds....................................................... 34
2.10. The Notes............................................................. 34
2.11. First LIBOR Method and Second LIBOR Method............................ 34
ARTICLE III
REPAYMENT AND PREPAYMENT OF THE LOANS
3.01. Term/Amortization..................................................... 34
3.02. Mandatory Prepayments of Loans........................................ 36
3.03. Optional Prepayments of Loans......................................... 38
3.04. Certain Matters relating to Repayments and Prepayments................ 38
ARTICLE IV
</TABLE>
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ILLEGALITY, INCREASED COSTS, CAPITAL ADEQUACY AND INDEMNITIES
4.01. Illegality............................................................ 39
4.02. Additional Costs and Capital Adequacy................................. 40
4.03. Taxes ................................................................ 41
4.04. Survival.............................................................. 43
ARTICLE V
REPRESENTATIONS AND WARRANTIES
5.01. Corporate Authority................................................... 43
5.02. Governmental Approvals................................................ 44
5.03. Title to Properties................................................... 44
5.04. Financial Statements.................................................. 44
5.05. No Material Adverse Effect, Etc....................................... 45
5.06. Franchises, Patents, Copyrights, Etc.................................. 45
5.07. License, Etc.......................................................... 45
5.08. Litigation............................................................ 45
5.09. No Materially Adverse Contracts, Etc.................................. 45
5.10. Compliance with Other Instruments, Laws, Etc.......................... 45
5.11. Tax Status............................................................ 46
5.12. No Default............................................................ 46
5.13. Holding Company and Investment Company Acts........................... 46
5.14. Absence of Financing Statements, Etc.................................. 46
5.15. FCC Matters........................................................... 46
5.16. Tariffs............................................................... 47
5.17. Disclosure............................................................ 47
5.18. Burdensome Obligations................................................ 47
5.19. Solvency.............................................................. 47
5.20. Security Interests.................................................... 47
5.21. Certain Transactions.................................................. 47
5.22. Business Plans........................................................ 48
5.23. Employee Benefit Plans................................................ 48
5.24. Regulations U and X................................................... 49
5.25. Environmental Compliance.............................................. 49
5.26. Subsidiaries, Etc..................................................... 50
5.27. Material Contracts.................................................... 50
</TABLE>
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ARTICLE VI
AFFIRMATIVE COVENANTS OF THE BORROWER
6.01. Maintenance of Office................................................. 50
6.02. Records and Accounts.................................................. 51
6.03. Corporate Existence; Maintenance of Licenses.......................... 51
6.04. Maintenance of Properties............................................. 51
6.05. Insurance............................................................. 52
6.06. Taxes ................................................................ 52
6.07. Inspection of Properties and Books.................................... 53
6.08. Compliance with Laws, Contracts, License, and Permits................. 53
6.09. Further Assurances.................................................... 54
6.10. Equity and Subordinated Debt.......................................... 54
6.11. Authorization from Landlord/Mortgagee, Etc............................ 54
6.12. Attornment and Recognition Agreements................................. 54
6.13. Expense Allocation Agreement.......................................... 55
6.14. Reporting Requirements; Notices....................................... 55
6.15. Financial Covenants of the Borrower................................... 60
6.16. Certified Copies of Insurance Policies................................ 62
6.17. Mortgage Liens........................................................ 62
ARTICLE VII
CERTAIN NEGATIVE COVENANTS OF THE BORROWER
7.01. Restrictions on Indebtedness.......................................... 63
7.02. Restrictions on Liens................................................. 65
7.03. No Contingent Obligations............................................. 67
7.04. Restrictions on Investments........................................... 67
7.05. Distributions......................................................... 68
7.06. Merger, Consolidation, Disposition of Assets, Etc..................... 71
7.07. Sale and Leaseback.................................................... 72
7.08. Compliance with Environmental Laws.................................... 72
7.09. Employee Benefit Plans................................................ 72
7.10. Key Management Personnel Compensation................................. 73
7.11. Transactions with Affiliates.......................................... 73
</TABLE>
<PAGE>
iv
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7.12. Change in Nature of Business.......................................... 74
7.13. Charter Amendments.................................................... 74
7.14. Accounting Changes.................................................... 74
7.15. Prepayments, Etc., of Indebtedness.................................... 74
7.16. Amendment, Etc., of Material Contracts................................ 75
7.17. Negative Pledge....................................................... 75
7.18. Partnerships.......................................................... 75
7.19. Default Under the Supply Agreement.................................... 76
ARTICLE VIII
CONDITIONS TO THE INITIAL ADVANCE
8.01. Loan Documents........................................................ 76
8.02. Proceedings and Documents............................................. 76
8.03. Validity of Liens..................................................... 76
8.04. Search Reports and Related Documents.................................. 76
8.05. Certificates of Insurance............................................. 77
8.06. Solvency Certificate.................................................. 77
8.07. Opinion of Counsel to the Borrower.................................... 77
8.08. Opinion of Counsel to Parent.......................................... 77
8.09. Opinion of FCC Counsel................................................ 77
8.10. Opinion of Counsel to Lenders and Administrative Agent................ 78
8.11. Payment of Fees....................................................... 78
8.12. Approvals, Permits.................................................... 78
8.13. Delivery of Operating Business Plans.................................. 78
8.14. Delivery of Pledged Shares............................................ 78
8.15. Material Agreements................................................... 78
8.16. Litigation............................................................ 79
8.17. Insurance Certificates................................................ 79
8.18. Other Documents....................................................... 79
ARTICLE IX
ADDITIONAL CONDITIONS TO ADVANCES
9.01. Conditions to All Advances............................................ 79
</TABLE>
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<S> <C>
ARTICLE X
EVENTS OF DEFAULT; ACCELERATION; ETC.
10.01. Events of Default and Acceleration................................... 80
ARTICLE XI
THE ADMINISTRATIVE AGENT
11.01. Authorization and Action............................................. 85
11.02. Administrative Agent's Reliance, Etc................................. 85
11.03. Ericsson and Affiliates.............................................. 86
11.04. Lender Credit Decision............................................... 86
11.05. Indemnification...................................................... 86
11.06. Successor Administrative Agents...................................... 87
ARTICLE XII
MISCELLANEOUS
12.01. Amendments, Etc...................................................... 88
12.02. Notices, Etc......................................................... 89
12.03. No Waiver; Remedies.................................................. 90
12.04. Costs, Expenses...................................................... 90
12.05. Right of Set-off..................................................... 92
12.06. Binding Effect....................................................... 92
12.07. Assignments and Participations....................................... 92
12.08. Governing Law........................................................ 96
12.09. Execution in Counterparts............................................ 96
12.10. Confidentiality...................................................... 96
12.11. Consent to Jurisdiction.............................................. 97
12.12. Matters Relating to the Collateral Agent............................. 97
12.13. Amendments, etc. to Intercreditor Agreement.......................... 98
12.14. Waiver of Jury Trial................................................. 98
</TABLE>
<PAGE>
vi
Exhibits
- --------
Exhibit A - Form of Note
Exhibit B - Form of Draw Request
Exhibit C - Form of Assignment and Acceptance
Exhibit D - Form of Borrower Security Agreement
Exhibit E - Form of Parent Pledge Agreement
Exhibit F - Form of Subordination Agreement
Exhibit G - Form of Compliance Certificate
Exhibit H - Form of Parent Guaranty
Exhibit I - Form of Real Estate Mortgage Option
Schedules
- ---------
Schedule 5.21 - Transactions with Officers, Directors and Employees
Schedule 5.25 - Environmental Matters
Schedule 5.27 - Material Contracts
Schedule 6.15(a) - Revenue
Schedule 6.15(d) - EBITDA
Schedule 7.04 - Investments
Schedule 7.10 - Compensation
<PAGE>
1
LOAN AGREEMENT
--------------
This Agreement is made as of the 7th day of August, 1996, by and among (a)
OMNIPOINT COMMUNICATIONS INC. (the "Borrower"), a Delaware corporation, (b) the
--------
lenders listed on the signature pages hereof and (c) ERICSSON INC., a Delaware
corporation, as administrative agent for the Lenders (together with any
successor thereto appointed pursuant to (S)11.06, the "Administrative Agent").
--------------------
ARTICLE I
DEFINITIONS AND RULES OF INTERPRETATION
---------------------------------------
Section 1.01. Definitions.
-----------
The following terms shall have the meanings set forth in this (S)1.01 or
elsewhere in the provisions of this Agreement referred to below:
Adjusted EBITDA. For any period, the sum of
---------------
(a) EBITDA for such period, and
(b) Contributed Capital received by the Borrower during such period.
Administrative Agent. See the preamble hereto.
--------------------
Administrative Agent's Office. The Administrative Agent's office set forth
-----------------------------
in (S)12.02 and, upon the appointment of a successor Administrative Agent
pursuant to (S)11.06, such address as shall be provided by such successor
Administrative Agent, or in either case such office as the Administrative Agent
from time to time may designate.
Advances. See (S)2.01.
--------
Affiliate. As to any Person, any other Person which, directly or
---------
indirectly, is in control of, is controlled by, or is under common control with
such Person. For purposes of this definition, control of a Person shall include
the power, direct or indirect, (a) to vote 50% or more of the securities or
other interests having ordinary voting power for the election of directors or
other managing Persons of such Person or (b) to direct or cause direction of the
management and policies of such Person whether by contract or otherwise.
<PAGE>
2
Applicable Lending Office. With respect to any Lender, for Base Rate
-------------------------
Loans, the office of such Lender specified as its domestic lending office and,
for LIBOR Rate Loans, the office of such Lender specified as its LIBOR lending
office, in either case on the signature pages hereof or in the Assignment and
Acceptance pursuant to which it became a Lender, or such other offices of such
Lender as such Lender may from time to time specify to the Administrative Agent.
Applicable Margin. For
-----------------
(a) Tranche A Advances that are Base Rate Advances, 1.70%,
(b) Tranche A Advances that are LIBOR Rate Advances, 4.45%,
(c) Tranche B Advances or Tranche C Advances that are Base Rate
Advances, 2.75% and
(d) Tranche B Advances or Tranche C Advances that are LIBOR Rate
Advances, 5.50%.
Approved Annual Operating Business Plan. With respect to the Borrower's
---------------------------------------
fiscal year ending December 31, 1996, the annual operating business plan
delivered pursuant to (S)8.13(a) and, with respect to each subsequent fiscal
year of the Borrower, the annual business operating plan delivered by the
Borrower pursuant to (S)6.14(a) with respect to such fiscal year, but only if
the Required Lenders shall have approved such plan for such fiscal year.
Approved Full Term Operating Business Plan. Unless and until the Borrower
------------------------------------------
in its discretion shall have delivered to the Lenders a revised full-term
operating plan that the Required Lenders shall have approved, the full-term
operating plan delivered by the Borrower pursuant to (S)8.13(b), and thereafter
the most recent full-term operating plan delivered by the Borrower that the
Required Lenders shall have approved.
Assignment and Acceptance. An Assignment and Acceptance substantially in
-------------------------
the form of Exhibit C.
---------
Base Rate. A fluctuating interest rate per annum in effect from time to
---------
time, which rate per annum shall at any date of determination be to equal to the
higher of:
(a) (i) the rate of interest quoted as the "Prime Rate" under the
heading "Money Rates" in The Wall Street Journal on such date (or, if
-----------------------
The Wall Street Journal is not published on such date, on the most
-----------------------
recent preceding date on which The Wall Street Journal was published),
-----------------------
or
<PAGE>
3
(ii) if such Prime Rate cannot be determined, the rate of
interest announced publicly by Morgan Guaranty Trust Company of New
York as its base rate on such date, or
(b) 1/2 of one percent per annum above the Federal Funds Rate on such
date.
Base Rate Loans. Loans bearing interest calculated by reference to the
---------------
Base Rate.
Borrower. See the preamble hereto.
--------
Borrower Security Agreement. The Amended and Restated Borrower Security
---------------------------
Agreement among the Borrower, the Collateral Agent, the Administrative Agent and
the Nortel Administrative Agent, substantially in the form of Exhibit D, as
---------
amended from time to time in compliance with the Loan Documents.
Borrower's Obligations. All indebtedness, obligations and liabilities of
----------------------
the Borrower to the Administrative Agent, the Collateral Agent or any Lender,
arising or incurred under this Agreement or any of the other Loan Documents or
otherwise in respect of any of the Loans or any of the Notes or other
instruments at any time evidencing any thereof, existing on the date of this
Agreement or arising thereafter, direct or indirect, joint or several, absolute
or contingent, matured or unmatured, liquidated or unliquidated, secured or
unsecured, or whether arising by contract, operation of law or otherwise.
Business Day. Any day other than a Saturday, a Sunday or a day on which
------------
commercial banks located in New York City are authorized or required by law or
other governmental action to close.
Capital Expenditures. Amounts paid or Indebtedness incurred by the
--------------------
Borrower in connection with the purchase or lease by the Borrower of assets that
would be required to be capitalized and shown on the balance sheet of such
Person in accordance with GAAP.
Capitalized Leases. Leases under which the Borrower is the lessee or
------------------
obligor, the discounted future rental-payment obligations under which are
required to be capitalized on the balance sheet of the lessee or obligor in
accordance with GAAP.
Cash Maintenance Agreement. The Cash Maintenance Agreement dated as of
--------------------------
August 7, 1996 between the Administrative Agent and Grand Parent, as amended
from time to time.
CERCLA. The Comprehensive Environmental Response, Compensation and
------
Liability Act, as amended, 42 USCA (S)9601 et seq.
<PAGE>
4
Closing Date. The meaning specified in the introductory clause of Article
------------
VIII.
Collateral. All of the property, rights and interests of the Borrower and
----------
Parent that are or are intended to be subject to the security interests created
by the Borrower Security Agreement and Parent Pledge Agreement.
Collateral Agent. Mellon Bank, N.A. or any successor thereto appointed
----------------
pursuant to (S)6.1 of the Intercreditor Agreement.
Collateral Documents. The Borrower Security Agreement and the Parent
--------------------
Pledge Agreement.
Commitment. With respect to any Lender, either of its Tranche A Advance
----------
Commitment or its Tranche B and C Advance Commitment.
Communications Act. The Communications Act of 1934, as amended, and the
------------------
rules and regulations issued thereunder, as from time to time in effect.
Confidential Information. Information that the Borrower furnishes to the
------------------------
Administrative Agent or any Lender in a writing designated as confidential, but
Confidential Information does not include any such information that is or
becomes generally available to the public or that is or becomes available to the
Administrative Agent or such Lender from a source other than the Borrower.
Contingent Obligation. As to any Person, any obligation of such Person
---------------------
guaranteeing or in effect guaranteeing any Indebtedness, lease, dividend or
other obligation ("primary obligations") of any other Person (the "primary
------------------- -------
obligor") in any manner, whether directly or indirectly, including, without
- -------
limitation, any obligation of such Person, whether or not contingent,
(a) to purchase any such primary obligation or any Property
constituting direct or indirect security therefor;
(b) to advance or supply funds
(i) for the purchase or payment of any such primary obligation,
or
(ii) to maintain working capital or equity capital of the primary
obligor or otherwise to maintain net worth, solvency or other
financial statement condition of the primary obligor;
<PAGE>
5
(c) to purchase Property, securities or services primarily for the
purpose of assuring the beneficiary or holder of any such primary
obligation of the ability of the primary obligor to make payment of such
primary obligation; or
(d) otherwise to assure, protect from loss, or hold harmless the
beneficiary or holder of such primary obligation against loss in respect
thereof;
provided that the term Contingent Obligation shall not include the indorsement
- --------
of instruments for deposit or collection in the ordinary course of business.
The term Contingent Obligation shall also include the liability of a general
partner in respect of the recourse liabilities of the partnership in which it is
a general partner. The amount of any Contingent Obligation of a Person shall be
deemed to be an amount equal to the stated or determinable amount of the primary
obligation in respect of which such Contingent Obligation is made or, if not
stated or determinable, the maximum reasonably anticipated liability in respect
thereof as determined by such Person in good faith.
Contributed Capital. For any period,
-------------------
(i) proceeds from the sale of the Borrower's equity securities
received by the Borrower during such period, plus
(ii) Subordinated Debt incurred by the Borrower during such period,
together with accrued and unpaid interest thereon.
Convert, Conversion and Converted. A conversion of Advances of one Type
------- ---------- ---------
into Advances of the other Type pursuant to (S)2.05 or 2.06.
Cumulative Cash Flow Shortfall. With respect to any date of determination,
------------------------------
the cumulative amount of EBTDA for the period beginning on January 1, 1996 and
ending on the last day of the Borrower's fiscal quarter most recently ended
prior to such date of determination, minus (without duplication) the following:
(a) to the extent deducted in calculating Net Income for such period,
taxes actually paid during such period,
(b) Capital Expenditures, net of proceeds of any financing for all or
any portion of such Capital Expenditures, made during such period and
<PAGE>
6
(c) the aggregate amount of payments and prepayments of principal in
respect of Indebtedness of the Borrower during such period net of any
refunding or refinancing thereof from Persons other than an Affiliate of
the Borrower.
Debt Service. For any period, the aggregate scheduled amount of interest
------------
required to be paid and principal required to be repaid by the Borrower during
such period on all Indebtedness of the Borrower outstanding during all or any
part of such period (excluding (a) the amount of any prepayment pursuant to
(S)3.02(a) or (b) or (S)3.2.B or C of the Nortel Loan Agreement required to be
made during such period and (b) interest capitalized under loans where such
loans provide for the funding of interest costs), whether such interest and
principal were or are required to be reflected as an item of expense or
capitalized, including payments in respect of Capitalized Leases and including
scheduled payments of commitment fees, agency fees, facility fees, origination
fees, balance-deficiency fees and similar fees or expenses in connection with
Indebtedness.
Default. Any Event of Default and any event or condition that, with the
-------
giving of notice, the lapse of time, or both, would become an Event of Default.
Distribution. Any of the following:
------------
(a) the declaration or payment of any cash dividend, dividend in kind
or cash equity distributions on or in respect of any shares of any class of
capital Stock of the Borrower, other than dividends payable solely in
shares of common Stock of the Borrower;
(b) the purchase, redemption, or other retirement of any shares of any
class of capital Stock of the Borrower;
(c) the return of capital by the Borrower to its shareholders as such;
(d) any other distribution on or in respect of any shares of any class
of capital Stock of the Borrower; or
(e) any payment of principal, premium or interest, or any other
amount, in respect of Subordinated Debt of the Borrower.
Dollars or $. Dollars in lawful currency of the United States of America.
------------
Draw Request. See (S)2.02.
------------
EBITDA. For any period,
------
<PAGE>
7
(a) Net Income of the Borrower for such period, plus
(b) to the extent deducted in determining Net Income, the sum of each
of the following for such period:
(i) depreciation, amortization and other non-cash charges;
(ii) income-tax expense; and
(iii) Total Interest Expense.
EBTDA. For any period,
-----
(a) Net Income of the Borrower for such period, plus
(b) to the extent deducted in determining Net Income, the sum of each
of the following for such period:
(i) depreciation, amortization and other non-cash charges;
(ii) income-tax expense; and
(iii) interest not being paid as an express feature of the
related debt instrument.
Employee Benefit Plan. Any employee benefit plan within the meaning of
---------------------
(S)3(3) of ERISA maintained or contributed to by any of the Borrower or any
ERISA Affiliate, other than a Multiemployer Plan.
Environmental Laws. Any federal, state or local law, statute, rule or
------------------
regulation or common law relating to the environment or occupational health and
safety, including any statute, regulation or order pertaining to
(a) treatment, storage, disposal, generation and transportation of
industrial, toxic or hazardous substances or solid or hazardous waste;
(b) air, water or noise pollution;
(c) groundwater and soil contamination;
<PAGE>
8
(d) the release or threatened release into the environment of
industrial, toxic or hazardous substances, or solid or hazardous waste,
including without limitation emissions, discharges, injections, spills,
escapes or dumping of pollutants, contaminants or chemicals;
(e) the protection of wildlife, marine sanctuaries and wetlands,
including without limitation all endangered and threatened species;
(f) underground and other storage tanks or vessels, abandoned,
disposed or discarded barrels, containers and other closed receptacles;
(g) health and safety of employees and other persons; and
(h) manufacture, processing, use, distribution, treatment, storage,
disposal, transportation or handling of pollutants, contaminants, chemicals
or industrial, toxic or hazardous substances or oil or petroleum products,
by-products or breakdown products or solid or hazardous waste,
including (i) CERCLA; (ii) RCRA; (iii) the Toxic Substance Control Act, as
amended, 15 USCA (S)2601 et seq.; (iv) the Water Pollution Control Act, as
amended, 33 USCA (S)1251 et seq.; (v) the Clean Air Act, as amended, 42 USCA
(S)7401 et seq.; (vi) the Hazardous Material Transportation Act, as amended, 49
USCA (S)1801 et seq.; (vii) the Superfund Amendments and Reauthorization Act of
1986 and (viii) all rules, regulations judgments decrees injunctions and
restrictions thereunder and any analogous state law. As used above, the terms
"release," "threatened release," "hazardous substance" and "environment" shall
have the meaning set forth in CERCLA, and the terms "solid waste" and "dispose"
(or "disposal") shall have the meaning set forth in the RCRA.
Environmental Permits. See (S)5.25(d).
---------------------
Ericsson. See the preamble hereto.
--------
ERISA. The Employee Retirement Income Security Act of 1974, as amended,
-----
and the rules and regulations issued thereunder as from time to time in effect.
ERISA Affiliate. Any Person that is treated as a single employer with the
---------------
Borrower under (S)414 of the IRC.
ERISA Event. With respect to the Borrower or any ERISA Affiliate,
-----------
(a) a Reportable Event,
<PAGE>
9
(b) the withdrawal of the Borrower or any ERISA Affiliate from a Plan
during a plan year in which it was a "substantial employer" as defined in
(S)4001(a)(2) of ERISA,
(c) the filing of a notice of intent to terminate a Plan under a
distress termination of the Plan under (S)4041(c) of ERISA, or the
treatment of a Plan amendment as a termination under (S)4041 of ERISA,
(d) the institution of proceedings to terminate a Plan by the PBGC
under (S)4042 of ERISA or
(e) the occurrence of any other event or condition which might
reasonably be expected to constitute grounds under (S)4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan or
to cause the imposition of any liability (other than PBGC premiums due but
not delinquent under (S)4007 of ERISA) in excess of $250,000 under Title IV
of ERISA.
Event of Default. Any of the events specified in (S)10.01.
----------------
Excess Cash Flow. With respect to any date of determination,
----------------
(a) EBTDA for the most recent complete fiscal year of the Borrower
preceding such date (the "Prior Fiscal Year"), plus
-----------------
(b) to the extent deducted in calculating Net Income for the Prior
Fiscal Year, the aggregate amount of interest payments made by the Borrower
in respect of Subordinated Debt owing to Parent or Grand Parent, minus
(c) the following, without duplication,
(i) to the extent added to Net Income in order to determine
EBTDA for the Prior Fiscal Year, income tax expense reflecting amounts
actually paid during the Prior Fiscal Year;
(ii) Capital Expenditures, net of proceeds of any new financing
for all or any portion of such Capital Expenditures, made during the
Prior Fiscal Year;
(iii) the aggregate amount of scheduled principal payments in
respect of Indebtedness outstanding under any Permitted Loan
Agreement, permitted
<PAGE>
10
under (S)7.1(e) or (g), or payable to the FCC with respect to the
License for the New York MTA during the Prior Fiscal Year, and during
the fiscal year of the Borrower in which such date of determination
falls;
(iv) the aggregate principal amount of mandatory prepayments
made during the Prior Fiscal Year under this Agreement and the Nortel
Loan Agreement and on Indebtedness of the Borrower owed to any other
lender that is a party to the Intercreditor Agreement (other than
mandatory prepayments under (S)3.02(b), (S)3.2.C of the Nortel Loan
Agreement and, to the extent, if any, permitted under the
Intercreditor Agreement, mandatory prepayments of loans under other
Permitted Loan Agreements, the proceeds of which may be used for
purposes substantially similar to the purposes described in the
definition of Tranche B Expenses or those permitted for Tranche B
Loans (as defined in the Nortel Loan Agreement as in effect on the
date hereof), out of Excess Cash Flow; and
(v) the difference between (A) the Working Capital of the last
day of the Prior Fiscal Year and (B) the Working Capital as of the day
before the first day of the Prior Fiscal Year; provided that in
--------
calculating Working Capital there shall be excluded from current
assets (1) all receivables outstanding more than 60 days past invoice
date and (2) all inventories that otherwise would be included as
current assets under such balance sheet and there shall be excluded
from current liabilities the current portion of long-term debt.
Expense Allocation Agreement. The Expense Allocation Agreement among the
----------------------------
Borrower, Parent and Grand Parent dated as of July 21, 1995, as amended from
time to time as permitted hereunder.
FCC. The Federal Communications Commission or any Governmental Body
---
succeeding to the functions thereof.
Federal Funds Rate. The fluctuating interest rate per annum equal for each
------------------
day during such period to the weighted average of the rates on overnight
federal-funds transactions with members of the Federal Reserve System arranged
by federal-funds brokers, as published for such day (or, if such day is not a
Business Day, for the next-preceding Business Day) by the Federal Reserve Bank
of New York, or, if such rate is not so published for any day that is a Business
Day, the average of the quotations for such day on such transactions received by
the Administrative Agent from three federal-funds brokers of recognized standing
selected by it.
<PAGE>
11
First LIBOR Method. The terms and provisions of this Agreement relating to
------------------
LIBOR Rate Advances specified as being applicable when the First LIBOR Method is
applicable under (S)2.11.
GAAP. See (S)1.03.
----
Governmental Body. Any nation or government, any state or other political
-----------------
subdivision thereof, any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government and any
court or arbitrator.
Grand Parent. Omnipoint Corporation, a Delaware corporation.
------------
Guaranteed Pension Plan. Any employee pension benefit plan within the
-----------------------
meaning of (S)3(2) of ERISA that is maintained or contributed to by any of the
Borrower or any ERISA Affiliate or that was so maintained or contributed to and
in respect of which the Borrower or any ERISA Affiliate could have liability
under Section 4064 or 4069 of ERISA in the event that such plan has been or were
to be terminated the benefits of which are guaranteed on termination in full or
in part by the PBGC pursuant to Title IV of ERISA, other than a Multiemployer
Plan.
Indebtedness. As to any Person, at a particular time, all items that
------------
constitute, without duplication,
(a) obligations of such Person in respect of borrowed money or for the
deferred purchase price of Property (other than trade payables incurred in
the ordinary course of business);
(b) obligations of such Person evidenced by notes, bonds, debentures
or similar instruments;
(c) obligations of such Person with respect to any conditional-sale or
title-retention agreement;
(d) obligations of such Person arising under acceptance facilities and
the amount available to be drawn under all letters of credit issued for the
account of such Person and, without duplication, all drafts drawn
thereunder to the extent such Person shall not have reimbursed the issuer
in respect of the issuer's payment of such drafts;
(e) all liabilities secured by any Lien on any Property owned by such
Person even though such Person has not assumed or otherwise become liable
for the payment
<PAGE>
12
thereof (other than carriers', warehousemen's, mechanics', repairmen's or
other like non-consensual Liens arising in the ordinary course of
business);
(f) obligations of such Person under Capitalized Leases;
(g) amounts owed by such Person to the FCC on the FCC License for the
New York PCS Network;
(h) all Contingent Obligations of such Person; and
(i) interest that is accreted or otherwise accrued and unpaid on
Subordinated Debt.
Intellectual Property. All copyrights, trademarks, service marks, patents,
---------------------
trade names and service names, Licenses and the like.
Intercreditor Agreement. The Intercreditor Agreement dated as of the date
-----------------------
hereof among the Collateral Agent, Ericsson, Nortel and the other administrative
agents and lenders parties thereto.
Interest Period. While the First LIBOR Method is applicable and Loans are
---------------
accruing interest at the LIBOR Rate, the period commencing on the date on which
interest on the Loans shall accrue at the LIBOR Rate as provided herein and
ending on the last day of such period, determined as provided below, and
thereafter each subsequent period commencing on the last day of the immediately
preceding Interest Period and ending on the last day of such period, determined
as provided below, or, if earlier, on the last day on which the Loans shall
accrue interest at the LIBOR Rate. While the Second LIBOR Method is applicable,
for each LIBOR Rate Advance comprising part of the same Loan, the period
commencing on the date of such LIBOR Rate Advance or the date of the Conversion
of any Base Rate Advance into such LIBOR Rate Advance and ending on the last day
of such period, determined as provided below, and, thereafter, each subsequent
period commencing on the last day of the immediately preceding Interest Period
and ending on the last day of such period, determined as provided below. The
duration of each such Interest Period shall be three months; provided that:
--------
(a) whenever the last day of any Interest Period would otherwise occur
on a day other than a LIBOR Business Day, the last day of such Interest
Period shall be extended to occur on the next-succeeding LIBOR Business
Day; provided that, if such extension would cause the last day of such
--------
Interest Period to occur in the next-following calendar month, the last day
of such Interest Period shall occur on the next-preceding LIBOR Business
Day, and
<PAGE>
13
(b) whenever the first day of any Interest Period occurs on a day of
an initial calendar month for which there is no numerically corresponding
day in the third-following calendar month, such Interest Period shall end
on the last LIBOR Business Day of such third-following calendar month.
Investments. All expenditures made and all liabilities incurred
-----------
(contingently or otherwise) for the acquisition of capital Stock or Indebtedness
of, or for loans, advances, capital contributions or transfers of property to,
or in respect of any guaranties (or other commitments as described under
Contingent Obligations), or obligations of, any Person. In determining the
aggregate amount of Investments outstanding at any particular time:
(a) the amount on any date of determination of any Investment
represented by a Contingent Obligation shall be taken at not less than the
principal amount of the obligations as to which such Contingent Obligation
exists and that are still outstanding on such date of determination;
(b) there shall be included as an Investment all interest accrued with
respect to Indebtedness constituting an Investment unless and until such
interest is paid;
(c) there shall be deducted in respect of each such Investment any
amount received as a return of capital (but only by repurchase, redemption,
retirement, repayment, liquidating dividend or liquidating distribution);
(d) there shall not be deducted in respect of any Investment any
amounts received as earnings on such Investment, whether as dividends,
interest or otherwise, except that accrued interest included as provided in
the foregoing clause (b) may be deducted when paid; and
(e) there shall not be deducted from the aggregate amount of
Investments any decrease in the value thereof.
IRC. The Internal Revenue Code of 1986, as amended from time to time, and
---
the rules and regulations issued thereunder as from time to time in effect.
Lender. Ericsson, unless and until it shall have assigned to other Persons
------
all of its rights and obligations as a Lender hereunder, and any other Person
that becomes a Lender by reason of an Assignment and Acceptance in accordance
with the terms of this Agreement.
LIBOR Business Day. Any Business Day on which commercial banks are open
------------------
for international business (including dealings in Dollar deposits) in London.
<PAGE>
14
LIBOR Rate. For any applicable Interest Period, a simple per annum
----------
interest rate (rounded upward, if necessary, to the nearest 1/100th of one
percent) equal to
(a) (i) the rate per annum that appears on Page 3750 of the Dow Jones &
Company Telerate, screen or any successor page as the composite offered
rate for London interbank deposits, in an amount approximately equal to the
amount of the requested Loan for a three-month period, as shown under the
heading "USD" as of 11:00 a.m. (London time), two LIBOR Business Days
before the first day of such Interest Period, or
(ii) if the rate specified in clause (i) cannot be determined, the
rate per annum equal to the arithmetic mean of the rates shown on the LIBO
page of Reuters Money Service at approximately 11:00 a.m. (London time),
two LIBOR Business Days before the first day of such Interest Period in an
amount approximately equal to the amount of the requested Loan,
divided by
(b) one, minus the LIBOR Reserve Rate, stated as a decimal.
LIBOR Rate Advance. An Advance bearing interest calculated by reference to
------------------
the LIBOR Rate.
LIBOR Reserve Rate. For any Interest Period for all LIBOR Rate Advances
------------------
comprising part of the same Loan, the reserve percentage applicable two Business
Days before the first day of such Interest Period under regulations issued from
time to time by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement (including any
emergency, supplemental or other marginal reserve requirement) for a member bank
of the Federal Reserve System in New York City with respect to liabilities or
assets consisting of or including Eurocurrency Liabilities (or with respect to
any other category of liabilities that includes deposits by reference to which
the interest rate on LIBOR Rate Advances is determined) having a term equal to
such Interest Period.
License. Any mobile telephone, cellular telephone, microwave, paging or
-------
other license, authorization, certificate of compliance, franchise, approval or
permit, whether for the construction or the operation of any PCS System, granted
or issued by the FCC and any other federal Governmental Bodies.
Lien. Any mortgage, pledge, hypothecation, assignment, deposit or
----
preferential arrangement, encumbrance, lien (statutory or other), or other
security agreement or security interest of any kind or nature whatsoever,
including any conditional sale or other title retention
<PAGE>
15
agreement and any Capitalized Lease or other financing lease having
substantially the same economic effect as any of the foregoing.
Loan Documents. This Agreement, the Notes, the Borrower Security
--------------
Agreement, the Parent Pledge Agreement, the Parent Guaranty, the respective
Subordination Agreements to be entered into by Parent and Grand Parent, the
Mortgage, the Intercreditor Agreement, the Cash Maintenance Agreement, the
Supply Agreement, any mortgage or deed of trust entered into pursuant to (S)6.17
or (S)7.02(e)(ii)(B)(1), any option entered into pursuant to
(S)7.02(e)(ii)(B)(2) and any other agreements or documents contemplated hereby
or thereby and all schedules, exhibits and annexes thereto.
Loans. Collectively, the Tranche A Loans, the Tranche B Loans and the
-----
Tranche C Loans.
Material Adverse Effect. An effect resulting from any circumstance or
-----------------------
event of whatever nature (including any adverse determination in any litigation)
which does, or could reasonably be expected to, materially and adversely
(a) impair the validity or enforceability of any of the Loan Documents
or the Administrative Agent's, the Collateral Agent's or any Lender's
rights or remedies with respect thereto;
(b) impair the ability of the Borrower to pay the Borrower's
Obligations in accordance with their terms;
(c) cause a Default;
(d) affect the business, property, prospects, operations, or financial
or other condition of the Borrower or Parent; or
(e) impair or affect the Collateral or Lender's Liens on the
Collateral or the priority of such Liens.
Material Contract: With respect to any Person, each contract to which such
-----------------
Person is a party involving aggregate consideration payable to or by such Person
of $5,000,000 or more in any 12-month period or otherwise material to the
business, condition (financial or otherwise), operations, performance,
properties or prospects of such Person.
Materials of Environmental Concern. Any chemicals, pollutants or
----------------------------------
contaminants, hazardous substances (as such term is defined under CERCLA), solid
wastes and hazardous wastes (as such terms are defined under the RCRA), toxic
materials, oil or petroleum and
<PAGE>
16
petroleum products, by products or breakdown products or any other material
subject to regulation under any Environmental Laws.
Mortgage. The Purchase Money Commercial Mortgage and Security Agreement
--------
dated as of November 1, 1995 in favor of the Nortel Administrative Agent, as
amended and assigned to the Collateral Agent as of August 7, 1996 and as further
amended from time to time in compliance with the Loan Documents.
MTA. Any "major trading area" as set forth on the Rand McNally 1992
---
Commercial Atlas & Marketing Guide, 123rd Edition, at pages 38-39 ("BTA/MTA
Map") and utilized by the FCC in dividing the 50 states, the District of
Columbia and United States territories into 51 MTAs for the purpose of licensing
PCS Systems.
Multiemployer Plan. A "multiemployer plan" as defined in Sections
------------------
4001(a)(3) and 3(37) of ERISA, and to which the Borrower or any ERISA Affiliate
is making, or is obligated to make, contributions or has made, or been obligated
to make, contributions.
Necessary Authorizations. All approvals and licenses from, and all filings
------------------------
and registrations with, any governmental or other regulatory authority,
including the License for the New York MTA and all grants, approvals, licenses,
filings and registrations under the Communications Act, necessary in order to
enable the Borrower to own, construct, maintain and operate PCS Systems.
Net Cash Proceeds. With respect to any transaction by any Person, the
-----------------
aggregate amount of cash received from time to time by or on behalf of such
Person in connection with such transaction, after deducting therefrom only
(a) reasonable and customary brokerage commissions, underwriting fees
and discounts, legal fees, finder's fees and other similar fees and
commissions, and
(b) the amount of taxes payable in connection with or as a result of
such transaction,
in each case to the extent, but only to the extent, that the amounts so deducted
are, at the time of receipt of such cash, actually paid to a Person that is not
an Affiliate of the Borrower and are properly attributable to such transaction
or to the asset that is the subject thereof.
Net Income. For any period, net income (or loss) of the Borrower
----------
determined in accordance with GAAP for such period.
<PAGE>
17
New York PCS Network. The PCS Network in the New York MTA to be
--------------------
constructed pursuant to the License for such MTA awarded to the Borrower.
Nortel Administrative Agent. At any time, the Person then acting as the
---------------------------
administrative agent under the Nortel Loan Agreement.
Nortel Loan Agreement. The Amended and Restated Loan Agreement dated as of
---------------------
August 7, 1996 among the Borrower, Northern Telecom Inc., as administrative
agent, and the lenders parties thereto, and as the same may be amended from time
to time in compliance with the Loan Documents.
Notes. The Notes substantially in the form of Exhibit A issued by the
----- ---------
Borrower hereunder.
Orbitel. Orbitel Mobile Communications, Ltd.
-------
Parent. Omnipoint PCS, Inc., a Delaware corporation.
------
Parent Guaranty. The limited-recourse guaranty of Parent in favor of the
---------------
Administrative Agent and the Lenders, substantially in the form of Exhibit I, as
---------
amended from time to time in compliance with the Loan Documents.
Parent Pledge Agreement. The Amended and Restated Pledge Agreement among
-----------------------
Parent, the Collateral Agent, the Administrative Agent and Nortel Administrative
Agent, substantially in the form of Exhibit E, as amended from time to time in
---------
compliance with the Loan Documents.
PBGC. The Pension Benefit Guaranty Corporation created by (S)4002 of
----
ERISA, or any Governmental Body succeeding to the functions thereof.
PCS. The business of providing mobile communications services through the
---
use of microcells on microwave broadband frequencies with numerous low-power
transmitters, each serving a small area, but excluding cellular telephone
services.
PCS System. A PCS radio telephone system constructed and operated pursuant
----------
to a License therefor.
Permitted Liens. Liens, security interests and other encumbrances
---------------
permitted by (S)7.02.
Permitted Loan Agreement. The meaning specified in the Intercreditor
------------------------
Agreement.
<PAGE>
18
Person. Any natural person, corporation, firm, joint venture, limited
------
liability company, partnership, association, enterprise, trust or other entity
or organization, or any government or political subdivision or any agency,
department or instrumentality thereof.
Plan. With respect to the Borrower or any ERISA Affiliate, at any time, an
----
employee pension benefit plan as defined in (S)3(2) of ERISA (other than a
Multiemployer Plan) that is covered by Title IV of ERISA or subject to the
minimum funding standards under (S)412 of the IRC and
(a) is maintained for the employees of the Borrower or any ERISA
Affiliate, or
(b) was so maintained and in respect of which the borrower or any
ERISA Affiliate could have liability under Section 4064 or 4069 of ERISA in
the event that such plan has been or were to be terminated.
Pledged Collateral. As defined in the Parent Pledge Agreement.
------------------
Pledged Shares. As defined in the Parent Pledge Agreement.
--------------
Property. All types of real, personal, tangible, intangible or mixed
--------
property, including the License for the New York MTA.
Qualified Commitment. A binding written commitment to contribute equity
--------------------
capital or loan Subordinated Debt to the Borrower that
(a) is from either
(i) a Person (including Affiliates of the Borrower other than
Parent or Grand Parent) that, in the sole judgment of the Required
Lenders, has the financial resources and capability of performing the
commitment and making such investment, or
(ii) Parent or Grand Parent, if and to the extent that such
Person is holding cash, securities for which there is a readily
available market on an established stock exchange (including over-
the-counter exchanges) or other permitted investments under (S)7.04(a)
through (e), inclusive, equal to or in excess of the amount of such
commitment;
(b) is in a form customarily utilized by institutional venture-
capital firms for binding written commitments that have passed all internal
credit reviews;
<PAGE>
19
(c) has been executed by and is binding on such Person and the
Borrower; and
(d) (i) if the Person providing such commitment is Parent or Grand
Parent or another Affiliate of the Borrower, as to which all
conditions precedent to the making of such investment shall have been
satisfied, and
(ii) in all other cases, is subject only to verification that
there has occurred no material adverse change in the financial
condition of the Borrower since the date of the credit review on which
such commitment was predicated and completion, execution and delivery
of definitive loan documentation and customary closing documents
required by such investor or lender.
Rate Hedging Agreements. (a) Any and all agreements, devices or
-----------------------
arrangements designed to protect at least one of the parties thereto from the
fluctuations of interest rates, exchange rates or forward rates applicable to
such party's assets, liabilities or exchange transactions, including, but not
limited to dollar-denominated or cross-currency interest-rate exchange
agreements, forward-currency-exchange agreements, interest-rate-cap or dollar-
protection agreements, forward-rate-currency or interest-rate options, puts and
warrants, and (b) any and all cancellations, buy backs, reversals, terminations
or assignments of any of the foregoing.
RCRA. The Resource Conservation and Recovery Act of 1976, as amended, 42
----
USCA (S)6901 et seq.
Real Estate. Any parcel of real property or any facility currently (or for
-----------
purposes of compliance with Environmental Laws, formerly) owned, operated or
controlled by the Borrower.
Register. See (S)12.07(c).
--------
Reportable Event. The occurrence of any of the events set forth in
----------------
(S)4043(c) of ERISA or the regulations thereunder with respect to a Plan.
Required Lenders. At any time Lenders owed at least a majority in interest
----------------
of the sum of
(a) the then-outstanding aggregate unpaid principal amount of the
Advances owing to the Lenders, and
<PAGE>
20
(b) the then-outstanding undrawn Commitments.
Revenue. For any period,
-------
(a) the sum, without duplication, of
(i) gross billings to subscribers, net of taxes and other
direct pass-through charges,
(ii) revenue from the sale of equipment in the ordinary course
of business, net of the cost of such equipment,
(iii) so-called "roamer revenue", net of direct pass-through
charges, and
(iv) other revenue of the Borrower (in the case of resales net
of associated direct costs),
in each case as determined in accordance with GAAP, minus
(b) all revenue arising from payments by Affiliates (except where the
Affiliate is acting as a reseller of goods or services for the Borrower),
in each case as determined with respect to such period.
Royalty Agreement. The Acquisition Supply and License Agreement for
-----------------
Omnipoint Personal Communications System (PCS) Infrastructure Products dated as
of April 16, 1996 between Ericsson and Omnipoint Corporation, as amended from
time to time.
Second LIBOR Method. The terms and provisions of this Agreement relating
-------------------
to LIBOR Rate Advances specified as being applicable when the Second LIBOR
Method is applicable under (S)2.11.
Solvent. With respect to any Person on a particular date, the condition
-------
that on such date,
(a) the present fair salable value of the assets of such Person is
greater than the total amount that will be required to pay the probable
liabilities of such Person as and when they become due, including
Contingent Obligations, of such Person;
<PAGE>
21
(b) such Person is paying, and believes that it will be able to pay
in the future, its debts generally as and when they become due; and
(c) such Person is not engaged in business or a transaction, or is
not about to engage in business or a transaction, for which such Person's
Property would constitute an unreasonably small amount of capital.
With respect to the determination referred to in clause (a) above, the fair
salable value of the License for the New York MTA during the initial three-year
period in which transfers are restricted by the FCC, the effect of such a
transfer restriction shall be ignored.
Stock. With respect to any Person, any and all shares of capital stock of
-----
such Person and interests, participations, warrants or other equivalents
(however designated) therein or with respect thereto.
Subordinated Debt. Indebtedness of the Borrower as to which the holder
-----------------
thereof has executed a Subordination Agreement.
Subordination Agreement. The Subordination Agreement in substantially the
-----------------------
form of Exhibit F.
---------
Subsidiary. As to any Person, any corporation, association, partnership,
----------
joint venture or other business entity of which such Person and/or any
Subsidiary of such Person, directly or indirectly, either
(a) in respect of a corporation, owns or controls more than 50% of
the outstanding capital Stock having ordinary voting power to elect a
majority of the board of directors or similar managing body, irrespective
of whether a class or classes shall or might have voting power by reason of
the happening of any contingency, or
(b) in respect of an association, partnership, joint venture or other
business entity, is entitled to share in more than 50% of the profits and
losses, however determined.
Supply Agreement. The Acquisition Agreement for Ericsson CMS 40 Personal
----------------
Communications Systems (PCS) Infrastructure Equipment dated as of April 16, 1996
between Ericsson and the Borrower, as amended from time to time.
Total Interest Expense. For any period, the aggregate amount of interest
----------------------
required to be accrued by the Borrower during such period on all Indebtedness of
the Borrower outstanding during all or any part of such period, whether such
interest was or is required to be reflected
<PAGE>
22
as an item of expense or capitalized, including payments consisting of interest
in respect of Capitalized Leases and including arrangement fees, commitment
fees, agency fees, facility fees, origination fees, balance-deficiency fees and
similar fees or expenses in connection with the borrowing of money, all as
determined in accordance with GAAP; provided that (a) any origination fee paid
--------
from the proceeds of a financing shall be treated as being amortized evenly over
the term of such financing for purposes of determining Total Interest Expense
for any period and (b) notwithstanding clause (a) above, fees payable to
Ericsson pursuant to (S)2.03 under all circumstances shall be treated as accrued
on the date when payable.
Tranche A Advance Commitment. See (S)2.01(a).
----------------------------
Tranche A Advances. See (S)2.01(a).
------------------
Tranche A Advance Maturity Date. The earlier of
-------------------------------
(a) December 31, 2004, and
(b) the date of the acceleration of the Advances pursuant to
(S)10.01.
Tranche A Expenses. With respect to any date of determination, amounts due
------------------
and payable or previously paid by the Borrower on or before such date of
determination for or in respect of:
(a) the purchase of equipment and services (other than IS661 base
station controllers) from Ericsson under the Supply Agreement (whether
manufactured or provided by Ericsson or purchased by Ericsson from other
sources and resold to the Borrower under the Supply Agreement) for use by
the Borrower in the build-out of the New York MTA;
(b) the purchase from the Grand Parent or one of its Subsidiaries of
IS661 base transceiver stations that are manufactured by the Grand Parent
or one of its Subsidiaries, or the purchase from Ericsson under the Supply
Agreement of IS661 base station controllers manufactured by Ericsson, for
use by the Borrower in the build-out of the New York MTA; and
(c) interest accruing on Advances through March 31, 1998.
Tranche A Loans. A loan consisting of simultaneous Tranche A Advances of
---------------
the same Type made by the Lenders.
Tranche B and C Advance Commitment. See (S)2.01(b).
----------------------------------
<PAGE>
23
Tranche B Advances. See (S)2.01(b).
------------------
Tranche B Advance Maturity Date. The earlier of
-------------------------------
(a) December 31, 2004, and
(b) the date of the acceleration of the Advances pursuant to
(S)10.01.
Tranche B Expenses. With respect to any date of determination, amounts due
------------------
and payable or previously paid by the Borrower on or before such date of
determination for or in respect of:
(a) costs incurred by the Borrower in connection with construction,
engineering, design and site acquisition for the New York PCS Network;
(b) the actual costs incurred by the Borrower of physically
relocating existing microwave installations which are incompatible with the
New York PCS Network; and
(c) amounts payable to vendors of equipment to build the New York PCS
Network from Persons other than Ericsson.
Tranche B Loans. A loan consisting of simultaneous Tranche B Advances of
---------------
the same Type made by the Lenders.
Tranche C Advances. See (S)2.01(c).
------------------
Tranche C Advance Maturity Date. The earlier of
-------------------------------
(a) June 30, 1998, and
(b) the date of the acceleration of the Advances pursuant to
(S)10.01.
Tranche C Expenses. With respect to any date of determination, amounts due
------------------
and payable or paid by the Borrower on or before such date of determination for
the purchase from Ericsson or Orbitel of PCS handsets and accessories
manufactured or supplied by Ericsson or Orbitel or their respective Affiliates
for sale in connection with the Borrower's business.
Tranche C Loans. A loan consisting of simultaneous Tranche C Advances of
---------------
the same Type made by the Lenders.
<PAGE>
24
Type. As to any Loan, its nature as a Base Rate Loan, or a LIBOR Rate
----
Loan.
Voting Stock. Capital Stock or similar interests, of any class or classes
------------
(however designated), the holders of which are at the time entitled, as such
holders, to vote for the election of a majority of the directors (or persons
performing similar functions) of the corporation, association, trust or other
business entity involved, whether or not the right so to vote exists by reason
of the happening of a contingency.
Working Capital. With respect to any date of determination, the difference
---------------
between the Borrower's "current assets" and "current liabilities" as of such
date of determination in accordance with GAAP.
Working Capital Loan Agreement. The meaning specified in the Intercreditor
------------------------------
Agreement.
Section 1.02. Rules of Interpretation. (a) A reference to any document
-----------------------
or agreement shall include such document or agreement as amended, modified or
supplemented from time to time in accordance with its terms and the terms of
this Agreement.
(b) The singular includes the plural and the plural includes the singular.
(c) A reference to any law includes any amendment or modification to such
law.
(d) A reference to any Person includes its permitted successors and
permitted assigns.
(e) Accounting terms not otherwise defined herein have the meanings
assigned to them by GAAP applied on a consistent basis by the accounting entity
to which they refer.
(f) The words "include", "includes" and "including" are not limiting.
(g) All terms not specifically defined herein or by GAAP, which terms are
defined in the Uniform Commercial Code as in effect in the State of New York,
have the meanings assigned to them therein.
(h) Reference to a particular "(S)" or Exhibit refers to that section or
that exhibit to this Agreement, unless otherwise indicated.
<PAGE>
25
(i) The words "herein", "hereof", "hereunder" and words of like import
shall refer to this Agreement as a whole and not to any particular section or
subdivision of this Agreement.
Section 1.03. Accounting Terms. Except as otherwise expressly provided
----------------
herein, all accounting terms used herein shall be interpreted, and all financial
statements and certificates and reports as to financial matters required to be
delivered to the Administrative Agent shall be prepared in accordance with the
following ("GAAP"):
----
(a) principles that are consistent with the principles promulgated or
adopted by the Financial Accounting Standards Board and its predecessors in
effect at December 31, 1995, and
(b) to the extent consistent with such principles, the accounting
practice of the Borrower reflected in its financial statements for the year
ended at the date referred to in clause (a) above,
provided that, if such Board after the date hereof shall promulgate or adopt
- --------
principles that are materially different from those in effect at December 31,
1995, the Borrower and the Lenders will endeavor in good faith to amend this
Agreement in order to amend (i) the definition of GAAP to include such different
principles, and (ii) the other provisions of this Agreement so as to reflect in
substance the same limitations and restrictions as in effect prior to such
amendment to the definition of GAAP. Prior to the effective date, if any, of
any such amendment, GAAP shall, however, continue to include only the principles
specified in clause (a) of the preceding sentence.
ARTICLE II
THE LOANS
---------
Section 2.01. Commitment to Lend. Each Lender severally agrees, on the
------------------
terms and conditions hereinafter set forth, to make
(a) until the earlier of (i) the date on which the purchase price for
the last equipment delivered under the Supply Agreement is payable (but not
later than the day before the last repayment date for Tranche A Advances
under (S)3.01(a)) and (ii) the termination of the Commitments pursuant to
(S)10.01, advances ("Tranche A Advances") up to an aggregate principal
------------------
amount for all Tranche A Advances (whether or not repaid or prepaid, except
as otherwise provided in (S)3.04(c)) set forth opposite such Lender's name
on the signature pages hereof under the heading Tranche A Advance
<PAGE>
26
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---------------------------------------------
Commitment or, if such Lender has entered into any Assignment and
Acceptance, set forth for such Lender in the Register maintained by the
Administrative Agent pursuant to (S)12.07(c) (such Lender's "Tranche A
---------
Advance Commitment");
------------------
(b) until the date on which the Lenders shall no longer be required
to make Tranche A Advances, advances ("Tranche B Advances") up to an
------------------
aggregate principal amount for all Tranche B Advances and Tranche C
Advances (whether or not repaid or prepaid, except as otherwise provided in
(S)3.04(c)) set forth opposite such Lender's name on the signature pages
hereof under the heading Tranche B and Tranche C Advance Commitment or, if
such Lender has entered into any Assignment and Acceptance, set forth for
such Lender in the Register maintained by the Administrative Agent pursuant
to (S)12.07(c) (such Lender's "Tranche B and C Advance Commitment"); and
----------------------------------
(c) until the earlier of June 30, 1998 and (ii) the termination of
the Commitments pursuant to (S)10.01, advances ("Tranche C Advances" and,
------------------
together with the Tranche A Advances and the Tranche B Advances, the
"Advances") up to an aggregate principal amount for all Tranche C Advances
---------
and Tranche B Advances (whether or not repaid or prepaid, except as
otherwise provided in (S)3.04(c)) equal to such Lender's Tranche B and C
Advance Commitment.
In no event shall any Lender make
(i) any Advance if, on the date of such Advance and after giving
effect thereto, the aggregate principal amount of all Advances would exceed
(A) ****** prior to the date on which the Lender shall
have delivered to the Administrative Agent evidence reasonably
satisfactory to the Administrative Agent that the Borrower has at
least ****** activated PC S handsets on which telephone calls are
billable to Persons other than the Borrower and its Affiliates, and
(B) ****** plus the aggregate purchase price of
equipment delivered to the Borrower or its Affiliates under the
Royalty Agreement, thereafter;
(ii) any Tranche A Advance if, on the date of such Tranche A Advance
and after giving effect thereto, the aggregate principal amount of all
Tranche A Advances would exceed the lesser of:
<PAGE>
27
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|with respect to the omitted portions. |
---------------------------------------------
(A) ****** plus the aggregate purchase price of
equipment delivered to the Borrower or its Affiliates in lieu of cash
payments under the Royalty Agreement prior to such date, and
(B) the sum of
(1) the lesser of (I) ****** and (II) the aggregate
amount of all Tranche A Expenses incurred by the Borrower on or
before such date with respect to equipment described in clause
(b) of the definition thereof, and
(2) the aggregate amount of all other Tranche A Expenses
incurred by the Borrower on or before such date, minus, after
June 30, 1998, Tranche A Expenses with respect to accrued
interest described in clause (c) of the definition thereof;
(iii) any Tranche B Advance if, on the date of such Tranche B Advance
and after giving effect thereto, the aggregate principal amount of all
Tranche B Advances then outstanding would exceed the lesser of:
(A) ****** and
(B) the aggregate amount of all Tranche B Expenses incurred by
the Borrower on or before such date; or
(iv) any Tranche C Advance if, on the date of such Tranche C Advance
and after giving effect thereto, the aggregate principal amount of all
Tranche C Advances, the proceeds of which shall have been used for such
purpose, shall exceed the lesser of:
(A) ****** multiplied by the number of handsets manufactured
by Ericsson or Orbitel theretofore purchased by the Borrower and to be
purchased by the Borrower with the proceeds of such Tranche C Advance,
or
(B) ****** of the aggregate purchase price for all such
handsets theretofore paid by the Borrower and to be paid by the
Borrower with the proceeds of such Tranche C Advance.
Each Tranche A Loan shall consist of Tranche A Advances of the same Type made on
the same day by the Lenders ratably according to their respective Tranche A
Advance Commitments and shall be in an aggregate principal amount of $2,500,000
or in an integral multiple of $100,000 in excess thereof (or, if less, the
aggregate remaining unused amounts of
<PAGE>
28
all Lenders' Tranche A Advance Commitments) if the proceeds of such Tranche A
Loan are used to pay any Person other than Ericsson. Each Tranche B Loan shall
consist of Tranche B Advances of the same Type made on the same day by the
Lenders ratably according to their respective Tranche B and C Advance
Commitments and shall be in an aggregate principal amount of $1,000,000 or in an
integral multiple of $100,000 in excess thereof (or, if less, the aggregate
remaining unused amounts of all Lenders' Tranche B and C Advance Commitments) if
the proceeds of such Tranche B Loan are used to pay any Person other than
Ericsson. Each Tranche C Loan shall consist of Tranche C Advances of the same
Type made on the same day by the Lenders ratably according to their respective
Tranche B and C Advance Commitments and shall be in an aggregate principal
amount of $1,000,000 or in an integral multiple of $100,000 (or, if less, the
aggregate remaining unused amounts of all Lenders' Tranche B and C Advance
Commitments) in excess thereof if the proceeds of such Tranche C Loan are used
to pay any Person other than Ericsson or Orbitel.
Section 2.02. Making the Advances. (a) Each Loan shall be made on
-------------------
notice, given not later than 11:00 A.M. (New York City time) on the third
Business Day prior to the date of the proposed Loan in the case of a Loan
consisting of LIBOR Rate Advances (or, while the First LIBOR Method is
applicable, such shorter period to which the Administrative Agent may consent),
or the first Business Day prior to the date of the proposed Loan in the case of
a Loan consisting of Base Rate Advances, by the Borrower to the Administrative
Agent, which shall give to each Lender prompt notice thereof by telecopier or
telex. Each such notice of a Loan (a "Draw Request") shall be by telecopier or
------------
telex, confirmed immediately in writing, substantially in the form of Exhibit B,
---------
specifying therein
(i) the requested date of such Loan (which shall be a Business Day);
(ii) the requested Type of Advances comprising such Loan; provided
that
(A) while the First LIBOR Method is applicable, the Borrower
may not request Advances of one Type while there are Advances of the
other Type outstanding, and
(B) while the Second LIBOR Method is applicable, the Borrower
may not request that Advances be LIBOR Rate Advances if, after giving
effect to such Advances, there would be more than three different
Interest Periods then in effect;
(iii) whether such Loan is a Tranche A Loan, a Tranche B Loan or a
Tranche C Loan;
<PAGE>
29
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(iv) in the case of a Tranche A Loan, whether the proceeds thereof are
to be used to pay interest that is due and owing hereunder or for other
permitted purposes and, if for other permitted purposes, the aggregate
principal amount of such Tranche A Loan that is to be used for such other
permitted purposes;
(v) a reasonably detailed description of the use of the proceeds of
such Loan;
(vi) the requested aggregate principal amount of such Loan (except in
the case of a Tranche A Loan the proceeds of which are to be used to pay
interest that is due and owing hereunder); and
(vii) the account to which the proceeds of such Loan shall be paid,
which shall be to an account specified by Ericsson in the case of any Loan
the proceeds of which are to be used to pay Tranche A Expenses, Tranche B
Expenses or Tranche C Expenses then owing by the Borrower to Ericsson or
Orbitel.
Each Draw Request shall be accompanied by the certification of Grand Parent
pursuant to the Cash Maintenance Agreement, if then required to be delivered by
Grand Parent to the Borrower for delivery to the Administrative Agent, and such
additional documents as may be required by Article IX. The Borrower shall
submit no more than
(x) one Draw Request for a Tranche A Loan for any purpose other than
the payment of interest that is due and owing hereunder,
(y) one Draw Request for a Tranche B Loan and
(z) one Draw Request for a Tranche C Loan
in any calendar month. Each Lender shall, before 11:00 A.M. (New York City
time) on the date of such Loan, make available for the account of its Applicable
Lending Office to the Administrative Agent at the following account: Morgan
Guaranty Trust Company of New York, 60 Wall Street, New York, New York 10260,
****** (or to such other account as the Administrative Agent from time to time
may specify), in same-day funds, such Lender's ratable portion of such Loan.
After the Administrative Agent's receipt of such funds and upon fulfillment of
the applicable conditions set forth in Articles VIII and IX, the Administrative
Agent will wire transfer same-day funds in the aggregate principal amount of
such Loan to such account as the Borrower shall have specified in its Draw
Request. If the Administrative Agent shall receive such funds and if such
applicable conditions shall be fulfilled prior to 11:00 A.M. (Central Time) on
the date of any
<PAGE>
30
proposed Loan, the Administrative Agent shall commence the wire transfer (or
direct its bank to commence the wire transfer) of such funds to such account by
1:00 P.M. (Central Time).
(b) Anything in subsection (a) above to the contrary notwithstanding, (i)
the Borrower may not select LIBOR Rate Advances for any Loan if the aggregate
amount of such Loan is less than $5,000,000 or if the obligation of the Lenders
to make LIBOR Rate Advances shall then be suspended pursuant to (S)2.05 or 4.01
and (ii) there shall be no more than three Interest Periods for LIBOR Rate
Advances at any one time in effect.
(c) Each Draw Request shall be irrevocable and binding on the Borrower. In
the case of any Loan that the related Draw Request specifies is to be comprised
of LIBOR Rate Advances and while the Second LIBOR Method is applicable, the
Borrower shall indemnify each Lender against any loss, cost or expense incurred
by such Lender as a result of any failure to fulfill on or before the date
specified in such Draw Request for such Loan the applicable conditions set forth
in Article VIII and IX, including any loss (including loss of anticipated
profits), cost or expense incurred by reason of the liquidation or reemployment
of deposits or other funds acquired by such Lender to fund the Advance to be
made by such Lender as part of such Loan when such Advance, as a result of such
failure, is not made on such date.
(d) Unless the Administrative Agent shall have received notice from a
Lender prior to the date of any Loan that such Lender will not make available to
the Administrative Agent such Lender's ratable portion of such Loan, the
Administrative Agent may assume that such Lender has made such portion available
to the Administrative Agent on the date of such Loan in accordance with
subsection (a) of this (S)2.02 and the Administrative Agent may, in reliance
upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Lender shall not have so
made such ratable portion available to the Administrative Agent, such Lender and
the Borrower severally will repay to the Administrative Agent forthwith on
demand such corresponding amount together with interest thereon, for each day
from the date such amount is made available to the Borrower until the date such
amount is repaid to the Administrative Agent, at (i) in the case of the
Borrower, the interest rate applicable at the time to Advances comprising such
Loan and (ii) in the case of such Lender, the Federal Funds Rate. If such
Lender shall repay to the Administrative Agent such corresponding amount, such
amount so repaid shall constitute such Lender's Advance as part of such Loan for
purposes of this Agreement.
(e) The failure of any Lender to make the Advance to be made by it as part
of any Loan shall not relieve any other Lender of its obligation, if any,
hereunder to make its Advance on the date of such Loan, but no Lender shall be
responsible for the failure of any other Lender to make the Advance to be made
by such other Lender on the date of any Loan.
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Section 2.03. Fees. (a) The Borrower will to pay to the Administrative
----
Agent for the account of each Lender a cash origination fee on the aggregate
principal amount of each Advance made by such Lender hereunder equal to ******
of the principal amount of such Advance. Such fee, with respect to each Advance
made on or before June 30, 1998 shall be payable on June 30, 1998 and, with
respect to each Advance made after June 30, 1998, shall be payable on the date
of such Advance.
(b) The Borrower shall pay to the Administrative Agent, if it is other
than Ericsson, such reasonable and customary fees as the Administrative Agent
from time to time may request.
Section 2.04. Interest. (a) The Borrower shall pay interest on the
--------
unpaid principal amount of each Advance owing to each Lender from the date of
such Advance until such principal amount shall be paid in full, at the following
rates per annum:
(i) During such periods as such Advance is a Base Rate Advance, a
rate per annum equal at all times to the sum of (A) the Base Rate in effect
from time to time, plus (B) the Applicable Margin in effect from time to
time and applicable to such Advance, payable in arrears quarterly on the
last day of each June, September, December and March during such periods
and on the date such Base Rate Advance shall be Converted or paid in full.
(ii) During such periods as such Advance is a LIBOR Rate Advance, a
rate per annum equal at all times during each Interest Period for such
Advance (or, if the First LIBOR Method is applicable, during each Interest
Period while such Advance is outstanding as a LIBOR Rate Advance) to the
sum of (A) the LIBOR Rate for such Interest Period for such Advance, plus
(B) the Applicable Margin in effect from time to time and applicable to
such Advance, payable in arrears on the last day of such Interest Period
and on the date such LIBOR Rate Advance shall be Converted or paid in full.
(b) Upon the occurrence and during the continuance of an Event of Default
under (S)10.01(a), the Borrower shall pay interest on
(i) the unpaid principal amount of each Advance owing to each
Lender, payable in arrears on the dates referred to in clause (a)(i) or
(a)(ii) above, at a rate per annum equal at all times to ****** per annum
above the rate per annum then required to be paid on such Advance pursuant
to clause (a)(i) or (a)(ii) above, and
(ii) the amount of any interest, fee or other amount payable
hereunder that is not paid when due, from the date such amount shall be due
until such amount shall be paid in full, payable in arrears on the date
such amount shall be paid in full and on
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demand, at a rate per annum equal at all times to ****** per annum above
the rate per annum required to be paid on Base Rate Advances pursuant to
clause (a)(i) above.
Section 2.05. Interest Rate Determination. (a) If, with respect to any
---------------------------
LIBOR Rate Advances, the Required Lenders notify the Administrative Agent that
the LIBOR Rate for any Interest Period for such Advances will not adequately
reflect the cost to such Required Lenders of making, funding or maintaining
their respective LIBOR Rate Advances for such Interest Period, the
Administrative Agent shall forthwith so notify the Borrower and the Lenders,
whereupon
(i) each LIBOR Rate Advance will automatically, on the last day of
the then-existing Interest Period therefor, Convert into a Base Rate
Advance, and
(ii) (A) while the First LIBOR Method is applicable, the obligation
of the Lenders to make or to Convert Advances into, LIBOR Rate
Advances shall be suspended as of the last day of the then-existing
Interest Period therefor, and
(B) while the Second LIBOR Method is applicable, the obligation
of the Lenders to make, or to Convert Advances into, LIBOR Rate
Advances shall be suspended immediately,
until the Administrative Agent shall notify the Borrower and the Lenders
that the circumstances causing such suspension no longer exist.
(b) On the date on which the aggregate unpaid principal amount of all
LIBOR Rate Advances shall be reduced, by payment or prepayment or otherwise, to
less than $5,000,000, such Advances shall automatically Convert into Base Rate
Advances.
(c) Upon the occurrence and during the continuance of any Event of Default
under (S)10.01(a),
(i) each LIBOR Rate Advance will automatically, on the last day of
the then-existing Interest Period therefor, Convert into a Base Rate
Advance and
(ii) (A) while the First LIBOR Method is applicable, the obligation
of the Lenders to make, or to Convert Advances into, LIBOR Rate
Advances shall be suspended as of the last day of the then-existing
Interest Period therefor, and
(B) while the Second LIBOR Method is applicable, the obligation
of the Lenders to make, or to Convert Advances into, LIBOR Rate
Advances shall be suspended immediately.
<PAGE>
33
(d) If the Administrative Agent cannot determine the LIBOR Rate for any
LIBOR Rate Advances,
(i) the Administrative Agent shall forthwith notify the Borrower
and the Lenders that the interest rate cannot be determined for such LIBOR
Rate Advances,
(ii) each such Advance will automatically, on the last day of the
then-existing Interest Period therefor, Convert into a Base Rate Advance,
and
(iii) (A) while the First LIBOR Method is applicable, the
obligation of the Lenders to make, or to Convert Advances into, LIBOR
Rate Advances shall be suspended as of the last day of the then-
existing Interest Period therefor, and
(B) while the Second LIBOR Method is applicable, the
obligation of the Lenders to make, or to Convert Advances into, LIBOR
Rate Advances shall be suspended immediately,
until the Administrative Agent shall notify the Borrower and the Lenders
that the circumstances causing such suspension no longer exist.
Section 2.06. Optional Conversion of Advances. The Borrower may on any
-------------------------------
Business Day, upon notice given to the Administrative Agent not later than 11:00
A.M. (New York City time) on the third Business Day prior to the date of the
proposed Conversion and subject to the provisions of (S)(S)2.07 and 2.09,
Convert all Advances of one Type comprising the same Loan into Advances of the
other Type; provided that,
--------
(a) while the Second LIBOR Method is applicable,
(i) any Conversion of LIBOR Rate Advances into Base Rate
Advances shall be made only on the last day of an Interest Period for
such LIBOR Rate Advances, and
(ii) the Borrower may not Convert Base Rate Advances into
LIBOR Rate Advances if, after giving effect thereto there would be
more than three Interest Periods in effect or if the Advances to be
Converted would be less than the minimum amount specified in
(S)2.02(b), and
(b) while the First LIBOR Method is applicable, the Borrower may
not convert any Advances of one Type into Advances of the other Type unless
it converts all Advances of one Type into Advances of the other Type.
<PAGE>
34
Each such notice of a Conversion shall, within the restrictions specified above,
specify (a) the date of such Conversion, and (b) the Advances to be Converted.
Each notice of Conversion shall be irrevocable and binding on the Borrower.
Section 2.07. Payments and Computations. (a) The Borrower shall make
-------------------------
each payment hereunder and under the Notes not later than 11:00 A.M. (New York
City time) on the day when due in U.S. dollars to the Administrative Agent at
the Administrative Agent's Account in same-day funds. The Administrative Agent
will promptly thereafter cause to be distributed like funds relating to the
payment of principal or interest or arrangement fees and other amounts ratably
(other than amounts payable pursuant to (S)4.02, 4.03 or 12.04(c)) to the
Lenders for the account of their respective Applicable Lending Offices, and like
funds relating to the payment of any other amount payable to any Lender to such
Lender for the account of its Applicable Lending Office, in each case to be
applied in accordance with the terms of this Agreement. Upon the Administrative
Agent's acceptance of an Assignment and Acceptance and recording of the
information contained therein in the Register pursuant to (S)12.07(d), from and
after the effective date specified in such Assignment and Acceptance, the
Administrative Agent shall make all payments hereunder and under the Notes in
respect of the interest assigned thereby to the Lender assignee thereunder, and
the parties to such Assignment and Acceptance shall make all appropriate
adjustments in such payments for periods prior to such effective date directly
between themselves.
(b) All computations of interest shall be made by the Administrative Agent
on the basis of a year of 360 days, for the actual number of days (including the
first day but excluding the last day) occurring in the period for which such
interest or facility fees are payable. Each determination by the Administrative
Agent of an interest rate hereunder shall be conclusive and binding for all
purposes, absent manifest error.
(c) Whenever any payment hereunder or under the Notes shall be stated to
be due on a day other than a Business Day, such payment shall be made on the
next-succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or facility fee, as the case
may be; provided that, if such extension would cause payment of interest on or
--------
principal of LIBOR Rate Advances to be made in the next-following calendar
month, such payment shall be made on the next-preceding Business Day.
(d) Unless the Administrative Agent shall have received notice from the
Borrower prior to the date on which any payment is due and owing to the Lenders
hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each Lender on such
due date an amount equal to the amount then due such Lender. If and to the
<PAGE>
35
extent the Borrower shall not have so made such payment in full to the
Administrative Agent, each Lender shall repay to the Administrative Agent
forthwith on demand such amount distributed to such Lender together with
interest thereon, for each day from the date such amount is distributed to such
Lender until the date such Lender repays such amount to the Administrative
Agent, at the Federal Funds Rate.
(e) To the extent permitted by law, all payments by the Borrower hereunder
and under any of the other Loan Documents shall be made without setoff or
counterclaim. Without limitation of the preceding sentence, to the extent
permitted by law the Borrower's obligation to pay all amounts due under the
Loans shall not be affected by any circumstance whatsoever, including:
(i) any set-off, counterclaim, recoupment, deduction, abatement,
suspension, diminution, reduction, defense or other right which the
Borrower may have against Ericsson for any reason whatsoever arising under
or pursuant to the Supply Agreement or the Royalty Agreement or otherwise
relating to the purchase of goods, other property or services from or by
Ericsson;
(ii) any defect in the condition, design, operation or fitness for
use of, or any damage to or loss or destruction of, any equipment or
material provided by Ericsson;
(iii) any actual or alleged default by Ericsson or any other Person
under the Supply Agreement or the Royalty Agreement; or
(iv) any other fact or circumstance relating to the Supply Agreement
or the Royalty Agreement.
No payment hereunder shall affect any rights of the Borrower under any other
agreement with Ericsson.
Section 2.08. Sharing of Payments, Etc. If any Lender shall obtain any
------------------------
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) on account of the Advances owing to it (other than
pursuant to (S)4.02, 4.03 or 12.04(c)) in excess of its ratable share of
payments on account of the Advances obtained by all the Lenders, such Lender
shall forthwith purchase from the other Lenders such participations in the
Advances owing to them as shall be necessary to cause such purchasing Lender to
share the excess payment ratably with each of them; provided that if all or any
--------
portion of such excess payment is thereafter recovered from such purchasing
Lender, such purchase from each Lender shall be rescinded and such Lender shall
repay to the purchasing Lender the purchase price to the extent of such recovery
together with an amount equal to such Lender's ratable share
<PAGE>
36
(according to the proportion of (a) the amount of such Lender's required
repayment to (b) the total amount so recovered from the purchasing Lender) of
any interest or other amount paid or payable by the purchasing Lender in respect
of the total amount so recovered. The Borrower agrees that any Lender so
purchasing a participation from another Lender pursuant to this (S)2.08 may, to
the fullest extent permitted by law, exercise all its rights of payment
(including the right of set-off) with respect to such participation as fully as
if such Lender were the direct creditor of the Borrower in the amount of such
participation.
Section 2.09. Use of Proceeds. The proceeds of the Advances shall be
---------------
available (and the Borrower shall use such proceeds) for general corporate
purposes.
Section 2.10. The Notes. The Borrower irrevocably authorizes each Lender
---------
to make or cause to be made an appropriate notation on the Schedule attached to
such Lender's Note of the making of Loans or (as the case may be) the receipt of
payments. The amount of the Loans set forth on such Schedule shall be prima-
------
facie evidence of the principal amount thereof owing and unpaid to such Lender,
- -----
but the failure to record, or any error in so recording, any such amount on such
Schedule shall not limit or otherwise affect the Borrower's Obligations
hereunder or under the Notes to make payments of principal of or interest on the
Notes when due.
Section 2.11. First LIBOR Method and Second LIBOR Method. If there is a
------------------------------------------
Lender in addition to or other than Ericsson (and that is unaffiliated with
Ericsson) and the Administrative Agent at the direction of the Required Lenders
shall have notified the Borrower that the Second LIBOR Method shall be
applicable, the Second LIBOR Method shall become applicable as of (a) if any
LIBOR Rate Advances are then outstanding, the last day of the then-existing
Interest Period therefor and (b) otherwise the date of such notice immediately.
After becoming applicable, the Second LIBOR Method shall remain applicable at
all times thereafter. The First LIBOR Method shall be applicable at all times
until the Second LIBOR Method becomes applicable.
ARTICLE III
REPAYMENT AND PREPAYMENT OF THE LOANS
-------------------------------------
Section 3.01. Term/Amortization. (a) On the last day of each calendar
-----------------
quarter specified below (or, if such day is not a Business Day, on the next-
preceding Business Day), the Borrower will repay
(i) a ratable aggregate principal amount of Tranche A Advances
forming part of the same Tranche A Loans equal to the percentage specified
in the table below
<PAGE>
37
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opposite such calendar quarter of the greatest aggregate principal amount
of Tranche A Advances outstanding on any date prior to the date of such
repayment, and
(ii) a ratable aggregate principal amount of Tranche B Advances
forming part of the same Tranche B Loans equal to the percentage specified
below opposite such calendar quarter of the greatest aggregate principal
amount of Tranche B Advances outstanding on any date prior to the date of
such repayment.
<TABLE>
<CAPTION>
================================================================================
Calendar Quarter Percentage
- ---------------- ----------
- --------------------------------------------------------------------------------
<S> <C>
From and including the first calendar quarter ******
in 2000 to and including the last calendar
quarter in 2001
- --------------------------------------------------------------------------------
From and including the first calendar quarter ******
in 2002 to and including the last calendar
quarter in 2002
- --------------------------------------------------------------------------------
From and including the first calendar quarter ******
in 2003 to and including the last calendar
quarter in 2004
================================================================================
</TABLE>
On each repayment date specified in the next-preceding sentence, the Borrower
also will repay:
(A) a ratable aggregate principal amount of Tranche A Advances
forming part of the same Tranche A Loans equal to the difference, if any,
between
(1) the aggregate principal amount of all Tranche A Advances
that would theretofore have been repaid pursuant to the next-preceding
sentence if all Tranche A Advances made after March 31, 2000 had been
prior to April 1, 2000, and
(2) the aggregate principal amount of all Tranche A Advances
actually repaid pursuant to the next-preceding sentence, and
(B) a ratable aggregate principal amount of the Tranche B Advances
forming part of the same Tranche B Loans equal to the difference, if any,
between
(1) the aggregate principal amount of all Tranche B Advances
that would theretofore have been repaid pursuant to the next-preceding
sentence if all Tranche B Advances made on or after March 31, 2000 had
been made prior to April 1, 2000, and
<PAGE>
38
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(2) the aggregate principal amount of all Tranche B Advances
actually repaid pursuant to the next-preceding sentence.
On the Tranche A Advance Maturity Date, the Borrower will repay the aggregate
then-outstanding principal amount of all Tranche A Advances and, on the Tranche
B Advance Maturity Date, the Borrower will repay the aggregate then-outstanding
principal amount of all Tranche B Advances.
(b) On the Tranche C Advance Maturity Date, the Borrower will repay the
aggregate then-outstanding principal amount of all Tranche C Advances.
Section 3.02. Mandatory Prepayments of Loans. (a) No later than three
------------------------------
Business Days after its receipt of any Net Cash Proceeds referred to in clause
(i) below, the Borrower will prepay the Advances in an aggregate principal
amount equal to
(i) the Net Cash Proceeds from the direct or indirect sale of any
assets of the Borrower (other than the Borrower's inventory and other goods
sold in the ordinary course of the Borrower's business) that is otherwise
permitted under this Agreement, during any calendar year, to the extent
such aggregate Net Cash Proceeds received during such calendar year shall
exceed ****** multiplied by
(ii) a fraction, (A) the numerator of which is the aggregate principal
amount of the Advances outstanding at the time of such sale, and (B) the
denominator of which is such aggregate principal amount, plus the aggregate
principal amount of all Indebtedness outstanding at the time of such sale
under the Nortel Loan Agreement and all other Permitted Loan Agreements the
loans under which are required to be prepaid with such Net Cash Proceeds.
Any prepayment pursuant to this subsection (a) shall be applied, first, to the
prepayment of a ratable aggregate principal amount of Tranche C Advances forming
part of the same Tranche C Loans, second, to the prepayment of a ratable
aggregate principal amount of Tranche B Advances forming part of the same
Tranche B Loans, and, third, to the repayment of a ratable aggregate principal
amount of Tranche A Advances forming part of the same Tranche A Loans. No
prepayment of any Tranche A Advances or Tranche B Advances shall reduce the
principal amount of such Advances required to be repaid on any date pursuant to
(S)3.01(a), to the extent that such Advances are outstanding on such date. No
prior prepayment of Tranche A Advances shall reduce the principal amount of the
Advances required to be prepaid pursuant to this subsection (a).
<PAGE>
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(b) On or before the 120th day of each fiscal year commencing in the fiscal
year beginning on ****** and each year for so long as any Tranche B Loans shall
remain outstanding, the Borrower will prepay the Tranche B Advances in an
aggregate principal amount equal to
(i) ****** of Excess Cash Flow in respect of the Borrower's
immediately preceding fiscal year, multiplied by
(ii) a fraction,
(A) the numerator of which is the aggregate principal amount of
the Tranche B Advances then outstanding, and
(B) the denominator of which is
(1) such aggregate principal amount, plus
(2) the aggregate principal amount of the Tranche B Loans
(as defined in the Nortel Loan Agreement) then outstanding under
the Nortel Loan Agreement, plus
(3) the aggregate principal amount of all loans under each
other Permitted Loan Agreement the proceeds of which may be used
for purposes substantially the same as those described in the
definition of Tranche B Expenses or those permitted for Tranche B
Loans (as defined in the Nortel Loan Agreement as in effect on
the date hereof) and that are required to be prepaid out of
Excess Cash Flow, if such other Permitted Loan Agreement provides
for mandatory prepayments from such Excess Cash Flow and the
Intercreditor Agreement permits such prepayment.
Any such prepayment shall be applied to the prepayment of a ratable aggregate
principal amount of Tranche B Advances forming part of the same Tranche B Loan
then outstanding, and shall not reduce the principal amount of the Tranche B
Advances required to be repaid on any date pursuant to (S)3.01(a), to the extent
that such Advances are outstanding on such date. No prior prepayment of Tranche
B Advances shall reduce the principal amount of the Tranche B Advances required
to be prepaid pursuant to this subsection (b).
(c) On ****** the Borrower will prepay an aggregate principal amount of the
Tranche A Advances equal to the aggregate amount of interest accrued on the
Loans through March 31, 1998. Any such prepayment shall be applied to the
prepayment of a
<PAGE>
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ratable aggregate principal amount of Tranche A Advances forming part of the
same Tranche A Loans as the Borrower shall specify, and shall be applied to the
ratable reduction of the amounts by which the Tranche A Advances are required to
be repaid pursuant to (S)3.01(a).
(d) On or before the third Business Day after the termination of the Supply
Agreement by Ericsson as a result of a default thereunder by the Borrower, the
Borrower will prepay the entire aggregate principal amount of the Advances then
outstanding.
(e) On each December 31 and June 30 (or, if such day is not a Business Day,
on the next-preceding Business Day), beginning on June 30, 1998, if the
aggregate principal amount of all Tranche B Advances outstanding on such date
shall exceed the lesser of:
(i) one half of the aggregate principal amount of Tranche A Advances
that may be outstanding as of such date under (S)2.01(ii) (except that, for
purposes of determining such amount, the aggregate purchase price of
equipment referred to in clause (a) or (b) of the definition of Tranche A
Expenses for which the Borrower has entered into binding, non-cancelable
orders to deliver such equipment to the Borrower within six months of such
date shall be deemed to be included in Tranche A Expenses (to the extent
that they would not otherwise be included therein)), or
(ii) the lesser of
(A) ****** multiplied by the number of handsets manufactured by
Ericsson or Orbitel theretofore purchased by the Borrower, or
(B) ****** of the aggregate purchase price theretofore paid for
all such handsets by the Borrower,
the Borrower will prepay an aggregate principal amount of the Tranche B Advances
equal to such excess. Any such prepayment shall be applied to the prepayment of
a ratable aggregate principal amount of Tranche B Advances forming part of the
same Tranche B Loans as the Borrower shall specify, and shall be applied to the
ratable reduction of the amounts by which the Tranche B Advances are required to
be repaid pursuant to (S)3.01(a). No prior prepayment of Tranche B Advances
shall reduce the principal amount of the Tranche B Advances required to be
prepaid pursuant to this subsection (e).
Section 3.03. Optional Prepayments of Loans. The Borrower may, upon at
-----------------------------
least three-Business-Days' notice to the Administrative Agent stating the
proposed prepayment date, aggregate principal amount of the Advances to be
prepaid and whether the Advances to be prepaid are Tranche A Advances, Tranche B
Advances or Tranche C Advances, and if such notice is given the Borrower shall,
prepay the outstanding principal amount of the Advances of
<PAGE>
41
the tranche specified then outstanding in whole or ratably in part. Any such
prepayment of less than the entire aggregate principal amount of the Advances
then outstanding shall be applied to the prepayment of a ratable aggregate
principal amount of Advances of the tranche specified by the Borrower forming
part of the same Loans of such kind. Any prepayment of Tranche A Advances or
Tranche B Advances pursuant to this Section 3.03 shall be applied to the
reduction of the amounts by which such Advances are required to be repaid
pursuant to (S)3.01(a) on the repayment dates next occurring after the date of
such prepayment.
Section 3.04. Certain Matters relating to Repayments and Prepayments. (a)
------------------------------------------------------
On the date on which Advances of a specified tranche are to be repaid or
prepaid, and if less than all Loans of such tranche are to be repaid or prepaid,
if the Second LIBOR Method is applicable and if both Base Rate Loans and LIBOR
Rate Loans are outstanding with respect to such tranche, the Borrower will
specify whether the Loan to be repaid or prepaid shall be a Base Rate Loan or a
LIBOR Rate Loan and, if a LIBOR Rate Loan is to be repaid or prepaid and more
than one LIBOR Rate Loan is outstanding, which such Loan shall be prepaid.
(b) All prepayments and repayments pursuant to this Article III shall be
accompanied by such additional amounts as are sufficient to pay accrued and
unpaid interest on the principal amount of the Advances then being prepaid or
repaid.
(c) Advances that are prepaid or repaid may not be reborrowed and any such
prepayment or repayment shall reduce ratably the amount of the Commitments
relating to the Advances then being repaid or prepaid, except that
(i) the prepayment of Tranche A Advances pursuant to (S)3.02(c) shall
not reduce the amount of Tranche A Advance Commitment and, after such
repayment, the Borrower may, subject to (S)2.01, borrow as Tranche A
Advances amounts equal to the principal amount of the Tranche A Advances
prepaid pursuant to such Section, and
(ii) the repayment of Tranche C Advances pursuant to (S)3.01(b) shall
not reduce the amount of Tranche B and C Advance Commitment and, after such
repayment, the Borrower may, subject to (S)2.01, borrow as Tranche B
Advances amounts equal to the principal amount of the Tranche C Advances
repaid pursuant to such Section.
ARTICLE IV
ILLEGALITY, INCREASED COSTS, CAPITAL ADEQUACY AND INDEMNITIES
-------------------------------------------------------------
<PAGE>
42
Section 4.01. Illegality. Notwithstanding any other provisions herein, if
----------
any present or future law, regulation, treaty or directive or the interpretation
or application thereof shall make it unlawful for any Lender to make or maintain
LIBOR Rate Loans, such Lender shall forthwith give notice of such circumstances
to the Borrower, the Administrative Agent and the other Lenders and thereupon
(a) the Commitments of such Lender to make LIBOR Rate Loans shall
forthwith be suspended until such notifying Lender shall have notified the
Administrative Agent and the Borrower that the circumstance giving rise to
such determination no longer exists (and if such notifying Lender shall
determine that such circumstance no longer exists it shall so notify the
Administrative Agent and the Borrower promptly after determining the same),
and
(b) the aggregate principal amount of such Lender's LIBOR Rate Loans,
if any, shall be Converted automatically to Base Rate Loans on the last day
of each Interest Period applicable to such LIBOR Rate Loans or within such
earlier period as may be required by applicable law.
Such Lender will designate a different Applicable Lending Office if such
designation will avoid the need for any suspension or Conversions described in
the preceding sentence and will not, in the judgment of such Lender, be
otherwise disadvantageous to such Lender.
Section 4.02. Additional Costs and Capital Adequacy. (a) If any present
-------------------------------------
or future applicable law, which expression, as used herein, includes statutes,
rules and regulations thereunder and interpretations thereof by any competent
court having jurisdiction with respect thereto or by any governmental or other
regulatory body or official charged with the administration or the
interpretation thereof and requests, directives, instructions and notices at any
time or from time to time hereafter made upon or otherwise issued to any Lender
or the Administrative Agent by any central bank or other fiscal, monetary or
other authority (whether or not having the force of law), shall
(i) impose or increase or render applicable (other than to the extent
specifically provided for elsewhere in this Agreement) any special-deposit,
reserve, assessment, liquidity, capital adequacy or other similar
requirements (whether or not having the force of law) against assets held
by, or deposits in or for the account of, or loans by, or commitments of an
office of any Lender, or
(ii) impose on any Lender or the Administrative Agent any other
conditions or requirements with respect to this Agreement, the other Loan
Documents, such Lender's Commitments, or any class of loans, or commitments
of which any of the Loans or such Lender's Commitments form a part,
<PAGE>
43
and the result of any of the foregoing is to increase the cost to such Lender of
making, funding, issuing, renewing, extending or maintaining any of the Advances
or such Lender's Commitment (taking into account such Lender's then-existing
policies with respect to maintaining capital), then the Borrower shall pay to
the Administrative Agent for the account of such Lender, within 15 days after
demand from time to time as specified by such Lender, additional amounts
sufficient to compensate such Lender or such corporation in the light of such
circumstances, for such increased costs.
(b) If any law, governmental rule, regulation, policy, guideline or
directive (whether or not having the force of law) or the interpretation thereof
by a court or governmental authority with appropriate jurisdiction, that in any
case becomes effective after the date hereof, affects the amount of capital
required or expected to be maintained by any Lender or any corporation
controlling such Lender and such Lender determines that the amount of capital
required to be maintained by it is increased by or based upon the existence of
such Lender's commitment with respect to any Advances, the Borrower will pay to
such Lender, within 15 days after demand from time to time as specified by such
Lender, additional amounts sufficient to compensate such Lender or such
corporation in the light of such circumstances, to the extent that such Lender
reasonably determines such increase in capital to be allocable to the existence
of such Lender's commitment to lend hereunder.
(c) Each demand by a Lender pursuant to this (S)4.02 shall be accompanied
by a statement setting forth in reasonable detail the basis for such demand and
the computation of such amount, including any method by which such cost was
allocated to the Borrower. In determining the amount of any compensation, such
Lender may use any reasonable averaging or attribution methods set forth in such
demand, and any such methods so used shall be binding on the Borrower. The
amount specified in any such demand shall be conclusive evidence of the amount
owing, absent manifest error. Such Lender will designate a different Applicable
Lending Office if such designation will avoid the need for or reduce the amount
of, any compensation under this (S)4.02 and will not, in the judgment of such
Lender, be otherwise disadvantageous to such Lender. By making any payment
under this (S)4.02, the Borrower is not waiving its right to contest that the
amounts set forth in the certificates are based on manifest error.
Section 4.03. Taxes. (a) Any and all payments by the Borrower hereunder
-----
or under the Notes shall be made free and clear of and without deduction for any
and all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding, in the case
---------
of each Lender and the Administrative Agent, taxes imposed on its income, and
franchise taxes imposed on it in lieu of income taxes, by the jurisdiction under
the laws of which such Lender or the Administrative Agent (as the case may be)
is organized or any political subdivision thereof and, in the case of each
Lender, taxes
<PAGE>
44
imposed on its income, and franchise taxes imposed on it in lieu of income
taxes, by the jurisdiction of such Lender's Applicable Lending Office or any
political subdivision thereof (all such non-excluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities being hereinafter referred to
as "Taxes"). If the Borrower shall be required by law to deduct any Taxes from
-----
or in respect of any sum payable hereunder or under any Note to any Lender or
the Administrative Agent,
(i) the sum payable shall be increased as may be necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this (S)4.03) such Lender or the
Administrative Agent (as the case may be) receives an amount equal to the
sum it would have received had no such deductions been made,
(ii) the Borrower shall make such deductions, and
(iii) the Borrower shall pay the full amount deducted to the relevant
taxation authority or other authority in accordance with applicable law.
(b) In addition, the Borrower agrees to pay any present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies that arise from any payment made hereunder or under the Notes or from the
execution, delivery or registration of, or otherwise with respect to, this
Agreement or the Notes (hereinafter referred to as "Other Taxes").
-----------
(c) The Borrower will indemnify each Lender and the Administrative Agent
for the full amount of Taxes or Other Taxes (including any Taxes or Other Taxes
imposed by any jurisdiction on amounts payable under this (S)4.03) paid by such
Lender or the Administrative Agent (as the case may be) and any liability
(including penalties, interest and expenses) arising therefrom or with respect
thereto. This indemnification shall be made within 15 days from the date such
Lender or the Administrative Agent (as the case may be) makes written demand
therefor.
(d) Within 30 days after the date of any payment of Taxes, the Borrower
will furnish to the Administrative Agent, at its address referred to in
(S)12.02, the original or a certified copy of a receipt evidencing payment
thereof. In the case of any payment hereunder or under the Notes by or on
behalf of the Borrower through an account or branch outside the United States or
on behalf of the Borrower by a payor that is not a United States person, if the
Borrower determines that no Taxes are payable in respect thereof, the Borrower
shall furnish, or shall cause such payor to furnish, to the Administrative
Agent, at such address, an opinion of counsel acceptable to the Administrative
Agent stating that such payment is exempt from Taxes. For purposes of this
subsection (d) and subsection (e) below, the terms "United States"
-------------
<PAGE>
45
and "United States person" shall have the meanings specified in (S)7701 of the
--------------------
Internal Revenue Code.
(e) Each Lender organized under the laws of a jurisdiction outside the
United States, on or prior to the date of its execution and delivery of this
Agreement in the case of each initial Lender and on the date of the Assignment
and Acceptance pursuant to which it becomes a Lender in the case of each other
Lender, and from time to time thereafter if requested in writing by the Borrower
(but only so long as such Lender remains lawfully able to do so), shall provide
the Borrower with Internal Revenue Service Form 1001 or 4224, as appropriate, or
any successor or other form prescribed by the Internal Revenue Service,
certifying that such Lender is exempt from or entitled to a reduced rate of
United States withholding tax on payments of interest pursuant to this Agreement
or the Notes. If the form provided by a Lender at the time such Lender first
becomes a party to this Agreement indicates a United States interest withholding
tax rate in excess of zero, withholding tax at such rate shall be considered
excluded from "Taxes" as defined in (S)4.03(a). If any form or document
referred to in this subsection (e) requires the disclosure of information, other
than information necessary to compute the tax payable and information required
on the date hereof by Internal Revenue Service form 1001 or 4224, that the
Lender reasonably considers to be confidential, the Lender shall give notice
thereof to the Borrower and shall not be obligated to include in such form or
document such confidential information.
(f) For any period with respect to which a Lender has failed to provide the
Borrower with the appropriate form described in (S)4.03(e) (other than if such
----- ----
failure is due to a change in law occurring subsequent to the date on which a
form originally was required to be provided, or if such form otherwise is not
required under the first sentence of subsection (e) above), such Lender shall
not be entitled to indemnification under (S)4.03(a) with respect to Taxes
imposed by the United States; provided that should a Lender become subject to
--------
Taxes because of its failure to deliver a form required hereunder, the Borrower
shall take such steps as such Lender shall reasonably request and at such
Lender's expense to assist such Lender to recover such Taxes.
(g) If the Borrower is required to pay any amounts to or for the account of
any Lender pursuant to this (S)4.03, such Lender will designate a different
Applicable Lending Office if such designation will avoid the need for or reduce
the amount of any such payment and will not, in the judgment of such Lender, be
otherwise disadvantageous to such Lender.
Section 4.04. Survival. Without prejudice to the survival of any other
--------
agreement of the Borrower hereunder, the agreements and obligations of the
Borrower contained in this Article IV shall survive the payment in full of
principal and interest hereunder and under the Notes.
<PAGE>
46
ARTICLE V
REPRESENTATIONS AND WARRANTIES
------------------------------
The Borrower represents and warrants to the Lenders and the Administrative
Agent as follows:
Section 5.01. Corporate Authority. (a) The Borrower
-------------------
(i) is a corporation duly organized, validly existing and in
good standing under the laws of its state of incorporation,
(ii) has all requisite corporate power to own its Property and
conduct its business as now conducted and as presently contemplated, and
(iii) is in good standing as a foreign corporation and is duly
authorized to do business in each jurisdiction where such qualification is
necessary in order to conduct its business as now conducted except where a
failure to be so qualified would not have a Material Adverse Effect.
(b) The execution, delivery and performance of this Agreement and the
other Loan Documents to which the Borrower is or is to become a party and the
transactions contemplated hereby and thereby
(i) are within the corporate authority of the Borrower,
(ii) have been duly authorized by all necessary corporate
proceedings,
(iii) do not conflict with or result in any breach or
contravention of any provision of law, statute, rule or regulation to which
the Borrower is subject or any judgment, order, writ, injunction, license
or permit applicable to the Borrower or its Property, and
(iv) do not conflict with any provision of the corporate charter
or bylaws of, or any agreement or other instrument binding upon, the
Borrower or its Property.
(c) The execution and delivery of this Agreement and the other Loan
Documents to which the Borrower is or is to become a party will result in valid
and legally binding obligations of the Borrower enforceable against it in
accordance with the respective terms and provisions hereof and thereof, except
as enforceability is limited by bankruptcy, insolvency,
<PAGE>
47
reorganization, moratorium or other laws relating to or affecting generally the
enforcement of creditors' rights and except to the extent that availability of
the remedy of specific performance or injunctive relief is subject to the
discretion of the court before which any proceeding therefor may be brought.
Section 5.02. Governmental Approvals. The execution, delivery and
----------------------
performance by the Borrower of this Agreement and the other Loan Documents to
which the Borrower is or is to become a party and the transactions contemplated
hereby and thereby do not require the approval or consent of, or filing with,
any governmental agency or authority other than those already obtained and for
any subsequent informational filing with the Securities and Exchange Commission.
Section 5.03. Title to Properties. The Borrower owns all of the assets
-------------------
reflected in the balance sheet of the Borrower as at December 31, 1995 or
acquired since that date (except property and assets sold or otherwise disposed
of in the ordinary course of business since that date), subject to no rights of
others, including any mortgages, leases, conditional sales-agreements, title-
retention agreements, liens or other encumbrances except Permitted Liens.
Section 5.04. Financial Statements. There has been furnished the
--------------------
Administrative Agent the audited balance sheet of the Borrower, as at December
31, 1995, and the audited statement of income and cash flow statement of the
Borrower for the fiscal year then ended, and such balance sheet and statement of
income and cash flow have been certified by the Borrower's independent certified
public accountants and accompanied by an unqualified opinion of such
accountants. Such balance sheet and statement of income and cash flow have been
prepared in accordance with GAAP and fairly present the financial condition of
the Borrower as at the close of business on the date thereof and the results of
operations for the fiscal year then ended. There are no Contingent Obligations
of the Borrower as of such date involving material amounts, known to the
officers of the Borrower, that were not disclosed in such balance sheet and the
notes related thereto.
Section 5.05. No Material Adverse Effect, Etc. Since December 31, 1995,
-------------------------------
there has occurred no Material Adverse Effect and, except as permitted
hereunder, the Borrower has not made any Distribution.
Section 5.06. Franchises, Patents, Copyrights, Etc. Except for the
------------------------------------
License for the New York MTA, there are no franchises, patents, copyrights,
trademarks, trade names, or other Intellectual Property, individually or in the
aggregate, that are material for the conduct of the Borrower's business as now
conducted or as presently contemplated to be conducted.
Section 5.07. License, Etc. The Borrower has secured
------------
<PAGE>
48
(a) with respect to the construction, installation and
development of facilities for the New York PCS Network, the License for the
New York MTA and all material Necessary Authorizations appropriate to the
level of development theretofore achieved and sufficient to avoid
noncompliance with the minimum build-out requirements under the License for
the New York MTA, and
(b) with respect to the operation of those portions of the New
York PCS Network the development of which has theretofore been completed,
the License and all material Necessary Authorizations sufficient to operate
such completed portions.
Neither the License for the New York MTA nor any material Necessary
Authorization needed to comply with the foregoing provisions of this (S)5.07 is
the subject of any pending or, to the best of the Borrower's knowledge,
threatened revocation or revocation proceeding.
Section 5.08. Litigation. There are no actions, suits, proceedings or
----------
investigations of any kind pending or, to the best of the Borrower's knowledge,
threatened against the Borrower before any court, tribunal or administrative
agency or board (including the FCC) that, if adversely determined, might, either
in any case or in the aggregate, have a Material Adverse Effect or materially
impair the right of the Borrower, to carry on business substantially as now
conducted, or result in any substantial and material liability not adequately
covered by insurance, or for which adequate reserves are not maintained on the
balance sheet of the Borrower, or that questions the validity of this Agreement
or any of the other Loan Documents, or any action taken or to be taken pursuant
hereto or thereto.
Section 5.09. No Materially Adverse Contracts, Etc. The Borrower is not
------------------------------------
subject to any charter, corporate or other legal restriction, or any judgment,
decree, order, rule or regulation that has or is expected in the future to have
a Material Adverse Effect. The Borrower is not a party to any contract or
agreement that has or is expected, in the judgment of such the Borrower's
officers, to have any Material Adverse Effect.
Section 5.10. Compliance with Other Instruments, Laws, Etc. The Borrower
--------------------------------------------
is not in violation of any provision of its charter documents, bylaws, or any
agreement or instrument to which it may be subject or by which it or any of its
Properties may be bound or any decree, order, judgment, statute, license, rule
or regulation, in any of the foregoing cases in a manner that could result in
the imposition of substantial penalties or have a Material Adverse Effect.
Section 5.11. Tax Status. The Borrower
----------
(a) has made or filed all federal and state income and all other
tax returns, reports and declarations required by any jurisdiction to which
it is subject or filed extensions therefor;
<PAGE>
49
(b) has paid all taxes and other governmental assessments and
charges shown or determined to be due on such returns, reports and
declarations, except those being contested in good faith and by appropriate
proceedings; and
(c) has set aside on its books provisions reasonably adequate
for the payment of all taxes for all elapsed periods subsequent to the
periods to which such returns, reports or declarations apply.
There are no unpaid taxes in any material amount claimed to be due by the taxing
authority of any jurisdiction, and the officers of the Borrower know of no basis
for any such claim.
Section 5.12. No Default. No Default has occurred and is continuing.
----------
Section 5.13. Holding Company and Investment Company Acts. The Borrower
-------------------------------------------
is not a "holding company", or a "subsidiary company" of a "holding company", or
an affiliate" of a "holding company", as such terms are defined in the Public
Utility Holding Company Act of 1935; nor is it an "investment company", or an
"affiliated company" or a "principal underwriter" of an "investment company", or
an entity "controlled" by an "investment company", as such terms are defined in
the Investment Company Act of 1940.
Section 5.14. Absence of Financing Statements, Etc. Except with respect
------------------------------------
to Permitted Liens, there is no financing statement, security agreement, chattel
mortgage, real estate mortgage or other document filed or recorded with any
filing records, registry or other public office, that purports to cover, affect
or give notice of any present or possible future lien on, or security interest
in, any assets or Property of the Borrower or any rights relating thereto.
Section 5.15. FCC Matters. Except for the filing of tariffs with the FCC,
-----------
the Borrower has duly and timely filed all filings which are required to be
filed by it under the Communications Act, the failure to file which could
reasonably be expected to have a Material Adverse Effect and is in all material
respects in compliance with the Communications Act, including the rules and
regulations of the FCC applicable to it, the failure to be in compliance with
which could reasonably be expected to have a Material Adverse Effect.
Section 5.16. Tariffs. No action to change, alter, rescind or otherwise
-------
terminate the tariffs containing service regulations or any rates and charges
for commercial mobile radio services which, if adversely determined, would have
a Material Adverse Effect, is pending or known by the Borrower to be under
consideration.
Section 5.17. Disclosure. This Agreement and the statements and documents
----------
referred to herein or delivered to the Administrative Agent and/or the Lenders
by or on behalf of the Borrower pursuant hereto taken together, contain no
untrue statement of a material fact or fail
<PAGE>
50
to state a material fact which would be necessary to make the statements (taken
as a whole) herein and therein not misleading at such time.
Section 5.18. Burdensome Obligations. The Borrower is not a party to or
----------------------
bound by any franchise, agreement, deed, lease or other instrument, or subject
to any legal restriction which, in the opinion of the management of the
Borrower, is so unusual or burdensome, in the context of its business, as in the
foreseeable future might materially and adversely affect or impair the revenue
or operating cash flow of the Borrower, or the ability of the Borrower to
perform obligations under the Loan Documents. The Borrower does not presently
anticipate that future expenditures by the Borrower needed to meet the
provisions of federal or state statutes, orders, rules or regulations will be so
burdensome as to affect or impair, in a materially adverse manner, the business
or condition, financial or otherwise, of the Borrower.
Section 5.19. Solvency. The Borrower is, and after giving effect to the
--------
incurrence of all Indebtedness as and when contemplated by the Loan Documents
will be, Solvent.
Section 5.20. Security Interests. The security interests granted under
------------------
the Collateral Documents constitute valid, binding and continuing duly perfected
first-priority Liens in and to the Collateral (except for Permitted Liens that
have priority under applicable law) in favor of the Collateral Agent, for the
benefit of, among other Persons, the Administration Agent and the Lenders.
Section 5.21. Certain Transactions. Except as set forth in Schedule 5.21,
-------------------- -------------
none of the officers, directors, or employees of the Borrower is presently a
party to any transaction with the Borrower (other than for services as
employees, officers and directors), including any contract, agreement or other
arrangement providing for the furnishing of services to or by, providing for
rental of real or personal property to or from, or otherwise requiring payments
to or from any officer, director or such employee or, to the knowledge of such
the Borrower, any corporation, partnership, trust or other entity in which any
officer, director, or any such employee has a substantial interest or is an
officer, director, trustee or partner. The Borrower has delivered a complete
and correct copy of the Expense Allocation Agreement to the Administrative
Agent. The Borrower is not a party to any management, operating, license or
other agreement providing for the payment of any amount to any of its
Affiliates, except for the Expense Allocation Agreement or as permitted under
(S)7.11.
Section 5.22. Business Plans. The Approved Full-Term Operating Business
--------------
Plan and Approved Annual Operating Business Plan, if any, have been prepared in
all material respects in accordance with GAAP.
Section 5.23. Employee Benefit Plans. (a) Each Employee Benefit Plan and
----------------------
each Plan has been maintained and operated in compliance in all material
respects with the
<PAGE>
51
provisions of ERISA and, to the extent applicable, the IRC, including the
provisions thereunder respecting prohibited transactions. The Borrower has made
all required contributions to each Employee Benefit Plan and each Multiemployer
Plan. To the extent applicable, the Borrower has heretofore delivered to the
Administrative Agent the most recently completed annual report, Form 5500, with
all required attachments, and actuarial statement required to be submitted under
(S)103(d) of ERISA, with respect to each Guaranteed Pension Plan.
(b) Under each Employee Benefit Plan that is an employee welfare benefit
plan within the meaning of (S)3(1) or (S)3(2)(B) of ERISA, no benefits are due
unless the event giving rise to the benefit entitlement occurs prior to plan
termination (except as required by Title I, Subtitle B, Part 6 of ERISA). The
Borrower or an ERISA Affiliate, as appropriate, may terminate each such Plan at
any time (or at any time subsequent to the expiration of any applicable
bargaining agreement) in the discretion of any of the Borrower or such ERISA
Affiliate without liability to any Person.
(c) Each contribution required to be made to a Guaranteed Pension Plan,
whether required to be made to avoid the incurrence of an accumulated funding
deficiency, the notice or lien provisions of (S)302(f) of ERISA, or otherwise,
has been timely made. No waiver of minimum funding standards or extension of
amortization periods has been requested or received with respect to any
Guaranteed Pension Plan. No liability to the PBGC (other than required
insurance premiums, all of which have been paid) has been incurred by the
Borrower or any ERISA Affiliate with respect to any Guaranteed Pension Plan and
there has not been any ERISA Event, or any other event or condition that
presents a material risk of termination of any Guaranteed Pension Plan by the
PBGC. Neither the Borrower nor any ERISA Affiliate has instituted or intends to
institute proceedings to terminate a Guaranteed Pension Plan. No event
requiring notice to the PBGC under (S)302(f)(4)(A) of ERISA has occurred with
respect to any Guaranteed Pension Plan and no amendment with respect to which
security is required under (S)307 of ERISA has been made or is reasonably
expected to be made to any Guaranteed Pension Plan. Based on the latest
valuation of each Guaranteed Pension Plan (which in each case occurred within 12
months prior to the date of this representation), and on the actuarial methods
and assumptions employed for that valuation, the aggregate benefit liabilities
of all such Guaranteed Pension Plans within the meaning of (S)4001 of ERISA did
not exceed the aggregate value of the assets of all such Guaranteed Pension
Plans, disregarding for this purpose the benefit liabilities and assets of any
Guaranteed Pension Plan with assets in excess of benefit liabilities.
(d) Neither the Borrower nor any ERISA Affiliate has incurred or expects to
incur any material liability (including secondary liability) to any
Multiemployer Plan as a result of a complete or partial withdrawal from such
Multiemployer Plan under (S)4201 of ERISA or as a result of a sale of assets
described in (S)4204 of ERISA. Neither the Borrower nor any ERISA
<PAGE>
52
Affiliate has been notified that any Multiemployer Plan is in reorganization or
insolvent under and within the meaning of (S)4241 or (S)4245 of ERISA or that
any Multiemployer Plan intends to terminate or has been terminated under
(S)4041A of ERISA.
Section 5.24. Regulations U and X. No portion of any Loan shall be used
-------------------
or obtained for the purpose of purchasing or carrying any "margin security" or
"margin stock" as such terms are used in Regulations U and X of the Board of
Governors of the Federal Reserve System, 12 C.F.R. Parts 221 and 224.
Section 5.25. Environmental Compliance. The Borrower has taken all
------------------------
necessary steps to investigate the past and present condition and usage of its
Real Estate and the operations conducted thereon and, based upon such diligent
investigation, makes the following representations:
(a) The Borrower in compliance with all applicable Environmental
Laws relating to the operation of its business and the use and occupancy of
any Real Estate. There is no pending or threatened civil or criminal
litigation, written notice of violation, formal administrative proceeding,
or investigation, inquiry or information request by any governmental entity
relating to any Environmental Law involving the Borrower.
(b) Except as set forth in Schedule 5.25, there have been no
-------------
releases of any Materials of Environmental Concern into the environment at
any parcel of Real Estate or any facility formerly or currently owned,
operated or controlled by the Borrower. With respect to any such releases
of any Materials of Environmental Concern, the Borrower has given all
required notices to government entities. The Borrower is not aware of any
releases of Materials of Environmental Concern at parcels of Real Estate or
facilities other than those owned, operated or controlled by the Borrower
that could reasonably be expected to have an impact on the Real Estate or
facilities owned, operated or controlled by the Borrower.
(c) Set forth in Schedule 5.25 is a list of all environmental
-------------
reports, investigations and audits relating to premises currently or
previously owned or operated by the Borrower (whether conducted by or on
behalf of the Borrower or a third party, and whether done at the initiative
of the Borrower or directed by a governmental entity or other third party)
which the Borrower has in its possession or to which it has access, and
complete and accurate copies of each such report, or the results of each
such investigation or audit, have been provided to the Administrative
Agent.
(d) The Borrower has filed all reports and returns required to
be filed by the Borrower under any Environmental Laws. The Borrower has
obtained and is in
<PAGE>
53
compliance with all licenses, permits, registrations, certificates,
consents, approvals or authorizations (collectively, "Environmental
-------------
Permits") required by all applicable Environmental Laws. No event has
-------
occurred and is continuing that requires, or after notice or lapse of time
or both would requires, any modification or termination of any
Environmental Permit. The Borrower (i) has not received any notice
asserting the absence of any Environmental Permit and (ii) has no knowledge
of any environmental law proposed or under consideration, which, if
effective, could have a Material Adverse Effect.
(e) Neither the Borrower nor any of the Real Estate is subject
to any applicable Environmental Laws requiring the performance of site
assessments for Materials of Environmental Concern, or the removal or
remediation of Materials of Environmental Concern, or the giving of notice
to any governmental agency or the recording or delivery to other Persons of
an environmental disclosure document or statement by virtue of the
transactions set forth herein and contemplated hereby, or as a condition to
the effectiveness of any transactions contemplated hereby.
Section 5.26. Subsidiaries, Etc. The Borrower has no Subsidiaries. The
-----------------
Borrower is not engaged in any joint venture or partnership with any other
Person.
Section 5.27. Material Contracts. As of the date of this Agreement, the
------------------
Borrower is not a party to any Material Contract or any agreement with any
director, officer or employee, and no shareholder of the Borrower is a party to
any shareholder, share-voting or similar agreement relating to the Borrower,
except as set forth in Schedule 5.27.
-------------
ARTICLE VI
AFFIRMATIVE COVENANTS OF THE BORROWER
-------------------------------------
The Borrower covenants and agrees that, so long as any Loan or Note is
outstanding or any Lender has any obligation to make any Loans:
Section 6.01. Maintenance of Office. The Borrower's chief executive
---------------------
office shall be located at its address for notices specified in (S)12.02, except
that the Borrower may change its chief executive office on not less than 30-
days' advance written notice to the Administrative Agent and after taking all
such action as may be necessary or appropriate or requested by the Collateral
Agent or the Administrative Agent to continue the perfection of the Collateral
Agent's security interest in the Collateral.
Section 6.02. Records and Accounts. The Borrower shall
--------------------
<PAGE>
54
(a) keep true and accurate records and books of account in which
full, true and correct entries shall be made in accordance with GAAP, and
(b) maintain adequate accounts and reserves for all taxes
(including income taxes), depreciation, depletion, obsolescence and
amortization of its Properties, contingencies and other reserves.
Section 6.03. Corporate Existence; Maintenance of Licenses. The Borrower
--------------------------------------------
shall do or cause to be done all things necessary to preserve and keep in full
force and effect its corporate existence. The Borrower shall maintain in full
force and effect,
(a) with respect to the construction, installation and
development of facilities for the New York PCS Network, the License for the
New York MTA and all material Necessary Authorizations appropriate to the
level of development theretofore achieved and sufficient to avoid
noncompliance with the then applicable minimum build-out requirements under
the License for the New York MTA, and
(b) with respect to the operation of those portions of the New
York PCS Network the development of which has theretofore been completed,
all material Licenses, copyrights, patents, franchises, Necessary
Authorizations and other rights as are necessary and sufficient to operate
such completed portions.
The Borrower will at all times perform and observe all covenants and conditions
on its part to be performed and observed under FCC rules and regulations or
otherwise with respect thereto with respect to the License for the New York MTA
and not cause or permit to exist any grounds for the FCC to revoke or suspend or
not to renew such License.
Section 6.04. Maintenance of Properties. The Borrower shall do or cause
-------------------------
to be done all things necessary to preserve and keep in full force and effect
its franchises, employment contracts and permits. The Borrower shall
(a) cause all of its Properties used or useful in the conduct of
its business to be maintained and kept in good condition, repair and
working order (ordinary wear and tear excepted) and supplied with all
necessary equipment;
(b) cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment
of the Borrower may be necessary so that the business carried on in
connection therewith may be properly and advantageously conducted at all
times;
<PAGE>
55
(c) continue to engage primarily in the businesses now conducted
by it and in related businesses; and
(d) continue in full force and effect all authorizations and
approvals required to conduct its business as appropriate to the then level
of construction, development and operation of the New York PCS Network;
provided that nothing in this (S)6.04 shall prevent the Borrower from
- --------
discontinuing the operation and maintenance of any of its Properties (other than
its License with respect to the New York MTA) if such discontinuance is, in the
judgment of the Borrower, desirable in the conduct of its business and that does
not have a Material Adverse Effect.
Section 6.05. Insurance. The Borrower shall obtain and maintain insurance
---------
with respect to its properties and business with insurers that hold an A.M. Best
rating of "A" or better. The insurance coverage shall
(a) include, as a minimum, the types of policies and respective
limits as reflected in (S)11(b) of the Borrower Security Agreement;
(b) with respect to all liability insurance, name the
Administrative Agent and the Collateral Agent as additional insured;
(c) with respect to casualty insurance, name the Collateral
Agent as loss payee as its interest may appear; and
(d) provide that the insurer will give the Administrative Agent
and the Collateral Agent at least 30-days' prior written notice of the
cancellation or any material change in the coverage, aggregate limits or
any other provision of such insurance.
The Borrower shall deliver to the Administrative Agent and the Collateral Agent,
as required by (S)8.18, no later than March 31 in each calendar year and
otherwise promptly on request by the Administrative Agent or the Collateral
Agent, certificate(s) of insurance reflecting the requirements of this (S)6.05
and (S)11(b) of the Borrower Security Agreement and setting forth any
deductibles applicable to any insurance coverage.
Section 6.06. Taxes. The Borrower shall duly pay and discharge, or cause
-----
to be paid and discharged, before the same shall become overdue, all taxes,
assessments and other governmental charges imposed upon it (including all
amounts due and owing to the FCC under the Borrower's License for the New York
MTA) and its Real Estate, sales and activities, or any part thereof, or upon the
income or profits therefrom, as well as all claims for labor,
<PAGE>
56
materials, or supplies that if unpaid might by law become a lien or charge upon
any of its Property; provided that any such tax, assessment, charge, levy or
--------
claim need not be paid if the validity or amount thereof shall currently be
contested in good faith by appropriate proceedings and if the Borrower has set
aside on its books adequate reserves with respect thereto; and provided further
-------- -------
that the Borrower will pay all such taxes, assessments, charges, levies or
claims forthwith upon the commencement of proceedings to foreclose any lien that
may have attached as security therefor.
Section 6.07. Inspection of Properties and Books. (a) The Borrower shall
----------------------------------
permit the Administrative Agent, the Lenders and their other designated
representatives to visit and inspect any of the Properties of the Borrower, to
examine the books of account of the Borrower (and to make copies thereof and
extracts therefrom), and to discuss the affairs, finances and accounts of the
Borrower with, and to be advised as to the same by, its officers, all at such
reasonable times and intervals as the Administrative Agent or any Lender may
reasonably request; provided that the Administrative Agent and each Lender shall
--------
use reasonable commercial efforts not to interfere with the Borrower's business.
(b) The Borrower authorizes the Administrative Agent and each Lender to
communicate directly with such the Borrower's independent certified public
accountants and authorizes such accountants to disclose to the Administrative
Agent and the Lenders any and all financial statements and other supporting
financial documents and schedules including copies of any management letter with
respect to the business, financial condition and other affairs of the Borrower.
At the reasonable request of the Administrative Agent, the Borrower shall
deliver a letter addressed to such accountants instructing them to comply with
the provisions of this (S)6.07(b). The Administrative Agent and the Lenders
will to use commercially reasonable efforts to coordinate the communications and
disclosures to and from the accountants and Administrative Agent and the
Lenders.
Section 6.08. Compliance with Laws, Contracts, License, and Permits. The
-----------------------------------------------------
Borrower will comply in all material respects with
(a) the applicable laws and regulations wherever its business is
conducted, including all Environmental Laws, all Environmental Permits,
ERISA, the IRC, the Communications Act, and all FCC rules and regulations;
(b) the provisions of its charter documents and by-laws;
(c) all Material Contracts to which it is a party and by which
it or any of its Properties may be bound;
<PAGE>
57
(d) all obligations with respect to any Employee Benefit Plan or
Multiemployer Plan; and
(e) all applicable decrees, orders, and judgments.
If any authorization, consent, approval, permit or license from any officer,
agency or instrumentality of any government shall become necessary or required
in order that the Borrower may fulfill any of the Borrower's Obligations
hereunder or any of the other Loan Documents to which the Borrower is a party,
the Borrower shall immediately take or cause to be taken all reasonable steps
within the power of the Borrower to obtain such authorization, consent,
approval, permit or license and furnish the Administrative Agent evidence
thereof.
Section 6.09. Further Assurances. The Borrower shall cooperate with the
------------------
Lenders and the Administrative Agent and shall execute and pay for the filing of
all such further instruments and documents, including, UCC financing statements
and other security documents, as the Required Lenders, the Collateral Agent or
the Administrative Agent shall reasonably deem appropriate at in order to
effectuate the security interests to the Collateral Agent and to carry out to
their satisfaction the transactions contemplated by the Loan Documents.
Section 6.10. Equity and Subordinated Debt. On each June 30 and December
----------------------------
31, beginning on June 30, 1997 and ending on the first such date for which the
Borrower shall have had positive EBTDA for its fiscal quarter ending on such
date and its immediately preceding fiscal quarter, the Borrower will cause the
sum of
(a) all cash equity capital contributed to, and all Subordinated
Debt incurred by, the Borrower after January 1, 1996, and
(b) all cash equity capital and Subordinated Debt committed to
be contributed or loaned to the Borrower pursuant to Qualified Commitments
that are in effect on such date,
at least to equal the aggregate amount of all Advances outstanding on such date.
Promptly and in any event within 15 days after entering into any agreement with
any Person to make equity contributions or loan Subordinated Debt to the
Borrower, the Borrower will deliver a copy of such agreement to the
Administrative Agent.
Section 6.11. Authorization from Landlord/Mortgagee, Etc. The Borrower
------------------------------------------
shall request that any landlord, mortgagee and easement grantor of the Borrower
agree to give the Collateral Agent and Administrative Agent, on a best-efforts
basis, notice of any default by the Borrower under the terms or conditions of
any agreement between the Borrower and any
<PAGE>
58
landlord, mortgagee of any such landlord or easement grantor, and allow
Collateral Agent to inspect or remove after the occurrence and continuance of an
Event of Default.
Section 6.12. Attornment and Recognition Agreements. The Borrower shall
-------------------------------------
obtain all attornment and recognition agreements from any landlord or landlord's
mortgagee of Real Estate leased or owned by the Borrower upon which any
Collateral (with a fair value in excess of $50,000) is stored or located, in
form and substance reasonably satisfactory to Administrative Agent. The
Borrower shall use its best efforts to obtain all attornment and recognition
agreements from any landlord or landlord's mortgagee of Real Estate leased or
owned by the Borrower upon which all other Collateral not covered by the
immediately preceding paragraph is stored or located, in form and substance
reasonably satisfactory to Required Lenders.
Section 6.13. Expense Allocation Agreement. The Borrower shall comply
----------------------------
with the terms of the Expense Allocation Agreement and not consent to any
waiver, modification or amendment thereto.
Section 6.14. Reporting Requirements; Notices. The Borrower shall deliver
-------------------------------
or cause to be delivered to the Administrative Agent on behalf of the Lenders
the following (in a sufficient number of copies to permit distribution to each
Lender):
(a) No later than 15 days prior to the end of each fiscal year of the
Borrower and until the first fiscal year ending after the date on which
Borrower's EBTDA is greater than zero for two successive fiscal quarters, a
proposed annual operating business plan containing the statements listed in
items (i) through (vi) in this paragraph and the exhibits contained in the
annual operating business plan delivered pursuant to (S)8.13(a) for the next-
succeeding fiscal year. The proposed annual operating business plan shall
contain (i) internally prepared statements of income and expense of Borrower in
reasonable detail for the applicable period prepared in all material aspects in
accordance with GAAP (except for the absence of footnotes), (ii) a schedule of
all Capital Expenditures estimated to be made during the period, (iii) a
statement of the amounts and times by which Borrower needs to raise additional
capital to meet its obligations when due during the period, (iv) a projected
balance sheet of Borrower, (v) a projected cash flow statement of Borrower, and
(vi) a statement listing all assumptions which formed the basis for (i) through
(v), each together with supporting schedules in sufficient detail as needed and
in all material aspects in accordance with the Approved Annual Operating
Business Plan delivered pursuant to (S)8.13(a) and on a consistent basis.
(b) No later than August 14 of each fiscal year of the Borrower, a report,
certified as true and correct by the Chief Financial Officer of the Borrower,
that shows in reasonable detail, variances, if any, between the actual operating
performance of the Borrower and what was estimated for the first six months of
such fiscal year in the Approved Annual Operating
<PAGE>
59
Business Plan for such fiscal year (or the Approved Full Term Operating Business
Plan if the Required Lenders have not approved a plan delivered pursuant to
(S)6.14(a) with respect to such fiscal year) and explains in reasonable detail
in form satisfactory to the Required Lenders the reasons for the discrepancies
between them, if any.
(c) As soon as practicable, but in any event not later than 45 days after
the end of each of the first three fiscal quarters of each fiscal year of the
Borrower, copies of the internally prepared unaudited balance sheet of the
Borrower, as at the end of such quarter, and the related statement of income and
statement of cash flow for the portion of the Borrower's fiscal year then
elapsed, all in reasonable detail and each setting forth in comparative form
(i) the figures for the prior year's corresponding fiscal
quarter and
(ii) so long as the Borrower is required to deliver an operating
business plan pursuant to (S)6.14(a), any variances from the Approved
Annual Operating Business Plan (or the Approved Full Term Operating
Business Plan, if the Required Lenders have not approved a plan delivered
pursuant to (S)6.14(a) with respect to such fiscal year),
if any, prepared in all material aspects in accordance with GAAP, together with
a certification by the principal financial or accounting officer of the Borrower
that the information contained in such financial statements fairly presents the
financial position of the Borrower on the date thereof (subject to year-end
adjustments).
(d) As soon as practicable, but in any event no later than 90 days after
the end of each fiscal year of the Borrower, the audited balance sheet of the
Borrower as at the end of such year, and the related audited statement of income
and audited statement of cash flow for such year prepared in accordance with
GAAP, and so long as the Borrower is required to deliver an operating business
plan pursuant to (S)6.14(a), a separate variance analysis setting forth in
comparative form the figures for the previous fiscal year and any variances from
the applicable period of the Approved Annual Operating Business Plan (or the
Approved Full Term Operating Business Plan, if the Required Lenders have not
approved a plan delivered pursuant to (S)6.14(a) with respect to such fiscal
year) in reasonable detail. Such balance sheet, statement of income and
statement of cash flow shall contain a certified audit report of a nationally
recognized independent certified public accounting firm satisfactory to
Administrative Agent, which report shall contain an unqualified opinion of such
accounting firm, and an "agreed-upon procedures" report pursuant to which the
accountants
(i) review the Borrower's statement that the Borrower is in
compliance with the provisions of the Expense Allocation Agreement,
<PAGE>
60
(ii) perform the agreed upon review procedures applicable thereto
and
(iii) confirm that in examining the financial statements of the
Borrower they have not become aware of any Default with respect to the
Expense Allocation Agreement, or, if such accountants shall have obtained
knowledge of any then existing Default they shall disclose in such report
any such Default;
provided that such accountants shall not be liable to the Lenders for failure to
- --------
obtain knowledge of any Default. The annual financial statements shall also be
accompanied by a management letter of the Borrower's accountants (only to the
extent otherwise obtained by the Borrower).
(e) Simultaneously with the delivery of the financial statements referred
to in subsections (c) and (d) above, a statement certified by the principal
financial or accounting officer of the Borrower substantially in the form of
Exhibit G setting forth in reasonable detail computations evidencing compliance
- ---------
with the covenants contained in (S)(S)6.10, 6.15 and 7.05, and (if applicable to
such fiscal quarter) the absence of an Event of Default under (S)10.01(r), in
each case with respect to the fiscal quarter relating to the financial
statements then being delivered.
(f) Within 45 days after the end of each fiscal quarter of the Borrower, a
report on
(i) the number of cell sites constructed,
(ii) the total number of customers,
(iii) the number of new customers acquired,
(iv) the number of customers who terminated their service,
(v) the average net monthly charges billed to customers
(excluding roaming charges),
(vi) aggregate roaming revenue,
(vii) payments to Parent, Grand Parent and other Affiliates of
Grand Parent, whether under the Expense Allocation Agreement or otherwise
and
(viii) equity contributions to and Subordinated Debt incurred by
the Borrower, and the Persons providing the same,
<PAGE>
61
during such fiscal quarter, together with a report showing variances from the
estimates previously provided to Administrative Agent and each Lender in the
Annual Approved Operating Business Plan (or the Approved Full Term Operating
Business Plan, if the Required Lenders have not approved a plan delivered
pursuant to (S)6.14(a) with respect to such fiscal year), along with an
explanation of discrepancies between the actual numbers and the estimated
numbers.
(g) Within three Business Days after the filing or mailing thereof, copies
of all
(i) material filed with the Securities and Exchange Commission by
the Borrower, Parent or Grand Parent;
(ii) information sent to the stockholders of the Borrower or lenders
to the Borrower (exclusive of proprietary information); or
(iii) information and reports directly and materially related to the
Borrower or the New York PCS Network that Parent or Grand Parent would be
required to file with the Securities and Exchange Commission pursuant to
the Securities Exchange Act of 1934, if Parent or Grand Parent were public
companies subject to the reporting requirements of such Act; provided that,
--------
if the information or reports covered by this clause (iii) contain
proprietary information, the Borrower shall not be obligated to provide the
proprietary information hereunder unless
(A) the Person that is the source of the information or reports
is a public company and
(B) such Person would then be required to file such proprietary
information with the SEC.
(h) Within 45 days after the end of each fiscal quarter of the Borrower an
accounts-receivable-aging report.
(i) Within three Business Days after the Borrower shall have knowledge of
the occurrence and continuance thereof, written notice of the occurrence and
continuance of a Default, together with a statement of what action the Borrower
is taking or proposes to take with respect thereto. If any Person shall give
any notice or take any other action in respect of a claimed default (whether or
not constituting a Default) under this Agreement or any other note, evidence of
indebtedness, indenture or other obligation to which or with respect to which
the Borrower is a party or obligor, whether as principal, guarantor, surety or
otherwise, which could result in the party to whom such indebtedness is owed
having the right under its governing documents to accelerate such indebtedness,
and such acceleration would have a
<PAGE>
62
Material Adverse Effect, the Borrower shall forthwith give written notice
thereof to the Administrative Agent, describing the notice or action and the
nature of the claimed default.
(j) As soon as possible, and in any event within 10 Business Days
(i) after making any such report, written notice of any violation
of any Environmental Law that the Borrower reports in writing or is
reportable by such Person in writing (or for which any written report
supplemental to any oral report is made) to any federal, state or local
environmental agency and
(ii) after the Borrower shall become aware thereof, written notice
of any inquiry, proceeding, investigation, or other action, including a
notice from any agency of potential environmental liability, or any
federal, state or local environmental agency or board, that, has the
potential to materially affect the assets, liabilities, financial
conditions or operations of the Borrower or the security interests for the
benefit of the Lenders pursuant to the Borrower Security Agreement.
(k) As soon as possible, and in any event within 10 days after the
Borrower or any ERISA Affiliate knows or has reason to know or believes that any
ERISA Affiliate knows or has reason to know or believes that any ERISA Event has
occurred, a statement of the chief financial officer of the Borrower or such
ERISA Affiliate describing such ERISA Event, together with any correspondence
with, or filings made with, the PBGC or Department of Labor, and the action, if
any, which the Borrower or such ERISA Affiliate proposes to take with respect
thereto.
(l) Promptly after
(i) filing the same with the Department of Labor or Internal
Revenue Service, (A) a copy of its initial actuarial statement required to
be submitted under (S)103(d) of ERISA and Annual Report, Form 5500, with
all required attachments, in respect of each Guaranteed Pension Plan, and
(B) a notice of all subsequent filings (with copies to be provided upon
request of the Administrative Agent),
(ii) receipt or dispatch thereof, a copy of any notice, report or
demand sent or received in respect of a Guaranteed Pension Plan under
(S)(S)302, 4041, 4042, 4043, 4063, 4065, 4066 and 4068 of ERISA, or in
respect of a Multiemployer Plan, under (S)(S)4041A, 4202, 4219, 4242, or
4245 of ERISA, and
(iii) becoming aware of the occurrence thereof, notice of (A) any
transaction that could result in the imposition of a penalty under
(S)502(i) of ERISA or an excise tax under (S)4975 against the Borrower or
an ERISA Affiliate; (B) any partial or complete
<PAGE>
63
withdrawal from a Multiemployer Plan by any of the Borrower or an ERISA
Affiliate; (C) a failure by any of the Borrower or an ERISA Affiliate to
make a payment to a Plan required to avoid imposition of a lien under
(S)302(f) of ERISA; (D) the adoption of an amendment to a Guaranteed
Pension Plan requiring the provision of security under (S)307 of ERISA; or
(E) any change in the actuarial assumptions or funding methods used for any
Guaranteed Pension Plan, where the effect of such change is to materially
increase the unfunded benefit liability or materially reduce the obligation
to make periodic contributions.
(m) Within three Business Days after becoming aware of any setoff, of any
claims (including, with respect to the Real Estate, environmental claims),
withholdings or other defenses to which any of the Collateral, or the Collateral
Agent's, the Administrative Agent's or the Lenders' rights with respect to the
Collateral, are subject, written notice thereof.
(n) Within 10 days after becoming aware thereof of
(i) any litigation or proceedings threatened in writing or any
pending litigation and proceedings affecting the Borrower or to which the
Borrower is or becomes a party that could reasonably be expected to have a
Material Adverse Effect (which notice shall include a statement as to the
nature and status of the proceedings, or
(ii) any judgment not covered by insurance, final or otherwise,
against the Borrower in an amount in excess of $1,000,000,
written notice thereof.
(o) Within 120 days after the end of each fiscal year of the Borrower,
beginning with its fiscal year ended December 31, 2000, and for so long as any
Tranche B Advances are outstanding, a report that includes calculations showing
in reasonable detail of the Borrower's Excess Cash Flow for such fiscal year, if
any, certified as correct by the Borrower's Chief Financial Officer.
(p) Within three Business Days after its receipt thereof, copies of all
material notices and correspondence received from or sent to the FCC relating to
the New York PCS Network License.
(q) Not later than 30 days prior to the occurrence thereof, written notice
to the Administrative Agent of a change in (i) the business or corporate name of
the Borrower or Parent, (ii) the location of the Collateral of the Borrower
(subject to (S)6(a) of the Borrower Security Agreement) or (iii) the Borrower's
chief executive office or other locations or the location where the Borrower's
books and records are kept.
<PAGE>
64
(r) Within 15 Business Days after the end of each fiscal quarter of the
Borrower, a report showing the respective aggregate principal amounts of all
Indebtedness outstanding as of the last day of such fiscal quarter under each
Permitted Loan Agreement (as defined in the Intercreditor Agreement).
(s) Such other information concerning its business, operations or
financial condition as shall be reasonably requested.
Upon the Administrative Agent's receipt of any and all financial and other
information furnished by the Borrower pursuant to this (S)6.14 the
Administrative Agent shall promptly deliver copies thereof to each Lender.
Section 6.15. Financial Covenants of the Borrower. So long as any Loan,
-----------------------------------
Note or other of the Borrower's Obligations are outstanding or any Lender has
any Commitment, the Borrower will:
(a) Have earned for each fiscal quarter, prior to the first fiscal quarter
in which the Borrower's EBTDA shall have exceeded zero for two successive fiscal
quarters, Revenue of not less than the applicable amount shown on Schedule
--------
6.15(a) with respect to such fiscal quarter.
- -------
(b) Maintain or cause to be maintained as of the last day of each fiscal
quarter (other than any fiscal quarter in which EBTDA is positive or any fiscal
quarter ending after the Borrower's EBTDA has exceeded zero for two successive
fiscal quarters), a ratio of
(i) the sum of the following, in each case as determined as of such
date:
(A) the Borrower's cash on hand,
(B) the Borrower's Investments to the extent they are permitted
by (S)(S)7.04(b) through (e),
(C) without duplication of any amount described in clauses (D)
and (E) below, Qualified Commitments in respect of Subordinated Debt,
the proceeds of which are available to be used for general business
purposes of the Borrower,
(D) the aggregate undrawn amount of the Tranche C Commitments
(as defined in the Nortel Loan Agreement), if all conditions precedent
to any advance thereunder on such date would be satisfied (other than
actually
<PAGE>
65
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submitting a Draw Request and other required documents) and up to the
amount then available to be drawn,
(E) until June 30, 1998, the greater of (1) zero and (2) (x)
the lesser of $25,000,000 and the then-remaining undrawn amount of the
Lenders' Tranche A Advance Commitments, minus (y) the aggregate amount
of interest accrued on the Advances (whether or not theretofore paid),
but only if all conditions precedent to a Tranche A Advance hereunder
on such date would be satisfied (other than actually submitting a Draw
Request and other required documents), and
(F) Qualified Commitments in respect of equity, to
(ii) EBTDA for such fiscal quarter,
of not less than ******.
For purposes of calculating the ratio in this (S)6.15(b), negative EBTDA shall
be treated as if it were a positive number.
(c) Beginning with the first fiscal quarter of its fiscal year beginning
on January 1, 1997, maintain or cause to be maintained as of the last day of
each fiscal quarter, a ratio of
(i) (A) the aggregate principal amount of the Borrower's
Indebtedness outstanding on such date, minus
(B) the aggregate principal amount of the Borrower's
Subordinated Debt outstanding on such date, to
(ii) the amount equal to
(A) shareholder equity shown on the Borrower's balance sheet
prepared in accordance with GAAP as of such date, plus
(B) to the extent not otherwise included in the amount
determined pursuant to clause (A) above, the aggregate principal
amount of all Subordinated Debt outstanding as of such date, plus
(C) to the extent not otherwise included in the amount
determined pursuant to clause (A) above, $95,194,000 (representing the
difference between the price paid for the Block B License for the New
York MTA ($442,712,000)
<PAGE>
66
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|Confidential treatment has been requested |
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and Borrower's cost of the License for the New York MTA
($347,518,000)), minus
(D) to the extent not otherwise included in the amount
determined pursuant to clause (A) above, the cumulative amount of
retained earnings (or deficit) of Borrower as determined in accordance
with GAAP,
of not more than (a) until the fiscal quarter ending on December 31, 1997,
******, and (b) thereafter, ******.
(d) Have, for each fiscal quarter set forth on Schedule 6.15(d), Adjusted
----------------
EBITDA of not less than the amounts shown on such Schedule for such fiscal
quarter.
Section 6.16. Certified Copies of Insurance Policies. Within 30 days
--------------------------------------
after the Closing Date, deliver to the Administrative Agent certified copies by
the applicable insurer(s) of all insurance policies that shall have been
required to have been delivered to the Administrative Agent by the Closing Date
pursuant to Section 8.05(b).
Section 6.17. Mortgage Liens. If the Borrower shall acquire any Real
--------------
Estate and shall not at the time of such acquisition incur Indebtedness with
respect thereto pursuant to (S)7.01(e)(ii)(C), it will grant to the Collateral
Agent a first-mortgage lien in form and substance satisfactory to the Required
Lenders on such Real Estate. Any Lien on any such Real Estate shall provide
that it shall be released upon the incurrence of any Indebtedness under
(S)7.01(e)(ii)(C) that is secured by a Lien on such Real Estate permitted under
(S)7.02(e)(ii).
ARTICLE VII
CERTAIN NEGATIVE COVENANTS OF THE BORROWER
------------------------------------------
The Borrower covenants and agrees that, so long as any Loan or Note or
other fees or expenses are outstanding or any Lender has any obligation to make
any Loans:
Section 7.01. Restrictions on Indebtedness. The Borrower shall not
----------------------------
create, incur, assume, guarantee or be or remain liable, contingently or
otherwise, with respect to any Indebtedness other than:
(a) Indebtedness to the Lenders arising under any of the Loan
Documents;
(b) Indebtedness owing under the Nortel Loan Agreement and other
Indebtedness outstanding under a Permitted Loan Agreement;
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67
(c) Indebtedness the proceeds of which are used
(i) to repay up to $41,000,000 aggregate principal amount
of Tranche C Loans (as defined in the Nortel Loan Agreement),
(ii) to repay up to $15,000,000 aggregate principal amount
of Tranche C Advances, and/or
(iii) to prepay Tranche A Advances pursuant to (S)3.02(c),
but only so long as
(A) the aggregate principal amount of such Indebtedness does
not exceed the aggregate principal amount of the Indebtedness then
being prepaid or repaid with such proceeds, in whole or in part, and
(B) no portion of the principal amount of such Indebtedness
is scheduled to be repaid or has required prepayments prior to the
Tranche A Advance Maturity Date or the Tranche B Advance Maturity
Date;
(d) Subordinated Debt;
(e) (i) Indebtedness (in addition to any purchase-money
Indebtedness described in clauses (ii) and (iii) below) in an
aggregate principal amount not exceeding $5,000,000 incurred in
connection with the purchase and installation of equipment to be used
in the New York PCS Network that is supplied by suppliers that are not
Affiliates of the Borrower, but only so long as such Indebtedness is
not in excess of the fair value of the property being acquired and
related services associated with the equipment;
(ii) (A) purchase-money Indebtedness (in addition to any
purchase-money Indebtedness described in clause (i) above and
(iii) below),
(B) Capital Lease obligations, and
(C) Indebtedness incurred in the acquisition of Real
Estate or within six months after the date of acquisition and
that is secured by a Lien permitted under Section 7.02(e)(ii),
but only so long as
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68
(I) the aggregate principal amount thereof any one time
outstanding does not exceed $10,000,000,
(II) such Indebtedness is in a principal amount that does
not exceed the fair value of the property being acquired or
leased and
(III) the aggregate principal amount of such purchase-
money Indebtedness (other than any of such Indebtedness described
in clause (C) above) and Capital Lease obligations outstanding at
any one time does not exceed $5,000,000; and
(iii) purchase-money Indebtedness (in addition to any purchase-
money Indebtedness described in clause (i) and (ii) above) incurred in
order to acquire inventory (other than in respect of handsets and
accessories with respect thereto manufactured or supplied by Ericsson
or Orbitel or their respective Affiliates),
and any refunding or refinancing of any such Indebtedness by lenders that
are not Affiliates of the Borrower in an aggregate principal amount not
exceeding the aggregate principal amount of the Indebtedness being
refinanced or refunded;
(f) Indebtedness the proceeds of which are used solely for working-
capital purposes, so long as, with respect to each of the two most recent
complete fiscal quarters of the Borrower, preceding the date on which such
Indebtedness is incurred
(i) the amount equal to
(A) the Borrower's EBTDA for such fiscal quarter minus
(B) the amount of interest that would have accrued on such
Indebtedness during such fiscal quarter if such Indebtedness had
been outstanding for all of such fiscal quarter and such interest
had accrued at the rate per annum applicable at the time of
incurrence
shall have exceeded zero, and
(ii) the ratio of
(A) the aggregate principal amount of all Indebtedness of
the Borrower outstanding on such date, after giving effect to
such Indebtedness, to
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69
(B) EBITDA for such fiscal quarter,
shall not exceed 7.5:1;
(g) Indebtedness under the Working Capital Loan Agreement the
proceeds of which are used solely for working-capital purposes in an
aggregate principal amount not exceeding $5,000,000;
(h) Indebtedness owed to the FCC in respect of the License for
the New York MTA;
provided that the Borrower shall not at any time incur or suffer to exist any
- --------
Indebtedness, whether or not otherwise permitted under clauses (a) through (h)
inclusive of this (S)7.01, in an aggregate principal amount then outstanding in
excess of $1,000,000,000.
Indebtedness of the Borrower to the Parent or Grand Parent shall only be
permitted hereunder pursuant to subsection (d), above.
Section 7.02. Restrictions on Liens. The Borrower shall not (A) create or
---------------------
incur or suffer to be created or incurred or to exist any Lien, encumbrance,
mortgage, pledge, charge, restriction or other security interest of any kind
upon any of its Property or assets of any character whether now owned or
hereafter acquired, or upon the income or profits therefrom; (B) transfer any of
such Property or assets or the income or profits therefrom for the purpose of
subjecting the same to the payment of Indebtedness or performance of any other
obligation in priority to payment of its general creditors; (C) acquire, or
agree or have an option to acquire, any property or assets upon conditional sale
or other title-retention or purchase-money security agreement, device or
arrangement; (D) suffer to exist for a period of more than 30 days after the
same shall have been incurred any Indebtedness or claim or demand against it
that if unpaid might by law or upon bankruptcy or insolvency, or otherwise, be
given any priority whatsoever over its general creditors; or (E) sell, assign,
pledge or otherwise transfer any accounts, contract rights, general intangibles,
chattel paper or instruments, with or without recourse; provided that the
--------
Borrower may create or incur or suffer to be created or incurred or to exist
(collectively "Permitted Liens"):
---------------
(a) Liens securing purchase-money Indebtedness permitted under
(S)7.01(e) owing to a Person that is not a party to the Intercreditor
Agreement; provided that such Liens cover only the property acquired with
--------
the proceeds of such Indebtedness;
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70
(b) Liens to secure taxes, assessments and other government
charges in respect of obligations not overdue or Liens on Properties to
secure claims for labor, material or supplies in respect of obligations not
overdue;
(c) deposits or pledges made in connection with, or to secure
payment of, workmen's compensation, unemployment insurance;
(d) Liens of carriers, warehousemen, mechanics and materialmen,
and other like liens on properties, in existence less than 120 days from
the date of creation thereof in respect of obligations not overdue;
(e) encumbrances on Real Estate consisting of:
(i) easements, rights of way, zoning restrictions,
restrictions on the use of real property and defects and
irregularities in the title thereto, landlord's or lessor's liens
under leases to which such the Borrower is a party, and other minor
liens or encumbrances none of which in the opinion of the Borrower
interferes materially with the use of the property affected in the
ordinary conduct of the business of the Borrower, which defects do
not individually or in the aggregate have a Material Adverse Effect
on the business of the Borrower, and
(ii) mortgage (or deed of trust) liens (collectively
"Mortgage Liens") to secure the payment of Indebtedness permitted
--------------
to be incurred under (S)7.01(e)(ii)(C), provided that
--------
(A) the amount secured by any Mortgage Lien shall not
exceed the sum of (1) the acquisition cost of the Real Estate
acquired by the Borrower and (2) the cost of any improvements
constructed thereon; and
(B) the Borrower shall simultaneously with the
acquisition of the Real Estate in question either
(1) grant to the Collateral Agent a second
mortgage (or deed of trust), in form and substance
satisfactory to the Required Lenders, subordinate only to
the Mortgage Lien, and securing the obligations of the
Borrower owing to lenders that are parties to the
Intercreditor Agreement, or
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71
(2) cause the lender in whose favor the Mortgage Lien
is to be made to execute and deliver to the Collateral Agent
an option to purchase the Mortgage Lien, substantially in
the form of Exhibit I;
---------
(f) Liens in favor of the Collateral Agent for the benefit of
the lenders and agents parties to the Intercreditor Agreement securing the
obligations permitted to be secured under the Intercreditor Agreement; and
(g) deposits to secure the performance of bids, trade contracts
(other than in respect of Indebtedness for borrowed money), leases,
statutory obligations, surety and appeal bonds, performance bonds, and
other obligations of a like nature incurred in the ordinary course of
business not to exceed in the aggregate at any one time $5,000,000.
Section 7.03. No Contingent Obligations. The Borrower shall not create,
-------------------------
incur, assume, guarantee or remain liable on any Contingent Obligations.
Section 7.04. Restrictions on Investments. The Borrower shall not make or
---------------------------
permit to exist or to remain outstanding any Investment except:
(a) Investments in Rate Hedging Agreements in a notional
principal amount on any date not to exceed the aggregate principal amount
of Indebtedness of the Borrower accruing interest at a floating rate, and
only so long as the purpose of such Investments shall be to hedge such
floating-rate interest and shall not be to speculate on interest rates;
(b) Investments in commercial paper maturing in 90 days or less
from the date of issuance which, at the time of acquisition by the
Borrower, is accorded a rating of A1 or better by Standard & Poor's Ratings
Group or P1 or better by Moody's Investors Service, Inc. or an equivalent
rating by another nationally recognized credit-rating agency of similar
standing;
(c) Investments in
(i) direct obligations of, or obligations guaranteed by,
the United States of America or any agency that constitutes a full-
faith-and-credit obligation of the United States of America, in any
case maturing in 12 months or less from the date of acquisition
thereof, and
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(ii) repurchase agreements fully secured by underlying
securities of the type described in clause (i) and issued by a bank or
trust company meeting the requirements of (S)7.04(d);
(d) Investments in certificates of deposit maturing within six
months from the date of issuance thereof (i) issued by a bank or trust
company organized under the laws of the United States or any state thereof,
having capital, surplus and undivided profits aggregating at least
$500,000,000 and whose long-term certificates of deposit are, at the time
of acquisition thereof by the Borrower, rated AA or better by Standard &
Poor's Ratings Group or Aa or better by Moody's Investors Service, Inc., or
(ii) issued by any Lender;
(e) Investments in money-market funds (other than single-state
funds) that make investments in accordance with the regulations of the
Securities and Exchange Commission under the Investment Company Act of
1940, as amended;
(f) Loans or advances in the usual and ordinary course of
business to officers, directors and employees for expenses (including
moving expenses related to a transfer) incidental to carrying on the
business of the Borrower; and
(g) Investments existing on the date hereof and listed on
Schedule 7.04.
-------------
Section 7.05. Distributions. The Borrower shall not make any
-------------
Distributions (other than a dividend or other distribution of any shares of
common Stock of the Borrower subject, to the extent received by Parent, to the
Parent's pledge under the Parent Pledge Agreement), except that the Borrower may
(a) pay interest in respect of Subordinated Debt owing to Parent
and Grand Parent, but only if:
(i) at the time of and after giving effect to such
payment, no Default shall have occurred and be continuing, and
(ii) interest on such Subordinated Debt shall accrue at a
rate per annum not exceeding a fixed rate of ****** per annum (or, if
approved by the Required Lenders, such higher rate as is consistent
with then-available market rates);
(b) repay or prepay principal owing in respect of Subordinated
Debt owing to Parent and Grand Parent, but only if:
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73
(i) at the time of and after giving effect to such
repayment or prepayment, no Default shall have occurred and be
continuing,
(ii) the aggregate principal amount of all such
Subordinated Debt that is being repaid or prepaid at such time shall
not exceed the sum of
(A) the difference, if any, between
(1) the maximum aggregate principal amount of the
Loans that could be outstanding at such time under (S)2.01
(after giving effect to the limitations set forth in the
second sentence thereof) and
(2) the sum of
(I) the aggregate principal amount of the Loans
that are actually outstanding at such time, and
(II) the aggregate principal amount of such
Subordinated Debt that shall have been repaid or
prepaid after the date of this Agreement and is
allocable to amounts that may be distributed pursuant
to this clause (A),
(B) the difference, if any, between
(1) the maximum aggregate principal amount of the
loans that could then be outstanding at such time under the
Nortel Loan Agreement, given the permissible uses of
proceeds thereof, and
(2) the sum of
(I) the aggregate principal amount of the loans
that are actually outstanding thereunder at such time,
and
(II) the aggregate principal amount of such
Subordinated Debt that shall have been repaid or
prepaid after the date of this Agreement and is
allocable to amounts that may be distributed pursuant
to this clause (B), and
<PAGE>
74
(C) the amount equal to
(1) the aggregate principal amount of such
Subordinated Debt that shall have been loaned to the
Borrower within the 90 days preceding the date of such
repayment or prepayment, minus
(2) the aggregate principal amount of such
Subordinated Debt that shall have been repaid within the 90
days preceding the date of such repayment or prepayment and
is allocable to amounts that may be distributed pursuant to
this clause (C);
provided that
--------
(x) any such repayment or prepayment on any date shall
be allocated to clause (A), (B) or (C) above for purposes of
determining whether any distribution may be made pursuant to
this clause (ii) in the following order of priority: first,
-----
any such repayment or prepayment shall be allocated to
clause (C) above until any further allocation to such clause
on such date would cause the amount calculated pursuant to
such clause to be less than zero; second any such repayment
------
or prepayment shall be allocated to clause (B) above until
any further allocation to such clause on such date would
cause the amount calculated pursuant to such clause to be
less than zero; and third any such repayment or prepayment
-----
shall be allocated to clause (A) above, and
(y) any such repayment or prepayment that is made with
proceeds of a borrowing under this Agreement or the Nortel
Loan Agreement shall not be taken into account for the
computation provided for in clauses (A)(2)(II) or (B)(2)(II)
above;
(iii) at any preceding date, no Default would have occurred if
such Subordinated Debt had not been outstanding;
(c) make other Distributions (other than Distributions in respect of
Subordinated Debt owing to Persons other than Parent or Grand Parent), but
only if at the time of and after giving effect to such Distribution:
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(i) no Default shall have occurred and be continuing,
(ii) the Borrower shall have had EBTDA in excess of zero
for each of its four consecutive fiscal quarters ending with its
fiscal quarter most recently ended prior to the date of such
Distribution (the "Preceding Fiscal Quarter") and
------------------------
(iii) the aggregate amount for all Distributions by the
Borrower during the fiscal year of the Borrower in which the date of
such Distribution occurs shall not exceed:
(A) Working Capital of the Borrower as of the last day
of the Preceding Fiscal Quarter, minus
(B) the aggregate amount of Debt Service payable by
the Borrower during the 12 calendar months next-following
the Preceding Fiscal Quarter, minus
(C) while any Tranche B Advance is outstanding,
(1) ******, multiplied by (2) ******, multiplied by (3) the
number of Borrower's fiscal quarters that have begun on or
before the date of such Distribution during the Borrower's
then-current fiscal year, multiplied by (4) Excess Cash Flow
in respect of the Borrower's immediately preceding complete
fiscal year, minus
(D) the aggregate amount of any prepayment of
Indebtedness required to be made pursuant to (S)3.02(b)
hereunder and pursuant to (S)3.2.C of the Nortel Loan
Agreement during the Borrower's then-current fiscal year and
that has not theretofore been made.
Section 7.06. Merger, Consolidation, Disposition of Assets, Etc. (a) The
-------------------------------------------------
Borrower shall not be a party to any merger or consolidation, shall not have any
Investment in any Subsidiary or agree to or effect any asset acquisition or
Stock acquisition (including any acquisition of any License) (other than the
acquisition of assets in the ordinary course of business consistent with sound
and prudent practices) and shall not issue any additional capital Stock (whether
or not such issuance would otherwise be permitted hereunder).
(b) The Borrower shall not become a party to or agree to or effect any
disposition of assets, other than
(i) the disposition of assets in the ordinary course of business,
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76
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(ii) the disposition of obsolete assets or equipment no longer
necessary to the operation of the Borrower's business, consistent with
sound and prudent practices, and
(iii) other disposition of assets for their fair-market value, as
determined in good faith by the Borrower, solely for cash consideration in
an amount not to exceed ****** in the aggregate during the term of this
Agreement.
Section 7.07. Sale and Leaseback. The Borrower shall not enter into any
------------------
arrangement, directly or indirectly, whereby the Borrower shall sell or transfer
any Property owned by it in order then or thereafter to lease such Property or
lease other property that the Borrower intends to use for substantially the same
purpose as the Property being sold or transferred.
Section 7.08. Compliance with Environmental Laws. The Borrower shall not
----------------------------------
(a) use any of the Real Estate or any portion thereof for the
handling, processing, storage or disposal of Materials of Environmental
Concern, except in compliance with Environmental Laws;
(b) cause or permit to be located on any of the Real Estate any
underground tank or other underground storage receptacle for Materials of
Environmental Concern, except in compliance with Environmental Laws;
(c) generate any Materials of Environmental Concern on any of
the Real Estate, except in compliance with Environmental Laws;
(d) conduct any activity at any Real Estate or use any Real
Estate in any manner so as to cause a release (i.e., releasing, spilling,
leaking, pumping, pouring, emitting, emptying, discharging, injecting,
escaping, leaching, disposing or dumping) or threatened release of
Materials of Environmental Concern on, upon or into the Real Estate except
in compliance with Environmental Laws; or
(e) otherwise conduct any activity at any Real Estate, except in
compliance with Environmental Laws, or use any Real Estate in any manner
that would violate any Environmental Law or bring such Real Estate in
violation of any Environmental Law.
Section 7.09. Employee Benefit Plans. Neither the Borrower nor any ERISA
----------------------
Affiliate shall
(a) engage in any "prohibited transaction" within the meaning of
(S)406 of ERISA or (S)4975 of the IRC which could result in a material
liability for the Borrower;
<PAGE>
77
(b) permit any Guaranteed Pension Plan to incur an "accumulated
funding deficiency", as such term is defined in (S)302 of ERISA, whether or
not such deficiency is or may be waived;
(c) fail to contribute to any Guaranteed Pension Plan to an
extent which, or terminate any Guaranteed Pension Plan in a manner which,
could result in the imposition of a lien or encumbrance on the assets of
the Borrower pursuant to (S)302(f) or (S)4068 of ERISA;
(d) permit or take any action which would result in the
aggregate benefit liabilities (with the meaning of (S)4001 of ERISA) of all
Guaranteed Pension Plans exceeding the value of the aggregate assets of
such Plans, disregarding for this purpose the benefit liabilities and
assets of any such Plan with assets in excess of benefit liabilities;
(e) fail to make when due any required contributions to a
Multiemployer Plan;
(f) withdraw (completely or partially) from any Multiemployer
Plan where such withdrawal is likely to result in a material liability of
the Borrower or an ERISA Affiliate;
(g) terminate or institute proceedings to terminate, any
Guaranteed Pension Plan, where such termination is likely to result in a
material liability of the Borrower or an ERISA Affiliate;
(h) make any amendment to any Guaranteed Pension Plan with
respect to which security is required under (S)307 of ERISA; or
(i) fail to give any and all notices and make all disclosures
and governmental filings required under ERISA or the IRC where such failure
is likely to result in material liability to the Borrower or an ERISA
Affiliate.
Section 7.10. Key Management Personnel Compensation. Until such time as
-------------------------------------
the Borrower's EBTDA has exceeded zero for two successive fiscal quarters, the
Borrower's compensation program for the categories of its key management
personnel listed on Schedule 7.10 shall not provide for incentive-based cash
-------------
compensation that is in excess of three times the applicable base salary.
Section 7.11. Transactions with Affiliates. The Borrower shall not enter
----------------------------
into
<PAGE>
78
(a) any agreement or arrangement providing for the payment of any
amounts to any of its Affiliates, except that the Borrower may enter into
(i) the Expense Allocation Agreement and the Servicing
Agreement dated as of the date hereof between the Borrower and Grand
Parent;
(ii) a tax-sharing agreement or arrangement pursuant to which
the Borrower shall not make any payments or agree to make any payments
in lieu of income taxes unless the cumulative sum of such payments
does not exceed the cumulative sum of income taxes that the Borrower
would have paid if the Borrower had always filed income-tax returns as
a separate entity; and
(iii) a management, consulting or other agreement, but only if
such agreement either
(A) relates to providing management, consulting or other
services to an Affiliate operating BTA markets and
(1) is on terms that are fair and reasonable and no
less favorable to the Borrower than it would obtain in a
comparable arm's-length transaction with a Person not an
Affiliate;
(2) does not provide for payments by the Borrower
under such agreement; and
(3) does not provide for the performance of services
or purchase or delivery of property by the Borrower in a
manner that, individually or together with all other such
agreements with Affiliates operating BTA markets, would
have a material adverse effect on the ability of the
Borrower to build-out or operate the New York MTA, or
(B) is approved in writing by the Required Lenders, or
(b) any other agreement, arrangement or transaction with any
of its Affiliates (whether or not providing for the payment of any
amounts to any of its Affiliates), except in the ordinary course of
business and on terms that are fair and reasonable and no less
favorable to the Borrower than it would obtain in a comparable arm's-
length transaction with a Person not an Affiliate.
<PAGE>
79
Section 7.12. Change in Nature of Business. The Borrower shall not make
----------------------------
any fundamental change in its business as carried on and as proposed to be
carried on at the date hereof.
Section 7.13. Charter Amendments. The Borrower shall not amend its
------------------
certificate of incorporation or bylaws.
Section 7.14. Accounting Changes. The Borrower shall not make or permit,
------------------
or permit any of its Subsidiaries to make or permit, any change in accounting
policies or reporting practices, except as required by GAAP, or change its
fiscal year.
Section 7.15. Prepayments, Etc., of Indebtedness. The Borrower shall not:
----------------------------------
(a) and shall not permit any Affiliate to, prepay, redeem,
purchase, defease or otherwise satisfy prior to the scheduled maturity
thereof in any manner, or make any payment in violation of any
subordination terms of, any Indebtedness owing by the Borrower, other than
the prepayment of the Advances in accordance with the terms of this
Agreement or as the Required Lenders may otherwise agree, except for
prepayments, redemptions, purchases or other satisfactions by the Borrower
as to which lenders under Section 5.02 of the Intercreditor Agreement are
not required to pay any amount to other lenders party thereto or
Indebtedness owing to the FCC, or
(b) amend, modify or change in any manner any term or condition
of any Subordinated Debt or any other Indebtedness secured by Liens in
favor of the Collateral Agent, except for amendments, modifications and
changes that the lenders party to the Intercreditor Agreement are permitted
to enter into thereunder.
If on any date any amount shall be due and owing hereunder and under any other
Indebtedness of the Borrower and the Borrower shall not pay in full all such
amounts as are then due and owing, the Borrower shall not pay any such amounts
except ratably, in accordance with the respective amounts then due and owing
thereunder. If the Borrower shall take any action in violation of this Section
7.15, it irrevocably authorizes each lender to it that is a party to the
Intercreditor Agreement on its behalf to make any payment required under Section
5.02 or 5.03 of the Intercreditor Agreement and acknowledges that any amount so
paid by any such lender shall be deemed not to have been paid by the Borrower to
such lender.
Section 7.16. Amendment, Etc., of Material Contracts. The Borrower shall
--------------------------------------
not cancel or terminate any Material Contract or consent to or accept any
cancellation or termination thereof, amend or otherwise modify any Material
Contract or give any consent, waiver or approval thereunder, waive any default
under or breach of any Material Contract, agree in any manner to any other
amendment, modification or change of any term or condition of any
<PAGE>
80
Material Contract, or take any other action in connection with any Material
Contract that, in any such case, could, at the time thereof, reasonably be
expected to have a material adverse effect on the Borrower's ability to perform
its obligations under this Agreement or any other Loan Document.
Section 7.17. Negative Pledge. The Borrower shall not enter into or
---------------
suffer to exist, or permit any of its Subsidiaries to enter into or suffer to
exist, any agreement prohibiting or conditioning the creation or assumption of
any Lien in favor of the Collateral Agent upon any of its property or assets.
Section 7.18. Partnerships. The Borrower shall not become a general
------------
partner in any general or limited partnership.
Section 7.19. Default Under the Supply Agreement. The Borrower shall not
----------------------------------
default in the performance or observance of any covenants or conditions on its
part to be performed or observed under the Supply Agreement.
ARTICLE VIII
CONDITIONS TO THE INITIAL ADVANCE
---------------------------------
The obligations of the Lenders to make their initial Advances shall be
subject to the satisfaction of the following conditions precedent on or prior to
the date of such initial Advances (the "Closing Date"):
------------
Section 8.01. Loan Documents. Each Lender shall have received a Note,
--------------
duly executed and delivered by the Borrower, as well as each of the other Loan
Documents, which shall have been duly executed and delivered by the respective
parties thereto, shall be in full force and effect and shall be in form and
substance satisfactory to the Administrative Agent, each of the Lenders and
their counsel.
Section 8.02. Proceedings and Documents. All corporate and other
-------------------------
proceedings in connection with the transactions contemplated hereby and by the
other Loan Documents shall be satisfactory to the Administrative Agent, each of
the Lenders and their counsel, and the Administrative Agent, each of the Lenders
and their counsel shall have received such secretary's certificates,
certificates of the Secretary of State of Delaware and other copies of documents
with respect thereto as they may reasonably request.
Section 8.03. Validity of Liens. The Borrower Security Agreement and the
-----------------
Parent Pledge Agreement shall each be effective to create in favor of the
Collateral Agent a legal,
<PAGE>
81
valid and enforceable first-priority security interest (except for Permitted
Liens that have priority under applicable law) in and Lien upon the Collateral.
All filings, recordings, deliveries of instruments and other actions necessary
or desirable in the opinion of the Collateral Agent to protect and preserve such
security interests shall have been duly effected and all such documents shall
have been duly executed by the Borrower and Parent. The Administrative Agent
shall have received evidence thereof in form and substance satisfactory to the
Administrative Agent.
Section 8.04. Search Reports and Related Documents. The Administrative
------------------------------------
Agent shall have received
(a) such UCC, tax, patent, trademark and judgment lien search
reports with respect to such applicable public offices where Liens are
filed, as shall be acceptable to the Administrative Agent, disclosing that
there are no Liens of record in such official's office covering any
Collateral or showing the Borrower or Parent as a debtor thereunder;
(b) a certificate of the Borrower and Parent signed by an
authorized officer of each thereof, dated the Closing Date, certifying
that, as of the Closing Date, there will exist no Liens on the Collateral
other than Permitted Liens; and
(c) duly executed file-stamped copies of UCC-1 and UCC-3
financing statements with respect to the Collateral (other than Pledged
Collateral), filed in each office where such filing is necessary or
appropriate to perfect a Lien on the Collateral.
Section 8.05. Certificates of Insurance. The Administrative Agent shall
-------------------------
have received
(a) a certificate of insurance from an independent insurance
broker, dated as of the Closing Date, identifying insurers, types of
insurance, insurance limits, and policy terms, and otherwise describing the
insurance obtained in accordance with the provisions of the Borrower
Security Agreement and this Agreement, and
(b) copies of all policies evidencing such insurance, which
shall contain provisions naming the Collateral Agent as an additional
insured and loss payee on behalf of the Lenders as its interests may
appear, and providing for 30-days' prior written notice to Administrative
Agent and the Collateral Agent of cancellation or diminishment.
Section 8.06. Solvency Certificate. Each of the Lenders and the
--------------------
Administrative Agent shall have received an officer's certificate of the
Borrower and Parent dated as of the Closing Date as to the Borrower and Parent
being Solvent following the consummation of the
<PAGE>
82
transactions contemplated herein and in form and substance satisfactory to the
Administrative Agent and Lenders.
Section 8.07. Opinion of Counsel to the Borrower. Each of the Lenders and
----------------------------------
the Administrative Agent shall have received a favorable legal opinion of the
Borrower's counsel addressed to the Lenders and the Administrative Agent, dated
as of the Closing Date, in form and substance satisfactory to the Lenders and
the Administrative Agent.
Section 8.08. Opinion of Counsel to Parent. Each of the Lenders and the
----------------------------
Administrative Agent shall have received a favorable legal opinion of Parent's
counsel addressed to the Lenders and the Administrative Agent, dated as of the
Closing Date, in form and substance satisfactory to the Lenders and the
Administrative Agent.
Section 8.09. Opinion of FCC Counsel. Each of the Lenders and the
----------------------
Administrative Agent shall have received a favorable legal opinion addressed to
the Lenders and Administrative Agent from FCC counsel to the Borrower and
Parent, dated as of the Closing Date, in form and substance satisfactory to the
Lenders and the Administrative Agent.
Section 8.10. Opinion of Counsel to Lenders and Administrative Agent.
------------------------------------------------------
Each of the Lenders and the Administrative Agent shall have received a favorable
legal opinion addressed to the Lenders and Administrative Agent from counsel to
the Lenders and Administrative Agent, dated as of the Closing Date, in form and
substance satisfactory to the Lenders and the Administrative Agent.
Section 8.11. Payment of Fees. The Borrower shall have paid all fees and
---------------
expenses, including the reasonable attorneys' fees of Administrative Agent's
counsel, and any FCC and local counsel to the Lenders, on the Closing Date and
payable by the Borrower hereunder.
Section 8.12. Approvals, Permits. The Borrower shall have obtained all
------------------
federal, state and local governmental and regulatory consents, approvals,
Licenses and permits, including any third-party consents, as required or
necessary for the Borrower to accept Loans and commence with the construction
and development of the New York PCS Network as contemplated for the current
stage of construction and development on the Closing Date and operate its
business pursuant to the Approved Full Term Operating Business Plan and shall
remain in effect; all applicable waiting periods shall have expired without any
action being taken by any competent authority; no law or regulation shall be
applicable in the judgment of the Lenders that restrains, prevents or imposes
materially adverse conditions upon the Loans or the construction and development
of the New York PCS Network referred to above, and the Administrative Agent and
each of the Lenders shall receive a certificate of an authorized officer of the
Borrower to that effect dated the Closing Date.
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83
Section 8.13. Delivery of Operating Business Plans. The Borrower shall
------------------------------------
have delivered to Administrative Agent and each Lender
(a) an annual operating business plan for its 1996 fiscal year
and
(b) a full-term operating business plan, each of which shall be
in form and substance satisfactory to the Administrative Agent and each
Lender,
together with a certificate of its Chief Financial Officer dated the Closing
Date certifying as to the reasonableness of the assumptions and expectations
contained therein and that there are presently no facts known to such Person
that would make either such plan misleading in any material respect.
Section 8.14. Delivery of Pledged Shares. The Parent shall have delivered
--------------------------
to the Collateral Agent all pledged stock certificates representing all of the
issued and outstanding capital Stock of the Borrower owned by Parent, which
shall not be less than 95.6% of all of the Borrower's issued and outstanding
shares of capital Stock, together with stock powers executed in blank.
Section 8.15. Material Agreements. Subject to confidentiality
-------------------
restrictions, the Administrative Agent and each of the Lenders shall have
received a complete and correct copy of (a) the Expense Allocation Agreement and
the servicing agreement referred to in (S)7.11(a)(i), in each case as then in
effect, and (b) each other contract set forth on Schedule 5.27, as such other
-------------
contract is then in effect and as to which the Administrative Agent shall have
requested a copy on or before the Closing Date.
Section 8.16. Litigation. There shall exist no action, suit,
----------
investigation, litigation or proceeding pending or threatened in any court or
before any arbitrator or governmental instrumentality that could have a Material
Adverse Effect.
Section 8.17. Insurance Certificates. One or more insurance certificates
----------------------
to the effect set forth in (S)6.05.
Section 8.18. Other Documents. The Administrative Agent and each Lender
---------------
shall receive all other documents, instruments and opinions from the Borrower
and Parent (including opinions of counsel for the Borrower and Parent) as
Administrative Agent and each Lender may reasonably request, in form and
substance satisfactory to the Administrative Agent and each Lender and their
counsel, and which shall be in full force and effect on the date of the initial
disbursement under this Agreement.
<PAGE>
84
ARTICLE IX
ADDITIONAL CONDITIONS TO ADVANCES
---------------------------------
Section 9.01. Conditions to All Advances. The obligation of each Lender
--------------------------
to make any Advance, including its initial Advance, shall also be subject to the
satisfaction of the following conditions precedent:
(a) The Administrative Agent shall have received a properly
completed Draw Request.
(b) Each of the representations and warranties of Borrower
contained in this Agreement, the other Loan Documents or in any document or
instrument delivered pursuant to or in connection with this Agreement shall
be true at and as of the time of the making of such Advance with the same
effect as if made at and as of that time (except to the extent of changes
resulting from transactions contemplated or permitted by this Agreement and
the other Loan Documents and changes occurring in the ordinary course of
business that singly or in the aggregate are not materially adverse, and to
the extent that such representations and warranties relate expressly to an
earlier date). The Administrative Agent shall have received a certificate
of an authorized officer of Borrower to such effect.
(c) No change shall have occurred in any law or regulations
thereunder or interpretations thereof that in the reasonable opinion of any
Lender would make it illegal for such Lender to make such Loan and no order
of any court or Governmental Body has been entered prohibiting the
consummation of the transactions contemplated by the Loan Documents.
(d) Each Lender shall have received such statements in substance
and form reasonably satisfactory to such Lender as such Lender shall
require for the purpose of compliance with any applicable regulations of
the Comptroller of the Currency or the Board of Governors of the Federal
Reserve System.
(e) The Administrative Agent shall have received such other
approvals, opinions or documents as any Lender through the Administrative
Agent may reasonably request.
(f) Grand Parent shall not be in default in the performance of
its obligations under the Cash Maintenance Agreement.
<PAGE>
85
(g) The Borrower shall have delivered to the Administrative
Agent invoices or other evidence reasonably satisfactory to the
Administrative Agent showing the aggregate amount of Tranche A Expenses (if
the proposed Advance is a Tranche A Advance), Tranche B Expenses (if the
proposed Advance is a Tranche B Advance) or Tranche C Expenses (if the
proposed Advance is a Tranche C Advance) that have been incurred by the
Borrower through the date of such Advance.
ARTICLE X
EVENTS OF DEFAULT; ACCELERATION; ETC.
-------------------------------------
Section 10.01. Events of Default and Acceleration.
----------------------------------
Upon the occurrence and during the continuance of any of the following
events,
(a) the Borrower shall fail to pay any principal of the Loans,
any Arrangement Fee, any interest on the Loans or any other sum hereunder
or under any of the other Loan Documents to which it is a party, in any
such case within three days after the date on which the same shall become
due and payable; or
(b) the Borrower shall fail to comply with any of the covenants
contained in Article VII or (S)6.10, 6.14(i) or 6.15; or
(c) Parent or the Borrower shall fail to perform any term,
covenant or agreement contained herein or in any of the other Loan
Documents (other than those specified elsewhere in this (S)10.01) and such
failure shall continue for a period of 30 days; or
(d) any representation or warranty of the Borrower or Parent
under the Loan Agreement or any of the other Loan Documents or in any other
document or instrument delivered pursuant to or in connection with this
Agreement or any Loan Document shall not be correct in any material respect
upon the date when made or deemed to have been made or repeated; or
(e) the Borrower shall
(i) make an assignment for the benefit of creditors, or
<PAGE>
86
(ii) generally not pay its debts as such debts become due
or admit in writing its inability to generally pay or generally
fail to pay its debts as they mature or become due, or
(iii) petition or apply for the appointment of a trustee or
other custodian, liquidator or receiver of the Borrower or of any
substantial part of the assets of the Borrower, or
(iv) shall commence any case or other proceeding relating
to the Borrower under any bankruptcy, reorganization,
arrangement, insolvency, readjustment of debt, dissolution or
liquidation or similar law of any jurisdiction providing for the
relief of debtors, now or hereafter in effect, or
(v) shall take any action to authorize or in furtherance
of any of the foregoing,
or any such petition or application shall be filed or any such case or
other proceeding shall be commenced against the Borrower and the Borrower
shall indicate its approval thereof, consent thereto or acquiescence
therein or shall not be able to have such proceeding dismissed within 30
days thereof or any of the actions sought in such proceeding (including the
entry of an order for relief against, or the appointment of a receiver,
trustee, custodian or other similar official for, it or any substantial
part of its property) shall occur; or the Borrower or Parent shall take any
corporate action to authorize any of the actions set forth above in this
subsection (e); or
(f) the Borrower shall fail to pay any principal of, premium or
interest on or any other amount payable in respect of any Indebtedness that
is outstanding in a principal amount of at least $5 million in the
aggregate (but excluding Indebtedness outstanding hereunder) of the
Borrower, when the same becomes due and payable (whether by scheduled
maturity, required prepayment, acceleration, demand or otherwise), or any
other event shall occur or condition shall exist under any agreement or
instrument relating to any such Indebtedness, if the effect of such event
or condition is to accelerate, or to permit the acceleration of, the
maturity of such Indebtedness or otherwise to cause, or to permit the
holder thereof to cause, such Indebtedness to mature; or any such
Indebtedness shall be declared to be due and payable or required to be
prepaid or redeemed (other than by a regularly scheduled required
prepayment or redemption), purchased or defeased, or an offer to prepay,
redeem, purchase or defease such Indebtedness shall be required to be made,
in each case prior to the stated maturity thereof; or
<PAGE>
87
(g) any judgment or order for the payment of money in excess of
$1,000,000 (excluding any portion thereof that an insurance company of
recognized standing and creditworthiness has agreed to pay) shall be
rendered against the Borrower and either
(i) enforcement proceedings shall have been commenced by
any creditor upon such judgment or order, or
(ii) there shall be any period of 30 consecutive days
during which a stay of enforcement of such judgment or order, by
reason of a pending appeal or otherwise, shall not be in effect;
or
(h) any of the Loan Documents shall be cancelled, terminated,
revoked or rescinded otherwise than in accordance with the terms thereof or
with the express prior written agreement, consent or approval of the
Lenders, or any action at law, suit or in equity or other legal proceeding
to cancel, revoke or rescind any of the Loan Documents shall be commenced
by or on behalf of the Borrower or any of its stockholders, or any court or
any other governmental or regulatory authority or agency of competent
jurisdiction shall make a determination that, or issue a judgment, order,
decree or ruling to the effect that, any one or more of the Loan Documents
is illegal, invalid or unenforceable in accordance with the terms thereof;
or
(i) with respect to any Guaranteed Pension Plan, an ERISA Event
shall have occurred and the Required Lenders shall have determined in their
reasonable discretion that such event reasonably could be expected to
result in liability of the Borrower to the PBGC or such Guaranteed Pension
Plan in an aggregate amount exceeding $250,000 and such event in the
circumstances occurring reasonably could constitute grounds for the
termination of such Guaranteed Pension Plan by the PBGC or for the
appointment by the appropriate United States District Court of a trustee to
administer such Guaranteed Pension Plan; or a trustee shall have been
appointed by the United States District Court to administer such Plan; or
the PBGC shall have instituted proceedings to terminate such Guaranteed
Pension Plan; or appointed a trustee to administer or liquidate any plan;
or
(j) the Borrower shall be the subject of writs of attachment or
garnishment and the like that might have a Material Adverse Effect and that
are unstayed for a period of 30 consecutive days or any such attachment
shall not have been bonded over within 30 days of the entry thereof; or
<PAGE>
88
(k) the FCC or any other Governmental Body shall cancel, revoke
or suspend any of the Borrower's material Licenses for the New York PCS
Network or fails to renew any such License; or
(l) the FCC or any other Governmental Body shall commence any
proceeding to cancel, revoke or suspend any of the Borrower's material
Licenses for the New York PCS Network which proceeding for the
cancellation, revocation or suspension (i) could reasonably be expected to
have a Material Adverse Effect and (ii) has not been stayed or enjoined by
the Borrower within five business days after the commencement of any such
proceeding; or
(m) the Borrower shall fail to pay when due amounts owing the
FCC unless (i) the Borrower's failure to pay can reasonably be expected, in
the sole judgment of Required Lenders, not to result in any cancellation,
revocation or suspension of the Borrower's License for the New York PCS
Network or (ii) the Borrower has obtained a stay or injunction against any
action by the FCC to cancel, revoke or suspend such License notwithstanding
the Borrower's failure to pay; or
(n) the Collateral Agent shall cease to have a valid and
perfected first-priority Lien on any Collateral securing the Borrower's
obligations hereunder (or, in the case of Collateral pledged by Parent,
Parent's guaranty of the Borrower's obligations hereunder), or the Borrower
or Parent shall so assert; or
(o) at any time any of the following shall occur:
(i) Grand Parent shall cease to have legal and beneficial
title, directly or indirectly through one or more subsidiaries
all of the issued and outstanding shares of capital Stock are
owned by it, at least a majority of the Voting Stock of the
Borrower then outstanding;
(ii) any person (other than Ericsson and its affiliates)
engaged in, or having an Affiliate engaged in, the business of
manufacturing, selling or distributing telecommunications
equipment shall own, directly or indirectly and as legal or
beneficial owner, more than 30% of the Voting Stock of the
Borrower then outstanding;
(iii) at least 95.6% of each series and class of issued and
outstanding shares of capital Stock of the Borrower shall not be
pledged as security for the Borrower's obligations hereunder and
under the other Loan Documents, or as security for the
obligations of Parent under the Parent Guaranty; or
<PAGE>
89
(iv) any sale of capital Stock of the Borrower held by Parent or
any other shareholder (other than Associated PCN Company), or any sale
of capital Stock of the Parent, shall occur, in either case for
consideration other than cash, or in either case unless the Borrower
shall receive the entire Net Cash Proceeds of such sale; or
(p) there shall occur in the judgment of the Required Lenders any
change in the business, condition (financial or otherwise), operations,
performance, properties or prospects of the Borrower that could reasonably
be expected to have a material adverse effect on the ability of the
Borrower to perform its obligations under the Loan Agreement and related
documents; or
(q) the Borrower shall default, after any applicable grace period,
under any equipment-acquisition agreement (other than the Supply Agreement)
providing for the purchase of more than $10,000,000 in aggregate purchase
price of equipment or other goods, from any Person, or such Person shall so
allege in writing; or
(r) as of any June 30 or December 31, beginning on June 30, 1997 and
ending on the first such date for which the Borrower shall have positive
EBTDA for both its fiscal quarter ending on such date and its fiscal
quarter immediately preceding such fiscal quarter shall fail to cause the
sum of
(i) all cash equity capital contributed to the Borrower after
January 1, 1996,
(ii) all Subordinated Debt incurred by the Borrower after
January 1, 1996 and
(iii) all Tranche C Advances outstanding on such date,
to be at least equal to the absolute value of the Cumulative Cash Flow
Shortfall as of such date;
then, and in any such event, so long as the same may be continuing, the
Administrative Agent may, and upon the request of the Required Lenders shall, by
notice to the Borrower, (i) declare the obligation of each Lender to make
Advances to be terminated, whereupon the same shall forthwith terminate, and/or
(ii) declare the Notes, all interest thereon and all other amounts payable under
this Agreement and the other Loan Documents to be forthwith due and payable,
whereupon the Notes, all such interest and all such amounts shall become and be
forthwith due and payable, without presentment, demand, protest or further
notice of any kind, all of which are hereby expressly waived by the Borrower;
provided that upon the occurrence of an Event of Default under subsection (e)
- --------
above, (A) the obligation of each Lender to make Advances shall automatically be
terminated and (B) the Notes, all such interest and all such amounts shall
automatically become and be due and payable, without presentment, demand,
protest or any notice of any kind, all of which are hereby expressly waived by
the Borrower.
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90
ARTICLE XI
THE ADMINISTRATIVE AGENT
------------------------
Section 11.01. Authorization and Action. Each Lender appoints and
------------------------
authorizes the Administrative Agent to take such action as agent on its behalf
and to exercise such powers and discretion under this Agreement and the other
Loan Documents as are delegated to the Administrative Agent by the terms hereof
and thereof, together with such powers and discretion as are reasonably
incidental thereto. As to any matters not expressly provided for by the Loan
Documents (including enforcement or collection of the Notes), the Administrative
Agent shall not be required to exercise any discretion or take any action, but
shall be required to act or to refrain from acting (and shall be fully protected
in so acting or refraining from acting) upon the instructions of the Required
Lenders, and such instructions shall be binding upon all Lenders; provided that
--------
the Administrative Agent shall not be required to take any action that exposes
the Administrative Agent to personal liability or that is contrary to this
Agreement or applicable law. The Administrative Agent will give to each Lender
prompt notice of each notice given to it by the Borrower pursuant to the terms
of this Agreement.
Section 11.02. Administrative Agent's Reliance, Etc. Neither the
------------------------------------
Administrative Agent nor any of its directors, officers, agents or employees
shall be liable for any action taken or omitted to be taken by it or them under
or in connection with the Loan Documents, except for its or their own gross
negligence or willful misconduct. Without limitation of the generality of the
foregoing, the Administrative Agent:
(a) may treat the Lender that made any Advance as the holder of the
Indebtedness resulting therefrom until the Administrative Agent receives
and accepts an Assignment and Acceptance entered into by such Lender, as
assignor, and an assignee, as provided in (S)12.07;
(b) may consult with legal counsel (including counsel for any Loan
Party), independent public accountants and other experts selected by it and
shall not be liable for any action taken or omitted to be taken in good
faith by it in accordance with the advice of such counsel, accountants or
experts;
(c) makes no warranty or representation to any Lender and shall not be
responsible to any Lender for any statements, warranties or representations
made in or in connection with the Loan Documents;
(d) shall not have any duty to ascertain or to inquire as to the
performance or observance of any of the terms, covenants or conditions of
any Loan Document on the part of any Loan Party or to inspect the property
(including the books and records) of any Loan Party;
<PAGE>
91
(e) shall not be responsible to any Lender for the due execution,
legality, validity, enforceability, genuineness, sufficiency or value of
any Loan Document or any other instrument or document furnished pursuant
hereto;
(f) shall incur no liability under or in respect of any Loan Document
by acting upon any notice, consent, certificate or other instrument or
writing (which may be by telegram, telecopy, cable or telex) believed by it
to be genuine and signed or sent by the proper party or parties; and
(g) shall incur no liability as a result of any determination whether
the transactions contemplated by the Loan Documents constitute a "highly
leveraged transaction" within the meaning of the interpretations issued by
the Comptroller of the Currency, the Federal Deposit Insurance Corporation
and the Board of Governors of the Federal Reserve System.
Section 11.03. Ericsson and Affiliates. With respect to its Commitments,
-----------------------
the Advances made by it and the Note issued to it, Ericsson and any other
Administrative Agent in its individual capacity shall have the same rights and
powers under the Loan Documents as any other Lender and may exercise the same as
though it were not the Administrative Agent; and the term "Lender" or "Lenders"
shall, unless otherwise expressly indicated, include Ericsson in its individual
capacity or any other Administrative Agent in its individual capacity. Ericsson
or any other Administrative Agent in its individual capacity and its affiliates
may a generally engage in any kind of business with, the Borrower and any of its
Affiliates and any Person who may do business with or own securities of any
Borrower or any of its Affiliates, all as if Ericsson or any other
Administrative Agent in its individual capacity were not the Administrative
Agent and without any duty to account therefor to the Lenders.
Section 11.04. Lender Credit Decision. Each Lender acknowledges that it
----------------------
has, independently and without reliance upon the Administrative Agent or any
other Lender and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender also acknowledges that it will, independently and
without reliance upon the Administrative Agent or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement.
Section 11.05. Indemnification. Each Lender severally will indemnify the
---------------
Administrative Agent (to the extent not promptly reimbursed by the Borrower)
from and against such Lender's ratable share of any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever that may be imposed
on, incurred by, or asserted against the Administrative Agent in any way
relating to or arising out of the Loan Documents or any action taken or omitted
by the Administrative Agent under the Loan Documents; provided that no Lender
--------
<PAGE>
92
shall be liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from the Administrative Agent's gross negligence or willful
misconduct. Without limitation of the foregoing, each Lender will reimburse the
Administrative Agent promptly upon demand for its ratable share of any costs and
expenses payable by the Borrower under (S)12.04, to the extent that the
Administrative Agent is not promptly reimbursed for such costs and expenses by
the Borrower. For purposes of this (S)11.05, the Lenders' respective ratable
shares of any amount shall be determined, at any time, according to the sum of
(a) the aggregate principal amount of the Advances outstanding at such time and
owing to the respective Lenders and (b) the aggregate unused portions of their
respective Commitments. The failure of any Lender to reimburse the
Administrative Agent promptly upon demand for its ratable share of any amount
required to be paid by the Lenders to the Administrative Agent as provided
herein shall not relieve any other Lender of its obligation hereunder to
reimburse the Administrative Agent for its ratable share of such amount, but no
Lender shall be responsible for the failure of any other Lender to reimburse the
Administrative Agent for such other Lender's ratable share of such amount.
Section 11.06. Successor Administrative Agents. The Administrative Agent
-------------------------------
may resign at any time by giving written notice thereof to the Lenders and the
Borrower and may be removed at any time with or without cause by the Required
Lenders. Upon any such resignation or removal, the Required Lenders shall have
the right to appoint a successor Administrative Agent. If no successor
Administrative Agent shall have been so appointed by the Required Lenders, and
shall have accepted such appointment, within 30 days after the retiring
Administrative Agent's giving of notice of resignation or the Required Lenders'
removal of the retiring Administrative Agent, then the retiring Administrative
Agent may, on behalf of the Lenders, appoint a successor Administrative Agent,
which shall be a commercial bank organized under the laws of the United States
or of any State thereof and having a combined capital and surplus of at least
$500,000,000. Upon the acceptance of any appointment as Administrative Agent
hereunder by a successor Administrative Agent and upon the execution and filing
or recording of such financing statements, or amendments thereto, and such other
instruments or notices, as may be necessary or desirable, or as the Required
Lenders may request, in order to continue the perfection of the Liens granted or
purported to
<PAGE>
93
be granted by the Collateral Documents, such successor Administrative Agent
shall succeed to and become vested with all the rights, powers, discretion,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations under
the Loan Documents. After any retiring Administrative Agent's resignation or
removal hereunder as Administrative Agent, the provisions of this Article XI
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent under this Agreement. A successor
Administrative Agent will notify the Borrower of its appointment promptly after
its appointment.
ARTICLE XII
MISCELLANEOUS
-------------
Section 12.01. Amendments, Etc. No amendment or waiver of any provision
---------------
of this Agreement or the Notes, nor consent to any departure by the Borrower
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Required Lenders, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given; provided that
--------
(a) no amendment, waiver or consent shall, unless in writing and
signed by all the Lenders, do any of the following at any time:
(i) waive any of the conditions specified in Article IX or, in
the case of the initial Borrowing, Article VIII;
(ii) change the percentage of the Commitments or of the
aggregate unpaid principal amount of the Notes, or the number of
Lenders, that shall be required for the Lenders or any of them to take
any action hereunder;
(iii) release any Collateral, other than as contemplated by the
Loan Documents;
(iv) permit the creation, incurrence, assumption or existence
of any Lien on any item of Collateral to secure any Obligations other
than Obligations owing to the Lenders and the Administrative Agent
under the Loan Documents and other than Debt owing to any other
Person;
(v) amend this (S)12.01;
<PAGE>
94
(vi) increase the Commitments of the Lenders or subject the
Lenders to any additional obligations;
(vii) reduce the principal of, or interest on, the Notes or any
fees or other amounts payable hereunder; or
(viii) postpone any date fixed for any payment of principal of,
or interest on, the Notes or any fees or other amounts payable
hereunder;
(b) no amendment, waiver or consent shall, unless in writing and
signed by the Administrative Agent in addition to the Lenders required
above to take such action, affect the rights or duties of the
Administrative Agent under this Agreement or any other Loan Document; and
(c) no amendment, waiver or consent shall, unless in writing and
signed by the Collateral Agent in addition to the Lenders required above to
take such action, adversely affect the rights or duties of the Collateral
Agent under this Agreement or any other Loan Document.
The Lenders will consider in good faith amendments proposed by the Borrower that
are intended to reconcile any apparent conflicts between the provisions of
(S)(S)3.02(a) and (b), 6.15 and 7.01 through 7.05 of this Agreement and the
related provisions of the Nortel Loan Agreement but shall not have any
obligation to enter into such amendments.
Section 12.02. Notices, Etc. All notices and other communications
------------
provided for hereunder shall be in writing (including telegraphic, telecopy,
telex or cable communication) and mailed, telegraphed, telecopied, telexed,
cabled or delivered,
(a) if to the Borrower, at:
Omnipoint Communications Inc.
49 Old Bloomfield Road
Mountain Lakes Corporate Center
Mountain Lakes, New Jersey 07046
Attn: Harry Plonskier
(fax no. (201) 257-2425)
with a copy to:
Piper & Marbury, L.L.P.
1200 19th Street, N.W.
<PAGE>
95
Washington, DC 20036
Attn: Edwin Martin, Esq.
(fax no. (202) 861-6317)
(b) if to any Lender, at its Domestic Lending Office; and
(c) if to the Administrative Agent, at
740 E. Campbell Road
Richardson, Texas 75081
Attn: Vice President-Finance
(fax no. (214) 952-8782)
with a copy, at the same address to the
attention of the Vice President-General Counsel
(fax no. (214) 907-7553)
or, as to each party, at such other address as shall be designated by such party
in a written notice to the other parties. All such notices and communications
shall, when mailed, telegraphed, telecopied, telexed or cabled, be effective
when deposited in the mails, delivered to the telegraph company, transmitted by
telecopier, confirmed by telex answerback or delivered to the cable company,
respectively, except that notices and communications to the Administrative Agent
pursuant to Article II, III, or XI shall not be effective until received by the
Administrative Agent.
Section 12.03. No Waiver; Remedies. No failure on the part of any Lender
-------------------
or the Administrative Agent to exercise, and no delay in exercising, any right
hereunder or under any Note or any other Loan Document shall operate as a waiver
thereof; nor shall any single or partial exercise of any such right preclude any
other or further exercise thereof or the exercise of any other right. The
remedies herein provided are cumulative and not exclusive of any remedies
provided by law.
Section 12.04. Costs, Expenses. (a) The Borrower will pay on demand
---------------
(i) all costs and expenses of the Administrative Agent incurred after
March 28, 1996 in connection with the preparation, execution, delivery,
administration, modification and amendment of the Loan Documents (including
(A) all search, filing and recording fees and expenses and (B) the
reasonable fees and expenses of counsel for the Administrative Agent with
respect thereto, with respect to advising the Administrative Agent as to
its rights and responsibilities, or the perfection, protection or
preservation of rights or interests, under the Loan Documents, with
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96
respect to negotiations with the Borrower, Parent, Grand Parent or with
other creditors of the Borrower, Parent or Grand Parent arising out of any
Default or any events or circumstances that may give rise to a Default and
with respect to presenting claims in or otherwise participating in or
monitoring any bankruptcy, insolvency or other similar proceeding involving
creditors' rights generally and any proceeding ancillary thereto), and
(ii) all costs and expenses of the Administrative Agent and the
Lenders in connection with the enforcement of the Loan Documents, whether
in any action, suit or litigation, any bankruptcy, insolvency or other
similar proceeding affecting creditors' rights generally or otherwise
(including the reasonable fees and expenses of counsel for the
Administrative Agent and each Lender with respect thereto).
(b) If, at any time while the Second LIBOR Method is applicable, any
payment of principal of, or Conversion of, any LIBOR Rate Advance is made by the
Borrower to or for the account of a Lender other than on the last day of the
Interest Period for such Advance, as a result of any repayment, prepayment
(other than pursuant to (S)3.03(b)) or Conversion thereof, acceleration of the
maturity of the Notes pursuant to (S)10.01 or for any other reason, the Borrower
shall, upon demand by such Lender (with a copy of such demand to the
Administrative Agent), pay to the Administrative Agent for the account of such
Lender any loss, cost or expense (including loss of anticipated profit) that any
Lender may sustain or incur as a consequence of the making of any payment of a
LIBOR Rate Loan on a day that is not the last day of the applicable Interest
Period with respect thereto.
(c) If the Borrower fails to pay when due any costs, expenses or other
amounts payable by it under any Loan Document, including fees and expenses of
counsel and indemnities, such amount may be paid on behalf of the Borrower by
the Administrative Agent or any Lender, in its sole discretion.
(d) The Borrower will indemnify each Lender, the Collateral Agent, the
Administrative Agent and their respective affiliates and their officers,
directors, employees, agents and advisors (each an "Indemnified Party") and hold
-----------------
each Indemnified Party harmless from and against from and against any and all
claims, damages, losses, liabilities and expenses (including reasonable fees and
expenses of counsel and, with respect to the Collateral Agent, reasonable
allocated costs and expenses of in-house counsel and legal staff) that may be
incurred by or asserted or awarded against any Indemnified Party, in each case
arising out of or in connection with
(i) the Notes, this Agreement and other Loan Documents, any of the
transactions contemplated herein or therein or the actual or proposed use
of the proceeds of the Advances, or
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97
(ii) the actual or alleged presence of Materials of Environmental
Concern on any property of the Borrower or any environmental proceeding
relating in any way to the Borrower,
except to the extent such claim, damage, loss, liability or expense is found in
a final, non-appealable judgment by a court of competent jurisdiction to have
resulted from such Indemnified Party's gross negligence or willful misconduct.
In the case of any investigation, litigation or other proceeding to which the
indemnity in this (S)12.04(d) applies, the indemnity shall be effective whether
or not such investigation, litigation or proceeding is brought by the Borrower,
its directors, shareholders or creditors or an Indemnified Party or any other
Person or any Indemnified Party is otherwise a party thereto and whether or not
the transactions contemplated hereby are consummated. The Borrower also shall
not to assert any claim against the Administrative Agent, the Collateral Agent,
any Lender, any of their Affiliates, or any of their respective directors,
officers, employees, attorneys and agents, on any theory of liability, for
special, indirect, consequential or punitive damages arising out of or otherwise
relating to the Notes, this Agreement, any of the transactions contemplated
herein or the actual or proposed use of the proceeds of the Advances.
(e) Without prejudice to the survival of any other agreement of the
Borrower hereunder, the agreements and obligations of the Borrower contained in
this (S)12.04 shall survive the payment in full of principal and interest
hereunder and under the Notes.
Section 12.05. Right of Set-off. Upon (a) the occurrence and during the
----------------
continuance of any Event of Default and (b) the making of the request specified
by (S)10.01 to authorize the Administrative Agent to declare, or the
Administrative Agent's declaration of, the Notes to be due and payable pursuant
to the provisions of (S)10.01, each Lender and each of its Affiliates is
authorized at any time and from time to time, to the fullest extent permitted by
law, to set off and otherwise apply any and all deposits (general or special,
time or demand, provisional or final) at any time held and other indebtedness at
any time owing by such Lender or such Affiliate to or for the credit or the
account of the Borrower against any and all of the Obligations of the Borrower
now or hereafter existing under this Agreement and the Note or Notes held by
such Lender, irrespective of whether such Lender shall have made any demand
under this Agreement or such Note and although such obligations may be
unmatured. Each Lender agrees promptly to notify the Borrower after any such
set-off and application; provided that the failure to give such notice shall not
--------
affect the validity of such set-off and application. The rights of each Lender
and its Affiliates under this (S)12.05 are in addition to other rights and
remedies (including other rights of set-off) that such Lender and its Affiliates
may have.
Section 12.06. Binding Effect. This Agreement shall become effective when
--------------
it shall have been executed by the Borrower and the Administrative Agent and
when the
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98
Administrative Agent shall have been notified by each Bank that such Bank has
executed it and thereafter shall be binding upon and inure to the benefit of the
Borrower, the Administrative Agent, each Lender, the Collateral Agent and their
respective successors and assigns, except that the Borrower shall not have the
right to assign its rights hereunder or any interest herein without the prior
written consent of the Lenders. Sections 12.04(d) and 12.12, insofar as they
relate to the Collateral Agent, and Section 7.15 also shall inure to the benefit
of each lender to the Borrower that at any time is a party to the Intercreditor
Agreement.
Section 12.07. Assignments and Participations. (a) Each Lender may
------------------------------
assign to one or more banks or other entities (including any trust or other
Person in connection with a securitization or monetization of the Advances or
other indirect raising of capital) all or a portion of its rights and
obligations under this Agreement (including all or a portion of its Commitment
or Commitments the Advances owing to it and/or the Note or Notes held by it);
provided that
- --------
(i) each such assignment shall be of a uniform, and not a varying,
percentage of all rights and obligations under and in respect of all
Commitments;
(ii) except in the case of an assignment to a Person that, immediately
prior to such assignment, was a Lender or an assignment of all of a
Lender's rights and obligations under this Agreement, the amount of the
Commitment and Advances of the assigning Lender being assigned pursuant to
each such assignment (determined as of the date of the Assignment and
Acceptance with respect to such assignment) shall in no event be less than
$5,000,000 and shall be an integral multiple of $1,000,000;
(iii)the parties to each such assignment shall
(A) execute and deliver to the Administrative Agent, for its
acceptance and recording in the Register, an Assignment and
Acceptance, together with any Note or Notes subject to such assignment
and a processing and recordation fee of $2,500,
(B) deliver a copy of such Assignment and Acceptance to the
Borrower at the time it delivers a copy to the Administrative Agent;
and
(iv) unless the Borrower shall have consented thereto, no such
assignment shall be made
(A) while any undrawn Commitment is outstanding, except to a
Person that shall have represented that it has a combined capital and
surplus of at least $50,000,000, and
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99
(B) except to a Person, other than a commercial bank or other
financial institution, that shall have represented that such Person is
not engaged in, and does not have an Affiliate that is engaged in, the
business of providing PCS telecommunications services to the public.
A Lender may assign outstanding Advances without assigning undrawn Commitments,
and may assign undrawn Commitments without assigning outstanding Advances. Upon
such execution, delivery, acceptance and recording, from and after the effective
date specified in such Assignment and Acceptance,
(x) the assignee thereunder shall be a party hereto and, to the
extent that rights and obligations hereunder and under the Intercreditor
Agreement have been assigned to it pursuant to such Assignment and
Acceptance, have the rights and obligations of a Lender hereunder and
thereunder and
(y) the Lender assignor thereunder shall, to the extent that rights
and obligations hereunder have been assigned by it pursuant to such
Assignment and Acceptance, relinquish its rights and be released from its
obligations under this Agreement and the Intercreditor Agreement (and, in
the case of an Assignment and Acceptance covering all or the remaining
portion of an assigning Lender's rights and obligations under this
Agreement, such Lender shall cease to be a party hereto).
(b) By executing and delivering an Assignment and Acceptance, the Lender
assignor thereunder and the assignee thereunder confirm to and agree with each
other and the other parties hereto as follows:
(i) other than as provided in such Assignment and Acceptance, such
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with this Agreement or the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other instrument or document furnished
pursuant hereto;
(ii) such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower or the performance or observance by the Borrower of any of its
obligations under this Agreement or any other instrument or document
furnished pursuant hereto;
(iii)such assignee confirms that it has received a copy of this
Agreement and the Intercreditor Agreement, together with copies of the
financial statements referred to
<PAGE>
100
in (S)5.04 and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance;
(iv) such assignee will, independently and without reliance upon the
Administrative Agent, such assigning Lender or any other Lender and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action
under this Agreement;
(v) such assignee appoints and authorizes the Administrative Agent to
take such action as agent on its behalf and to exercise such powers and
discretion under this Agreement as are delegated to the Administrative
Agent by the terms hereof, together with such powers and discretion as are
reasonably incidental thereto;
(vi) such assignee agrees that it will perform in accordance with
their terms all of the obligations that by the terms of this Agreement and
the Intercreditor Agreement are required to be performed by it as a Lender;
(vii) such assignee makes the representations set forth in subsection
(a)(iv) above; and
(viii) such assignee confirms that it is bound by the confidentiality
provisions set forth in (S)12.10.
(c) The Administrative Agent shall maintain at its address referred to in
(S)12.02 a copy of each Assignment and Acceptance delivered to and accepted by
it and a register for the recordation of the names and addresses of the Lenders
and the Commitments of, and principal amount of the Advances owing to, each
Lender from time to time (the "Register"). The entries in the Register shall be
--------
conclusive and binding for all purposes, absent manifest error, and the
Borrower, the Administrative Agent and the Lenders may treat each Person
whose name is recorded in the Register as a Lender hereunder for all purposes of
this Agreement. The Register shall be available for inspection by the Borrower
or any Lender at any reasonable time and from time to time upon reasonable prior
notice.
(d) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and an assignee, together with any Note or Notes subject to
such assignment, the Administrative Agent shall, if such Assignment and
Acceptance has been completed and is substantially in the form of Exhibit C,
(i) accept such Assignment and Acceptance,
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101
(ii) record the information contained therein in the Register and
(iii) give prompt notice thereof to the Borrower.
Within five Business Days after its receipt of such notice, the Borrower, at its
own expense, shall execute and deliver to the Administrative Agent in exchange
for the surrendered Note or Notes a new Note to the order of such assignee in an
amount equal to the Advances and/or Commitments assumed by it pursuant to such
Assignment and Acceptance and, if the assigning Lender has retained Advances or
Commitments hereunder, a new Note to the order of the assigning Lender in an
amount equal to the Advances and/or Commitments retained by it hereunder. Such
new Note or Notes shall be in an aggregate principal amount equal to the
aggregate principal amount of such surrendered Note or Notes, shall be dated the
effective date of such Assignment and Acceptance and shall otherwise be
substantially in the form of Exhibit C.
(e) Each Lender may sell participations in or to all or a portion of its
rights and obligations under this Agreement (including all or a portion of its
Commitments, the Advances owing to it and the Note or Notes held by it);
provided that
- --------
(i) such Lender's obligations under this Agreement (including its
Commitments) shall remain unchanged,
(ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations,
(iii) such Lender shall remain the holder of any such Note for all
purposes of this Agreement and
(iv) the Borrower, the Administrative Agent and the other Lenders
shall continue to deal solely and directly with such Lender in connection
with such Lender's rights and obligations under this Agreement.
(f) Any Lender may, in connection with any assignment or participation or
proposed assignment or participation pursuant to this (S)12.07, disclose to the
assignee or participant or proposed assignee or participant, any information
relating to the Borrower furnished to such Lender by or on behalf of the
Borrower; provided that, prior to any such disclosure, the assignee or
--------
participant or proposed assignee or participant shall agree to preserve the
confidentiality of any Confidential Information received by it from such Lender.
(g) Notwithstanding any other provision set forth in this Agreement, any
Lender may at any time create a security interest in all or any portion of its
rights under this
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102
Agreement (including the Advances owing to it and the Note or Notes held by it)
in favor of any Federal Reserve Bank in accordance with Regulation A of the
Board of Governors of the Federal Reserve System.
Section 12.08. Governing Law. This Agreement and the Notes shall be
-------------
governed by, and construed in accordance with, the laws of the State of New
York.
Section 12.09. Execution in Counterparts. This Agreement may be executed
-------------------------
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Delivery of an executed counterpart of a signature page to this Agreement by
telecopier shall be effective as delivery of a manually executed counterpart of
this Agreement.
Section 12.10. Confidentiality. Neither the Administrative Agent nor any
---------------
Lender shall disclose any Confidential Information to any Person without the
consent of the Borrower, other than
(a) to the Administrative Agent's or such Lender's Affiliates and
their officers, directors, employees, agents and advisors and to actual or
prospective Eligible Assignees and participants, and then only on a
confidential basis,
(b) as required by any law, rule or regulation or judicial process
and
(c) as requested or required by any state, federal or foreign
authority or examiner regulating banks or banking.
The Administrative Agent and the Lenders shall not, and the Borrower shall
not and shall cause its Affiliates not to, disclose the terms of this Agreement,
the other Loan Documents or the transactions contemplated hereby to any Person
without the consent of the other party hereto, except
(i) to any other lender that is a party to a Permitted Loan Agreement
(as defined in the Intercreditor Agreement) and that shall have agreed to
be bound by the provisions of this paragraph,
(ii) to the extent that such terms or transactions become generally
available to the public,
(iii) to their respective Affiliates and their officers, directors,
employees, agents, advisors and (in the case of the Lenders) to actual or
prospective assignees and
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103
participants, in each case to the extent that the Administrative Agent, any
Lender or the Borrower deems necessary or appropriate,
(iv) as required by any law, rule or regulation or judicial process
and
(v) as requested by any state, federal or foreign regulatory
authority.
A reasonable period of time prior to making any disclosure with respect to such
terms and transactions that is permitted under clause (iv) or (v) of the
preceding sentence, the party proposing, or whose Affiliate is proposing, to
make such disclosure will consult with the other party concerning the need for
and scope of any such disclosure.
Section 12.11. Consent to Jurisdiction. The Borrower irrevocably
-----------------------
(a) submits to the jurisdiction of any New York State or Federal
court sitting in New York City and any appellate court from any thereof in
any action or proceeding arising out of or relating to any Loan Document;
(b) agrees that all claims in respect of such action or proceeding
may be heard and determined in such New York State or in such Federal
court;
(c) waives, to the fullest extent that it may effectively do so, the
defense of an inconvenient forum to the maintenance of such action or
proceeding;
(d) consents to the service of any and all process in any such action
or proceeding by the mailing of copies of such process to such Borrower at
its address specified in (S) 12.02; and
(e) agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on
the judgment or in any other manner provided by law.
Nothing in this (S)12.11 shall affect the right of the Administrative Agent or
any Lender to serve legal process in any other manner permitted by law or affect
the right of the Administrative Agent or any Lender to bring any action or
proceeding against any Borrower or its property in the courts of other
jurisdictions.
Section 12.12. Matters Relating to the Collateral Agent. (a) The
----------------------------------------
Borrower will pay the Collateral Agent a fee in an amount, computed as provided
and payable at the times separately agreed to by the Collateral Agent and the
Borrower. In addition, the Borrower will pay on demand all costs and expenses of
the Collateral Agent (including allocated costs and
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reasonable expenses of in-house counsel and legal staff) in connection with the
preparation, execution, delivery, performance, administration, enforcement,
modification and amendment of this Intercreditor Agreement, the Borrower
Security Agreement, the Parent Pledge Agreement, the Mortgages and/or any other
Loan Document at any time, including without limitation the reasonable fees and
expenses of counsel (including reasonable allocated costs and expenses of in-
house counsel and legal staff) and the costs and expenses incurred by the
Collateral Agent in the course of performing its duties and obligations as
Collateral Agent.
Section 12.13. Amendments, etc. to Intercreditor Agreement. Neither the
-------------------------------------------
Administrative Agent nor the Lenders shall consent to any amendment or
modification of, supplement to, replacement of or substitution for the
Intercreditor Agreement unless either
(a) the Borrower shall have consented thereto in writing, or
(b) at the time at which such amendment, modification or waiver is
entered into a Default, or any event that, with the passage of time or
giving of notice or both would constitute an event of default under any
other Permitted Loan Agreement, shall have occurred and be continuing.
Section 12.14. Waiver of Jury Trial. Each of the Borrower, the
--------------------
Administrative Agent and the Lenders irrevocably waives all right to trial by
jury in any action, proceeding or counterclaim (whether based on contract, tort
or otherwise) arising out of or relating to any of the Loan Documents, the
Advances or the actions of the Administrative Agent or any Lender in the
negotiation, administration, performance or enforcement thereof.
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as a
sealed instrument as of the date first set forth above.
OMNIPOINT COMMUNICATIONS INC.
By /s/ Harry Plonskier
------------------------------
Title: Vice President, Finance
ERICSSON INC., as Administrative Agent
and a Lender
Tranche A Advance Commitment:
- ----------------------------
******
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105
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|Confidential treatment has been requested |
|with respect to the omitted portions. |
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Tranche B and C Advance By /s/ Joseph Hagan
- ----------------------- ------------------------------
Commitment: ****** Title: Chief Financial Officer
- ----------
Domestic Lending Office and LIBOR
- ---------------------------------
Lending Office:
- --------------
740 East Campbell Road
Richardson, Texas 75081
Attn: Vice President-Finance
(fax no. (214) 952-0432)
A copy of any notice delivered pursuant to
(S)12.02 should be delivered to the address set
forth above to the attention of the
Vice President-General Counsel
(fax no. (214) 907-7553)
