<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
AMENDMENT NO. 1
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report:
July 25, 1997
-------------
OMNIPOINT CORPORATION
---------------------
(Exact Name of Registrant as Specified in Charter)
Delaware 0-27442 04-2969720
-------- ------- ----------
(State of Incorporation) (Commission File Number) (IRS Employer
Identification No.)
3 Bethesda Metro Center
Suite 400
Bethesda, MD 20814
-------------------
(Address of principal executive offices) (Zip Code)
(301) 951-2500
--------------
(Registrant's telephone number)
<PAGE>
Item 5. Other Events.
------------
(1) On July 25, 1997, OPCS Philadelphia Holdings, Inc. ("OPCS"), an indirectly-
held, wholly-owned subsidiary of Omnipoint Corporation (the "Company"), entered
into a credit facility agreement with Ericsson Inc. ("Ericsson") and certain
other lenders party thereto to provide financing to OPCS for up to $120 million
for the purpose of financing the buildout of networks in the Philadelphia market
(the "Ericsson Philadelphia Facility").
Under the terms of the Ericsson Philadelphia Facility, OPCS is subject to
certain financial and operational covenants, including restrictions on OPCS's
ability to pay dividends, restrictions on indebtedness, and certain other
financial maintenance requirements. Additionally, the Ericsson Philadelphia
Facility provides that, among other events, the failure of OPCS to pay when due
amounts owing to the FCC shall constitute any event of default. The Ericsson
Philadelphia Facility is secured by substantially all of the assets of OPCS and
its license and operating subsidiaries for the Philadelphia and Dover BTA
markets, including a pledge of all capital stock of each such license and
operating subsidiary, as well as all capital stock of OPCS.
The principal amount of the Ericsson Philadelphia Facility is payable in
installments beginning in the year 2001, with a final payment due on December
31, 2005. Interest on such amount is payable quarterly with regard to base rate
loans and at the end of an applicable interest period with regard to LIBOR loans
(of which a portion of the loan proceeds are available to finance such interest
payments).
(2) On January 30, 1998, Omnipoint Midwest Holdings, LLC ("OMH"), an
indirectly-held, wholly-owned subsidiary of the Company, entered into a credit
facility agreement with Northern Telecom Inc. ("NorTel") and certain other
lenders party thereto to provide financing to OMH for up to $400 million for the
purpose of financing the buildout of networks in certain midwest BTA markets,
including the Detroit and Indianapolis BTA markets as well as certain other
designated BTA markets including Atlantic City (the "NorTel Facility"). The
NorTel Facility provides that up to $85 million of the NorTel Facility is
available to OMH to make an inter-company loan to the Company.
Under the terms of the NorTel Facility, OMH is subject to certain financial
and operational covenants, including restrictions on OMH's ability to pay
dividends, restrictions on indebtedness, and certain other financial maintenance
requirements. The NorTel Facility is secured by substantially all of the assets
of OMH and its license and operating subsidiaries for the midwest and certain
other designated markets, including a pledge of all capital stock of each such
license and operating subsidiary, as well as all capital stock of OMH.
The principal amount of a portion of the NorTel Facility which is available
to finance equipment purchases from NorTel and certain eligible third party
expenses is payable in installments beginning in the year 2002, with a final
payment due on December 31, 2006. Interest on such amount is payable quarterly
with regard to base rate loans and at the end of an applicable interest period
with regard to LIBOR loans. The $85 million portion of the NorTel
-2-
<PAGE>
Facility which has no required amortization, matures on March 31, 2008. Interest
on such portion is payable semi-annually (which interest may be accreted until
March 31, 2004).
(3) On February 17, 1998, Omnipoint Communications Inc. ("OCI"), an indirectly-
held, 95.6% -owned subsidiary of the Company, entered into a credit facility
agreement with DLJ Capital Funding, Inc., Goldman Sachs Credit Partners L.P.,
Bank of America National Trust & Savings Association and NationsBank, N.A. to
provide financing to OCI of up to $595 million (the "NY Facility"). The NY
Facility provides the immediate availability of $595 million, of which $295
million was funded to OCI at closing (a portion of the proceeds of which were
used to refinance an interim facility closed on December 29, 1997 for up to $516
million, of which a portion of the proceeds of such interim facility were used
to refinance then existing vendor facilities with Ericsson and Nortel, which
facilities were used to finance the buildout of networks in the New York
market). The remaining $300 million is available for borrowing on or prior to
April 1, 1998. A portion of the proceeds of the NY Facility are available to OCI
to make distributions to the Company.
Under the terms of the NY Facility, OCI is subject to certain financial and
operational covenants, including restrictions on OCI's ability to pay dividends,
restrictions on indebtedness, and certain other financial maintenance
requirements. The NY Facility is secured by substantially all of the assets of
OCI and its license subsidiary, including a pledge of all capital stock of such
license subsidiary, as well as all capital stock of OCI, which collateral is
shared pari-passu pursuant to an intercreditor agreement with the holders of the
notes issued by OCI pursuant to a Note Purchase Agreement, dated as of February
17, 1998, by and among OCI, IBJ Schroder Bank & Trust Company and certain other
purchasers party thereto.
The principal amount of the NY Facility is payable in installments
beginning June 30, 1998, with a final payment due on February 17, 2006.
Interest on such amount is payable quarterly with regard to base rate loans and
at the end of an applicable interest period with regard to LIBOR loans.
(4) On February 17, 1998, OCI entered into a note purchase agreement with IBJ
Schroder Bank & Trust Company and certain other purchasers party thereto to
provide financing to OCI of up to $155 million (the "Note Agreement"). The
entire commitment of $155 million under the Note Purchase Agreement was funded
to OCI at closing (a portion of the proceeds of which were used to refinance an
interim facility closed on December 29, 1997 for up to $516 million, of which a
portion of the proceeds of such interim facility were used to refinance then
existing vendor facilities with Ericsson Nortel, which facilities were used to
finance the buildout of networks in the New York market).
Under the terms of the Note Agreement, OCI is subject to financial and
operational covenants, similar to the NY Facility. The Note Agreement's
-3-
<PAGE>
underlying notes (the "Notes") are secured by substantially all of the assets of
OCI and its license subsidiary, including a pledge of all capital stock of each
such license subsidiary, as well as all capital stock of OCI, which collateral
is shared pari-passu pursuant to an intercreditor agreement with the agent for
the lenders of the NY Facility.
The principal amount of the Notes is payable in installments beginning June
30, 1998, with a final payment due on February 17, 2006. Interest on such
amount is payable quarterly.
-4-
<PAGE>
Item 7. Financial Statements and Exhibits.
---------------------------------
(c) Exhibits.
Exhibit No. Description
- ----------- -----------
10.1 Loan Agreement by and among OPCS Philadelphia Holdings,
Inc., Ericsson Inc. and certain other lenders named
therein, July 25, 1997.
10.2 Loan Agreement by and among Omnipoint Midwest Holdings,
LLC, Northern Telecom Inc. and certain other lenders
named therein, dated January 30, 1998.
10.3 Loan Agreement by and among Omnipoint Corporation,
Omnipoint Communications Inc., DLJ Capital Funding Inc
and certain other lenders named therein, dated February
17, 1998.
10.4 Note Purchase Agreement by and among Omnipoint
Corporation, Omnipoint Communications Inc., IBJ Schroder
Bank & Trust Company and certain other purchasers named
therein, dated February 17, 1998.
SIGNATURES
- ----------
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: January 20, 2000 OMNIPOINT CORPORATION
By: /s/ Harry Plonskier
-----------------------
Harry Plonskier
Acting Chief Financial Officer
-5-
<PAGE>
OMNIPOINT CORPORATION
FORM 8-K
EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
10.1 Loan Agreement by and among OPCS Philadelphia Holdings,
Inc., Ericsson Inc. and certain other lenders named
therein, July 25, 1997.
10.2 Loan Agreement by and among Omnipoint Midwest Holdings,
LLC, Northern Telecom Inc. and certain other lenders
named therein, dated January 30, 1998.
10.3 Loan Agreement by and among Omnipoint Corporation
Omnipoint Communications Inc., DLJ Capital Funding Inc
and certain other lenders named therein, dated
February 17, 1998.
10.4 Note Purchase Agreement by and among Omnipoint
Corporation, Omnipoint Communications Inc.,
IBJ Schroder Bank & Trust Company and certain other
purchasers named therein, dated February 17, 1998.
-6-
<PAGE>
================================================================================
LOAN AGREEMENT
dated as of July 25, 1997
among
OPCS PHILADELPHIA HOLDINGS, INC.
Borrower,
ERICSSON INC.,
as Administrative Agent,
and
THE LENDERS NAMED HEREIN
================================================================================
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS AND RULES OF INTERPRETATION
1.01. Definitions........................................................... 1
1.02. Rules of Interpretation............................................... 33
1.03. Accounting Terms...................................................... 33
ARTICLE II
THE LOANS
2.01. The Advances.......................................................... 34
2.02. Making the Advances................................................... 35
2.03. Fees.................................................................. 37
2.04. Interest.............................................................. 37
2.05. Interest Rate Determination........................................... 38
2.06. Optional Conversion of Advances....................................... 39
2.07. Payments and Computations............................................. 40
2.08. Sharing of Payments, Etc.............................................. 41
2.09. Use of Proceeds....................................................... 42
2.10. The Notes............................................................. 42
2.11. First LIBOR Method and Second LIBOR Method............................ 42
2.12. Reduction or Termination of the Commitments........................... 42
ARTICLE III
REPAYMENT AND PREPAYMENT OF THE LOANS
3.01. Repayment............................................................. 43
3.02. Mandatory Prepayments of Loans........................................ 44
3.03. Optional Prepayments of Loans......................................... 47
3.04. Certain Matters Relating to Repayments and Prepayments................ 47
ARTICLE IV
ILLEGALITY, INCREASED COSTS, CAPITAL ADEQUACY AND INDEMNITIES
4.01. Illegality............................................................ 47
4.02. Additional Costs and Capital Adequacy................................. 48
4.03. Taxes................................................................. 49
4.04. Survival.............................................................. 51
<PAGE>
ii
Page
----
ARTICLE V
REPRESENTATIONS AND WARRANTIES
5.01. Corporate Authority................................................... 51
5.02. Governmental Approvals................................................ 53
5.03. Title to Properties................................................... 53
5.04. Financial Statements.................................................. 53
5.05. No Material Adverse Effect, Etc....................................... 54
5.06. Franchises, Patents, Copyrights, Etc.................................. 54
5.07. FCC Licenses, Etc..................................................... 54
5.08. Litigation............................................................ 54
5.09. No Materially Adverse Contracts, Etc.................................. 54
5.10. Compliance with Other Instruments, Laws, Etc.......................... 54
5.11. Tax Status............................................................ 55
5.12. No Default............................................................ 55
5.13. Holding Company and Investment Company Acts........................... 55
5.14. Absence of Financing Statements, Etc.................................. 55
5.15. FCC Matters........................................................... 55
5.16. Tariffs............................................................... 56
5.17. Disclosure............................................................ 56
5.18. Burdensome Obligations................................................ 56
5.19. Solvency.............................................................. 56
5.20. Security Interests.................................................... 56
5.21. Certain Transactions.................................................. 56
5.22. Business Plans........................................................ 57
5.23. Employee Benefit Plans................................................ 57
5.24. Regulations U and X................................................... 58
5.25. Environmental Compliance.............................................. 58
5.26. Joint Ventures, Etc................................................... 59
5.27. Material Contracts.................................................... 60
5.28. Representations in Other Loan Documents............................... 60
ARTICLE VI
AFFIRMATIVE COVENANTS OF THE BORROWER
6.01. Maintenance of Office................................................. 60
6.02. Records and Accounts.................................................. 60
6.03. Corporate Existence; Maintenance of Licenses.......................... 60
6.04. Maintenance of Properties............................................. 61
6.05. Insurance............................................................. 62
6.06. Taxes................................................................. 63
<PAGE>
iii
Page
----
6.07. Inspection of Properties and Books.................................... 63
6.08. Compliance with Laws, Contracts, FCC Licenses and Permits............. 64
6.09. Further Assurances.................................................... 64
6.10. Authorization from Landlord/Mortgagee, Etc............................ 65
6.11. Attornment and Recognition Agreements................................. 65
6.12. Expense Allocation Agreement.......................................... 65
6.13. Maintenance of Restricted Subsidiary.................................. 65
6.14. Reporting Requirements; Notices....................................... 65
6.15. Financial Covenants of the Borrower................................... 73
6.16. Certified Copies of Insurance Policies................................ 76
6.17. Mortgage Liens........................................................ 76
6.18. New Restricted Subsidiaries........................................... 76
6.19. C-Block Subsidiaries.................................................. 77
6.20. Post-Closing Matters.................................................. 77
ARTICLE VII
CERTAIN NEGATIVE COVENANTS OF THE BORROWER
7.01. Restrictions on Indebtedness.......................................... 78
7.02. Restrictions on Liens................................................. 81
7.03. No Contingent Obligations............................................. 83
7.04. Restrictions on Investments........................................... 83
7.05. Distributions......................................................... 85
7.06. Merger, Consolidation, Disposition of Assets, Etc..................... 89
7.07. Sale and Leaseback.................................................... 93
7.08. Compliance with Environmental Laws.................................... 93
7.09. Employee Benefit Plans................................................ 93
7.10. New Subsidiaries...................................................... 94
7.11. Transactions with Affiliates.......................................... 94
7.12. Permitted Business.................................................... 96
7.13. Charter Amendments.................................................... 96
7.14. Accounting Changes.................................................... 96
7.15. Prepayments, Etc., of Indebtedness.................................... 96
7.16. Amendment, Etc., of Material Contracts................................ 97
7.17. Restrictions on Restricted Subsidiaries............................... 97
7.18. Partnerships.......................................................... 97
7.19. Default Under the Equipment Acquisition Agreement..................... 98
7.20. Collections of Receivables............................................ 98
ARTICLE VIII
CONDITIONS TO THE INITIAL ADVANCE
<PAGE>
iv
Page
----
8.01. Terms and Conditions of Transaction................................... 98
8.02. Due Diligence......................................................... 98
8.03. Validity of Liens..................................................... 98
8.04. Search Reports and Related Documents.................................. 99
8.05. Certificates of Insurance............................................. 99
8.06. Solvency Certificate..................................................100
8.07. Opinions of Counsel to the Borrower...................................100
8.08. Opinion of Counsel to the Grandparent and the Parent..................100
8.09. Opinion of FCC Counsel................................................100
8.10. Opinion of Counsel to the Administrative Agent........................100
8.11. Payment of Fees.......................................................100
8.12. Approvals, Permits; FCC Licenses......................................100
8.13. Delivery of Operating Business Plans..................................101
8.14. Security Agreements...................................................101
8.15. Guaranties............................................................102
8.16. Mortgages, Etc........................................................103
8.17. Attornment and Recognition Agreements.................................103
8.18. Material Agreements...................................................103
8.19. Litigation............................................................104
8.20. Insurance Certificates................................................104
8.21. No Default............................................................104
8.22. No Material Adverse Change............................................104
8.23. Corporate Documents...................................................104
8.24. Intercreditor Agreement...............................................106
8.25. Support Agreement.....................................................106
8.26. Amendment to Equipment Acquisition Agreement..........................106
8.27. Acknowledgement of Assignment.........................................106
8.28. Other Information.....................................................107
ARTICLE IX
ADDITIONAL CONDITIONS TO ADVANCES
9.01. Conditions Precedent to an Initial Advance Based on
Attributed Expenses with Respect to Any Operating Subsidiary
or License Subsidiary..............................................107
9.02. Conditions to All Advances............................................107
ARTICLE X
EVENTS OF DEFAULT; ACCELERATION; ETC.
10.01. Events of Default and Acceleration...................................109
<PAGE>
v
Page
----
ARTICLE XI
THE ADMINISTRATIVE AGENT
11.01. Authorization and Action.............................................113
11.02. Administrative Agent's Reliance, Etc.................................114
11.03. Ericsson and Affiliates..............................................115
11.04. Lender Credit Decision...............................................115
11.05. Indemnification......................................................115
11.06. Successor Administrative Agents......................................116
ARTICLE XII
MISCELLANEOUS
12.01. Amendments, Etc......................................................117
12.02. Notices, Etc.........................................................118
12.03. No Waiver; Remedies..................................................119
12.04. Costs, Expenses......................................................119
12.05. Right of Set-off.....................................................122
12.06. Binding Effect.......................................................122
12.07. Assignments and Participations.......................................122
12.08. Governing Law........................................................126
12.09. Execution in Counterparts............................................126
12.10. Confidentiality......................................................127
12.11. Consent to Jurisdiction..............................................128
12.12. Matters Relating to the Collateral Agent.............................128
12.13. Amendments, Etc., to Intercreditor Agreement.........................128
12.14. Certain FCC Actions..................................................129
12.15. Waiver of Jury Trial.................................................129
<PAGE>
vi
Exhibits
Exhibit A - Form of Note
Exhibit B - Form of Draw Request
Exhibit C - Form of Assignment and Acceptance
Exhibit D-1 - Form of Services Agreement
Exhibit D-2 - Form of Operating Agreement
Exhibit E-1 - Form of Borrower Security Agreement
Exhibit E-2 - Form of Parent Pledge Agreement
Exhibit E-3 - Form of Operating Subsidiary Security Agreement
Exhibit E-4 - Form of License Subsidiary Security Agreement
Exhibit F - Form of Real Estate Mortgage Option
Exhibit G - Form of Subordination Agreement
Exhibit H-1 - Form of Limited Recourse Parent Guaranty
Exhibit H-2 - Form of Subsidiary Guaranty
Exhibit I - Form of Intercreditor Agreement
Exhibit J - Form of Support Agreement
Schedules
Schedule 1.01 - Core BTAs, Dependent BTAs and Other BTAs
Schedule 5.01(b) - Subsidiaries
Schedule 5.06 - Intellectual Property
Schedule 5.07 - FCC Licenses
Schedule 5.25 - Environmental Matters
Schedule 5.26 - Permitted Joint Ventures
Schedule 5.27 - Material Contracts
Schedule 6.15(a) - Revenue
Schedule 6.15(c) - Leverage Ratio
Schedule 7.04 - Investments
Schedule 8.16 - Mortgaged Property
<PAGE>
LOAN AGREEMENT
This Agreement is made as of July 25, 1997, by and among (a) OPCS
PHILADELPHIA HOLDINGS, INC., a Delaware corporation (the "Borrower"), (b) the
lenders listed on the signature pages hereof and (c) ERICSSON INC., a Delaware
corporation ("Ericsson"), as administrative agent for the Lenders (together with
any successor thereto appointed pursuant to Section 11.06, the "Administrative
Agent").
ARTICLE I
DEFINITIONS AND RULES OF INTERPRETATION
Section 1.01. Definitions.
Administrative Agent. See the preamble hereto.
Administrative Agent's Account. The account of the Administrative Agent
maintained by the Administrative Agent with Mellon Bank N.A. at its office at
Mellon Bank Center, Pittsburgh, PA 15258, for the account of Ericsson Radio
Systems Financing Account, Account No. 030-8540 (or such other account as the
Administrative Agent from time to time may specify).
Administrative Agent's Office. The Administrative Agent's office set forth
in Section 12.02 and, upon the appointment of a successor Administrative Agent
pursuant to Section 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. An advance by a Lender to the Borrower pursuant to Article II,
and refers to a Base Rate Advance or a Eurodollar Rate Advance.
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.
Agents. Collectively, the Administrative Agent and the Collateral Agent.
Applicable Area. With respect to any Permitted BTA, any portion of the
geographic area covered thereby, other than any portion thereof as to which the
right to provide PCS services to POPs located in such portion shall have been
sold in a Restricted Sale.
<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 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. With respect to any Advance that is:
(a) a Base Rate Advance, 1.00% per annum until December 31, 2000 and
2.50% per annum thereafter, and
(b) a LIBOR Advance, 3.75% per annum until December 31, 2000 and 5.25%
per annum thereafter.
Approved Annual Operating Business Plan. With respect to each fiscal year
of the Borrower, beginning with its fiscal year ending December 31, 1998, the
annual business operating plan delivered by the Borrower pursuant to
Section 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 Section 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.
Attributed Expenses. At any date and with respect to any Permitted BTA or
the right to provide PCS services to POPs within any geographic area included in
a Permitted BTA, the aggregate amount of all Ericsson Related Expenses and Other
Costs incurred primarily with respect to, or used primarily for the normal
commercial operation of, a PCS System for such Permitted BTA or such geographic
area, other than, in the case of any Permitted BTA (other than the Philadelphia
BTA) the FCC License for which has been the subject of a C-Block General License
Revocation Event, any such Ericsson Related Expenses in respect of equipment
that shall have been installed and shall be used for a normal commercial
operation of another Permitted BTA on or before the date on which such Permitted
BTA shall become an Excluded BTA.
Balance Sheet Date. December 31, 1996.
<PAGE>
3
Base Rate. A fluctuating interest rate per annum in effect from time to
time, which rate per annum shall at any date be equal to the higher of:
(a) the rate of interest per annum announced publicly by Morgan
Guaranty Trust Company of New York as its prime or base rate on such date,
and
(b) 1/2 of 1% per annum above the Federal Funds Rate on such date.
Base Rate Advance. An Advance bearing interest calculated by reference to
the Base Rate.
Base Rate Loans. Loans bearing interest calculated by reference to the Base
Rate.
Borrower. See the preamble hereto.
Borrower Security Agreement. See Section 8.14(a).
Borrowing Base. At any date:
(a) prior to December 31, 2000:
(i) Net Ericsson Related Expenses as of such date, plus
(ii) the lesser of:
(A) (1) one third of the Maximum Commitment as of such
date, minus
(2) on and after December 31, 1998, one half of
Permitted Interest Expense as of such date, and
(B) the greater of:
(1) the aggregate amount of Net Other Costs and Handset
Costs as of such date, minus the aggregate principal
amount of the Advances theretofore prepaid pursuant
to Section 3.02(e), and
(2) the lesser of:
(I) one half of Net Ericsson Related Expenses as of
such date, and
<PAGE>
4
(II) the aggregate amount of Net Other Costs and
Handset Costs incurred as of such date, plus
(iii) Permitted Interest Expense as of such date, and
(b) thereafter:
(i) the aggregate principal amount of the Advances outstanding on
such date, minus
(ii) the aggregate amount, without duplication, of all Attributed
Expenses with respect to any right to provide PCS services to any POPs
that shall have been subject to a Restricted Sale, and any Permitted
BTA that shall have become an Excluded BTA, on or before such date.
Borrowing Base Certificate. A certificate, in form and substance
satisfactory to the Administrative Agent, duly certified by the chief or
principal financial or accounting officer of the Borrower, stating the amount of
the Borrowing Base as of the date of such certificate and setting forth in
reasonable detail the calculation of the amount thereof.
BTA. Any "basic trading area" as set forth on the Rand McNally 1992
Commercial Atlas & Marketing Guide, 123rd Edition, and utilized by the FCC in
dividing the 50 states, the District of Columbia and the United States
territories into 493 BTAs for the purpose of licensing PCS Systems.
BTA Cluster. Any group of Permitted BTAs for which one or more License
Subsidiaries have FCC Licenses and that consists of a Core BTA and its related
Dependent BTAs.
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 and, if the applicable Business Day relates
to any LIBOR Advance, a day on which dealings are not carried on in the London
interbank market.
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.
<PAGE>
5
Cash Equivalents. Any Investments of the Borrower or any of its
Subsidiaries of the types permitted under clauses (b), (c), (d) and (e) of
Section 7.04 having a maturity of not greater than 270 days from the date of
acquisition thereof.
Cash Management Agreement. The Cash Management Agency Agreement dated
November 7, 1996 among Enterprises and the Grandparent from time to time parties
thereto.
C-Block General License Revocation Event. Any action by the FCC the effect
of which is to revoke, annul, rescind, cancel, suspend or terminate all FCC
Licenses issued in connection with the FCC's C-block auction (including those
held by License Subsidiaries), regardless of whether the Persons owning such FCC
Licenses were in default thereunder.
C-Block FCC License. Any FCC License sold in the FCC's C-block auction.
C-Block Subsidiary. Each Subsidiary of the Parent that, as of the date
hereof, holds an FCC License listed in Part II of Schedule 1.01.
CERCLA. The Comprehensive Environmental Response, Compensation and
Liability Act, as amended, 42 USCA Section 9601 et seq.
Closing Date. The meaning specified in the introductory clause of Article
VIII.
Collateral. All "Collateral" and "Pledged Collateral" referred to in the
Collateral Documents and all other property that is or is intended to be subject
to any Lien in favor of the Collateral Agent for the benefit of Secured Parties.
Collateral Agent. Mellon Bank, N.A. or any successor thereto appointed
pursuant to Section 6.1 of the Intercreditor Agreement.
Collateral Documents. The Security Agreements, the Mortgages and any other
agreement that purports to create a Lien in favor of the Collateral Agent for
the benefit of the Secured Parties.
Commitment. With respect to any Lender, has the meaning specified in
Section 2.01.
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 or any of its
Affiliates 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
<PAGE>
6
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 or any
of its Affiliates.
Consolidated. The consolidation of accounts in accordance with GAAP of the
Borrower and its Restricted Subsidiaries.
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;
(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.
<PAGE>
7
Convert, Conversion and Converted. A conversion of Advances of one Type
into Advances of the other Type pursuant to Sections 2.05 or 2.06.
Core BTA. Any of the Philadelphia BTA, any other BTA with POPs exceeding
1,000,000 and any BTA that is designated as a "Core BTA" on Part A of Schedule
1.01, as such schedule may be updated from time to time in accordance with
Section 6.14(s), and in each case for which the FCC License therefor is held by
a License Subsidiary.
Debt Service. For any period, the aggregate scheduled amount of interest
required to be paid and principal required to be repaid by the Borrower and its
Restricted Subsidiaries (in each case, without duplication) during such period
on all Indebtedness of the Borrower and its Restricted Subsidiaries outstanding
during all or any part of such period (excluding (a) the amount of any
prepayment pursuant to Section 3.02(a), (b) or (c) or any similar prepayment
under a Permitted Loan Agreement and (b) interest capitalized under loans where
such loans provide for the funding of interest costs) and owing to Persons other
than the Borrower and its Restricted Subsidiaries, 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.
Dependent BTA. With respect to any Core BTA, any other BTA within the same
MTA as that of such Core BTA and any other BTA that the Borrower and the Lenders
may agree is a Dependent BTA with respect to such Core BTA and that is
designated as a "Dependent BTA" with respect to such Core BTA on Part B of
Schedule 1.01, as such schedule may be updated from time to time in accordance
with Section 6.14(s).
Distribution. Any of the following with respect to any Person:
(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
Stock of such Person, other than dividends payable solely in shares of
common stock (or equivalent interests) of the such Person;
(b) the purchase, redemption, or other retirement of any shares of any
class of Stock of such Person;
(c) the return of capital by Person to its shareholders (or holders of
interests equivalent to shares) as such;
<PAGE>
8
(d) any other distribution on or in respect of any shares or
equivalent interests of any class or series of Stock of such Person; or
(e) if such Person is the Borrower, 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 Section 2.02.
EBTDA. For any period, the sum, determined on a Consolidated basis, of
(a) Net Income of the Borrower and its Restricted Subsidiaries 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
Section 3(3) of ERISA maintained or contributed to by any Loan Party or any
ERISA Affiliate, other than a Multiemployer Plan.
Enterprises. Omnipoint Communications Enterprises, Inc., a Delaware
corporation, together with its successors.
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>
9
(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 Section 2601 et seq.; (iv) the Water Pollution Control Act, as
amended, 33 USCA Section 1251 et seq.; (v) the Clean Air Act, as amended,
42 USCA Section 7401 et seq.; (vi) the Hazardous Material Transportation Act, as
amended, 49 USCA Section 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 Section 5.25(d).
Equipment Acquisition Agreement. The Acquisition Agreement for Ericsson CMS
40 Personal Communications Systems (PCS) Infrastructure Equipment dated as of
April 16, 1996, as amended as of July 25, 1997 among Ericsson, Omnipoint
Communications Inc., Omnipoint MB Holdings, Inc. and the Borrower, as further
amended, supplemented or otherwise modified from time to time.
Ericsson. See the preamble hereto.
<PAGE>
10
Ericsson Related Expenses. With respect to any Permitted BTA and any date:
(a) the aggregate purchase price paid (excluding (x) all amounts paid
or incurred on a date before the date that such Permitted BTA shall have
become a Permitted BTA, other than those paid or incurred by or on behalf
of the Grandparent or any of its Affiliates and (y) if no License
Subsidiary then holds a C-Block FCC License for the Philadelphia BTA and
such Permitted BTA is another BTA for which a C-Block FCC License is held
by a License Subsidiary, all amounts paid or incurred with respect to such
Permitted BTA on or after any date on which a Proposed C-Block General
License Revocation Event shall have occurred), or being paid with the
proceeds of an Advance hereunder simultaneously with the making of such
Advance, by the Borrower and its Subsidiaries for:
(i) CMS 40/PCS 1900 or IS-661 equipment and software purchased
from Ericsson pursuant to the Equipment Acquisition Agreement for use
primarily in the Applicable Area of such Permitted BTA or the
Applicable Areas of such Permitted BTA and one or more other Permitted
BTAs and integral to the PCS Systems to be built out in such
Applicable Area or Applicable Areas, including without limitation base
stations, switching and other network infrastructure, software,
materials and the installation of the same, in each case whether
manufactured or provided by Ericsson or purchased by Ericsson from
other sources and resold to the Borrower or any of its Restricted
Subsidiaries under the Equipment Acquisition Agreement, and
(ii) services provided by Ericsson relating to the design,
engineering and other related services integral to such systems, minus
(b) the aggregate amount of all later refunds or reductions of or
other adjustments to the original purchase price for any of such equipment,
software or services.
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 Section 414 of the IRC.
ERISA Event. With respect to any Loan Party or any ERISA Affiliate,
(a) a Reportable Event,
<PAGE>
11
(b) the withdrawal of any Loan Party 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 under a
distress termination of the Plan under Section 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) the occurrence of 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 Section 10.01.
Excess Cash Flow. With respect to any fiscal year,
(a) EBTDA for such fiscal year, plus
(b) the aggregate amount of interest paid by the Borrower or any of
its Restricted Subsidiaries on any Indebtedness owing to the Grandparent or
any Affiliate thereof (other than the Borrower and its Restricted
Subsidiaries) during such fiscal year, minus
(c) proceeds from the sale of FCC Licenses, Stock of License
Subsidiaries and rights to provide PCS services by the Borrower and its
Restricted Subsidiaries, to the extent such proceeds would be included in
EBTDA for such fiscal year, minus
(d) income-tax payments, capital expenditures net of new financing
proceeds, aggregate scheduled principal payments under any Indebtedness of
the Borrower and its Restricted Subsidiaries (including payments on amounts
owing to the FCC with respect to BTA licenses) (other than mandatory
prepayments out of Excess Cash Flow), in each case during such fiscal year,
plus (if negative) or minus (if positive), as the case may be,
(e) differences between beginning and ending Working Capital
(excluding for purposes of any determination of working capital receivables
past due more than
<PAGE>
12
60 days, inventory and current portions of long-term Indebtedness) in
respect of such fiscal year.
Excess Proceeds. With respect to any disposition of any FCC License, any
Stock of a License Subsidiary or any right to provide PCS services to any POPs,
the Net Cash Proceeds of thereof, whether received at the time of such sale or
at any time thereafter, after deducting from such proceeds the amount of any
prepayment as a result of a thereof pursuant to Section 3.02(f) with respect to
such sale and any prepayments of other providers of vendor financing to the
Borrower pursuant to provisions substantially the same as the applicable
provisions of this Agreement.
Excluded BTA. At any date:
(a) any Core BTA as to which the right to provide PCS services with
respect to any POPs shall have theretofore been sold in a Restricted Sale
(except for any Restricted Sale of any right to provide PCS services to
POPs located in any geographic area specified in Part C of Schedule 1.01
with respect to any Core BTA);
(b) any Dependent BTA with respect to any Core BTA that shall be an
Excluded BTA as of such date;
(c) any BTA that is not a Core BTA or Dependent BTA with respect to
which the right to provide PCS services to more than 30% of the total POPs
of such BTA Cluster shall have theretofore been sold in a Restricted Sale;
(d) any BTA the FCC License for which shall have been disposed of
pursuant to Section 7.06(b)(iii), other than a disposition to a Qualified
Joint Venture permitted under such Section and Section 7.05;
(e) if at such date no License Subsidiary shall hold a C-Block FCC
License for the Philadelphia BTA, any BTA as to which the related FCC
License shall have been the subject of a C-Block General License Revocation
Event that occurred 180 or more days prior to such date or as to which to
which the related FCC License shall have been the subject of Permitted
Transfer that occurred 90 or more days prior to such date, in either case
unless a License Subsidiary shall then hold an FCC License or the right to
provide PCS services on terms and conditions acceptable to the Required
Lenders with respect to such BTA covering at least 10 MHz of spectrum; and
(f) any BTA with respect to which the right to provide PCS services to
any portion thereof has been transferred to a Qualified Joint Venture as to
which an event of the nature described in Section 10.01(e) shall have
occurred with respect to any holder of
<PAGE>
13
any equity interest in such Qualified Joint Venture, unless the Grandparent
shall have unconditionally guaranteed, in a manner in form and substance
satisfactory to the Required Lenders, an aggregate principal amount (plus
interest and costs of collection) of the Advances at any time outstanding
equal to the lesser of the aggregate principal amount of the Advances at
any time outstanding and the Attributed Expenses relating to such BTA.
Excluded Other Costs. Any amounts paid in connection with the purchase of
any of the following equipment manufactured or sold by any vendor other than
Ericsson (or any of its Affiliates): Base Station Controllers (BSC), Operation
and Support Systems (OSS), Intelligent Networks (IN), Mobile Switching Centers
(MSC), Authentication Centers (AUC), Equipment Identity Registers (EIR), Base
Transceiver Stations (BTS), Home Location Registers (HLR), Visitor Location
Registers (VLR) and Short Message Service Centers (SMS) (other than those
manufactured or sold by CMG Telecommunications, Inc.).
Expense Allocation Agreement. The Expense Allocation Agreement dated as of
July 25, 1997 among the Borrower, Enterprises and the Grandparent.
FCC. The Federal Communications Commission or any Governmental Body
succeeding to the functions thereof.
FCC 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 Body with respect to any
BTA.
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.
First LIBOR Method. The terms and provisions of this Agreement relating to
LIBOR Advances specified as being applicable when the First LIBOR Method is
applicable under Section 2.11.
Fiscal Quarter. A fiscal quarter of the Borrower and its Consolidated
Subsidiaries.
GAAP. See Section 1.03.
<PAGE>
14
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.
Grandparent. Omnipoint Corporation, a Delaware corporation, and its
successors.
Guaranteed Pension Plan. Any employee pension benefit plan within the
meaning of Section 3(2) of ERISA that is maintained or contributed to by any
Loan Party 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.
Guaranties. See Section 8.15(b).
Guarantors. Collectively, the Parent and, as of any date, any Person that
shall theretofore have delivered a Guaranty.
Handset Costs. An amount equal to the lesser of:
(a) the number of handsets purchased by the Borrower or an Operating
Subsidiary from Ericsson and its Affiliates that could be used in Permitted
BTAs, multiplied by $200; and
(b) one half of the aggregate purchase price for such handsets, net of
any refunds, reductions or other adjustments thereto.
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;
<PAGE>
15
(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 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 any FCC License;
(h) all Contingent Obligations of such Person; and
(i) interest that is accreted or otherwise accrued and unpaid on
Subordinated Debt.
Intercreditor Agreement. See Section 8.24.
Interest Period. While the First LIBOR Method is applicable and Loans are
accruing interest at LIBOR, the period commencing on the date on which interest
on the Loans shall accrue at LIBOR 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 LIBOR.
While the Second LIBOR Method is applicable, for each LIBOR Advance comprising
part of the same Loan, the period commencing on the date of such LIBOR Advance
or the date of the Conversion of any Base Rate Advance into such LIBOR 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 Business Day, the last day of such Interest Period
shall be extended to occur on the next-succeeding 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 Business Day, and
<PAGE>
16
(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 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 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;
(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;
(e) there shall not be deducted from the aggregate amount of
Investments any decrease in the value thereof; and
(f) there shall be included as an Investment (i) each receivable
(other than with respect to sales of handsets and accessories thereto) that
is payable more than three months following the date of the sale giving
rise thereto and (ii) each receivable with respect to sales of handsets and
accessories thereto that is payable more than six months following the date
of the sale giving rise thereto.
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.
<PAGE>
17
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. 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 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 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 Advance. An Advance bearing interest calculated by reference to
LIBOR.
LIBOR Reserve Rate. For any Interest Period for all LIBOR 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 Advances is determined) having a term equal to such
Interest Period.
License Subsidiary. At any date, each Subsidiary of the Borrower and each
C-Block Subsidiary that holds an FCC License for a Permitted BTA, other than any
C-Block Subsidiary the pledge of the shares of Stock of which shall have been
released pursuant to the applicable Security Agreement.
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
<PAGE>
18
retention agreement and any Capitalized Lease or other financing lease having
substantially the same economic effect as any of the foregoing.
Limited Recourse Parent Guaranty. See Section 8.15(a).
Loan. A loan consisting of simultaneous Advances of the same Type made by
the Lenders.
Loan Documents. This Agreement, the Notes, the Collateral Documents, the
Guaranties, the Subordination Agreement between the Grandparent and the
Borrower, the Intercreditor Agreement, the Support Agreement, the Equipment
Acquisition Agreement, any mortgage or deed of trust entered into pursuant to
Section 6.17 and any other agreements or documents contemplated hereby or
thereby and all schedules, exhibits and annexes thereto.
Loan Parties. Collectively, the Borrower, the Grandparent and each
Guarantor.
Marketing Expenses. With respect to any period, the sales and marketing
expenses of the Borrower and its Restricted Subsidiaries for such period,
including, without limitation, any such expenses incurred during such period in
respect of sales literature and advertising, promotions; subscriber acquisition
services; amounts allocable during such period to marketing expenses in respect
of travel, entertainment, sales training, office expenses and research; and the
difference (if negative) between revenues from sales of handsets during such
period and the cost of such handsets, as determined on a basis consistent with
the Borrower's accounting methods that are consistent with GAAP.
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:
(a) materially and adversely 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) materially and adversely impair the ability of the Borrower to pay
any amounts owing hereunder or under any other Loan Document in accordance
with their terms;
(c) cause a Default;
(d) materially and adversely affect the business, property, prospects,
operations, or financial or other condition of the Borrower, the Parent or
the Grandparent; or
<PAGE>
19
(e) materially and adversely 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 petroleum products, by products or breakdown
products or any other material subject to regulation under any Environmental
Laws.
Maturity Date. The earlier of
(a) December 31, 2005, and
(b) the date of the acceleration of the Advances pursuant to
Section 3.02(d) or 10.01.
Maximum Commitment. At any date, an amount equal to (a) $120,000,000, minus
(b) the aggregate amount by which the Maximum Commitment has been permanently
reduced pursuant to Section 2.12 on or prior to such date.
Mortgages. See Section 8.16.
MTA. Any "major trading area" as set forth on the Rand McNally 1992
Commercial Atlas & Marketing Guide, 123rd Edition, at pages 38-39 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 any Loan Party 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 each FCC License held by a License Subsidiary and all grants,
approvals, licenses, filings and registrations under the Communications Act,
necessary in order to enable the Borrower and its Restricted Subsidiaries to
own, construct, maintain and operate PCS Systems.
<PAGE>
20
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), determined on a
Consolidated basis, of the Borrower and its Restricted Subsidiaries determined
in accordance with GAAP for such period.
Net Ericsson Related Expenses. At any date:
(a) the aggregate amount of Ericsson Related Expenses as of such date,
minus
(b) the aggregate amount of all Restricted Ericsson Expenses as of
such date.
Net Other Costs. At any date:
(a) Other Costs as of such date, minus
(b) Restricted Other Costs as of such date.
Non-Qualified Joint Venture. Any Person that is not a Qualified Joint
Venture or a Wholly Owned Subsidiary of the Borrower.
Notes. The Notes substantially in the form of Exhibit A issued by the
Borrower hereunder.
Omnipoint Services. Omnipoint Communications Services, Inc., a Delaware
corporation, together with its successors.
Operating Cash Flow. For any period,
<PAGE>
21
(a) Net Income for such period, plus
(b) to the extent deducted or accrued in determining Net Income, the
sum of each of the following for such period:
(i) depreciation, scheduled amortization of principal of
Indebtedness and other non-cash charges,
(ii) income tax expense and
(iii) interest expense;
provided that there shall be excluded from Operating Cash Flow (without
duplication) the following to the extent that any of the same shall have been
included in Net Income for such period:
(a) the income (or deficit) of any Person accrued prior to the date it
becomes a Restricted Subsidiary or is merged into or consolidated with the
Borrower or any of its Restricted Subsidiaries;
(b) any restoration to income of any contingency reserve, except to
the extent that provision for such reserve was made out of income accrued
during such period;
(c) any aggregate net gain (but not any aggregate net loss) during
such period arising from the sale, exchange or other disposition of capital
assets (such term to include all fixed assets, whether tangible or
intangible, all inventory sold in conjunction with the disposition of fixed
assets, and all securities);
(d) any write-up of any asset; and
(e) any net income or gain or loss during such period (but, in the
case of any loss, only to the extent that such loss, net of any gains
during such period, shall be $5,000,000 or less) from any change in
accounting, from any discontinued operations or the disposition thereof,
from any extraordinary events or from any prior-period adjustments.
Operating Subsidiary. Enterprises and any other Restricted Subsidiary of
the Borrower that is engaged in the business of building out and operating one
or more BTAs on behalf of one or more License Subsidiaries.
<PAGE>
22
Other Costs. The aggregate purchase price paid or being paid (including
amounts paid or incurred with respect to any Permitted BTA on a date before the
date that such Permitted BTA shall have become a Permitted BTA) with the
proceeds of an Advance hereunder simultaneously with the making of such Advance
for
(a) equipment and services approved by Ericsson (but excluding
equipment and services provided by Ericsson under the Equipment Acquisition
Agreement) that are:
(i) integral to the PCS Systems to be built out in Applicable
Areas of Permitted BTAs for which Ericsson Related Expenses have been
incurred and other BTAs in the same BTA Cluster,
(ii) purchased by the Borrower or an Operating Subsidiary, and
(iii) purchased in connection with infrastructure-related
construction, engineering and design relating to equipment purchased
from Ericsson, including site-acquisition costs and
microwave-relocation costs, and
(b) Real Estate located in any such Applicable Area with an aggregate
acquisition price not exceeding $1,000,000 and in each such case that is
subject to a first-priority Lien in favor of the Collateral Agent and that
is acquired in connection with the operation of mobile switching centers,
base station controllers, base transceiver stations and/or home location
registers;
but excluding, unless and to the extent otherwise consented to in writing by the
Administrative Agent, any Excluded Other Costs.
Other Taxes. See Section 4.03(b).
Ownership Fraction. At any date, a fraction, expressed as a percentage,
that is equal to:
(a) a fraction, the numerator of which is the number of shares Voting
Stock of the Borrower legally and beneficially owned by the Parent as of such
date and the denominator of which is the total number of shares of such Stock
outstanding as of such date, multiplied by
(b) a fraction, the numerator of which is the number of shares of
Voting Stock of the Parent legally and beneficially owned by the Grandparent as
of such date and the denominator of which is the total number of shares of such
Stock outstanding as of such date.
<PAGE>
23
Parent. OPCS Corp., a Delaware corporation, together with its successors.
Parent Pledge Agreement. See Section 8.14(b).
PBGC. The Pension Benefit Guaranty Corporation created by Section 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 an FCC License therefor held by a License Subsidiary.
Permitted BTA. At any date:
(a) any BTA located within the Philadelphia MTA and for which the FCC
License is held by a License Subsidiary as of such date, and
(b) any other BTA for which an FCC License is held by a License
Subsidiary as of such date, but only if such BTA is within an MTA approved
by Ericsson after reviewing (i) a business plan prepared by the Grandparent
with respect to the build-out of the BTAs within such MTA for which FCC
Licenses are held by License Subsidiaries, (ii) business conditions
relating to the repayment of Advances in respect of such MTA and (iii)
other business considerations considered relevant by Ericsson and after
receiving internal credit approvals,
but excluding any BTA that shall have become an Excluded BTA on or before such
date.
Permitted Disaggregation means a disposition of a portion of or any rights
to use spectrum under any C-Block FCC License in connection with a
disaggregation thereof approved by the FCC pursuant to which a License
Subsidiary retains either:
(a) the right to use at least 10 MHz of spectrum under such C-Block FCC
License on terms and conditions (including without limitation any such terms and
conditions relating to the potential effect of any default in respect of such
C-Block FCC License, by any other Person having the right to use the remaining
spectrum covered by such C-Block FCC License, on the rights of such License
Subsidiary with respect to the portion of the spectrum covered by such C-Block
FCC License retained by such License Subsidiary) that are acceptable to the
Required Lenders, or
(b) an FCC License;
<PAGE>
24
(i) covering at least 10 MHz of the spectrum formerly covered
by such C-Block FCC License.
(ii) each term of which that is comparable to a term of such
C-Block FCC License is substantially the same as, or more favorable to
such License Subsidiary than, the comparable term of such C-Block FCC
License, and
(iii) that has no term burdensome on such License Subsidiary for
which there is no comparable term included in such C-Block FCC
License, except for any such term that shall have been approved by the
Required Lenders or that would be applicable to C-Block FCC Licenses
generally whether or not any disaggregation thereof shall have
occurred.
Permitted Interest Expense. At any date prior to December 31, 1998,
interest accrued and paid or payable on the Advances (whether or not paid)
through September 30, 1998, and at any date on or after December 31, 1998, the
lesser of (a) interest accrued and paid or payable on the Advances (whether or
not paid) through September 30, 1998, and (b) 10% of the Net Ericsson Related
Expenses as of December 31, 1998.
Permitted Liens. See Section 7.02.
Permitted Loan Agreement. As defined in the Intercreditor Agreement.
Permitted Stock Transfer. Any direct or indirect issuance, sale, assignment
or other transfer of shares of Stock of the Borrower (whether by the Borrower or
the Parent) after the date hereof, as to which all of the following conditions
shall have been satisfied as of the date of such transfer:
(a) after giving effect to such transfer, no Default shall have
occurred and be continuing;
(b) after giving effect to such transfer, the Parent shall own at
least a majority of each class and series of Stock of the Borrower then
outstanding;
(c) the transferee shall have entered into a guaranty in form and
substance satisfactory to the Required Lenders, except that recourse
thereon shall be limited to the Stock of the Borrower held by such
transferee, and shall have pledged such Stock (and delivered any stock
certificates evidencing such Stock) to the Collateral Agent pursuant to a
pledge agreement in form and substance satisfactory to the Required
Lenders;
<PAGE>
25
(d) the Stock and stockholders of the Borrower shall not be subject or
parties to any agreement under which the shareholder of a majority of the
outstanding Voting Stock of the Borrower would not have day-to-day control
of the operations of the Borrower or that would be binding on any Person
acquiring such Stock by reason of realization thereon by the Collateral
Agent;
(e) all outstanding Stock of the Borrower shall be subject to
restrictions on transfer satisfactory in form and substance to Ericsson to
prevent its transfer to a competitor of Ericsson;
(f) the consideration received for such transfer shall be equal to the
fair-market value of the Stock transferred, as determined in good faith by
the Board of Directors of the Grandparent; and
(g) the entire proceeds of such transfer shall have been contributed
to the Borrower.
Permitted Transfer. For purposes of Section 7.06(b)(iii)(D)(2), a
disposition, whether or not for any consideration, of a C-Block FCC License in
whole, or that is a Permitted Disaggregation, in respect of a Permitted BTA as
to which all of the following are true:
(a) The Borrower or any of its Restricted Subsidiaries owes
Indebtedness to the FCC in respect of such FCC License and, after giving
effect to such disposition, neither the Borrower nor any Restricted
Subsidiary shall have any liability in respect of such Indebtedness, except
that, in the case of any Permitted Disaggregation in respect of a
C-Block FCC License a License Subsidiary may remain liable in respect of a
portion of the Indebtedness in respect of such C-Block FCC License equal to
the amount thereof, multiplied by a fraction, the numerator of which is the
amount of spectrum retained by such License Subsidiary in connection with
such Permitted Disaggregation and the denominator of which is 30 MHz.
(b) The transferee of such FCC License is to the FCC or a Wholly Owned
Subsidiary of the Grandparent other than the Borrower or a Subsidiary of
the Borrower.
(c) Such disposition, if other than to the FCC, is effected by a
written agreement in form and substance reasonably satisfactory to the
Required Lenders under which:
(i) such transferee agrees that, while any Advances are
outstanding:
<PAGE>
26
(A) for so long as it shall own or hold such FCC License, it
will remain a Wholly Owned Subsidiary of the Grandparent, shall
engage in no activities other than the holding of such FCC
License and have no liabilities other than Indebtedness owing to
the FCC in respect of such FCC License;
(B) for so long as it shall own or hold such FCC License, it
shall not voluntarily allow such FCC License or any rights
thereunder to provide PCS services to be used other than by the
Borrower or a Restricted Subsidiary; and
(C) it shall not voluntarily transfer such FCC License or
any rights thereunder to any Person other than to the Borrower, a
Restricted Subsidiary or the FCC, and
(ii) such transferee confirms that the Administrative Agent and
the Lenders are third-party beneficiaries of the obligations of the
transferee thereunder.
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.
Philadelphia BTA. BTA No. 346
Plan. With respect to any Loan Party 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
(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.
POPs. With respect to any BTA or geographic area included therein, the
population of such BTA or geographic area, as set forth in the 1990 census of
the United States by the United States Census Bureau.
<PAGE>
27
Portion of Excess Proceeds. With respect to any Person, the sale of any BTA
and any date, a ratable portion (determined by reference to the respective
amounts of the Advances, other vendor-financing advances and capital (including
Subordinated Debt) contributed to the Borrower by such Person and other Persons,
in each case as determined immediately after giving effect to any prepayment of
Advances and other vendor-financing advances as a result of such sale) of the
Excess Proceeds relating to such sale.
Preceding Fiscal Quarter. See Section 7.05(d).
Property. All types of real, personal, tangible, intangible or mixed
property, including each FCC License held by a License Subsidiary.
Proposed C-Block General License Revocation Event. Any notice of proposed
rulemaking or other proposal by the FCC as to the possible adoption of any rule
or taking of any action that would be a C-Block General License Revocation Event
or any other event or circumstance that with the passage of time would become a
C-Block General License Revocation Event or that would be a C-Block General
License Revocation Event but for the existence of any stay or injunction then in
effect with respect thereto.
Qualified Joint Venture. Any Person all of the Stock of which is owned by
the Borrower and/or any of its Restricted Subsidiaries and any other Person or
Persons that is or are not Affiliates of the Borrower or competitors of Ericsson
and as to which the following conditions shall have been satisfied as of the
date on which such Person becomes a Qualified Joint Venture and at all times
thereafter:
(a) the Borrower or such Restricted Subsidiary owns, directly or
indirectly through one or more Wholly Owned Subsidiaries, at least a
majority of each class and series of Voting Stock of such Person, and such
Person is a Subsidiary of the Borrower;
(b) all of the Stock of such Person shall have been pledged to the
Collateral Agent on behalf of the Secured Parties as security, among other
things, for the obligations of the Loan Parties under the Loan
Documents;
(c) all conditions and requirements specified in (S)6.18 shall have
been complied with respect to such Person;
(d) such Person is not subject to any restrictions that would violate
(S)7.17;
(e) the Stock and stockholders of such Person shall not be subject or
parties to any agreement under which the majority shareholder would not have
day-to-
<PAGE>
28
day control of the operations of such Person or that would be binding on
any Person acquiring such Stock by reason of realization thereon by the
Collateral Agent;
(f) the Stock of such Person held by anyone other than the Borrower and
its Restricted Subsidiaries shall not have the benefit of any special or
preferential rights not applicable to all Stock held by the Borrower and
its Restricted Subsidiaries; and
(g) all outstanding Stock of such Person is subject to restrictions on
transfer satisfactory in form and substance to Ericsson to prevent its
transfer to a competitor of Ericsson.
Rate Hedging Agreements. 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 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 Section 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 or any of its Restricted Subsidiaries.
Register. See Section 12.07(c).
Reportable Event. The occurrence of any of the events set forth in
Section 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
(b) the then-outstanding undrawn Commitments.
<PAGE>
29
Required Operation Improvement Date. Any Required Operation Test Date as to
which the Borrower shall have delivered a report pursuant to (S)6.14(u) for the
period ending on such date showing that the Borrower is not in compliance with
generally accepted industry standards applicable at the time (reflecting
appropriate adjustments for non-recurrent activity) for call blocking and
dropped calls with respect to the operation of the Philadelphia BTA.
Required Operation Test Date. Each day occurring on or after December 31,
1999 that is the last day of every third calendar month after a disposition of
the Philadelphia BTA permitted under (S)7.06(b)(iii)(D)(2)(I)(x)(b) as a result
of which License Subsidiaries shall hold one or more FCC Licenses, or the right
to provide, on terms and conditions satisfactory to the Required Lenders, PCS
services under FCC Licenses held by third parties, covering less than 20 MHz of
spectrum for the Philadelphia BTA unless, prior to such day. License
Subsidiaries shall hold such licenses or right covering at least 20 MHz of
spectrum for such BTA.
Restricted Ericsson Expenses. At any date, the aggregate amount, without
duplication, of all Attributed Expenses relating to Ericsson Related Expenses
with respect to any Permitted BTA that shall have become an Excluded BTA or any
geographic area within a Permitted BTA for which the right to provide PCS
services shall have been disposed of pursuant to an FCC License Partition
permitted under Section 7.06(b)(iii) on or before such date.
Restricted Sale. Any of the following:
(a) with respect to any FCC License (in its entirety) or any Stock of
a License Subsidiary, any sale, assignment or other transfer thereof, other
than (i) any transfer to a Qualified Joint Venture permitted under
Section 7.06(b)(iii)(C) and, in the case of any FCC License, a disposition
permitted under Section 7.06(b)(iii)(D) (other than, subject to clause (b)
below, Section 7.06(b)(iii)(D)(2)(I)(x)(b));
(b) the occurrence of the second Required Operation Test Date after
any Required Operation Improvement Date, unless, on or before such second
Required Operation Test Date:
(i) a License Subsidiary shall hold one or more FCC Licenses, or
the right to provide, on terms and conditions satisfactory to the
Required Lenders, PCS services under FCC Licenses held by third
parties, covering at least 20 MHz of spectrum for the Philadelphia
BTA, or
(ii) the Borrower shall then be in compliance with generally
accepted industry standards applicable at the time (reflecting
appropriate adjustments for non-recurrent activity) for call blocking
and dropped calls with respect to such BTA; and
<PAGE>
30
(c) with respect to any right to provide PCS services to any POPs in a
BTA covered by an FCC License, the sale, assignment or other transfer of
such right if:
(i) prior to such transfer (and all other prior transfers of such
right with respect to such POPs) the transferor had the right to
provide PCS services to such POPs using at least 20 MHz of spectrum
under the related FCC License and after such transfer the transferor
had the right to provide PCS services to such POPs using less than 20
MHz of spectrum under the related FCC License, or
(ii) prior to such transfer (and all other prior transfers of
such right with respect to such POPs) the transferor had the right to
provide PCS services to such POPs using 10 MHz of spectrum under the
related FCC License and after such transfer the transferor had the
right to provide PCS services to such POPs using less than 10 MHz of
spectrum under the related FCC License,
other than any such transfer to a Qualified Joint Venture permitted under
Section 7.06(b)(iii)(C).
The consideration received in connection with any Restricted Sale described in
clause (b) above shall be deemed to be the consideration received in connection
with any disposition of the FCC License or the Stock of the License Subsidiary
that shall have occurred prior to the date specified in such clause (b) with
respect to the Philadelphia BTA.
Restricted Other Costs. At any date, the aggregate amount, without
duplication, of all Attributed Expenses relating to Other Costs with respect to
any Permitted BTA that shall have become an Excluded BTA, or portion of a
Permitted BTA that shall not be part of the Applicable Area thereof, as of such
date.
Restricted Subsidiary. At any date, each Subsidiary of the Borrower and
each C-Block Subsidiary that is not a Subsidiary of the Borrower at such date
but whose C-Block Subsidiary Guaranty shall not have been terminated as of such
date, other than any Subsidiary of the Borrower that is a Non-Qualified Joint
Venture or whose sole activity is the holding of an equity interest in a
Non-Qualified Joint Venture.
Revenue. For any period, with respect to the Borrower and its Restricted
Subsidiaries, on a Consolidated basis,
<PAGE>
31
(a) the sum, without duplication, of
(i) gross billings to subscribers, net of taxes and other direct
pass-through charges,
(ii) (if positive) 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 (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),
in each case as determined with respect to such period.
Second LIBOR Method. The terms and provisions of this Agreement relating to
LIBOR Advances specified as being applicable when the Second LIBOR Method is
applicable under Setion 2.11.
Secured Parties. Collectively, the Administrative Agent, the Collateral
Agent, the Lenders and the other agents and lenders parties to the Intercreditor
Agreement.
Security Agreement. See Section 8.14(c).
Services Agreement. The Services Agreement dated as of January 1, 1997
between Omnipoint Services and an Operating Subsidiary.
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;
(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
<PAGE>
32
(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.
Stock. With respect to any Person, any and all shares of capital stock,
partnership or other interests or units, participations or equivalent rights of
or in such Person and interests, participations, warrants, convertible
securities 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. A Subordination Agreement in substantially the
form of Exhibit G.
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 (excluding in the case of the Borrower Subsidiaries
other than Restricted Subsidiaries), 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.
Subsidiary Guaranty. See Section 8.15(b).
Subsidiary Security Agreement. See Section 8.14(c).
Support Agreement. See Section 8.25.
Taxes. See Section 4.03(a).
Termination Date. December 31, 2000.
Type. As to any Loan, its nature as a Base Rate Loan or a LIBOR Loan.
<PAGE>
33
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.
Wholly Owned. As applied to any Subsidiary of a Person, a Subsidiary all
the outstanding shares (other than directors' qualifying shares, if required by
law) of every class of Stock of which are at the time owned by such Person or by
one or more Wholly Owned Subsidiaries of such Person or by such Person and one
or more Wholly Owned Subsidiaries of such Person.
Working Capital. With respect to any date, the difference between the
"current assets" and "current liabilities" of the Borrower and its Restricted
Subsidiaries on a Consolidated basis as of such date in accordance with GAAP.
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 "Section" or Exhibit refers to that section
or that exhibit to this Agreement, unless otherwise indicated.
(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.
<PAGE>
34
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, 1996, 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,
1996, 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. The Advances. Each Lender severally agrees, on the terms and
conditions hereinafter set forth, to make advances (the "Advances") to the
Borrower on any Business Day from the date hereof until the earlier of
(a) the Termination Date, and
(b) the termination of the Commitments pursuant to Section 3.02(d) or
10.01,
up to an aggregate principal amount not to exceed the amount set forth opposite
such Lender's name on the signature pages hereof or, if such Lender has entered
into an Assignment and Acceptance, set forth for such Lender in the Register
maintained by the Administrative Agent pursuant to Section 12.07(c) (such
Lender's "Commitment"). Each Loan shall be in an amount equal to at least
U.S.$1,000,000 (or, if less, the aggregate remaining unused amounts of all
Lenders' Commitments) (unless such Loan is made in order to pay Ericsson any
amount owing to Ericsson or any Affiliate thereof, in which case there shall be
<PAGE>
35
no minimum amount for such Advance) and shall consist of Advances of the same
Type made on the same day by the Lenders ratably according to their respective
Commitments.
In no event shall the aggregate principal amount of all Advances
outstanding on any date exceed the lesser of:
(a) the Maximum Commitment as of such date, and
(b) the Borrowing Base as of such date.
Section 2.02. Making the Advances. (a) Except as otherwise provided in
Section 2.02(b), 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 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 hereto, 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 Advances if, after giving effect to
such Advances, there would be more than three different Interest
Periods then in effect;
(iii) the requested aggregate principal amount of such Loan; and
(iv) the account to which the proceeds of such Loan shall be paid.
Each Draw Request shall be accompanied by a Borrowing Base Certificate that,
among other things, shows the Borrowing Base as of the date of such Draw Request
and such additional documents as may be required by Article IX.
<PAGE>
36
Each Lender shall, before 12:00 noon (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 Administrative Agent's Account 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 12:00 A.M. (New York City time) on the date of any 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 2:00 P.M.
(New York City time).
(b) Anything in subsection (a) above to the contrary notwithstanding, (i)
the Borrower may not select LIBOR 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 Advances shall then be suspended pursuant to Section 2.05 or 4.01 and (ii)
there shall be no more than three Interest Periods for LIBOR 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 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 Articles
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 Section 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 agree to repay or pay 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
<PAGE>
37
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.
Section 2.03. Fees. (a) Usage Fee. The Borrower will pay to the
Administrative Agent for the account of each Lender a usage fee equal to 1.50%
per annum of the outstanding principal amount of each Advance for the period
from and including the date on which such Advance is made through but excluding
December 31, 2000. Such usage fee shall be payable in full on December 31, 2000;
provided that no usage fee shall be payable if all Advances shall have been
prepaid in full pursuant to (S)3.02 or 3.03 prior to December 31, 2000.
(b) Syndication Fee. If Ericsson shall sell or otherwise assign all or any
portion of any Advances owing to it or its Commitment hereunder to any Person
other than an Affiliate of Ericsson, the Borrower shall pay to Ericsson such fee
as is actually payable to any such Person in connection with such sale or
assignment, up to a maximum amount equal to 2.00% of the aggregate principal
amount of the Advances or Commitment so sold or assigned.
(c) Agents' Fees. The Borrower shall pay to the Administrative Agent (if
other than Ericsson or any of its Affiliates) and the Collateral Agent for their
own respective accounts such reasonable and customary fees as may from time to
time be agreed between the Borrower and each such Agent.
Section 2.04. Interest. (a) The Borrower shall pay interest on the unpaid
principal amount of each Advance owing to each Lender from and including the
date of such Advance through but excluding the date on which 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 March, June, September and December during such periods and on
the Maturity Date.
(ii) During such periods as such Advance is a LIBOR Advance, a rate
per annum equal at all times during each Interest Period for such Advance
(or, if the First
<PAGE>
38
LIBOR Method is applicable, during each Interest Period while such Advance
is outstanding as a LIBOR Advance) to the sum of (A) LIBOR 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 on which such Advance
shall be Converted or repaid or prepaid, in whole or in part.
(b) Upon the occurrence and during the continuance of an Event of Default
under Section 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 4.00% 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 demand, at a rate per annum equal at
all times to 4.00% per annum above the rate per annum then 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 Advances, the Required Lenders notify the Administrative Agent that LIBOR
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 Advances for such Interest Period, the Administrative Agent shall
forthwith so notify the Borrower and the Lenders, whereupon
(i) each LIBOR 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
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 Advances
shall be suspended immediately,
until such time as the Administrative Agent shall notify the Borrower and
the Lenders that the circumstances causing such suspension no longer exist.
<PAGE>
39
(b) On the date on which the aggregate unpaid principal amount of all LIBOR
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 Section 10.01(a),
(i) each LIBOR 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
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
Advances shall be suspended immediately.
(d) If the Administrative Agent cannot determine LIBOR for any LIBOR
Advances,
(i) the Administrative Agent shall forthwith notify the Borrower and
the Lenders that the interest rate cannot be determined for such LIBOR
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
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 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
<PAGE>
40
subject to the provisions of Sections 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 Advances into Base Rate Advances
shall be made only on the last day of an Interest Period for such
LIBOR Advances, and
(ii) the Borrower may not Convert Base Rate Advances into LIBOR
Advances if, (x) after giving effect to such Conversion, there would
be more than three Interest Periods in effect or (y) the Advances to
be Converted would be less than the minimum amount specified in
Section 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.
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 Section 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 Section 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 and fees 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 fees are
<PAGE>
41
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 usage fee, as the case may
be; provided that, if such extension would cause payment of interest on or
principal of LIBOR 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
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 Equipment Acquisition 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 Equipment Acquisition Agreement; or
<PAGE>
42
(iv) any other fact or circumstance relating to the Equipment
Acquisition 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 Section 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 (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 Section 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 the general corporate
and working-capital purposes of the Borrower and its Restricted Subsidiaries,
including the payment of interest hereunder.
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 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 obligations of the Borrower 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. The First LIBOR
Method shall be applicable at all times until such time as the Second LIBOR
Method becomes applicable. If there is a Lender in addition to or other than
Ericsson (other than an Affiliate of Ericsson) and the Administrative Agent at
the direction of the Required Lenders
<PAGE>
43
shall have notified the Borrower that the Second LIBOR Method shall be
applicable, the Second LIBOR Method shall become applicable immediately as of
the date of such notice; provided that, if any LIBOR Advances are then
outstanding, the Second LIBOR Method shall become applicable on the last day of
the then-existing Interest Period for such LIBOR Advances. After becoming
applicable, the Second LIBOR Method shall remain applicable at all times
thereafter.
Section 2.12. Reduction or Termination of the Commitments. (a) Optional
Reduction. The Borrower may, upon at least three Business Days' notice to the
Administrative Agent, terminate in whole or reduce in part the unused portions
of the Commitments; provided that each such partial reduction:
(i) shall be in an aggregate amount of $5,000,000 or an integral
multiple of $1,000,000 in excess thereof (or, if less, the aggregate
remaining unused amounts of all Lenders' Commitments), and
(ii) shall be made ratably among the Lenders in accordance with their
respective Commitments.
(b) Mandatory Reduction. The Maximum Commitment shall be automatically and
permanently reduced as follows:
(i) on any date on which a Core BTA that was a Permitted BTA shall no
longer be a Permitted BTA, by the amount of the Attributed Expenses of such
Core BTA and its Dependent BTAs as of such date;
(ii) on any date on which the Maximum Commitment shall exceed (A) the
aggregate POPs of all Permitted BTAs as of such date (excluding any POPs
with respect to such BTAs with respect to which the right to provide PCS
services shall have been sold in Restricted Sales), multiplied by (B)
$22.00, by the amount of such excess; and
(iii) as of any date on which Advances are prepaid pursuant to
Section 3.02(a), (b), (c) or (f) or Section 3.03, by the aggregate
principal amount of the Advances so prepaid.
Each such reduction shall be made ratably among the Lenders in accordance with
their respective Commitments.
(c) Termination. On the Termination Date, the then-remaining undrawn
Commitments of the Lenders shall be automatically terminated.
<PAGE>
44
ARTICLE III
REPAYMENT AND PREPAYMENT OF THE LOANS
Section 3.01. Repayment. (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 a ratable aggregate principal amount of
each Advance forming part of the same Loan equal to the percentage specified in
the table below opposite such calendar quarter of the greatest aggregate
principal amount of 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 of 2001 to and including 3.75%
the last calendar quarter of 2002
- --------------------------------------------------------------------------------
From and including the first calendar
quarter of 2003 to and including 5.00%
the last calendar quarter of 2003
- --------------------------------------------------------------------------------
From and including the first calendar
quarter of 2004 to and including 6.25%
the last calendar quarter of 2005
================================================================================
</TABLE>
(b) On the Maturity Date, the Borrower shall repay the aggregate
then-outstanding principal amount of all Advances, together with any and all
accrued and unpaid interest thereon and all other amounts due and owing
hereunder, under the Notes and under the other Loan Documents.
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 shall prepay 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 and/or any of its Restricted Subsidiaries (other
than (A) any sale of inventory and other goods in the ordinary course of
business, (B) any sale of an FCC License, the Stock of a License Subsidiary
or any right to provide PCS services to any POPs and (C) any sale of
equipment and other assets) 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
<PAGE>
45
(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 all Permitted Loan Agreements the loans under which are required to
be prepaid with such Net Cash Proceeds, to the extent the Intercreditor
Agreement permits such prepayment.
No prepayment of any Advances pursuant to this subsection (a) shall reduce the
principal amount of such Advances required to be repaid on any date pursuant to
Section 3.01(a). No prior prepayment of Advances shall reduce the principal
amount of the Advances required to be prepaid pursuant to this subsection (a).
(b) If, at any time after the occurrence of any Restricted Sale with
respect to any FCC License, the Stock of any License Subsidiary or any right to
provide PCS services to any POPs within a BTA as a result of which any
Indebtedness under any Permitted Loan Agreement is required to be prepaid, the
Borrower shall make any Distribution (other than a Distribution permitted under
Section 7.05(d)) in respect of its Stock or any Indebtedness owing to the
Grandparent or any Affiliate thereof (other than the Borrower and its Restricted
Subsidiaries), the Borrower will notify the Administrative Agent of its
intention to make such Distribution at least 10 Business Days prior to the
proposed date of such Distribution and, if the Required Lenders shall so require
by the proposed date of such Distribution and the Borrower shall make such
Distribution, shall prepay then-outstanding Advances within five Business Days
after receipt of notice of such requirement from the Administrative Agent in an
aggregate principal amount equal to the same proportion of the Lenders' Portion
of Excess Proceeds in respect of such sale or assignment as such Distribution
bore to the Parent's Portion of Excess Proceeds in respect of such sale or
assignment, until such time as an aggregate amount equal to the Excess Proceeds
in respect of such sale or assignment shall have been paid to the Lenders, other
providers of vendor financing to the Borrower and its Restricted Subsidiaries
and the Parent. Any prepayment pursuant to this subsection (b) shall be applied
to the prepayment of a ratable aggregate principal amount of Advances forming
part of the same Loan then outstanding and shall not reduce the principal amount
of Advances required to be repaid on any date pursuant to Section 3.01(a). No
prior prepayment of Advances shall reduce the principal amount of the Advances
required to be prepaid pursuant to this subsection (b).
(c) By April 30 of each calendar year beginning in 2002, the Borrower shall
prepay outstanding Advances in an aggregate principal amount equal to the lesser
of:
(i) 50% of any Excess Cash Flow in respect of the immediately
preceding fiscal year, multiplied by a fraction, (x) the numerator of which
is the aggregate principal amount of the Advances then outstanding, and (y)
the denominator of which is the aggregate principal amount then outstanding
of all Advances and all other loans
<PAGE>
46
under each Permitted Loan Agreement that are required to be prepaid out of
Excess Cash Flow, and
(ii) the amount, if any, by which the aggregate principal amount of
the Advances outstanding on the date of such prepayment exceeds (A) the
Borrowing Base as of such date, minus (B) the amount calculated under
clause (a)(ii) of the definition of "Borrowing Base" as of such date.
Any prepayment pursuant to this subsection (c) shall be applied to the
prepayment of a ratable aggregate principal amount of Advances forming part of
the same Loan then outstanding and shall not reduce the principal amount of
Advances required to be repaid on any date pursuant to Section 3.01(a), to the
extent that such Advances are outstanding on such date. No prior prepayment of
Advances shall reduce the principal amount of the Advances required to be
prepaid pursuant to this subsection (c).
(d) The Borrower shall prepay all outstanding Advances, and the Lenders'
Commitments hereunder shall terminate, upon the termination of the Equipment
Acquisition Agreement as a result of a default thereunder by the Borrower.
(e) (i) On each July 5 and January 4, beginning with January 4, 1999,
the Borrower shall be required to prepay the amount, if any, by which the
then-outstanding principal amount of the Advances on the immediately
preceding Test Date shall exceed:
(A) 150% of Net Ericsson Related Expenses as of such Test Date
(assuming for purposes of such definition that unfilled purchase
orders outstanding on such Test Date (or delivered on or prior to the
related date on which a prepayment would be required to be made under
this subsection (e)) for the delivery of equipment within the six
months following such date would be included as Net Ericsson Related
Expenses and including in such amount the purchase price of equipment
delivered but not fully paid for and for which the remaining purchase
price is reasonably expected to be payable within the six months
following such Test Date), plus
(B) 50% of Permitted Interest Expense as of such Test Date.
Any such prepayment shall be applied to the prepayment of a ratable
aggregate principal amount of Advances forming part of the same Loan as the
Borrower shall specify, and shall be applied to the ratable reduction of
the amounts by which the Advances are required to be repaid on any date
pursuant to Section 3.01(a). No prior prepayment of Advances shall reduce
the principal amount of the Advances required to be prepaid pursuant to
this subsection (e).
<PAGE>
47
(ii) "Test Date" means each December 31 and June 30.
(f) If on any date the aggregate principal amount of outstanding Advances
shall exceed either the Maximum Commitment or the Borrowing Base, the Borrower
shall prepay an amount equal to such excess. Any such prepayment shall be
applied to the prepayment of a ratable aggregate principal amount of Advances
forming part of the same Loan as the Borrower shall specify, and shall be
applied to the ratable reduction of the amounts by which the Advances are
required to be repaid on any date pursuant to Section 3.01(a). No prior
prepayment of Advances shall reduce the principal amount of the Advances
required to be prepaid pursuant to this subsection (f).
Section 3.03. Optional Prepayments of Loans. The Borrower may, upon at
least two Business Days' notice to the Administrative Agent stating the proposed
prepayment date and the aggregate principal amount of the Advances to be prepaid
on such date, and if such notice is given the Borrower shall, prepay the
outstanding principal amount of the Advances 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 forming part of the same Loans.
Any prepayment of 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 Section 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 are to be repaid or prepaid, and if less than all
Loans are to be repaid or prepaid, if the Second LIBOR Method is applicable and
if both Base Rate Loans and LIBOR Loans are outstanding, the Borrower will
specify whether the Loan to be repaid or prepaid shall be a Base Rate Loan or a
LIBOR Loan and, if a LIBOR Loan is to be repaid or prepaid and more than one
LIBOR Loan is outstanding, which such LIBOR 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.
ARTICLE IV
ILLEGALITY, INCREASED COSTS, CAPITAL ADEQUACY AND INDEMNITIES
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 Loans, such Lender shall
<PAGE>
48
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 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 Loans, if
any, shall be Converted automatically to Base Rate Loans on the last day of
each Interest Period applicable to such LIBOR 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,
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
<PAGE>
49
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 Section 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 Section 4.02 and will
not, in the judgment of such Lender, be otherwise disadvantageous to such
Lender. By making any payment under this Section 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 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
<PAGE>
50
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 Section 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 Section 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 such 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
Section 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" and "United
States person" shall have the meanings specified in Section 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
<PAGE>
51
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 Section 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 Section 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 Section 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 Section 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>
52
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) Each Loan Party in existence on the
date hereof (or on any date on which these representations and warranties are
deemed repeated):
(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) Set forth on Schedule 5.01(b) hereto (as updated pursuant to Section
6.14(s)) is a complete and accurate list of all Subsidiaries of the Borrower,
showing (as to each such Subsidiary) the jurisdiction of its incorporation, the
number of shares of each class of Stock authorized, and the number outstanding,
on the date hereof and the percentage of the outstanding shares of each such
class owned (directly or indirectly) by the Borrower, the number of shares
covered by all outstanding options, warrants, rights of conversion or purchase
and similar rights at the date hereof and whether such Subsidiaries are
Restricted Subsidiaries. All of the outstanding Stock of each such Subsidiary
has been validly issued, is fully paid and non-assessable and is owned by the
Borrower or one or more of its Subsidiaries free and clear of all Liens, except
those created or permitted under the Loan Documents or as disclosed in such
Schedule (as so updated). Each such Subsidiary
(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.
<PAGE>
53
(c) The execution, delivery and performance by each Loan Party of this
Agreement and the other Loan Documents to which it is or is to become a party,
and the consummation of the transactions contemplated hereby and thereby:
(i) are within the corporate authority of such Loan Party,
(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 such Loan Party
is subject or any judgment, order, writ, injunction, license or permit
applicable to such Loan Party 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.
(d) This Agreement has been, and each of the Notes and each other Loan
Document when delivered hereunder will have been, duly executed and delivered by
each Loan Party party thereto. This Agreement is, and each of the Notes and each
other Loan Document when delivered hereunder will be, the legal, valid and
binding obligation of each Loan Party party thereto, enforceable against such
Loan Party in accordance with its terms, except as enforceability may be 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.
Section 5.02. Governmental Approvals. The execution, delivery and
performance by each Loan Party of this Agreement and the other Loan Documents to
which such Loan Party 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 and each of its Restricted
Subsidiaries own all of the FCC Licenses listed on Schedule 5.07 hereto (other
than those listed therein which are owned by a C-Block Subsidiary) and all
assets of such Persons acquired since such 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
<PAGE>
54
mortgages, leases, conditional sales-agreements, title-retention agreements,
liens or other encumbrances except Permitted Liens.
Section 5.04. Financial Statements. There have been furnished to the
Administrative Agent the consolidated balance sheets, income statements and cash
flow statements of the Borrower and its Restricted Subsidiaries, as at the
Balance Sheet Date, and such balance sheets and statements of income and cash
flow have been certified by the Borrower's chief or principal financial or
accounting officer. Such balance sheets and statements of income and cash flow
have been prepared in accordance with GAAP and fairly present the financial
condition of the Borrower and its Restricted Subsidiaries 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 or any of its
Restricted Subsidiaries as of such date involving material amounts, known to the
officers of the Borrower, that were not disclosed in such balance sheets and the
notes related thereto.
Section 5.05. No Material Adverse Effect, Etc. Since the Balance Sheet
Date, 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 as set forth in
Schedule 5.06, there are no franchises, licenses, patents, copyrights,
trademarks, trade names, or other intellectual property, individually or in the
aggregate, that are material for the conduct of the business of the Borrower or
any of its Restricted Subsidiaries, as now conducted or as presently
contemplated to be conducted. Set forth on Schedule 5.06 is a list of all
intellectual property material to the business or operations of the Borrower and
its Restricted Subsidiaries, as now conducted and as presently contemplated to
be conducted.
Section 5.07. FCC Licenses, Etc. Each FCC License for a Permitted BTA
listed in Part I of Schedule 5.07 is held by a License Subsidiary. Part II of
Schedule 5.07 lists all FCC Licenses held by License Subsidiaries that are
Subsidiaries of the C-Block Subsidiary Parent. The C-Block Subsidiary Parent has
filed or caused to be filed applications with the FCC for the transfer of all of
the capital stock of the License Subsidiaries holding all of the FCC Licenses
listed in Part II of Schedule 5.07 to the Borrower. Neither any FCC License nor
any material Necessary Authorization needed to comply with the provisions of
this Agreement 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 any Loan Party 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 such Loan Party, to carry on business
<PAGE>
55
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 such Loan Party, or that questions
the validity of this Agreement or any of the Loan Documents, or any action taken
or to be taken pursuant hereto or thereto.
Section 5.09. No Materially Adverse Contracts, Etc. None of the Loan
Parties is 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. None of the Loan Parties is a party to
any contract or agreement that has or is expected, in the judgment of such Loan
Party's officers, to have any Material Adverse Effect.
Section 5.10. Compliance with Other Instruments, Laws, Etc. None of the
Loan Parties is 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. Each Loan Party and each of its Subsidiaries and
Affiliates
(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;
(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 in respect of any Loan Party or any of its
Subsidiaries or Affiliates, 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. Neither any Loan
Party nor any of its Subsidiaries is 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.
Neither any Loan Party nor any of its
<PAGE>
56
Subsidiaries is 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, as amended.
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 of its Restricted Subsidiaries
or any rights relating thereto.
Section 5.15. FCC Matters. Except for the filing of tariffs with the FCC,
each Loan Party 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. No failure
to pay any Indebtedness owing to the FCC in respect of any C-Block FCC License
has occurred, except in accordance with the orders, rules and regulations of the
FCC.
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 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. No Loan Party is 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 such Loan Party, or the ability of such Loan Party to perform the
obligations to be performed by it under the Loan Documents to which such Loan
Party is a party. The Borrower does not presently anticipate that future
expenditures by the Borrower or any of its Subsidiaries needed to meet the
provisions of federal or state statutes, orders, rules or regulations will be so
burdensome as to affect or
<PAGE>
57
impair, in a materially adverse manner, the business or condition, financial or
otherwise, of the Borrower or any of its Subsidiaries.
Section 5.19. Solvency. Each Loan Party is, individually and together with
its Subsidiaries, 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 or as provided herein or in the Intercreditor
Agreement) in favor of the Collateral Agent, for the benefit of the Secured
Parties.
Section 5.21. Certain Transactions. 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 and the Cash Management 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
Section 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 (except for the treatment of
Indebtedness owing to the FCC, which has been reflected in such plans at
historical cost).
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 provisions of ERISA and, to the extent applicable, the IRC,
including the provisions thereunder respecting prohibited transactions. The
Borrower and each of its Subsidiaries 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 Section
103(d) of ERISA, with respect to each Guaranteed Pension Plan.
<PAGE>
58
(b) Under each Employee Benefit Plan that is an employee welfare benefit
plan within the meaning of Section 3(1) or Section 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, each of its Subsidiaries and each ERISA Affiliate 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 such Loan Party 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 Section 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, any of its Subsidiaries 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. None of the Borrower, any of its
Subsidiaries or any ERISA Affiliate has instituted or intends to institute
proceedings to terminate a Guaranteed Pension Plan. No event requiring notice to
the PBGC 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 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 Section 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) None of the Borrower, any of its Subsidiaries or 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 Section 4201 of ERISA or
as a result of a sale of assets described in Section 4204 of ERISA. Neither any
Loan Party nor any ERISA Affiliate has been notified that any Multiemployer Plan
is in reorganization or insolvent under and within the meaning of Section 4241
or Section 4245 of ERISA or that any Multiemployer Plan intends to terminate or
has been terminated under Section 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"
<PAGE>
59
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 and each of its Subsidiaries is 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 or any of its Subsidiaries.
(b) 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 or any
of its Subsidiaries. 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 or any of its
Subsidiaries that could reasonably be expected to have an impact on the
Real Estate or facilities owned, operated or controlled by the Borrower or
any of its Subsidiaries.
(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 and its Subsidiaries (whether conducted
by or on behalf of the Borrower, any of its Subsidiaries or a third party,
and whether done at the initiative of the Borrower or any of its
Subsidiaries or directed by a governmental entity or other third party)
which the Borrower or any of its Subsidiaries 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 and each of its Subsidiaries has filed all reports
and returns required to be filed by such Person under any Environmental
Laws. The Borrower and each of its Subsidiaries has obtained and 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 that requires, or after notice or lapse
<PAGE>
60
of time or both would requires, any modification or termination of any
Environmental Permit. Neither the Borrower nor any of its Subsidiaries (i)
has received any notice asserting the absence of any Environmental Permit
or (ii) has 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 its Subsidiaries, 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. Joint Ventures, Etc. Except as set forth in Schedule 5.26,
the Borrower is not engaged in any joint venture or partnership with any other
Person, and each joint venture or partnership listed in such Schedule is a
Qualified Joint Venture.
Section 5.27. Material Contracts. As of the date of this Agreement, neither
the Borrower nor any of its Restricted Subsidiaries is a party to any Material
Contract or any agreement with any director, officer or employee, except as set
forth in Schedule 5.27.
Section 5.28. Representations in Other Loan Documents. Each of the
representations by any Loan Party in any of the other Loan Documents is true as
of the date hereof.
ARTICLE VI
AFFIRMATIVE COVENANTS OF THE BORROWER
The Borrower covenants and agrees that, so long as any Loan or Note or any
fees or expenses are outstanding or any Lender has any Commitment hereunder:
Section 6.01. Maintenance of Office. The Borrower shall maintain, and shall
cause each of its Restricted Subsidiaries to maintain, its chief executive
office at 3 Metro Center, Bethesda, Maryland 20814 (except in the case of the
Operating Subsidiary the chief executive office for which is at 16 Wing Drive,
Cedar Knolls, New Jersey 07927) or in the applicable Collateral Document, as the
case may be, except that the Borrower or any such Restricted Subsidiary 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
<PAGE>
61
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, and shall cause
each of its Subsidiaries to:
(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, and shall cause each of its Restricted
Subsidiaries to do or cause to be done, all things necessary to:
(a) preserve and keep in full force and effect its corporate
existence;
(b) maintain in full force and effect:
(i) each FCC License with respect to the BTAs specified in
Schedule 5.07 (other than any such FCC License that has been
previously sold or transferred in accordance with this Agreement or
loss of any C-Block FCC License for a BTA other than the Philadelphia
BTA that has been subject to a General C-Block License Revocation
Event) and any other FCC Licenses from time to time held by any
License Subsidiary and cause each License Subsidiary at all times to
own each FCC License listed in Schedule 5.07 (other than any such FCC
License that has been previously sold or transferred in accordance
with this Agreement or loss of a C-Block License for any BTA other
than the Philadelphia BTA on account of a C-Block General License
Revocation Event) with respect thereto, free and clear of any Lien of
any kind, other than any Liens permitted under Section 7.02(g);
(ii) with respect to the construction, installation and
development of facilities for Permitted BTAs, 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 such
BTAs; and
(iii) with respect to the operation of those portions of such
BTAs the development of which has theretofore been completed, all
material Licenses,
<PAGE>
62
copyrights, patents, franchises, Necessary Authorizations and other
rights as are necessary and sufficient to operate such completed
portions; and
(c) use, and cause the Grandparent to use, its best efforts to cause
the ownership of all capital stock of License Subsidiaries holding FCC
Licenses for the BTAs listed in Part II of Schedule 5.07 to be transferred
to the Borrower promptly after the date hereof, it being understood that
such transfer requires the FCC's consent.
The Borrower will, and will cause its Restricted Subsidiaries to, 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 FCC Licenses held by License Subsidiaries and not cause or,
except for a C-Block General License Revocation Event or Proposed C-Block
General License Revocation Event with respect to BTAs other than the
Philadelphia BTA, 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, and shall cause each of its Restricted Subsidiaries to do or cause to
be done, all things necessary to preserve and keep in full force and effect its
material franchises, employment contracts and permits. The Borrower shall, and
shall cause each of its Restricted Subsidiaries to,
(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;
(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 the businesses now conducted by it as appropriate to
the then level of construction, development and operation of PCS Systems
covered by FCC Licenses held by License Subsidiaries;
provided that nothing in this Section 6.04 shall prevent the Borrower or any of
its Restricted Subsidiaries from discontinuing the operation and maintenance of
any of its Properties if such
<PAGE>
63
discontinuance is, in the judgment of the Borrower or such Restricted
Subsidiary, desirable in the conduct of its business and would not have a
Material Adverse Effect.
Section 6.05. Insurance. The Borrower shall obtain and maintain, and shall
cause each of its Restricted Subsidiaries to 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 Section 13 of each 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 Section 8.20, 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 Section
6.05, each Security Agreement and each Mortgage, and setting forth any
deductibles applicable to any insurance coverage.
Section 6.06. Taxes. The Borrower shall duly pay and discharge, and cause
each of its Subsidiaries to duly pay and discharge, before the same shall become
overdue, all taxes, assessments and other governmental charges imposed upon it
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 no such tax, assessment, charge, levy or claim need be
paid if the validity or amount thereof shall currently be contested in good
faith by appropriate proceedings and if the Borrower or any of its Subsidiaries
has set aside on its books adequate reserves with respect thereto; and provided
further that the Borrower shall 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, and shall cause each of its Subsidiaries to permit, the Administrative
Agent, the Lenders and
<PAGE>
64
their other designated representatives to visit and inspect any of the
Properties of the Borrower or such Subsidiary, to examine the books of account
of the Borrower or such Subsidiary (and to make copies thereof and extracts
therefrom), and to discuss the affairs, finances and accounts of the Borrower or
such Subsidiary 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 business of
the Borrower or any of its Subsidiaries.
(b) The Borrower authorizes the Administrative Agent and each Lender to
communicate directly with the independent certified public accountants of the
Borrower or any of its Subsidiaries 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 and its Subsidiaries. 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 Section
6.07(b). The Administrative Agent and the Lenders shall 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, FCC Licenses and Permits.
The Borrower shall comply, and shall cause each of its Subsidiaries to comply,
in all material respects with
(a) the applicable laws, rules, regulations and orders wherever its
business is conducted, including without limitation compliance with all
Environmental Laws, all Environmental Permits, ERISA, the IRC, the
Communications Act and all FCC rules and regulations (including without
limitation compliance with FCC rules and regulations relating to
maintaining the status of the License Subsidiaries as designated entities
and small businesses);
(b) the provisions of its charter documents and by-laws;
(c) all Material Contracts to which it or any of its Subsidiaries is a
party and by which it or any of its Subsidiaries or any of its or their
Properties may be bound;
(d) all obligations with respect to any Employee Benefit Plan or
Multiemployer Plan; and
(e) all applicable decrees, orders, and judgments.
<PAGE>
65
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 or any of its Subsidiaries may fulfill any of the
Borrower's or such Subsidiary's obligations hereunder or any of the other Loan
Documents to which the Borrower or any of its Subsidiaries is a party, the
Borrower shall immediately take, or shall cause such Subsidiary immediately to
take, all reasonable steps within the power of the Borrower or such Subsidiary
to obtain such authorization, consent, approval, permit or license and furnish
the Administrative Agent evidence thereof.
Section 6.09. Further Assurances. (a) The Borrower shall cooperate, and
shall cause each of its Subsidiaries to cooperate, with the Lenders and the
Administrative Agent, and shall execute and pay, and shall cause each of its
Subsidiaries to execute and pay, as applicable, for the filing of all such
further instruments and documents, including, without limitation, such Uniform
Commercial Code financing statements and other security documents as the
Required Lenders, the Collateral Agent or the Administrative Agent shall
reasonably deem appropriate at any time 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.
(b) If at any time the granting of a Lien on the FCC License held by any
License Subsidiary, or in any proceeds of any sale or disposition thereof, shall
not violate then-applicable FCC regulations, the Borrower shall so notify the
Administrative Agent and shall, at its expense, promptly cause such License
Subsidiary to execute and deliver any and all such instruments, documents and
opinions of counsel and take such other action as either Agent may deem
desirable in order to grant in favor of the Collateral Agent on behalf of the
Secured Parties a Lien on such FCC License and/or the proceeds thereof.
Section 6.10. Authorization from Landlord/Mortgagee, Etc. The Borrower
shall request that any landlord, mortgagee and easement grantor of the Borrower
or any of its Restricted Subsidiaries agree to give the Collateral Agent and the
Administrative Agent, on a best-efforts basis, notice of any default by the
Borrower or such Restricted Subsidiary under the terms or conditions of any
agreement between the Borrower and/or such Restricted Subsidiary and any
landlord, mortgagee of any such landlord or easement grantor, and allow the
Collateral Agent to inspect or remove Collateral after the occurrence and
continuance of an Event of Default.
Section 6.11. Attornment and Recognition Agreements. The Borrower shall
obtain, and shall cause each of its Restricted Subsidiaries to obtain, all
attornment and recognition agreements from any landlord or landlord's mortgagee
of Real Estate leased or owned by the Borrower or any of its Restricted
Subsidiaries upon which any equipment with an aggregate purchase price in excess
of $1,000,000 is stored or located, in form and substance reasonably
satisfactory to the Administrative Agent. The Borrower shall use its best
efforts to obtain all
<PAGE>
66
attornment and recognition agreements from any landlord or landlord's mortgagee
of Real Estate leased or owned by the Borrower or any of its Restricted
Subsidiaries 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 6.12. 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 6.13. Maintenance of Restricted Subsidiary. The Borrower shall
cause Enterprises to remain a Restricted Subsidiary at all times at which this
Agreement is in force and effect.
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
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 Section 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
the Borrower and its Restricted Subsidiaries 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 the Borrower and its Restricted Subsidiaries
need to raise additional capital to meet their obligations when due during
the period, (iv) projected balance sheets of the Borrower and its
Restricted Subsidiaries, (v) projected cash flow statements of the Borrower
and its Restricted Subsidiaries, 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 Section 8.13(a) and on a consistent basis.
(b) No later than August 14 of each fiscal year of the Borrower,
beginning with its 1998 fiscal year, a report, certified as true and
correct by the chief or principal financial or accounting officer of the
Borrower, that shows in reasonable detail, variances, if any, between the
actual operating performance of the Borrower
<PAGE>
67
and its Restricted Subsidiaries and what was estimated for the first six
months of such fiscal year in the Approved Annual Operating 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
Section 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 (beginning with its 1998 fiscal year), copies of the
internally prepared unaudited Consolidated balance sheets of the Borrower
and its Restricted Subsidiaries as of the end of such quarter and
Consolidated and consolidating statements of income and a Consolidated
statement of cash flows of the Borrower and its Restricted Subsidiaries for
the period commencing at the end of the previous fiscal quarter and ending
with the end of such fiscal quarter, and Consolidated and consolidating
statements of income and a Consolidated statement of cash flows of the
Borrower and its Restricted Subsidiaries for the period commencing at the
end of the previous fiscal year of the Borrower and ending with the end of
such quarter, 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 Section 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 Section 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 and its Restricted
Subsidiaries 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 Consolidated
balance sheets of the Borrower and its Restricted Subsidiaries as at the
end of such year, and the related audited Consolidated statements of income
and the audited Consolidated statement of cash flows of the Borrower and
its Restricted Subsidiaries for such year prepared in accordance with GAAP,
and so long as the Borrower is required to deliver an operating business
plan pursuant to Section 6.14(a), a separate variance analysis setting
forth in comparative form the figures for the previous fiscal year and any
variances from
<PAGE>
68
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 Section 6.14(a) with respect
to such fiscal year) in reasonable detail. Such balance sheets, statements
of income and statement of cash flows shall contain a certified audit
report of a nationally recognized independent certified public accounting
firm satisfactory to the 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,
(ii) perform the agreed upon review procedures applicable
thereto, and
(iii) confirm that in examining the financial statements of the
Borrower and its Restricted Subsidiaries 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,
(i) a statement certified by the principal financial or
accounting officer of the Borrower, in form and substance satisfactory
to the Administrative Agent, setting forth in reasonable detail
computations evidencing compliance with the covenants contained in
Sections 6.15 and 7.05, and, if in making the calculations required to
be made pursuant to Section 6.15(b), the Borrower would not be in
compliance with such covenant but for the inclusion therein of amounts
under Section 6.15(b)(i)(D)(1)(III), a certificate of the Grandparent
as to the amount of unrestricted cash, Cash Equivalents and undrawn
lines of credit available to be drawn, as of the date specified in
such Section for such calculations, in each case with respect to the
fiscal quarter or fiscal year, as the case may be, relating to the
financial statements then being delivered, and
<PAGE>
69
(ii) a Borrowing Base Certificate showing the Borrowing Base as
of the last day of such fiscal quarter or fiscal year, as the case may
be.
(f) Within 45 days after the end of each fiscal quarter of the
Borrower, a report on
(i) with respect to each Operating Subsidiary:
(A) the number of cell sites constructed and cell sites
where equipment with an aggregate purchase price in excess of
$1,000,000 is located,
(B) the total number of customers,
(C) the number of new customers acquired,
(D) the number of customers who terminated their service,
(E) the average net monthly charges billed to customers
(excluding roaming charges), and
(F) aggregate roaming revenue,
(ii) payments by the Borrower or any of its Restricted
Subsidiaries to the Grandparent or any of its Affiliates (other than
payments by the Borrower or any of its Restricted Subsidiaries to one
another), or to any Subsidiary of the Borrower that is not a
Restricted Subsidiary, whether as dividends, payments under any
management, service or tax-allocation agreement or otherwise; and
(iii) equity contributions to the Borrower, the Persons providing
the same and any issuance or sale of shares of Stock or other equity
interests in the Borrower or any of its Subsidiaries,
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 Section 6.14(a) with respect to such fiscal year),
along with an explanation of discrepancies between the actual numbers and
the estimated numbers.
<PAGE>
70
(g) Within three Business Days after the filing or mailing thereof,
copies of all
(i) materials filed with the Securities and Exchange Commission
by the Borrower or any of its Subsidiaries or the Grandparent;
(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 and its Subsidiaries that the Grandparent would be
required to file with the Securities and Exchange Commission pursuant
to the Securities Exchange Act of 1934, if the Grandparent were a
public company 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 Securities and Exchange
Commission.
(h) Within 45 days after the end of each fiscal quarter of the
Borrower, an accounts-receivable-aging report in respect of each Operating
Subsidiary.
(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 or any of its Restricted
Subsidiaries 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,
the Borrower shall forthwith give written notice thereof to the
Administrative Agent, describing the notice or action and the nature of the
claimed default.
<PAGE>
71
(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 any
of its Subsidiaries or the security interests for the benefit of the
Secured Parties pursuant to any of the Collateral Documents.
(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 Section 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
Sections 302, 4041, 4042, 4043, 4063, 4065, 4066 and 4068 of ERISA, or
in respect of a Multiemployer Plan, under Sections 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
Section 502(i) of ERISA or an excise tax under Section 4975 against
the Borrower, any of its Subsidiaries or an ERISA Affiliate; (B) any
partial or complete withdrawal
<PAGE>
72
from a Multiemployer Plan by the Borrower, any of its Subsidiaries or
an ERISA Affiliate; (C) a failure by the Borrower, any of its
Subsidiaries 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; 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 any of
its Subsidiaries or to which the Borrower or any of its Subsidiaries
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 or any of its Subsidiaries 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, 2001, and for so long as
any Advances are outstanding and exceed at such time (i) the Borrowing Base
as of such date minus (ii) the amount calculated under clause (a)(ii) of
the definition of "Borrowing Base" as of such date, a report that includes
calculations showing in reasonable detail the Borrower's Excess Cash Flow
for such fiscal year, if any, certified as correct by the Borrower's chief
or principal financial or accounting officer.
<PAGE>
73
(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 any FCC License listed on Schedule 5.07.
(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 any of the Loan Parties, (ii) the location of any of the
Collateral or (iii) the chief executive office or other locations of each
Loan Party or the location where the books and records of the Borrower or
any of its Subsidiaries are kept.
(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.
(s) As soon as available and in any event within 30 days after the end
of each fiscal year of the Borrower and when necessary in connection with a
repetition of any representation or warranty referring thereto in
connection with any Draw Request, a report supplementing the Schedules
hereto, including, without limitation, (i) new Subsidiaries of the Borrower
and ownership of the Stock thereof, (ii) any change in the designation of
any BTA as set forth in, or any addition, deletion or other change to,
Schedule 1.01 and (iii) a description of such other changes in the
information included in such Schedules as may be necessary for such
Schedules to be accurate and complete in all material respects.
(t) Within 10 Business Days following the occurrence thereof, written
notice of the disposition of any FCC License owned or held by the Borrower
or any of its Subsidiaries, the right to provide PCS services to any POPs
included in any BTA relating to any such FCC License or any General C-Block
License Revocation Event, specifying the affected FCC License or POPs and
setting forth in reasonable detail the terms of such disposition.
(u) No later than the 10th Business Day after each Required Operation
Test Date, a report in form and scope and containing such information as
the Required Lenders may reasonably request concerning the rates of call
blocking and dropped calls with respect to all cells in the Philadelphia
BTA for the three-calendar-month period ended on the immediately preceding
Required Operation Test Date.
(v) Such other information concerning the business operations or
financial condition of any Loan Party or any of its Subsidiaries as the
Administrative Agent or any Lender shall from time to time reasonably
request.
<PAGE>
74
Upon the Administrative Agent's receipt of any and all financial and other
information furnished by the Borrower pursuant to this Section 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 obligations of the Borrower are outstanding hereunder or
any Lender has any Commitment, the Borrower will:
(a) Have earned for each fiscal quarter, prior to the first fiscal
quarter in which 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, with respect to each Fiscal Quarter, beginning with the
Fiscal Quarter ending on December 31, 1998, the ratio of
(i) the amount equal to:
(A) Operating Cash Flow for such Fiscal Quarter and the
three Fiscal Quarters immediately preceding such Fiscal Quarter,
plus
(B) the aggregate amount of cash and Cash Equivalents held
by the Borrower and its Restricted Subsidiaries as of the first
day of the third Fiscal Quarter immediately preceding such Fiscal
Quarter, plus
(C) the aggregate principal amount of (x) the Advances made
to the Borrower, (y) advances made under other Permitted Loan
Agreements and (z) advances made in respect of other Indebtedness
permitted under Section 7.01 provided by Persons other than
Affiliates of the Borrower, in each case during such Fiscal
Quarter and the three Fiscal Quarters immediately preceding such
Fiscal Quarter, plus
(D) (1) the aggregate amount of:
(I) the lesser of the Maximum Commitment and the
Borrowing Base as of the last day of such Fiscal Quarter,
(II) the aggregate amount available to be drawn under
other Indebtedness permitted under Section 7.01 provided by
Persons other than Affiliates of the
<PAGE>
75
Borrower by the Borrower or any of its Restricted
Subsidiaries for general corporate purposes as of such last
day, and
(III) the amount available to be contributed to the
Borrower by the Grandparent under the Support Agreement
as of such last day to the extent the Grandparent has
unrestricted cash, Cash Equivalents and undrawn lines of
credit available as of such last day to make such
contribution, minus
(2) the aggregate principal amount of the Advances as of
such last day, plus
(E) the aggregate amount of equity contributions and cash
loans by way of Subordinated Debt made to the Borrower during
such Fiscal Quarter and the three Fiscal Quarters immediately
preceding such Fiscal Quarter, to
(ii) the sum of
(A) the aggregate scheduled amount of principal and interest
payable in cash in respect of Indebtedness of the Borrower and
its Restricted Subsidiaries (including, without limitation, in
respect of the Advances, payments under other Permitted Loan
Agreements, Capitalized Leases and Indebtedness owing to the FCC)
to Persons other than the Borrower or any of its Subsidiaries,
plus
(B) dividends paid by the Borrower pursuant to Section
7.05, plus
(C) Capital Expenditures by the Borrower and its Restricted
Subsidiaries, plus
(D) cash income taxes paid by the Borrower and its
Restricted Subsidiaries, plus
(E) mandatory prepayments of the Advances by the Borrower
pursuant to Section 3.02(a), (c) or, to the extent resulting from
a Restricted Sale described in Section 7.05(b)(iii)(C), (e) and
mandatory prepayments by the Borrower pursuant to any similar
provision contained in the other Permitted Loan Agreements, plus
<PAGE>
76
(F) any fees paid pursuant to Section 2.03 and any other
similar fees paid in respect of any other Indebtedness by the
Borrower or any of its Restricted Subsidiaries,
in each case in respect of such Fiscal Quarter and the three Fiscal
Quarters immediately preceding such Fiscal Quarter,
to be not less than 1:1.
(c) Maintain, with respect to each Fiscal Quarter beginning with the
Fiscal Quarter ending on March 31, 2001, a ratio of
(i) Consolidated Indebtedness of the Borrower and its Restricted
Subsidiaries as of the last day of such Fiscal Quarter (other than any
portion thereof reflecting the capitalization of accrued and unpaid
interest and other than any Subordinated Debt) to
(ii) an amount equal to
(A) 200% of Operating Cash Flow of the Borrower and its
Restricted Subsidiaries for such Fiscal Quarter and the Fiscal
Quarter immediately preceding such Fiscal Quarter, adjusted by
(B) 400% of the difference, whether positive or negative,
between:
(1) 50% of the aggregate amount of Marketing Expenses
for such Fiscal Quarter and the immediately preceding Fiscal
Quarter, and
(2) 25% of the aggregate amount of Marketing Expenses
for such Fiscal Quarter and the immediately preceding three
Fiscal Quarters,
of not more than the ratio set forth in Schedule 6.15(c) with respect to
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).
<PAGE>
77
Section 6.17. Mortgage Liens. If the Borrower or any of its Restricted
Subsidiaries shall acquire any Real Estate and shall not at the time of such
acquisition incur Indebtedness with respect thereto pursuant to
Section 7.01(d)(ii)(B), the Borrower shall grant, or cause such Subsidiary to
grant, to the Collateral Agent on behalf of the Secured Parties a first-mortgage
Lien on such Real Estate in form and substance satisfactory to the Required
Lenders. Any Lien on any such Real Estate shall provide that it shall be
released upon the incurrence of any Indebtedness under Section 7.01(d)(ii)(B)
that is secured by a Lien on such Real Estate permitted under Section
7.02(d)(ii).
Section 6.18. New Restricted Subsidiaries. Upon the creation of any
Restricted Subsidiary not in existence on the date hereof, the Borrower shall at
its expense:
(a) duly execute and deliver, or cause such Restricted Subsidiary to
duly execute and deliver, to the Administrative Agent and the Collateral
Agent a Subsidiary Guaranty in respect of such Restricted Subsidiary (with
such changes thereto as either Agent may reasonably request);
(b) duly execute and deliver, or cause such Restricted Subsidiary to
duly execute and deliver, to the Administrative Agent and the Collateral
Agent, a Subsidiary Security Agreement (with such changes thereto as either
Agent may reasonably request) and such other mortgages, pledges,
assignments and other security agreements, in form and substance reasonably
satisfactory to the Agents, securing payment of all of the obligations of
such Restricted Subsidiary under its Guaranty and the obligations of the
Loan Parties under the Loan Documents and constituting Liens on all
Collateral described therein; and pledge, or cause to be pledged, to the
Collateral Agent on behalf of the Secured Parties, all authorized, issued
and outstanding capital stock of such Restricted Subsidiary; and execute
and/or deliver to the Administrative Agent each other document or
instrument required to be delivered in connection with the execution and
delivery of such Security Agreement pursuant to Sections 8.14(c)(1) through
(8);
(c) take whatever action (including without limitation the recording
of mortgages, the filing of Uniform Commercial Code financing statements,
the giving of notices and the endorsement of notices on title documents)
may be necessary or advisable in the opinion of either Agent to vest in the
Collateral Agent (or in any representative of the Collateral Agent
designated by it) valid and subsisting Liens on the properties purported to
be subject to the security agreements delivered pursuant to this
Section 6.18, enforceable against all third parties in accordance with
their terms;
(d) deliver to the Administrative Agent a signed copy of favorable
opinions, addressed to the Agents and the Lenders, of counsel for the
Borrower
<PAGE>
78
acceptable to the Administrative Agent as to such matters relating to such
Restricted Subsidiary as either Agent may reasonably request; and
(e) at any time and from time to time, promptly execute and deliver
any and all further instruments and documents and take all such other
action as the Administrative Agent may deem desirable in obtaining the full
benefits of, or in preserving the Liens of, each security agreement
delivered pursuant to this Section 6.18 and mortgages and other agreements
and instruments entered into by such Restricted Subsidiary.
Section 6.19. C-Block Subsidiaries. While any C-Block Subsidiary shall be a
guarantor hereunder the Borrower will cause such C-Block Subsidiary to perform
and observe each covenant and condition hereunder applicable to, and as if such
Person were, a Subsidiary of the Borrower.
Section 6.20. Post-Closing Matters. By September 4, 1997 the Borrower will
cause the parties thereto to enter into the Services Agreement and will cause
the consent contemplated thereby, in form and substance reasonably acceptable to
the Required Lenders and duly executed by the parties thereto, to be delivered
to the Administrative Agent.
ARTICLE VII
CERTAIN NEGATIVE COVENANTS OF THE BORROWER
The Borrower covenants and agrees that, so long as any Loan or Note or fees
or expenses are outstanding or any Lender has any Commitment hereunder:
Section 7.01. Restrictions on Indebtedness. The Borrower shall not create,
incur, assume, guarantee or suffer to exist, or permit any of its Restricted
Subsidiaries to create, incur, assume, guarantee or suffer to exist,
contingently or otherwise, any Indebtedness other than (without duplication):
(a) In the case of the Borrower:
(i) Indebtedness to the Lenders arising under any of the Loan
Documents;
(ii) Indebtedness outstanding under a Permitted Loan Agreement,
except for any such Indebtedness described in clause (a)(v) below;
<PAGE>
79
(iii) Indebtedness the proceeds of which are used to prepay
Advances pursuant to Section 3.02(f), 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 Maturity Date;
(iv) Subordinated Debt;
(v) Indebtedness the proceeds of which are used solely for
working-capital purposes, but only so long as the aggregate principal
amount of such Indebtedness outstanding on any date does not exceed
the lesser of:
(A) 10% of the Maximum Commitment at such time, and
(B) an amount that, when divided by the aggregate POPs of
the Applicable Areas of all BTAs for which License Subsidiaries
hold FCC Licenses as of such date, equals $2.00; and
(vi) guaranties of Indebtedness permitted under clause (c)(ii) or
(iii) below;
(b) in the case of any of the Borrower's Restricted Subsidiaries:
(i) Indebtedness arising by way of a guaranty of Indebtedness of
the Borrower under any Permitted Loan Agreement, and
(ii) Indebtedness owing to the Borrower not evidenced by a note
or other instrument.
(c) In the case of any License Subsidiary,
(i) Indebtedness owing to the FCC in connection with the payment
of the deferred-purchase price of FCC Licenses held by such License
Subsidiary;
(ii) Indebtedness owing to any Person incurred in connection with
any extension of the maturity, or any refunding or refinancing, in
whole or in
<PAGE>
80
part, of any Indebtedness described in clause (c)(i) above of such
License Subsidiary, but only to the extent that:
(A) such extending, refunding or refinancing is otherwise
permitted by this Agreement, and
(B) the principal amount of such Indebtedness shall not be
increased above the principal amount thereof outstanding
immediately prior to such extension, refunding or refinancing,
and the direct and contingent obligors therefor shall not be
changed, as a result of or in connection with such extension,
refunding or refinancing; and
(iii) purchase-money Indebtedness owing to the seller of (A) any
FCC License, (B) all of the stock, partnership interests or other
ownership interests in any Person holding an FCC License or (C) the
right to provide PCS services to any POPs covered by an FCC License,
in each case incurred by a License Subsidiary that holds no other
assets in order to acquire such FCC License, such ownership interests
or such right to provide PCS services, but only to the extent that
such Indebtedness is (x) unsecured and (y) non-recourse to the
Borrower or any Subsidiary of the Borrower other than such License
Subsidiary except as permitted under Section 7.03(c).
(d) In the case of the Borrower and its Operating Subsidiaries:
(i) purchase-money Indebtedness (in addition to all other
purchase-money Indebtedness permitted under this Section 7.01) and
guaranties of such purchase-money Indebtedness permitted under clause
(c)(ii) or (iii) above in an aggregate principal amount outstanding at
any one time not to exceed 7.5% of the Maximum Commitment at such time
(but, with respect to any such purchase-money Indebtedness, only to
the extent such purchase-money Indebtedness is in a principal amount
that does not exceed the fair market value of the property being
acquired);
(ii) (A) Capital Lease obligations at any one time outstanding
not to exceed $5,000,000, and
(B) Indebtedness incurred in the acquisition of Real Estate
or within six months after the date of acquisition of Real Estate
and that is secured by a Lien permitted under
Section 7.02(d)(ii),
but only so long as:
<PAGE>
81
(I) the aggregate principal amount of Indebtedness under
clauses (A) and (B) above at any one time outstanding does not
exceed [*] and
(II) such Indebtedness is in a principal amount that does
not exceed the fair market value of the property being acquired
or leased;
(iii) purchase-money Indebtedness (in addition to any other
purchase-money Indebtedness described under clauses (i) and (ii) above
and clause (iv) below of this paragraph (d)) 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, but only to the extent such
Indebtedness is in a principal amount that does not exceed the fair
market value of the property being acquired); and
(iv) purchase-money Indebtedness (in addition to any
purchase-money Indebtedness described in clauses (a)(i), (a)(ii) and
(d)(i) above) incurred in connection with the purchase of equipment
and services the purchase price of which would be included in Excluded
Other Costs (except to the extent such Excluded Other Costs are
treated as Other Costs as provided in the definition of "Other
Costs"), in an aggregate principal amount at any one time outstanding
not to exceed 10% of the Maximum Commitment at such time, but only to
the extent such Indebtedness is in a principal amount that does not
exceed the fair market value of the property being acquired;
provided that, notwithstanding subsections (a) through (d) above, neither
the Borrower nor any of its Restricted Subsidiaries shall create, incur,
assume, guarantee or suffer to exist any Indebtedness on any date if the
aggregate principal amount of all Indebtedness of the Borrower and its
Restricted Subsidiaries (other than (x) any Indebtedness owing to the FCC
and without duplication of Indebtedness permitted hereunder and Guaranties
with respect to such Indebtedness and (y) any Subordinated Debt owing to
the Grandparent) would exceed $35.00 multiplied by the aggregate POPs of
all Applicable Areas of BTAs for which the Borrower and its Restricted
Subsidiaries hold FCC Licenses as of such date.
Indebtedness to the Grandparent or any of its Subsidiaries shall only be
permitted hereunder pursuant to subsection (a)(iv) 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
<PAGE>
82
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; and
shall not permit any of its Restricted Subsidiaries to do any of the foregoing;
provided that the Borrower or any Restricted Subsidiary may create or incur or
suffer to be created or incurred or to exist the following (collectively,
"Permitted Liens"):
(a) 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;
(b) deposits or pledges made in connection with, or to secure payment
of, workmen's compensation, unemployment insurance;
(c) 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;
(d) 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 or any of its Restricted Subsidiaries 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 or any of its
Restricted Subsidiaries, which defects do not individually or in the
aggregate have a Material Adverse Effect on the business of the
Borrower or any of its Restricted Subsidiaries, and
(ii) with respect to Real Estate the acquisition price for which
is not included in Other Costs, mortgage (or deed of trust) Liens
(collectively, "Mortgage Liens") to secure the payment of Indebtedness
permitted to be incurred under Section 7.01(d)(ii)(B); provided that
<PAGE>
83
(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 or any of its Restricted Subsidiaries and (2) the
cost of any improvements constructed thereon, and
(B) the Borrower or such Restricted Subsidiary 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 and its Restricted
Subsidiaries owing to lenders that are parties to the
Intercreditor Agreement, or
(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 F;
(e) 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;
(f) 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;
(g) Liens on FCC Licenses and proceeds of the sale or other
disposition thereof in favor of the FCC securing Indebtedness owing by
License Subsidiaries to the FCC or lenders of permitted Indebtedness
pursuant to Section 7.01(c)(ii); and
(h) Liens securing purchase-money Indebtedness permitted under
Section 7.01(d)(i), (ii), (iii) or (iv) 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 and the
proceeds of such property to the extent the applicable Uniform Commercial
Code provides for the automatic perfection of a security interest in such
proceeds.
<PAGE>
84
Section 7.03. No Contingent Obligations. The Borrower shall not create,
incur, assume, guarantee or remain liable, or permit any of its Restricted
Subsidiaries to create, incur, assume, guarantee or remain liable, on any
Contingent Obligations other than:
(a) the Guaranties,
(b) guaranties of Indebtedness under other Permitted Loan Agreements
and
(c) guaranties permitted under Sections 7.01(a)(vi) and (d)(i) of
Indebtedness permitted under Section7.01(c)(ii) or (iii).
Section 7.04. Restrictions on Investments. The Borrower shall not make or
permit to exist or to remain outstanding, or permit any of its Restricted
Subsidiaries to 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 reasonably related to 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 or
any of its Restricted Subsidiaries, 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
(ii) repurchase agreements fully secured by underlying securities
of the type described in clause (i) above and issued by a bank or
trust company meeting the requirements of Section 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
<PAGE>
85
are, at the time of acquisition thereof by the Borrower, rated "AA" or
better by Standard & Poor's Ratings Group or "A" 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 or any of its Restricted Subsidiaries;
(g) Investments by the Borrower in its Restricted Subsidiaries, by
Operating Subsidiaries in License Subsidiaries and by Restricted
Subsidiaries in the Borrower by way of loans;
(h) Investments by the Borrower or any of its Restricted Subsidiaries
in the following Persons (except as the Borrower and the Required Lenders
may otherwise agree):
(i) partnerships, but only to the extent permitted by
Section 7.18;
(ii) Qualified Joint Ventures; provided that the aggregate amount
of such Investments at any one time outstanding shall not exceed
$20,000,000; and
(iii) Non-Qualified Joint Ventures; provided that the aggregate
amount of such Investments at any one time outstanding shall not
exceed $10,000,000,
in each case in addition to any other Investments in such Persons permitted
under this Section 7.04;
(i) loans, advances, installment sales or receivables that would
constitute Investments, in each case in respect of sales of handsets and
accessories thereto to retail end users on payment terms requiring full
payment within 365 days following such sales;
(j) Investments existing on the date hereof and listed on Schedule
7.04; and
<PAGE>
86
(k) Investments by the Borrower or any of its Restricted Subsidiaries
consisting of seller take-back financing permitted under
Section 7.06(b)(iii)(C)(1).
The aggregate amount of any Investment consisting of non-cash consideration in
any Qualified Joint Venture or any Non-Qualified Joint Venture shall be the
greater of (A) the net book value of the assets (as determined in accordance
with GAAP) contributed thereto (or, in the case of a contribution of the right
to provide PCS services to only a portion of the POPs of a BTA, a ratable
portion of such net book value, determined with respect to the total POPs of
such BTA), net of any purchase-money Indebtedness of the Borrower or a
Restricted Subsidiary in respect thereof that is assumed by the acquiror
thereof, and (B) the fair-market value of the assets so contributed, as
determined in good faith by the Board of Directors of the Grandparent.
Section 7.05. Distributions. The Borrower shall not make, or permit any of
its Restricted Subsidiaries to make, any Distributions (other than a dividend or
other distribution of any shares of common Stock of the Borrower subject to the
Parent's pledge under the Parent Pledge Agreement) in respect of the Borrower's
Stock or any Subordinated Debt of the Borrower, except that the Borrower may:
(a) pay interest in respect of Subordinated Debt owing to the
Grandparent, 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 12% 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 the Grandparent, but only if:
(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:
<PAGE>
87
(A) the difference, if any, between
(1) the maximum aggregate principal amount of the Loans
that could be then outstanding at such time under
Section 2.01, 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
Indebtedness that could then be outstanding at such time
under other Permitted Loan Agreements, and
(2) the sum of
(I) the aggregate principal amount of the
Indebtedness that is 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
(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
<PAGE>
88
(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 any
Permitted Loan Agreement shall not be taken into account for
the computation provided for in clause (A)(2)(II) or
(B)(2)(II) above; and
(iii) at any preceding date, no Default would have occurred if
such Subordinated Debt had not been outstanding;
(c) so long as no Default shall have occurred and be continuing at the
time of and after giving effect to such Distribution, make a Distribution
of an amount equal to the Net Cash Proceeds of any Restricted Sale with
respect to any FCC License, the Stock of any License Subsidiary or the
right to provide PCS services to any POPs, to the extent such Net Cash
Proceeds are not required to be applied to the prepayment of Advances
pursuant to Section 3.02 or of any other Indebtedness of the Borrower or
any of its Restricted Subsidiaries; and
(d) make other Distributions (other than Distributions in respect of
Subordinated Debt owing to Persons other than the Borrower or the
Grandparent), but only if at the time of and after giving effect to such
Distribution:
<PAGE>
89
(i) no Default shall have occurred and be continuing,
(ii) the Borrower and its Restricted Subsidiaries shall have had
Consolidated 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 as of the last day of the Preceding
Fiscal Quarter, minus
(B) the aggregate amount of Debt Service payable by the
Borrower and its Restricted Subsidiaries during the 12 calendar
months next-following the Preceding Fiscal Quarter, minus
(C) the aggregate amount of any prepayment of Indebtedness
required to be made pursuant to Section 3.02(c) hereunder and any
other similar prepayment of Indebtedness of the Borrower from
Excess Cash Flow pursuant to a Permitted 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 merge into or consolidate with any Person or permit any
Person to merge into it, and shall not permit any of its Restricted Subsidiaries
to do any of the foregoing.
(b) The Borrower shall not, and shall not permit any Restricted Subsidiary
to, 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 or any Restricted Subsidiary's
business, consistent with sound and prudent practices;
(iii) so long as no Default shall have occurred and be continuing at
the time thereof,
<PAGE>
90
(A) dispositions of rights to provide PCS services to any POPs
included in any Permitted BTA, so long as such dispositions are not
Restricted Sales;
(B) any sale of (w) FCC Licenses with respect to Permitted BTAs
that are not Core BTAs, (x) the Stock of any License Subsidiary
holding FCC Licenses for Permitted BTAs that are not Core BTAs, (y)
the right to provide PCS services with respect to POPs included in
Permitted BTAs in a transaction that constitutes a Restricted Sale, or
(z) any equipment or other assets used primarily for the operation of
any Permitted BTA the FCC License for which has been so sold or for
providing services to POPs for which the right to provide PCS services
shall have been so sold, but in any such case only if:
(1) of the aggregate value of the consideration received by
the Borrower and its Restricted Subsidiaries therefor (as
determined in good faith by the Board of Directors of the
Grandparent), no less than 75% shall be cash payable at the time
of such sale, no more than 25% shall be in the form of deferred
cash payments, and no such consideration shall be in any other
form,
(2) such consideration shall be at least equal to the
fair-market value (as determined in good faith by the Board of
Directors of the Grandparent) of the assets sold and
(3) no equipment and other assets are sold if such assets
are necessary for the normal commercial operation of any
Permitted BTA, or to provide PCS services to any POPs included in
any Permitted BTA, for which such a sale shall not have occurred;
(C) dispositions by way of capital contributions to Qualified
Joint Ventures or Non-Qualified Joint Ventures of FCC Licenses with
respect to Permitted BTAs that are not Core BTAs, the Stock of any
License Subsidiary holding FCC Licenses for Permitted BTAs that are
not Core BTAs, the right to provide PCS services with respect to POPs
included in Permitted BTAs, and any equipment and other assets used
primarily for the operation of any such Permitted BTA that has been so
disposed of, or to provide services to POPs for which the right to
provide PCS services shall have been so disposed of, so long as (x)
such disposition shall be in compliance with Section 7.04(h) and (y)
the aggregate value of the consideration received by the Borrower and
its Restricted Subsidiaries for such contribution shall at least be
equal to the fair-market value (as determined in good faith by the
Board of Directors of the Grandparent) of the assets so contributed;
and
<PAGE>
91
(D) dispositions of (x) any FCC License (or portion thereof, in
the case of a Permitted Transfer that is a Permitted Disaggregation
disposed of pursuant to clause (2) below) in respect of a Permitted
BTA or (y) the Stock of any License Subsidiary holding an FCC License
for a Permitted BTA, but only if :
(1) all of the following are true:
(I) the sole consideration received in connection with
such disposition is another FCC License in respect of the
same BTA,
(II) the FCC License being acquired covers at least the
same amount of spectrum as the FCC License being disposed
of, and
(III) no License Subsidiary or other Loan Party shall
be liable for the payment of any Indebtedness owing to the
FCC in connection with the payment of any deferred-purchase
price for the FCC License being disposed of;
(2) all of the following are true:
(I) at the time of and after giving effect to such
disposition:
(x) if the FCC License (or portion thereof) being
so disposed of is for, or the License Subsidiary for
which the Stock is being so disposed of holds the FCC
License for, a Core BTA, either:
(a) a License Subsidiary shall hold either
(i) one or more FCC Licenses or (ii) the right to
provide, on terms and conditions satisfactory to
the Required Lenders, PCS services under FCC
Licenses held by third parties covering an
aggregate amount of spectrum that is equal to at
least the lesser of the amount of spectrum covered
by the FCC License being so disposed of and 20
MHz, or
<PAGE>
92
(b) such FCC License (or portion thereof) is
for the Philadelphia BTA, and, after giving effect
thereto, a License Subsidiary shall hold either
one or more FCC Licenses, or the right to provide,
on terms and conditions satisfactory to the
Required Lenders, PCS services under FCC Licenses
held by third parties, covering at least (i) prior
to December 31, 1999, 10 MHz of spectrum and (ii)
thereafter (A) 10 MHz of spectrum if the Borrower
shall have demonstrated to the reasonable
satisfaction of the Required Lenders that, as of
the date of such disposition, the rates of call
blocking and dropped calls with respect to all
cells in the Philadelphia BTA will conform to
generally accepted industry standards at the time,
and (B) 20 MHz otherwise, and
(y) in all other circumstances and after giving
effect to such disposition , a License Subsidiary shall
hold either (i) one or more FCC Licenses or (ii) the
right to provide, on terms and conditions satisfactory
to the Required Lenders, PCS services under FCC
Licenses held by third parties, covering at least 10
Mhz of spectrum;
(II) no other asset is disposed of in connection with such
disposition;
(III) such disposition is by way of either (x) a sale that
complies with the requirements of subsection (B) above
(notwithstanding that at the time of such disposition such
disposition is not a Restricted Sale) or (y) a Permitted
Transfer; and
(IV) no License Subsidiary or other Loan Party shall be
liable for the payment of any Indebtedness owing to the FCC in
connection with the payment of the deferred-purchase price of the
FCC License being disposed of; or
<PAGE>
93
(3) the Required Lenders shall have accepted as a Permitted BTA a
BTA in substitution for the BTA as to which such disposition shall
have occurred;
(iv) other dispositions 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 $10,000,000 in the aggregate during the term of
this Agreement; and
(v) transfers of assets from the Borrower to any Restricted Subsidiary
or from a Restricted Subsidiary to the Borrower or another Restricted
Subsidiary, in each case to the extent that, after giving effect to such
transfer, the transferee would be in compliance with its obligations under
Section 7.12.
If the Borrower or any of its Restricted Subsidiaries shall make any
disposition of any assets pursuant to clause (iii)(D) above to a Qualified Joint
Venture, it shall not thereafter permit such Qualified Joint Venture to fail to
continue to qualify as a Qualified Joint Venture, except in a transaction
involving a disposition of the assets of such Qualified Joint Venture that is
otherwise permitted under this subsection (b). The Borrower shall not, and shall
not permit any Restricted Subsidiary to, contribute any assets to a Qualified
Joint Venture except to the extent reasonably necessary for the contemplated
operations of such Qualified Joint Venture.
(c) Except with the agreement of the Required Lenders, the Borrower shall
not permit any Restricted Subsidiary to issue or sell any Stock or other equity
interest in itself, other than to the Borrower or another Restricted Subsidiary
of the Borrower and only if such Stock is pledged as security under the
Collateral Documents.
Section 7.07. Sale and Leaseback. The Borrower shall not enter into, or
permit any of its Restricted Subsidiaries to enter into, any arrangement,
directly or indirectly, whereby the Borrower or any of its Restricted
Subsidiaries 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 or
such Restricted Subsidiary 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,
and shall not permit any of its Subsidiaries to:
(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;
<PAGE>
94
(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, nor shall the Borrower permit any of its Subsidiaries to:
(a) engage in any "prohibited transaction" within the meaning of
Section 406 of ERISA or Section 4975 of the IRC which could result in a
material liability for the Borrower;
(b) permit any Guaranteed Pension Plan to incur an "accumulated
funding deficiency", as such term is defined in Section 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 Section 302(f) or Section 4068 of ERISA;
(d) permit or take any action which would result in the aggregate
benefit liabilities (with the meaning of Section 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;
<PAGE>
95
(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 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 the Borrower or an ERISA
Affiliate.
Section 7.10. New Subsidiaries. The Borrower shall not create or acquire
any Person other than Operating Subsidiaries, Licenses Subsidiaries, any Person
the sole asset of which consists of its partnership interest in a general or
limited partnership or equity interest in a corporation, and, to the extent
permitted under Section 7.04(h), Non-Qualified Joint Ventures.
Section 7.11. Transactions with Affiliates. The Borrower shall not enter
into, or permit any of its Restricted Subsidiaries to enter into:
(a) any agreement or arrangement providing for the payment of any
amounts to any of its Affiliates, except that:
(i) the Borrower may enter into the Expense Allocation Agreement
, and any Operating Subsidiary may enter into (A) the Cash Management
Agreement, (B) the Services Agreement and (C) one or more operating
agreements substantially in the form of Exhibit D-2 hereto, between
such Operating Subsidiary and a License Subsidiary;
(ii) the Borrower and its Restricted Subsidiaries may enter into
a tax-sharing agreement or arrangement pursuant to which the Borrower
and its Restricted Subsidiaries 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 and its Restricted Subsidiaries would have paid if
the Borrower and its Restricted Subsidiaries had always filed
income-tax returns as separate entities; and
(iii) the Borrower and its Restricted Subsidiaries may enter into
a management, consulting or other agreement, but only if such
agreement either
<PAGE>
96
(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 or such Restricted Subsidiary
than it would obtain in a comparable arm's-length
transaction with a Person not an Affiliate; and
(2) does not provide for the performance of services or
purchase or delivery of property by the Borrower or such
Restricted Subsidiary 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 or such Restricted Subsidiary
to build-out or operate any BTA or MTA for which it owns the
applicable FCC License, 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 or such
Restricted Subsidiary than it would obtain in a comparable arm's-length
transaction with a Person not an Affiliate.
Section 7.12. Permitted Business. The Borrower shall not
(a) engage in any business other than the holding of Stock of
Operating Subsidiaries and License Subsidiaries and the purchasing and
reselling to Restricted Subsidiaries of equipment used in connection with
the build-out and operation of PCS Systems for which FCC Licenses for BTAs
other than Excluded BTAs are held by License Subsidiaries or hold any
assets other than such Stock,
(b) permit any License Subsidiary to engage in any business other than
the holding of FCC Licenses and the licensing thereof to other Persons to
the extent permitted hereunder or hold any assets other than FCC Licenses,
and
(c) permit any Operating Subsidiary to engage in any business other
than the development, construction and operation of PCS Systems and related
businesses.
Section 7.13. Charter Amendments. The Borrower shall not, and shall not
permit any of its Restricted Subsidiaries to, amend its certificate of
incorporation or bylaws.
<PAGE>
97
Section 7.14. Accounting Changes. The Borrower shall not make or permit, or
permit any of its Restricted 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
and shall not permit any Restricted Subsidiary:
(a) 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 or any of its Restricted Subsidiaries, 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
the Intercreditor Agreement are not required to pay any amount to other
lenders party thereto or Indebtedness owing to the FCC, or
(b) to 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 or any of its Restricted Subsidiaries and the
Borrower or such Restricted Subsidiary shall not pay in full all such amounts as
are then due and owing, the Borrower shall not pay, or permit such Restricted
Subsidiary to 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 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 or such Restricted Subsidiary to such lender.
Section 7.16. Amendment, Etc., of Material Contracts. The Borrower shall
not, and shall not permit any Restricted Subsidiary to, 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, and shall not permit any of its
Restricted Subsidiaries to do any of the foregoing, that, in any such case,
could, at the time thereof, reasonably be expected to have a material adverse
effect on the ability of the Borrower or
<PAGE>
98
any of its Restricted Subsidiaries to perform its obligations under this
Agreement or any other Loan Document.
Section 7.17. Restrictions on Restricted Subsidiaries. (a) The Borrower
shall not enter into or suffer to exist, or permit any of its Restricted
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 or limiting the ability of any
Restricted Subsidiary to declare and pay dividends and distributions or make
Investments in the Borrower.
(b) So long as any Advances are outstanding or any other amount is owing
under the Loan Documents, no Distribution shall be made by any Qualified Joint
Venture except in cash or to any Person other than the Borrower and its
Restricted Subsidiaries if such Person would receive more than 10% of the total
amount of such Distribution or if the total amount of all such Distributions
during any calendar year would exceed the Excess Cash Flow of such Qualified
Joint Venture for the immediately preceding calendar year;
Section 7.18. Partnerships. The Borrower shall not become, or permit any of
its Restricted Subsidiaries to become, a general partner in any general or
limited partnership other than any Restricted Subsidiary the sole asset of which
consists of its interest in such partnership.
Section 7.19. Default Under the Equipment Acquisition 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 Equipment
Acquisition Agreement.
Section 7.20. Collections of Receivables. The Borrower shall not, and shall
not permit any of its Subsidiaries to, collect any receivables arising from
providing PCS or other services or sales of handsets or other assets, except
through the Operating Subsidiary.
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. Terms and Conditions of Transaction. (a) Each Lender shall
have received a Note, payable to the order of such Lender, duly executed and
delivered by the Borrower, as well as copies of each of the other Loan
Documents, which shall have been
<PAGE>
99
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.
(b) The Lenders shall be satisfied with the final terms and conditions of
the transactions contemplated hereby and by the other Loan Documents, including,
without limitation, all legal and tax aspects thereof.
(c) The Lenders shall be satisfied with the corporate and legal structure
and capitalization of the Borrower and its Subsidiaries, including, without
limitation, their respective charters and bylaws and each agreement or
instrument relating thereto.
Section 8.02. Due Diligence. The Lenders shall have completed a
due-diligence investigation of the Borrower and its Subsidiaries in scope, and
with results, satisfactory to the Lenders and shall have been given such access
to the management, records, books of account, contracts and properties of the
Borrower and shall have received such financial, business and other information
regarding the Borrower and its Subsidiaries as they shall have requested.
Section 8.03. Validity of Liens. The Borrower Security Agreement, the
Parent Pledge Agreement and each other Collateral Document required to be
entered into on the date hereof shall be effective to create in favor of the
Collateral Agent a legal, 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, all
such documents shall have been duly executed by the applicable Loan Party and
all filing and recording fees and taxes relating to any of the foregoing shall
have been duly paid. 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 Uniform Commercial Code, 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 (other than Permitted Liens)
in such official's office covering any Collateral or showing any Loan Party
as a debtor thereunder;
<PAGE>
100
(b) a certificate of each Loan Party signed by an authorized officer
of such Loan Party, 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) acknowledgment copies or duly executed file-stamped copies of
UCC-1 and UCC-3 financing statements with respect to the Collateral (other
than the pledged Collateral), filed in each office in each jurisdiction
that the Administrative Agent may deem necessary or appropriate to perfect
and protect a first-priority 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 Collateral Documents 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 the Parent, in form and substance satisfactory to the
Administrative Agent and the Lenders, dated as of the Closing Date as to the
Borrower and the Parent being Solvent after giving effect to the consummation of
the transactions contemplated herein and in the other Loan Documents.
Section 8.07. Opinions of Counsel to the Borrower and its Subsidiaries.
Each of the Lenders and the Administrative Agent shall have received favorable
legal opinions addressed to the Lenders and the Administrative Agent, each dated
as of the Closing Date, in form and substance satisfactory to the Lenders and
the Administrative Agent, from (i) Piper & Marbury, L.L.P., counsel to the
Borrower, (ii) Piper & Marbury, L.L.P., counsel to the Borrower's Subsidiaries,
and (iii) local counsel to the Borrower's Subsidiaries in such jurisdictions as
the Administrative Agent may reasonably request.
<PAGE>
101
Section 8.08. Opinion of Counsel to the Grandparent and the Parent. Each of
the Lenders and the Administrative Agent shall have received a favorable legal
opinion addressed to the Lenders and the Administrative Agent, from Piper &
Marbury, L.L.P., counsel to the Grandparent and the Parent, 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 Piper & Marbury, L.L.P., FCC counsel
to the Borrower, the Grandparent and the 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 the 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 Shearman &
Sterling, counsel to the Administrative Agent, dated as of the Closing Date, in
form and substance satisfactory to the Administrative Agent.
Section 8.11. Payment of Fees. The Borrower shall have paid all accrued
fees and expenses of the Administrative Agent, the Collateral Agent and the
Lenders, to the extent payable by the Borrower hereunder and under the other
Loan Documents.
Section 8.12. Approvals, Permits; FCC Licenses. (a) The Borrower and each
of its Subsidiaries shall have obtained all federal, state and local
governmental and regulatory consents, approvals, FCC Licenses and permits,
including any third-party consents, as required or necessary for the Borrower to
accept Loans and for the Borrower and its Subsidiaries to operate their
businesses pursuant to the Approved Full Term Operating Business Plan and shall
maintain in effect each of the foregoing; 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
operation of the businesses of the Borrower and its Subsidiaries as currently
operated, 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.
(b) The Lenders shall have received evidence satisfactory to the Lenders
that each FCC License listed in Parts I and II of Schedule 5.07 has been won by
the Grandparent and its Subsidiaries in FCC PCS auctions, has been transferred
to a License Subsidiary, that each such FCC License is held by a Subsidiary of
the Grandparent and that no such FCC License is subject or likely to be subject
to any revocation action commenced or threatened by the FCC or to being
purchased by any Person other than a License Subsidiary.
<PAGE>
102
Section 8.13. Delivery of Operating Business Plans. The Borrower shall have
delivered to the Administrative Agent and each Lender 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 (i) a certificate of the
chief or principal financial or accounting 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 and (ii)
such pro-forma financial statements and projections for the Borrower and its
Subsidiaries, in form and substance satisfactory to the Lenders, as shall be
reasonably requested by the Lenders.
Section 8.14. Security Agreements. The Borrower shall have delivered to the
Administrative Agent and each Lender copies of each of the following:
(a) a security agreement (as amended from time to time, the "Borrower
Security Agreement"), in substantially the form of Exhibit E-1, duly
executed by the Borrower, that, among other things, grants to the
Collateral Agent for the benefit of the Secured Parties a Lien on such
assets of the Borrower (including without limitation all issued and
outstanding Stock of each License Subsidiary and each Operating Subsidiary
owned by the Borrower) as the Lenders may request;
(b) a pledge agreement (as amended from time to time, the "Parent
Pledge Agreement"), in substantially the form of Exhibit E-2, duly executed
by the Parent, that, among other things, pledges to the Collateral Agent
for the benefit of the Secured Parties all issued and outstanding Stock of
the Borrower owned by the Parent;
(c) security agreements (together with each other security agreement
delivered pursuant to Section 6.18(b), in each case as amended from time to
time, a "Subsidiary Security Agreement" and, together with the Borrower
Security Agreement and the Parent Pledge Agreement, the "Security
Agreements"), substantially in the respective forms of Exhibit E-3 (for any
Operating Subsidiary) and E-4 (for any License Subsidiary) hereto, duly
executed by the Guarantors (other than the Parent), each of which, among
other things, grants to the Collateral Agent for the benefit of the Secured
Parties a Lien on such assets of such Guarantor (including, in the case of
any Operating Subsidiary, all issued and outstanding Stock of each of its
Restricted Subsidiaries that is a License Subsidiary or an Operating
Subsidiary, but in the case of any License Subsidiary, excluding any assets
for which the grant of such a Lien would violate applicable FCC
regulations) as the Lenders may request,
<PAGE>
103
in each case together with:
(1) if applicable, certificates representing the any shares of
Stock pledged under such Security Agreement, accompanied by undated
stock powers executed in blank,
(2) duly executed financing statements, in proper form for filing
under the Uniform Commercial Code of all jurisdictions that the
Administrative Agent may deem necessary or desirable in order to
perfect and protect the first priority liens and security interests
created under such Security Agreement covering the Collateral
described in such Security Agreement,
(3) evidence of any insurance required by the terms of such
Security Agreement and
(4) evidence that all other action that the Administrative Agent
may deem necessary or desirable in order to perfect and protect the
first priority liens and security interests created under such
Security Agreement has been taken.
Section 8.15. Guaranties. The Borrower shall have delivered to the
Administrative Agent and each Lender copies of each of the following:
(a) from the Parent, a limited recourse guaranty in substantially the
form of Exhibit H-1 hereto (as amended, supplemented or otherwise modified
from time to time in accordance with its terms, the "Limited Recourse
Parent Guaranty"), duly executed by the Parent, and
(b) from each Operating Subsidiary and each License Subsidiary, a
guaranty in substantially the form of Exhibit H-2 hereto (together with
each other such guaranty delivered pursuant to Section 6.18(a), in each
case as amended, supplemented or otherwise modified from time to time in
accordance with its terms, a "Subsidiary Guaranty" and, together with the
Limited Recourse Parent Guaranty, the "Guaranties"), duly executed by each
Operating Subsidiary and each License Subsidiary.
Section 8.16. Mortgages, Etc. The Borrower shall have delivered to the
Administrative Agent and each Lender copies of deeds of trust, trust deeds,
mortgages, leasehold mortgages and leasehold deeds of trust in form and
substance satisfactory to the Administrative Agent and covering the properties
listed on Schedule 8.16 hereto (together with each other mortgage delivered
pursuant to Section 6.18(b), in each case as amended,
<PAGE>
104
supplemented or otherwise modified from time to time in accordance with their
terms, the "Mortgages"), duly executed by each party thereto, in each case
together with:
(a) evidence that counterparts of the Mortgages have been duly
recorded on or before the day of the initial Advance (or, with respect to
any such Mortgage entered into after the date of the initial Advance in
accordance with this Agreement, on or before the date of execution and
delivery of such Mortgage) in all filing or recording offices that the
Administrative Agent may deem necessary or desirable in order to create a
valid first and subsisting Lien (other than Permitted Liens) on the
property described therein in favor of the Secured Parties and that all
filing and recording taxes and fees have been paid;
(b) evidence of the insurance required by the terms of such Mortgage;
and
(c) evidence that all other action that the Administrative Agent or
Collateral Agent may deem necessary or desirable in order to create valid
first and subsisting Liens on the property described in such Mortgage has
been taken.
Section 8.17. Attornment and Recognition Agreements. The Borrower shall
have delivered to the Administrative Agent and each Lender copies of each
attornment and recognition agreement required by Section 6.11.
Section 8.18. Material Agreements. Subject to confidentiality restrictions,
the Administrative Agent and each of the Lenders shall have received a complete
and correct copy, in form and substance satisfactory to the Lenders, of (a) the
Expense Allocation Agreement and the servicing agreement and form of licensing
agreement referred to in Section 7.11(a)(i), in each case (if applicable) as
then in effect and duly executed by the parties thereto, 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 8.19. Litigation. There shall exist no action, suit, investigation,
litigation or proceeding pending or threatened in any court or before any
arbitrator or governmental instrumentality affecting any of the Grandparent, the
Parent, the Borrower or any of their respective Subsidiaries that
(i) could have a Material Adverse Effect, or
(ii) purports to affect the legality, validity or enforceability of
this Agreement, any Note, any other Loan Document or the consummation of
the transactions contemplated hereby or thereby or challenges any of the
Lenders' rights under this Agreement, any Note or any other Loan Agreement.
<PAGE>
105
Section 8.20. Insurance Certificates. The Administrative Agent shall have
received one or more insurance certificates to the effect set forth in
Section 6.05.
Section 8.21. No Default. No default shall have occurred and be continuing
under the Equipment Acquisition Agreement.
Section 8.22. No Material Adverse Change. There shall have occurred no
material adverse change in the business, condition (financial or otherwise),
operations, performance, properties or prospects of the Borrower or any of its
Restricted Subsidiaries since the date of the most recent audited financial
statements provided to the Lenders, and all information provided by or on behalf
of the Borrower to the Lenders prior to the date of the initial Advance shall be
true and correct in all material aspects.
Section 8.23. Corporate Documents. The Administrative Agent shall have
received on or before the day of the initial Advance the following, each dated
such day (unless otherwise specified), in form and substance satisfactory to
each Lender (unless otherwise specified) and in sufficient copies for each
Lender:
(a) Certified copies of the resolutions of the Board of Directors of
the Borrower and each other Loan Party approving this Agreement, the Notes
and each other Loan Document to which it is or is to be a party, and of all
documents evidencing other necessary corporate action and governmental and
other third party approvals and consents, if any, with respect to this
Agreement, the Notes and each other Loan Document.
(b) A copy of the charter of the Borrower, the Grandparent and each
other Loan Party and each amendment thereto, certified (as of a date
reasonably near the date of the initial Advance) by the Secretary of State
of the jurisdiction of its incorporation as being a true and correct copy
thereof.
(c) A copy of a certificate of the Secretary of State of the
jurisdiction of incorporation of the Borrower, the Grandparent and each
other Loan Party, dated reasonably near the date of the initial Advance,
listing the charter of such Person and each amendment thereto on file in
his office and certifying that
(i) such amendments are the only amendments to such Person's
charter on file in his office,
(ii) such Person has paid all franchise taxes to the date of such
certificate, and
<PAGE>
106
(iii) such Person is duly incorporated and in good standing under
the laws of the state of incorporation of such Person.
(d) A copy of a certificate of the Secretary of State or other
appropriate representative of each state in which each of the Borrower and
each other Loan Party is engaged in any business, dated reasonably near the
date of the initial Advance, stating that each of the Borrower and each
other Loan Party is duly qualified and in good standing as a foreign
corporation in such state and has filed all annual reports required to be
filed to the date of such certificate.
(e) A certificate of the Borrower and each other Loan Party, signed on
behalf of the Borrower and such other Loan Party by its President or a Vice
President and its Secretary or any Assistant Secretary, dated the date of
the initial Advance (the statements made in which certificate shall be true
on and as of the date of the initial Advance), certifying as to
(A) the absence of any amendments to the charter of the Borrower,
or such other Loan Party since the date of the Secretary of State's
certificate referred to in Section 8.23(c),
(B) a true and correct copy of the bylaws of the Borrower and
such other Loan Party as in effect on the date of the initial Advance,
(C) the due incorporation and good standing of the Borrower and
such other Loan Party as a corporation organized under the laws of the
jurisdiction in which such Loan Party is incorporated, and the absence
of any proceeding for the dissolution or liquidation of the Borrower
or such other Loan Party,
(D) the truth of the representations and warranties of such
Person contained in the Loan Documents as though made on and as of the
date of the initial Advance, and
(E) the absence of any event occurring and continuing, or
resulting from the initial Advance, that constitutes a Default.
(f) A certificate of the Secretary or an Assistant Secretary of the
Borrower and each other Loan Party certifying as to the names and true
signatures of the officers of the Borrower and such other Loan Party
authorized to sign this Agreement, the Notes and each other Loan Document
to which they are or are to be parties and the other documents to be
delivered hereunder and thereunder.
<PAGE>
107
(g) All other documents, instruments, financial information and
opinions from the Borrower, the Grandparent, the Parent or any other Loan
Party (including opinions of counsel for the Borrower, the Grandparent, the
Parent or any other Loan Party) as the 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 Advance.
Section 8.24. Intercreditor Agreement. The Borrower shall have delivered to
the Administrative Agent an intercreditor agreement substantially in the form of
Exhibit I, duly executed by the Collateral Agent (as the same may be amended
from time to time, the "Intercreditor Agreement").
Section 8.25. Support Agreement. The Borrower shall have delivered to the
Administrative Agent a Support Agreement substantially in the form of Exhibit J,
duly executed by the Grandparent and the Borrower (as the same may be amended
from time to time, the "Support Agreement").
Section 8.26. Amendment to Equipment Acquisition Agreement. The
Administrative Agent shall have received evidence satisfactory to it that the
Equipment Acquisition Agreement has been amended to allow for purchases of
equipment and services by the Borrower or one or more Operating Subsidiaries
thereunder for the build-out of certain BTA markets for which Subsidiaries of
the Borrower have been issued FCC Licenses.
Section 8.27. Acknowledgement of Assignment. The Administrative Agent shall
have received from Omnipoint Services a written statement to it in which
Omnipoint Services (a) consents to the assignment by the Operating Subsidiary
party to the Services Agreement of all of its right, title and interest in and
to the Services Agreement (including, without limitation, the right to receive
any monies due thereunder) to the Collateral Agent pursuant to the Collateral
Documents, (b) agrees not to cancel or terminate the Services Agreement except
upon at least 90 days written notice to the Administrative Agent and (c) agrees
that the Administrative Agent or the Collateral Agent shall be entitled to make
any payment or otherwise perform any obligation or cure any default of the
Borrower or any of its Restricted Subsidiaries under the Services Agreement.
Section 8.28. Other Information. The Lenders and the Administrative Agent
shall have received such other information respecting the business, condition
(financial or otherwise), operations, performance, properties or prospects of
any Loan Party or any of its Restricted Subsidiaries as any Lender Party
(through the Administrative Agent) may from time to time reasonably request.
<PAGE>
108
ARTICLE IX
ADDITIONAL CONDITIONS TO ADVANCES
SECTION 9.01. Conditions Precedent to an Initial Advance Based on
Attributed Expenses with Respect to Any Operating Subsidiary or License
Subsidiary. The obligation of the Lenders to make an Advance on the basis of any
portion of the Borrowing Base relating to Attributed Expenses in respect of any
Permitted BTA relating to any Operating Subsidiary or License Subsidiary not in
existence on the date of the initial Advance, any FCC License not held by a
License Subsidiary as of the date of the initial Advance or any BTA in any
jurisdiction other than a jurisdiction as to which the Borrower shall have
received an opinion of counsel pursuant to Section 8.07, is subject to the
satisfaction of the following conditions precedent:
(a) the Lenders shall be satisfied with the corporate and legal
structure and capitalization of such Restricted Subsidiary, including the
terms and conditions of the charter, bylaws and each class of capital stock
of such Restricted Subsidiary and of each agreement or instrument relating
thereto, and
(b) such Restricted Subsidiary (or the Borrower on behalf of such
Restricted Subsidiary) shall have delivered each agreement, opinion of
counsel and other document required to be delivered by or on behalf of such
Restricted Subsidiary pursuant to Section 6.18.
Section 9.02. 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 that on the date of such
Advance:
(a) The Administrative Agent shall have received a properly completed
Draw Request.
(b) Each of the representations and warranties of the Borrower and
each other Loan Party contained in this Agreement, the other Loan Documents
or in any document or instrument delivered pursuant to or in connection
with this Agreement or any other Loan Document is true and correct in all
material respects immediately prior to, and after giving effect to, the
making of such Advance and the application of the proceeds therefrom, as
though made on and as of such date (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
<PAGE>
109
Administrative Agent shall have received a certificate of an authorized
officer of the Borrower to such effect.
(c) No event has occurred and is continuing, or would result from such
Advance or from the application of the proceeds therefrom, that constitutes
a Default or a default under any other Loan Document.
(d) 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.
(e) 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.
(f) The Administrative Agent shall have received such other approvals,
opinions or documents as any Lender through the Administrative Agent may
reasonably request.
(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 Ericsson Related Expenses that have
been incurred by the Borrower and its Restricted Subsidiaries 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
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 perform or observe any term, covenant
or agreement contained in Article VII or Section 6.14(i) or 6.15; provided
that the Borrower
<PAGE>
110
shall have the right to comply with the covenants contained in
Sections 6.15(a), (b) and (c) by providing, prior to the delivery of the
financial statement or other report to the Administrative Agent disclosing
the existence of such default, additional cash equity to the extent that if
such equity were included in Revenue or Operating Cash Flow, the Borrower
would be in compliance with Sections 6.15(a), (b) and (c), as the case may
be; or
(c) any Loan Party 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 Section 10.01) and such failure
shall continue for a period of 30 days; or
(d) any representation or warranty made by any Loan Party or any of
its Restricted Subsidiaries (or any of its officers) under this Agreement
or any of the other Loan Documents or in any certificate, statement,
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 confirmed or deemed to have been made, confirmed
or repeated; or
(e) any Loan Party or any shareholder of the Borrower shall:
(i) make an assignment for the benefit of creditors, or
(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 any Loan Party or any such
shareholder or of any substantial part of the assets of any Loan Party
or any such shareholder, or
(iv) shall commence any case or other proceeding relating to any
Loan Party or any such shareholder 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 any Loan Party or any such
shareholder and such Loan
<PAGE>
111
Party or shareholder 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 any Loan
Party or any such shareholder shall take any corporate action to authorize
any of the actions set forth above in this subsection (e); or
(f) the Borrower or any of its Restricted Subsidiaries 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 an aggregate principal
amount of at least $5,000,000 (but excluding Indebtedness outstanding
hereunder or owing by any License Subsidiary to the FCC), 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
(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), or any
material non-monetary judgment or order, 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 any Loan Party or any of its or their stockholders, or any court
or any other governmental or regulatory authority or
<PAGE>
112
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 or any of its Restricted Subsidiaries 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
(k) the FCC or any other Governmental Body shall cancel, revoke,
suspend or fail to renew any FCC License held by any License Subsidiary
relating to (i) any right held by any Restricted Subsidiary to provide PCS
services to any POPs included in any Core BTA, Dependent BTA or other
Permitted BTA, in either case for which the cancellation, revocation,
suspension or failure to renew the FCC License relating to which could
reasonably be expected to have a Material Adverse Effect, or (ii) any
Permitted BTA for which Ericsson Related Expenses in excess of $1,000,000
have been incurred, in either case except for any C-Block General License
Revocation Event or Proposed C-Block General License Revocation Event
occurring at any time when no License Subsidiary shall hold a C-Block
License for the Philadelphia BTA; or
(l) the FCC or any other Governmental Body shall commence any
proceeding to cancel, revoke or suspend any of the any FCC License held by
any License Subsidiary relating to BTAs described in clause (k) above,
which proceeding (i) could reasonably be expected to have a Material
Adverse Effect, and (ii) has not been stayed or enjoined within five
Business Days after the commencement of any such proceeding, in either case
except for any C-Block General License Revocation Event or Proposed C-Block
General License Revocation Event occurring at any time when no License
Subsidiary shall hold a C-Block License for the Philadelphia BTA; or
<PAGE>
113
(m) any License Subsidiary shall fail to pay when due amounts owing to
the FCC relating to BTAs described in clause (k) above unless (i) such
failure to pay can reasonably be expected, in the reasonable judgment of
the Required Lenders, not to result in any cancellation, revocation or
suspension of such FCC License or (ii) the Borrower has obtained a stay or
injunction against any action by the FCC to cancel, revoke or suspend such
FCC License notwithstanding such failure to pay and such injunction or stay
shall then be in effect; or
(n) the Collateral Agent shall cease to have a valid and perfected
first-priority Lien on any Collateral securing any Loan Party's obligations
under any Loan Document, or any Loan Party shall so assert (subject,
however, to Permitted Liens entitled to priority in accordance with the
terms of the Loan Documents); or
(p) at any time any of the following shall occur:
(i) the Ownership Fraction shall be less than 51%;
(ii) any issuance by the Borrower or disposition by the Parent of
Stock of the Borrower shall occur, other than a Permitted Stock
Transfer, or 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, legal or beneficially, more than
30% of the Voting Stock of the Borrower then outstanding; or
(iii) all of each series and class of issued and outstanding
shares of Stock of the Borrower and each of its Subsidiaries shall
cease to be pledged as security for the obligations of the Borrower,
the other Loan Parties and their respective Subsidiaries hereunder and
under the other Loan Documents; 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 any Loan Party that could
reasonably be expected to have a material adverse effect on the ability of
such Loan Party to perform its obligations under the Loan Documents to
which it is a party; or
(q) the Borrower or any Restricted Subsidiary shall default, after any
applicable grace period, under any equipment-acquisition agreement (other
than the Equipment Acquisition 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
<PAGE>
114
(r) the transferee of any FCC License disposed of in a Permitted
Transfer pursuant to Section 7.06(b)(iii)(E)(2) shall default in any of its
obligations under clause (c)(i)(C) of the definition of "Permitted
Transfer";
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.
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,
<PAGE>
115
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 Section 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
(whether written or oral) 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;
(e) shall not be responsible to any Lender for the due execution,
legality, validity, enforceability, genuineness, sufficiency or value of,
or the perfection or priority of any lien or security interest created or
purported to be created under or in connection with, any Loan Document or
any other instrument or document furnished pursuant thereto;
(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
<PAGE>
116
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
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 Section 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 Section 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.
Without prejudice to the survival of any other agreement of any
<PAGE>
117
Lender hereunder, the agreements and obligations of each Lender contained in
this Section 11.05 shall survive the payment in full of principal, interest and
all other amounts payable hereunder and under the other Loan Documents.
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 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 or any other Loan Document, 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:
<PAGE>
118
(i) waive any of the conditions specified in Article IX or, in
the case of the initial Advance, 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, the Collateral Agent and the
Administrative Agent under the Loan Documents and other than
Indebtedness owing to any other Person;
(v) amend this Section 12.01;
(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.
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:
<PAGE>
119
OPCS Philadelphia Holdings, Inc.
16 Wing Drive
Cedar Knolls, NJ 07927
Attn: Mr. Harry Plonskier
(fax no. (201) 257-2521)
with copies to:
OPCS Philadelphia Holdings, Inc.
3 Bethesda Metro Center
Bethesda, MD 20000
Attn: Mr. Bradley E. Sparks
(fax no. (301) 951-2592)
and
Piper & Marbury, L.L.P.
1200 19th Street, N.W.
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. (972) 583-1818)
with a copy, at the same address to the
attention of the Vice President-General Counsel
(fax no. (972) 583-1839)
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.
<PAGE>
120
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) (i) Except as specified in clause (ii)
or (iii) below, Ericsson will pay its own legal and other out-of-pocket costs in
connection with the drafting, negotiation and closing of this Agreement and the
other Loan Documents.
(ii) The Borrower will pay on demand all fees and reasonable expenses
that are incurred in connection with any necessary or desirable filings or
recordations by the Administrative Agent, the Collateral Agent or Ericsson
in connection with this Agreement, the other Loan Documents and the
transactions contemplated hereby and thereby, whether or not any such
transactions are consummated.
(iii) The Borrower will also pay on demand:
(A) all ongoing costs, including, without limitation, all
reasonable legal fees and charges, recording costs and related taxes
or charges, filing fees, costs and expenses of the Administrative
Agent (if other than Ericsson) and (except with respect to legal fees)
the Lenders related to (1) 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, (2) the perfection, protection or preservation of any of
their respective rights or interests under the Loan Documents or to or
in the Collateral, (3) the administration of this Agreement or any
other Loan Document and (4) any amendments, waivers or supplements
related to this Agreement and the other Loan Documents;
(B) to the extent not paid pursuant to clause (a)(ii) above, all
out-of-pocket costs and expenses of the Collateral Agent (including
allocated costs and reasonable expenses of in-house counsel and legal
staff) in connection with the preparation, execution, delivery,
performance, administration, enforcement, modification and amendment
of this Agreement, the Intercreditor Agreement, the Collateral
Documents, the Guaranties 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, whether or not the transactions
contemplated hereby are contemplated;
<PAGE>
121
(C) all reasonable legal fees and expenses relating to the
matters described in clause (A) above incurred by Ericsson as
Administrative Agent or a Lender if a Default shall have occurred and
be continuing under this Agreement; and
(D) all reasonable legal fees and expenses relating to the
matters described in clause (A) above incurred by any Lender other
than Ericsson or an Affiliate thereof or for which such Lender would
have an indemnification obligation (whether or not contingent on
non-payment thereof by the Borrower) under this Agreement.
(b) If, at any time while the Second LIBOR Method is applicable, any
payment of principal of, or Conversion of, any LIBOR 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 Section 3.02(c)) or Conversion thereof,
acceleration of the maturity of the Notes pursuant to Section 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 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
(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,
<PAGE>
122
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
Section 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 Section 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 Section 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 Section 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 Section 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 Administrative Agent shall have been notified by each Lender that such
Lender 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(a) and
<PAGE>
123
(d), 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 of any Commitments 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/or 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, and
(B) deliver a copy of such Assignment and Acceptance to the
Borrower at the time it delivers a copy to the Administrative Agent;
(iv) unless the Borrower shall have consented thereto, no such
assignment of undrawn commitments shall be made:
(A) except to a Person that shall have represented that it has a
combined capital and surplus in excess of $50,000,000, and
(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;
and
<PAGE>
124
(v) in the case of any proposed assignment by Ericsson (in its
capacity as a Lender) of any portion of its rights and obligations
hereunder to a Person other than a Person at least 45% of the voting stock
of which is owned by Telefonaktiebolaget LM Ericsson and/or its
Subsidiaries, Ericsson shall give the Borrower at least two-month's written
notice of such proposed assignment.
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).
Ericsson shall consider in good faith any assignment of all or a portion of its
Commitments, the outstanding Advances owing to it and the Note or Notes held by
it to any Person that the Borrower may propose from time to time; provided that
Ericsson shall have no obligation to enter into any such assignment.
(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
<PAGE>
125
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, the Intercreditor Agreement and each other Loan Document,
together with copies of the financial statements referred to in
Section 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 Section 12.10.
(c) The Administrative Agent shall maintain at its address referred to in
Section 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
<PAGE>
126
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,
(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 Section 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
<PAGE>
127
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 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 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 Subsidiaries and 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,
<PAGE>
128
(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 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 Section 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 Section 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.
<PAGE>
129
Section 12.12. 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 (including allocated costs and 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. Certain FCC Actions. If the FCC shall issue a decision in
FCC Docket WT No. 97-82 or in any subsequent or related FCC proceeding that
alters the terms and conditions or structure of the deferred purchase price on
C-Block FCC Licenses (including without limitation debt restructuring, debt
reduction, license amnesty, prepayment of debt or any other repayment options
not currently available under the FCC's current rules), the Lenders will
consider and negotiate in good faith any proposal of the Borrower with respect
to its participation in such program. The Lenders shall have no obligation to
accept any such proposal unless such proposal is acceptable to the Lenders in
their sole discretion. Neither the Administrative Agent nor any Lender shall
have any obligation to forbear from the exercise of their rights and remedies
hereunder and under the other Loan Documents while any such proposal is being
prepared by the Borrower, considered by the Lenders or negotiated by the
Borrowers and the Lenders. Nothing contained in this Section 12.14 shall
derogate from the rights of the Administrative Agent and the Lenders in their
discretion at any time and from time to time to exercise such rights and
remedies as may be available to them under this Agreement and the other Loan
Documents.
Section 12.15. 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
<PAGE>
130
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.
<PAGE>
131
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as a
sealed instrument as of the date first set forth above.
OPCS PHILADELPHIA HOLDINGS,
INC.
By ________________________________
Title:
Commitment: ERICSSON INC., as Administrative
$120,000,000 Agent and a Lender
By ________________________________
Title:
Domestic Lending Office and
LIBOR Lending Office:
740 East Campbell Road
Richardson, Texas 75081
Attn: Vice President-Finance
(fax no. (972) 583-1818)
A copy of any notice delivered pursuant to
Section 12.02 should be delivered to the
address set forth above to the attention
of the
Vice President - General Counsel
(fax no. (972) 583-1839).
<PAGE>
Schedule 6.15(a)
REVENUE
<TABLE>
<CAPTION>
FISCAL QUARTER ENDING REVENUE
--------------------- -------
<S> <C>
March 31, 1998 $ 100,000
June 30, 1998 $ 500,000
September 30, 1998 $ 1,100,000
December 31, 1998 $ 1,800,000
March 31, 1999 $ 2,800,000
June 30, 1999 $ 3,900,000
September 30, 1999 $ 5,000,000
December 31, 1999 $ 6,200,000
March 31, 2000 $ 7,900,000
June 30, 2000 $ 9,600,000
September 30, 2000 $11,300,000
December 31, 2000 $12,900,000
Thereafter $13,100,000
</TABLE>
<PAGE>
Schedule 6.15(c)
LEVERAGE RATIO
FISCAL QUARTER ENDING LEVERAGE RATIO
--------------------- --------------
March 31, 2001* *
June 30, 2001 40
September 30, 2001 30
December 31, 2001 20
March 31, 2002 20
June 30, 2002 16
September 30, 2002 12
December 31, 2002 10
March 31, 2003 6
June 30, 2003 6
September 30, 2003 6
December 31, 2003 6
- -------------
* Leverage Ratio will be positive (greater than 0)
<PAGE>
LOAN AGREEMENT
dated as of January 30, 1998
among
OMNIPOINT MIDWEST
HOLDINGS, LLC,
Borrower,
NORTHERN TELECOM INC.
as Administrative Agent,
and
THE LENDERS NAMED HEREIN
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS AND RULES OF INTERPRETATION.....................................1
Section 1.01. Definitions.............................................1
Section 1.02. Rules of Interpretation................................34
Section 1.03. Accounting Terms.......................................35
ARTICLE II
THE LOANS..................................................................36
Section 2.01. The Advances...........................................36
Section 2.02. Making the Advances....................................37
Section 2.03. Fees...................................................40
Section 2.04. Interest...............................................41
Section 2.05. Interest Rate Determination............................43
Section 2.06. Conversion of Advances.................................44
Section 2.07. Payments and Computations..............................44
Section 2.08. Sharing of Payments, Etc...............................49
Section 2.09. Use of Proceeds........................................50
Section 2.10. The Notes..............................................52
Section 2.11. Reduction or Termination of the Commitments............53
Section 2.12. Change in Terms Applicable to Facility B Advances......54
ARTICLE III
REPAYMENT AND PREPAYMENT OF THE LOANS......................................54
Section 3.01. Repayment..............................................54
Section 3.02. Mandatory Prepayments of Loans.........................55
Section 3.03. Optional Prepayments of Loans..........................62
Section 3.04. Certain Matters Relating to Repayments and
Prepayments...........................................................63
ARTICLE IV
ILLEGALITY, INCREASED COSTS, CAPITAL ADEQUACY AND
INDEMNITIES................................................................64
Section 4.01. Illegality.............................................64
Section 4.02. Additional Costs and Capital Adequacy..................65
Section 4.03. Taxes..................................................66
Section 4.04. Survival...............................................68
i
<PAGE>
ARTICLE V
REPRESENTATIONS AND WARRANTIES.............................................68
Section 5.01. Corporate Authority; Limited Liability Company
Authority.............................................................68
Section 5.02. Governmental Approvals.................................70
Section 5.03. Title to Properties....................................71
Section 5.04. Financial Statements...................................71
Section 5.05. No Material Adverse Effect, Etc........................71
Section 5.06. Franchises, Patents, Copyrights, Etc...................71
Section 5.07. FCC Licenses, Etc......................................71
Section 5.08. Litigation.............................................72
Section 5.09. No Materially Adverse Contracts, Etc...................72
Section 5.10. Compliance with Other Instruments, Laws, Etc...........72
Section 5.11. Tax Status.............................................72
Section 5.12. No Default.............................................73
Section 5.13. Holding Company and Investment Company Acts............73
Section 5.14. Absence of Financing Statements, Etc...................73
Section 5.15. FCC Matters............................................73
Section 5.16. Tariffs................................................74
Section 5.17. Disclosure.............................................74
Section 5.18. Burdensome Obligations.................................74
Section 5.19. Solvency...............................................74
Section 5.20. Security Interests.....................................74
Section 5.21. Certain Transactions...................................74
Section 5.22. Business Plans.........................................75
Section 5.23. Employee Benefit Plans.................................75
Section 5.24. Regulations G, T, U and X..............................76
Section 5.25. Environmental Compliance...............................76
Section 5.26. Joint Ventures, Etc....................................78
Section 5.27. Material Contracts.....................................78
Section 5.28. Representations in Other Loan Documents................78
Section 5.29. Ericsson Tranche Y Loan................................78
Section 5.30. OC Stock Payment Date..................................78
ARTICLE VI
AFFIRMATIVE COVENANTS OF THE BORROWER......................................78
Section 6.01. Maintenance of Office..................................78
Section 6.02. Records and Accounts...................................78
ii
<PAGE>
Section 6.03. Corporate and Limited Liability Company Existence;
Maintenance of Licenses...............................................79
Section 6.04. Maintenance of Properties..............................80
Section 6.05. Insurance..............................................80
Section 6.06. Taxes..................................................81
Section 6.07. Inspection of Properties and Books.....................81
Section 6.08. Compliance with Laws, Contracts, FCC Licenses and
Permits...............................................................82
Section 6.09. Further Assurances.....................................82
Section 6.10. Attornment and Recognition Agreements; Consents to
Collateral Assignments................................................83
Section 6.11. Expense Allocation Agreement...........................83
Section 6.12. Maintenance of Subsidiary..............................84
Section 6.13. Reporting Requirements; Notices........................84
Section 6.14. Financial Covenants of the Borrower....................91
Section 6.15. Mortgage Liens.........................................95
Section 6.16. New Subsidiaries; Qualified Joint Ventures.............95
Section 6.17. Subordinated Debt Rate Hedging Arrangements............96
Section 6.18. Syndication............................................96
Section 6.19. Capital Contribution Agreement.........................97
Section 6.20. Ericsson Tranche Y Loan................................97
Section 6.21. C-Block Subsidiaries and D-, E- and F-Block
Subsidiaries..........................................................97
Section 6.22. Wichita PCS and D&E/Omnipoint Intercompany Notes;
Overadvances..........................................................97
Section 6.23. Atlantic City BTA......................................97
ARTICLE VII
CERTAIN NEGATIVE COVENANTS OF THE BORROWER.................................97
Section 7.01. Restrictions on Indebtedness...........................98
Section 7.02. Restrictions on Liens..................................99
Section 7.03. No Contingent Obligations.............................101
Section 7.04. Restrictions on Investments...........................101
Section 7.05. Distributions.........................................104
Section 7.06. Merger, Consolidation, Disposition of Assets, Etc.....106
Section 7.07. Sale and Leaseback....................................110
Section 7.08. Compliance with Environmental Laws....................110
Section 7.09. Employee Benefit Plans................................110
Section 7.10. New Subsidiaries......................................111
Section 7.11. Transactions with Affiliates..........................111
Section 7.12. Permitted Business....................................113
Section 7.13. Charter Amendments....................................114
Section 7.14. Accounting Changes....................................114
iii
<PAGE>
Section 7.15. Prepayments, Etc., of Indebtedness....................114
Section 7.16. Amendment, Etc., of Material Contracts................115
Section 7.17. Restrictions on Subsidiaries..........................115
Section 7.18. Partnerships..........................................115
Section 7.19. Default Under the Volume Purchase Agreement...........115
Section 7.20. Collections of Receivables............................115
Section 7.21. Management Fees.......................................115
Section 7.22. Operating Leases......................................116
Section 7.23. Restrictions Regarding License Subsidiaries...........116
ARTICLE VIII
CONDITIONS TO THE CLOSING.................................................116
Section 8.01. Terms and Conditions of Transaction...................116
Section 8.02. Due Diligence.........................................117
Section 8.03. Validity of Liens.....................................117
Section 8.04. Search Reports and Related Documents..................117
Section 8.05. Certificates of Insurance.............................118
Section 8.06. Solvency Certificate..................................118
Section 8.07. Opinions of Counsel to the Borrower and its
Subsidiaries.........................................................118
Section 8.08. Opinion of Counsel to the Parent......................118
Section 8.09. Opinion of FCC Counsel................................119
Section 8.10. Payment of Fees.......................................119
Section 8.11. Approvals, Permits; FCC Licenses......................119
Section 8.12. Delivery of Full-Term Operating Business Plan.........120
Section 8.13. Security Agreements...................................120
Section 8.14. Guaranties............................................121
Section 8.15. Mortgages, Etc........................................122
Section 8.16. Landlord Waivers, Attornment and Recognition
Agreements, Consents to Collateral Assignments.......................123
Section 8.17. Material Agreements...................................123
Section 8.18. Litigation............................................123
Section 8.19. Insurance Certificates................................124
Section 8.20. No Default............................................124
Section 8.21. No Material Adverse Effect............................124
Section 8.22. Corporate or Limited Liability Company Documents......124
Section 8.23. Intercreditor Agreement...............................126
Section 8.24. Capital Contribution Agreement........................126
Section 8.25. Amendment to Volume Purchase Agreement................126
Section 8.26. Management Services Agreement and Other
Agreements; Acknowledgement of Assignment............................126
Section 8.27. Interest..............................................127
iv
<PAGE>
Section 8.28. No Misrepresentations.................................127
Section 8.29. Compliance Certificate................................128
Section 8.31. Other Information.....................................128
Section 8.32. Applications for Transfer of Ownership................128
ARTICLE IX
CONDITIONS TO ADVANCES....................................................128
Section 9.01. Conditions Precedent to an Initial Advance............128
Section 9.02. Conditions to All Advances............................129
ARTICLE X
EVENTS OF DEFAULT; ACCELERATION; ETC......................................131
Section 10.01. Events of Default and Acceleration...................131
ARTICLE XI
THE ADMINISTRATIVE AGENT..................................................136
Section 11.01. Authorization and Action.............................136
Section 11.02. Administrative Agent's Reliance, Etc.................136
Section 11.03. Nortel and Affiliates................................137
Section 11.04. Lender Credit Decision...............................138
Section 11.05. Indemnification......................................138
Section 11.06. Successor Administrative Agents......................138
ARTICLE XII
MISCELLANEOUS........................................................139
Section 12.01. Amendments, Etc......................................139
Section 12.02. Notices, Etc.........................................140
Section 12.03. No Waiver; Remedies..................................142
Section 12.04. Costs, Expenses......................................142
Section 12.05. Right of Set-off.....................................145
Section 12.06. Binding Effect.......................................145
Section 12.07. Assignments and Participations.......................145
Section 12.08. Governing Law........................................150
Section 12.09. Execution in Counterparts............................150
Section 12.10. Confidentiality......................................150
Section 12.11. Consent to Jurisdiction..............................151
Section 12.12. Matters Relating to the Collateral Agent.............151
Section 12.13. Amendments, Etc., to Intercreditor Agreement.........152
Section 12.14. Limitation of Liability..............................152
v
<PAGE>
Section 12.15. No Duty..............................................152
Section 12.16. No Fiduciary Relationship; No Agency
Relationship.........................................................153
Section 12.17. Waiver of Jury Trial.................................153
vi
<PAGE>
Exhibits
Exhibit A-1 - Form of Facility A Note (Tranche 1)
Exhibit A-2 - Form of Facility A Note (Tranche 2)
Exhibit A-3 - Form of Facility B Note (Tranche 1)
Exhibit A-4 - Form of Facility B Note (Tranche 2)
Exhibit A-5 - Form of Facility B Note (Tranche 3)
Exhibit B - Form of Draw Request
Exhibit C - Form of Assignment and Acceptance
Exhibit D-1 - Form of Management Services Agreement and Form of
Assignment and Consent
Exhibit D-2 - Form of Operating Agreement and Form of Assignment and
Consent
Exhibit E-1 - Form of Borrower Security Agreement
Exhibit E-2 - Form of Parent Pledge Agreement
Exhibit E-3 - Form of C-Block Subsidiary Parent Pledge Agreement
Exhibit E-4 - Form of D-, E- and F-Block Subsidiary Parent Pledge Agreement
Exhibit E-5 - Form of Subsidiary Security Agreement
Exhibit F - Form of Real Estate Mortgage Option
Exhibit G-1 - Form of Subordination Agreement (Affiliate)
Exhibit G-2 - Form of Subordination Agreement (Non-Affiliate)
Exhibit H-1 - Form of Limited Recourse Parent Guaranty
Exhibit H-2 - Form of C-Block Subsidiary Parent Limited Recourse Guaranty
Exhibit H-3 - Form of D-, E- and F-Block Subsidiary Parent Limited Recourse
Guaranty
Exhibit H-4 - Form of Subsidiary Guaranty
Exhibit H-5 - Form of OC Guaranty
Exhibit I - Form of Intercreditor Agreement
Exhibit J - Form of Capital Contribution Agreement
Exhibit K - Form of Compliance Certificate
Exhibit L - Cash Management Agreement and Form of Assignment and
Consent
Exhibit M-1 - Form of Opinion Letter of Counsel to Borrower
Exhibit M-2 - Form of Opinion Letter of Counsel to Parent
Exhibit M-3 - Form of Opinion Letter of Counsel to OC
Exhibit M-4 Form of Opinion Letter of Counsel to C-Block Subsidiary Parent
Exhibit M-5 Form of Opinion Letter of Counsel to D-, E- and F- Block
Subsidiary Parent
Exhibit M-6 Form of Opinion Letter of Local Counsel to Operating Subsidiary
in Indiana
Exhibit M-7 Form of Opinion Letter of FCC Counsel to Borrower, Parent and
License Subsidiaries
Exhibit N - Form of Facility B Mirror Note
Exhibit O - Form of Intercompany Note
vii
<PAGE>
Schedules
Schedule 1.01 - Designated BTAs
Schedule 1.01A - Certain Geographic Areas of Designated BTAs
Schedule 1.01B - Wichita Loan Facility and D&E Loan Facility Schedule
Schedule 1.01C - Excluded Purchases/Invoices $8.3 million for Denver &
Ephrata BTAs -- schedule to be provided]
Schedule 5.01(b) - Subsidiaries
Schedule 5.06 - Intellectual Property
Schedule 5.07 - FCC Licenses
Schedule 5.08 - Litigation
Schedule 5.25 - Environmental Matters
Schedule 5.27 - Material Contracts
Schedule 7.04 - Investments
Schedule 8.16 - Mortgaged Property
viii
<PAGE>
LOAN AGREEMENT
This Loan Agreement (the "Agreement") is made as of January 30, 1998, by
and among (a) OMNIPOINT MIDWEST HOLDINGS, LLC, a Delaware limited liability
company (the "Borrower"), (b) the lenders listed on the signature pages hereof
and (c) NORTHERN TELECOM INC., a Delaware corporation ("Nortel"), as
administrative agent for the Lenders (together with any successor thereto
appointed pursuant to Section 11.06, the "Administrative Agent").
ARTICLE I
DEFINITIONS AND RULES OF INTERPRETATION
Section 1.01. Definitions.
Adjusted Debt. As of any date of determination, Total Debt less that
portion of Affiliate Subordinated Debt for which current interest is not payable
in cash prior to the final repayment of Facility A and Facility B.
Adjusted Net Income. For any period, Consolidated Net Income less (without
duplication) to the extent that any of the following shall have been included in
Consolidated Net Income for such period (i) any net gain or loss arising from
the sale of capital assets, (ii) any net gain or loss arising from any write-up
or write-down of assets, (iii) earnings or losses of any other Person,
substantially all of the assets of which have been acquired by the Borrower or a
Consolidated Subsidiary of the Borrower in any manner, to the extent that such
earnings or losses were realized by such other Person prior to the date of such
acquisition, (iv) earnings or losses of any Person (other than a Consolidated
Subsidiary of the Borrower) in which the Borrower or a Consolidated Subsidiary
has an ownership interest, unless such earnings have actually been received by
the Borrower or such Consolidated Subsidiary in the form of cash Distributions,
(v) any net gain or loss arising from the acquisition of any securities of the
Borrower or a Consolidated Subsidiary, and (vi) the accrued and unpaid portion
of expenses pursuant to the Expense Allocation Agreement.
Adjusted OCF. For any period, the sum of (i) OCF for such period plus (ii)
the aggregate amount of Marketing Expenses deducted in determining Consolidated
Net Income for such period.
Administrative Agent. Nortel or a financial institution acceptable to
Nortel as administrative agent, together with its successors or assigns.
Administrative Agent's Letter. That certain letter agreement dated the date
hereof between the Administrative Agent and the Borrower.
1
<PAGE>
Administrative Agent's Account. The account of the Administrative Agent
maintained by the Administrative Agent with The First National Bank of Chicago
at its office at One First National Plaza, Chicago, Illinois 60670, for the
account of Northern Telecom, Account No. 5107520, ABA #071000013 (or such other
account as the Administrative Agent from time to time may specify).
Administrative Agent's Office. The Administrative Agent's office set forth
in Section 12.02 and, upon the appointment of a successor Administrative Agent
pursuant to Section 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. An advance by a Lender to the Borrower pursuant to Article II and
refers to a Base Rate Advance or a LIBOR Advance and a Facility A Advance or a
Facility B Advance.
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.
Affiliate Subordinated Debt. Indebtedness of a Loan Party to an Affiliate
as to which the holder thereof has executed a subordination agreement
substantially in the form of the Subordination Agreement (Affiliate) attached
hereto as Exhibit G-1.
Agents. Collectively, the Administrative Agent and the Collateral Agent.
Annualized EBITDA. As of June 30, 2001, EBITDA for the two most recently
completed fiscal quarters multiplied by two. As of September 30, 2001, EBITDA
for the three most recently completed fiscal quarters multiplied by a fraction,
the numerator of which is 4 and the denominator of which is 3. As of any other
date of determination, EBITDA for the four most recently completed fiscal
quarters.
Applicable Lender. With respect to Facility A Loans, Facility A Lenders and
with respect to Facility B Loans, Facility B Lenders.
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 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.
2
<PAGE>
Applicable Margin. With respect to:
(a) any Facility A Advance that is:
(i) a Base Rate Advance, 3.00% per annum, and
(ii) a LIBOR Advance, 4.00% per annum, and
(b) any Facility B Advance that is:
(i) a Base Rate Advance, 1.25% per annum, and
(ii) a LIBOR Advance, 2.25% per annum;
provided, however, that the Applicable Margin with respect to
Facility B Advances as calculated above will increase by 2% per
annum on the sixth anniversary of the Closing Date and by an
additional 2% per annum on each anniversary of the Closing Date
thereafter (but shall in no event exceed the Maximum Lawful
Rate), and provided further, that the Applicable Margin for
Advances under Tranche 1 and Tranche 2 of Facility B as
calculated above shall increase by one percent (1%) per annum
from the Launch Date if the Network has not been placed in
Commercial Service in the Detroit BTA and Indianapolis BTA by the
Launch Date, until such time as the Network in those markets is
placed in Commercial Service. If one but not both the Detroit BTA
and Indianapolis BTA are in Commercial Service by the Launch
Date, the increase in the Applicable Margin, as applicable, shall
only apply with respect to an amount equal to the then-
outstanding principal balance of Facility B Advances multiplied
by (i) if the Detroit BTA is in Commercial Service by such date,
.30 and (ii) if the Indianapolis BTA is in Commercial Service by
such date, .70. Subject to the provisions of Section 2.12, if the
Network in the Detroit BTA and Indianapolis BTA has not been
placed in Commercial Service by the first anniversary of the
Launch Date, then the Applicable Margin with respect to the then
outstanding aggregate principal balance of all Facility B
Advances shall be the same as the Applicable Margin with respect
to Facility A Advances of the same Type.
Approved Annual Operating Business Plan. With respect to each fiscal year
of the Borrower, beginning with its fiscal year ending December 31, 1998, any
annual business operating plan delivered by the Borrower pursuant to Section
6.13(a) with respect to such fiscal year that shall have been approved by the
Required Lenders.
3
<PAGE>
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 Section 8.12, 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.
Atlantic City BTA. As defined in Section 6.23.
Availability. As of any date, the sum of (I) the amount by which the lesser
of (x) the Facility A Borrowing Base and (y) the Facility A Maximum Commitments
exceeds the outstanding Facility A Loans, and (II) the amount by which the
lesser of (x) the Facility B Borrowing Base and (y) the Facility B Maximum
Commitments exceeds the outstanding Facility B Loans.
Balance Sheet Date. December 31, 1997.
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 equal to the
higher of:
(a) the rate of interest per annum announced publicly by Citibank N.A.
as its prime or base rate in effect on such date at its principal office in
New York City; and
(b) 1/2 of 1% per annum above the Federal Funds Rate on such date.
Base Rate Advance. A Facility A Advance or Facility B Advance bearing
interest calculated by reference to the Base Rate.
Base Rate Loans. Facility A Loans or Facility B Loans bearing interest
calculated by reference to the Base Rate.
Borrower. See the preamble hereto.
Borrower Security Agreement. See Section 8.13(a).
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 the Borrower in payment of the principal amount
of any LIBOR Loans as and when due and payable, including 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 Loans or (b) the
making of any payment of a LIBOR Loan on a day that is not the last day of the
applicable
4
<PAGE>
Interest Period with respect thereto, including interest or fees payable by such
Lender or Administrative Agent to lenders of funds obtained by it in order to
maintain any such Loans.
BTA. Any "basic trading area" as on the Rand McNally 1992 Commercial
Atlas & Marketing Guide, 123rd Edition, and utilized by the FCC in dividing the
50 states, the District of Columbia and the United States territories into 493
BTAs for the purpose of licensing PCS Systems.
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 and, if the applicable Business Day relates
to any LIBOR Advance, a day on which dealings are not carried on in the London
interbank market.
Capital Contribution Agreement. See Section 8.24 hereof.
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.
Capital Lease Obligations. As to any Person, all outstanding Indebtedness,
obligations and liabilities of such Person incurred under Capitalized Leases.
Capitalized Leases. Leases, 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 Equivalents. As to any Person, any Investments of such Person of the
types permitted under clauses (b), (c), (d) and (e) of Section 7.04 having a
maturity of not greater than 270 days from the date of acquisition thereof.
Cash Management Agreement. The Cash Management Agency Agreement dated as of
January 30, 1998 between Operations and OC.
C-Block FCC License. Any FCC License sold in the FCC's C-block auction.
C-Block Subsidiary. Each Subsidiary of the C-Block Subsidiary Parent that,
as of the date hereof, holds a C-Block FCC License listed in Part II of Schedule
1.01.
C-Block Subsidiary Parent. OPCS, LLC, a Delaware limited liability company,
together with its successors.
C-Block Subsidiary Parent Limited Recourse Guaranty. See Section 8.14(b).
5
<PAGE>
C-Block Subsidiary Pledge Agreement. See Section 8.13(c).
CERCLA. The Comprehensive Environmental Response, Compensation and
Liability Act, as amended, 42 USCA Section 9601 et seq.
Change in Control. With respect to the Borrower, any change in ownership of
the Borrower resulting in less than fifty-one percent (51%) of the voting
control or Stock (excluding for this purpose debt securities or debt
instruments) of the Borrower being owned, directly or indirectly, by OC, and
with respect to any Operating Subsidiary or License Subsidiary, any change in
ownership resulting in less than one hundred percent (100%) of the voting
control or Stock (excluding for this purpose debt securities or debt
instruments) of such Subsidiaries being owned by the Borrower.
Closing Date. The meaning specified in the introductory clause of Article
VIII.
Collateral. All "Collateral" and "Pledged Collateral" referred to in the
Collateral Documents and all other property that is or is intended to be subject
to any Lien in favor of the Collateral Agent for the benefit of Secured Parties.
Collateral Agent. Chase Manhattan Trust Company, National Association, or
any successor thereto appointed pursuant to Section 6.1 of the Intercreditor
Agreement.
Collateral Documents. The Security Agreements, the Mortgages, the Parent
Pledge Agreement and any other agreement that purports to create a Lien in favor
of the Collateral Agent for the benefit of the Secured Parties.
Commercial Service. With respect to any portion of the Network, the time at
which that portion of the Network is carrying traffic for paying subscribers.
Commitment Fee. See Section 2.03.
Commitments. The Facility A Commitments and the Facility B Commitments.
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 or any of its
Affiliates 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 or any of its Affiliates.
6
<PAGE>
Consolidated. The consolidation of accounts in accordance with GAAP of the
Borrower and its Subsidiaries.
Consolidated Interest Expense. For any period, all interest on Indebtedness
of the Borrower and its Consolidated Subsidiaries paid in cash during such
period, including the interest portion of payments under Capital Lease
obligations, to the extent deducted in determining Adjusted Net Income
Consolidated Net Income. For any period, the net income (or loss) of the
Borrower and its Consolidated Subsidiaries for such period, determined on a
Consolidated basis in accordance with GAAP.
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;
(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.
Contributed Capital. For any period, the sum of (i) equity contributions
during such period (including equity contributed on or before the Closing Date
and that portion of the purchase price of the FCC Licenses for the Designated
BTAs which has theretofore been paid to the FCC in cash by or on behalf of the
respective License Subsidiaries as an equity contribution
7
<PAGE>
in such License Subsidiary), plus (ii) the amount of cash proceeds of
Subordinated Debt received during such period, minus (iii) any Distributions
made during such period minus (iv) all cash interest paid on Subordinated Debt
during such period.
Convert, Conversion and Converted. A conversion of Advances of one Type
into Advances of the other Type pursuant to Section 2.05 or Section 2.06.
Core BTAs. All BTAs designated as "Core" on the attached Schedule 1.01 and
any other BTA whether or not so designated that has one million or more POPs.
Credit Facility. Collectively, Facility A and Facility B.
Currency Hedge Agreement. Any currency hedge or exchange agreement, option
or futures contract or other agreement intended to protect against or manage a
Person's exposure to fluctuations in currency exchange rates.
D&E Loan Facility. A loan facility in an amount to be agreed having
substantially the same terms as Facility A hereunder entered into by
D&E/Omnipoint within 180 days of the date of this Agreement.
Denver & Ephrata BTAs. BTA Nos. 240 (Lancaster), 483 (York-Hanover), 181
(Harrisburg) and 370 (Reading).
D&E/Omnipoint. D&E/Omnipoint Wireless Joint Venture, L.P., a Delaware
limited partnership, and a Non-Qualified Joint Venture, the partners of which
are D&E Wireless, Inc. ("D&E Wireless"), a Pennsylvania corporation, owning a 1%
general partnership interest and a 49% limited partnership interest, Omnipoint
Venture Partners, LLC, a Delaware limited liability company, owning a 49%
general partnership interest, and Omnipoint Holdings, Inc., a Delaware
corporation, owning a 1% limited partnership interest.
D-, E- and F-Block Subsidiary. Each Subsidiary of the D-,E- and F-Block
Subsidiary Parent that, at the date hereof, holds an FCC License listed in Part
III of Schedule 1.01.
D-, E- and F-Block Subsidiary Parent. Omnipoint PCS Entrepreneurs Two, LLC,
a Delaware limited liability company, together with its successors and assigns.
D-, E- and F-Block Subsidiary Parent Limited Recourse Guaranty. See Section
8.14(c).
D-, E- and F-Block Subsidiary Pledge Agreement. See Section 8.13(d).
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.
8
<PAGE>
Designated BTA. At any date:
(a) any BTA the FCC License for which is listed in Schedule 1.01 and
is held by a License Subsidiary as of such date, and
(b) any other BTA acceptable to the Required Lenders in writing, the
FCC License for which is held by a License Subsidiary as of such date.
Detroit BTA. BTA No. 112.
Distribution. Any of the following with respect to any Person:
(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
Stock of such Person, other than dividends payable solely in shares of
common Stock (or equivalent interests) of such Person;
(b) the purchase, redemption, or other retirement of any shares of any
class of Stock of such Person;
(c) the return of capital by such Person to its shareholders (or
holders of interests equivalent to shares) as such;
(d) any other distribution on or in respect of any shares or
equivalent interests of any class or series of Stock of such Person; or
(e) any payment of principal, premium or interest, or any other
amount, in respect of Subordinated Debt, excluding such payments made to
the Borrower by any of its Subsidiaries.
Dollars or $. Dollars in lawful currency of the United States of America.
Draw Request. See Section 2.02(a).
EBITDA. For any period, without duplication, the sum of the following for
the Borrower and its Consolidated Subsidiaries for such period determined on a
Consolidated basis in accordance with GAAP: (a) Adjusted Net Income, plus (b)
Consolidated Interest Expense, plus (c) income and franchise taxes to the extent
deducted in determining Adjusted Net Income, plus (d) depreciation and
amortization expense and other non-cash, non-tax items to the extent deducted in
determining Adjusted Net Income, minus (e) non-cash income (or losses) to the
extent included in determining Adjusted Net Income.
9
<PAGE>
Employee Benefit Plan. Any employee benefit plan within the meaning of
Section 3(3) of ERISA maintained or contributed to by any Loan Party 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;
(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 Section 2601 et seq.; (iv) the Water Pollution Control Act, as
amended, 33 USCA Section 1251 et seq.; (v) the Clean Air Act, as amended, 42
USCA Section 7401 et seq.; (vi) the Hazardous Material Transportation Act, as
amended, 49 USCA Section 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 in CERCLA, and the terms "solid waste" and
"dispose" (or "disposal") shall have the meaning in the RCRA.
Environmental Permits. See (s)(s).5.25(d).
10
<PAGE>
Equipment. As defined in the Volume Purchase Agreement.
Ericsson Tranche Y Loan. See Section 2.09(b)(i)(A)(I).
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 Section 414 of the IRC.
ERISA Event. With respect to any Loan Party or any ERISA Affiliate,
(a) a Reportable Event,
(b) the withdrawal of any Loan Party 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 under a
distress termination of the Plan under Section 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) occurrence of 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 Section 10.01.
Event of Force Majeure. A fire, act of civil disobedience, riot, rebellion,
accident, explosion, flood, storm, Act of God, governmental action or similar
occurrence that is not reasonably foreseeable and beyond the reasonable control
of the OC and its Subsidiaries and that has the effect of preventing the
Borrower or one of its Subsidiaries from fulfilling any of its obligations under
this Agreement.
Excess Cash Flow. For any fiscal year, EBITDA for such fiscal year minus
(i) taxes payable in cash for such fiscal year, (ii) all principal and cash
interest payments on Indebtedness made during such fiscal year whether optional,
mandatory or scheduled payments, and (iii)
11
<PAGE>
Capital Expenditures (but only to the extent paid in cash and not financed) made
during such fiscal year.
Excess Proceeds. With respect to any FCC License Transfer or any FCC
License Partition, the Net Cash Proceeds thereof, whether received at the time
of such sale or at any time thereafter, after deducting from such proceeds the
amount of any prepayment that becomes due as a result thereof and any
prepayments to other providers of vendor financing to the Borrower made as a
result thereof pursuant to provisions substantially the same as the applicable
provisions of this Agreement.
Expense Allocation Agreement. The Expense Allocation Agreement dated as of
January 30, 1998 among the Borrower, Operations and OC.
Facility A. A term facility that provides for Facility A Loans to the
Borrower on the terms and conditions herein.
Facility A Advances. See Section 2.01(a).
Facility A Borrowing Base. At any date:
(a) For Tranche 1 of Facility A, an amount equal to one hundred
percent (100%) of the dollar amount paid to Nortel for Nortel Goods and
Services (excluding interest which has accrued or is accruing on such
purchases) for any one or more of the Designated BTAs prior to or
concurrently with any Facility A Tranche 1 Draw Request.
(b) For Tranche 2 of Facility A,
(i) from the Closing Date, to but excluding December 31, 1998 an
amount equal to fifty percent (50%) of the sum of
(A) the dollar amount paid to Nortel for Nortel Goods and
Services (excluding interest which has accrued or is accruing on
such purchases) for any one or more of the Designated BTAs prior
to or concurrently with any Facility A Tranche 2 Draw Request,
plus
(B) the dollar amount of the Initial Purchase Order, plus
(C) the dollar amount of any other unfilled irrevocable
purchase orders (whether placed by the Borrower before or after
the Closing Date) for Nortel Goods and Services for any one or
more of the Designated BTAs accepted by Nortel for delivery on
Site and Scheduled for Installation in 1997 or 1998 or within
one hundred eighty (180) days of the
12
<PAGE>
date of the Facility A Tranche 2 Draw Request and Scheduled for
Installation within twenty-one days (21) of delivery.
(ii) beginning on and after December 31, 1998 an amount equal
to fifty percent (50%) of the sum of
(A) the dollar amount paid to Nortel for Nortel Goods and
Services (excluding interest which has accrued or is accruing on
such purchases) for any one or more of the Designated BTAs prior
to or concurrently with any Facility A Tranche 2 Draw Request,
plus
(B) the dollar amount of any unfilled irrevocable purchase
orders (whether placed by the Borrower before or after the
Closing Date) for Nortel Goods and Services for any one or more
of the Designated BTAs accepted by Nortel for delivery on Site
within one hundred eighty (180) days of the date of Facility A
Tranche 2 Draw Request and Scheduled for Installation within
twenty-one, (21) days of delivery.
Facility A Borrowing Base Certificate. A certificate, in form and substance
satisfactory to the Administrative Agent, duly certified by the chief or
principal financial or accounting officer of the Borrower, stating the amount of
the Facility A Borrowing Base as of the date of such certificate and setting
forth in reasonable detail the calculation of the amount thereof.
Facility A Commitment. For any Facility A Lender at any date, the Facility
A Maximum Commitments as of such date, multiplied by such Facility A Lender's
Facility A Commitment Percentage as of such date, as the same may be reduced
from time to time pursuant to Section 2.11, Section 3.02 Section 3.03 or Section
10.01 or any other applicable section of this Agreement.
Facility A Commitment Percentage. For any Facility A Lender, the percentage
next to the heading "Facility A Commitment Percentage" opposite its name on the
signature pages hereof or on the Assignment and Acceptance, if such Lender has
entered into an Assignment and Acceptance pursuant to Section 12.07.
Facility A Commitment Termination Date. The earliest of (i) December 31,
2001, (ii) the date on which an aggregate of $315,000,000 has been advanced
pursuant to Facility A, (iii) the Facility A Maturity Date, or (iv) the
termination of the Facility A Commitments in their entirety pursuant to Section
2.11, Section 3.02, Section 3.03 or Section 10.01 or any other applicable
section of this Agreement.
Facility A Lender. Any Lender for which there is a percentage greater than
zero next to the heading "Facility A Commitment Percentage" opposite its name or
on the signature pages hereof or on the Assignment and Acceptance, if such
Facility A Lender has entered into an Assignment and Acceptance, pursuant to
Section 12.07.
13
<PAGE>
Facility A Loan. A Loan consisting of simultaneous Facility A Advances of
the same Type made by the Facility A Lenders.
Facility A Maturity Date. The earliest of:
(a) December 31, 2006;
(b) the date of the acceleration of the Facility A Advances pursuant
to Section 10.01; and
(c) the date on which the entire Network is sold.
Facility A Maximum Commitments. At any date, an amount that is equal to:
(a) for Tranche 1 of Facility A,
(i) $315,000,000, minus
(ii) the dollar amount which equals .67 multiplied by the amount
listed on Schedule 1.01B, minus
(iii) the aggregate principal amount of the Facility A Advances
under Tranche 2 of Facility A at any time outstanding, minus
(iv) the aggregate amount by which the Facility A Maximum
Commitments for Tranche 1 of Facility A shall have been permanently
reduced pursuant to Section 2.11, Section 3.02, Section 3.03 or
Section 10.01 or any other applicable section of this Agreement on or
prior to such date.
(b) for Tranche 2 of Facility A,
(i) $105,000,000, minus
(ii) the dollar amount which equals .33 multiplied by the amount
listed on Schedule 1.01B, minus
(iii) the aggregate amount by which the Facility A Maximum
Commitments for Tranche 2 of Facility A shall have been permanently
reduced pursuant to Section 2.11, Section 3.02, Section 3.03 or
Section 10.01 or any other applicable section of this Agreement on or
prior to such date.
Facility B. A term facility that provides for Facility B Loans to the
Borrower on the terms and conditions herein.
14
<PAGE>
Facility B Advances. See Section 2.01(b).
Facility B Borrowing Base. At any date,
(a) For Tranche 1 of Facility B,
(i) on and after April 1, 1998 until and excluding December 31,
1999, an amount equal to the lesser of
(A) $42,500,000 or
(B) fifty percent (50%) of the total of:
(1) the dollar amount of any unfilled irrevocable
purchase orders (whether placed by the Borrower before, on,
or after the Closing Date) for Nortel Goods and Services for
any one or more of the Designated BTAs accepted by Nortel
for delivery on Site and Scheduled for Installation in 1997
or 1998, plus
(2) the dollar amount paid by the Borrower for
purchases of Nortel Goods and Services in 1997 or 1998
(excluding interest which has accrued or is accruing on such
purchases) for any one or more of the Designated BTAs, the
Wichita BTAs and the Denver & Ephrata BTAs (exclusive of any
amounts paid for the Nortel Goods and Services listed on
Schedule 1.01C) prior to or concurrently with any Facility B
Tranche 1 Draw Request, plus
(3) the dollar amount of any unfilled irrevocable
purchase orders for Nortel Goods and Services for any one or
more of the Wichita BTAs and the Denver & Ephrata BTAs
(exclusive of those unfilled irrevocable purchase orders
referenced on Schedule 1.01C) accepted by Nortel for
delivery on Site and Scheduled for Installation in 1998.
(ii) on and after December 31, 1999 an amount equal to the
lesser of
(A) $42,500,000 or
(B) forty percent (40%) of
(1) the dollar amount paid to Nortel for Nortel Goods
and Services (excluding interest which has accrued or is
accruing on such purchases) for any one or more of the
Designated BTAs, the
15
<PAGE>
Wichita BTAs or the Denver & Ephrata BTAs (exclusive of any
amounts paid for the Nortel Goods and Services listed on
Schedule 1.01C) prior to or concurrently with any Facility B
Tranche 1 Draw Request, plus
(2) the dollar amount of any unfilled irrevocable
purchase orders (whether placed by the Borrower before or
after the Closing Date) for Nortel Goods and Services for
any one or more of the Designated BTAs, the Wichita BTAs and
the Denver & Ephrata BTAs (exclusive of the unfilled
irrevocable purchase orders referenced on Schedule 1.01C)
accepted by Nortel for delivery on Site within 180 days and
Scheduled for Installation within twenty-one (21) days of
delivery.
(b) For Tranche 2 of Facility B,
(i) on and after January 1, 1999 to and excluding December 31,
1999, an amount equal to the lesser of
(A) $85,000,000 or
(B) fifty percent (50%) of the total of
(1) the dollar amount of unfilled irrevocable purchase
orders (whether placed by the Borrower before or after the
Closing Date) for Nortel Goods and Services for any one or
more of the Designated BTAs, the Wichita BTAs and the Denver
& Ephrata BTAs (exclusive of those unfilled irrevocable
purchase orders referenced on Schedule 1.01C) accepted by
Nortel for delivery on Site and Scheduled for Installation
in 1997, 1998 or 1999 plus
(2) the actual dollar amount paid for purchases of
Nortel Goods and Services in 1997, 1998 or 1999 (excluding
interest which has accrued or is accruing on such purchases)
for any one or more of the Designated BTAs, the Wichita BTAs
and the Denver & Ephrata BTAs (exclusive of any amounts paid
for the Nortel Goods and Services listed on Schedule 1.01C)
prior to or concurrently with any Facility B Tranche 2 Draw
Request.
less, in either case (A) or (B), the dollar amount advanced under Tranche 1
of Facility B (without giving effect to any prepayments or repayments).
16
<PAGE>
(ii) on and after December 31, 1999 an amount equal to the
lesser of
(A) $85,000,000 or
(B) forty percent (40%) of
(1) the dollar amount paid to Nortel for Nortel Goods
and Services (excluding interest which has accrued or is
accruing on such purchases) for any one or more of the
Designated BTAs, the Wichita BTAs and the Denver & Ephrata
BTAs (exclusive of any amounts paid for the Nortel Goods and
Services listed on Schedule 1.01C) prior to or concurrently
with any Facility B Tranche 2 Draw Request, plus
(2) the dollar amount of any unfilled irrevocable
purchase orders (whether placed by the Borrower before or
after the Closing Date) for Nortel Goods and Services for
any one or more of the Designated BTAs, the Wichita BTAs and
the Denver & Ephrata BTAs (exclusive of the unfilled
irrevocable purchase orders referenced on Schedule 1.01C)
accepted by Nortel for delivery on Site within 180 days and
Scheduled for Installation within twenty-one (21) days of
delivery.
less, in either case (A) or (B), the dollar amount advanced under
Tranche 1 of Facility B (without giving effect to any prepayments or
repayments, except to the extent of a mandatory prepayment of Facility
B Loans made on or prior to December 31, 1999 required as a result of
borrowings in excess of the Facility B Borrowing Base pursuant to
Section 3.02(d)).
(c) For Tranche 3 of Facility B, an amount equal to the amount of
interest which has accrued on Tranches 1, 2 and 3 of Facility B through
March 31, 2004.
Facility B Borrowing Base Certificate. A certificate, in form and substance
satisfactory to the Administrative Agent, duly certified by the chief or
principal financial or accounting officer of the Borrower, stating the amount of
the Facility B Borrowing Base as of the date of such certificate and setting
forth in reasonable detail the calculation of the amount thereof.
Facility B Commitment. For any Facility B Lender at any date, the Facility
B Maximum Commitments as of such date, multiplied by such Facility B Lender's
Facility B Commitment Percentage as of such date, as the same may be reduced
from time to time pursuant to Section 2.11, Section 2.12, Section 3.02, Section
3.03 or Section 10.01 or any other applicable section of this Agreement.
17
<PAGE>
Facility B Commitment Percentage. For any Facility B Lender, the percentage
next to the heading "Facility B Commitment Percentage" opposite its name on the
signature pages hereof or on the Assignment and Acceptance, if such Lender has
entered into an Assignment and Acceptance pursuant to Section 12.07.
Facility B Commitment Termination Date: (a) With respect to Tranches 1 and
2 of Facility B, the earliest of (i) December 31, 2001 (ii) the first date
after December 31, 1999, on which an aggregate of $85,000,000 has been advanced
under Tranches 1 and 2 of Facility B, (iii) the Facility B Maturity Date, or
(iv) the termination of the Facility B Commitments in their entirety pursuant to
Section 2.11, Section 2.12, Section 3.02, Section 3.03 or Section 10.01 or any
other applicable section of this Agreement; (b) With respect to Tranche 3 of
Facility B, the earliest of (i) March 31, 2004, (ii) the date on which an
aggregate of $80,000,000 has been advanced under Tranche 3 of Facility B, (iii)
the Facility B Maturity Date, or (iv) the termination of the Facility B
Commitments in their entirety pursuant to Section 2.11, Section 2.12, Section
3.02, Section 3.03 or Section 10.01 or any other applicable section of this
Agreement.
Facility B Initial Mandatory Payment Date. Any date (other than the
Facility B Maturity Date) on which Facility B Loans would be required to be paid
or prepaid in full in accordance with Section 3.02(d), or 3.02(e) or any other
applicable section of this Agreement but for provisions thereof pertaining to
any limitation imposed by Section 2.07(b)(VIII) on payments by delivery of OC
Common Stock, including any Initial Payment Date (as defined in Section
3.02(e)).
Facility B Lender. Any Lender for which there is a percentage greater than
zero next to the heading "Facility B Commitment Percentage" opposite its name or
osignature pages hereof or on the Assignment and Acceptance if such Lender has
entered into an Assignment and Acceptance pursuant to Section 12.07.
Facility B Loan. A Loan consisting of simultaneous Facility B Advances made
by the Facility B Lenders.
Facility B Maturity Date. The earliest of:
(a) March 31, 2008,
(b) the date of the acceleration of the Facility B Advances pursuant
to Section 10.01, and
(c) the date on which the entire Network is sold.
Facility B Maximum Commitments. At any date, an amount that is equal to:
(a) For Tranche 1 of Facility B,
18
<PAGE>
(i) $42,500,000, minus
(ii) the aggregate amount by which the Facility B Maximum
Commitments for Tranche 1 of Facility B shall have been permanently
reduced pursuant to Section 2.11, Section 2.12, Section 3.02, Section
3.03 or Section 10.01 or any other applicable section of this
Agreement on or prior to such date;
(b) For Tranche 2 of Facility B,
(i) $85,000,000, minus
(ii) the aggregate principal amount of the Facility B Advances
under Tranche 1 of Facility B at anytime outstanding, minus
(iii) the aggregate amount by which the Facility B Maximum
Commitments for Tranche 2 of Facility B shall have been permanently
reduced pursuant to Section 2.11, Section 2.12, Section 3.02, Section
3.03 or Section 10.01 or any other applicable section of this
Agreement on or prior to such date;
(c) For Tranche 3 of Facility B,
(i) the lesser of (I) $80,000,000 and (II) the amount of interest
that has accrued on the aggregate outstanding principal balance of
Tranche 1 and Tranche 2 of Facility B through March 31, 2004, plus
accrued and unpaid interest on the outstanding principal balance of
Tranche 3 of Facility B through March 31, 2004, minus
(ii) the aggregate amount by which the Facility B Maximum
Commitments for Tranche 3 of Facility B shall have been permanently
reduced pursuant to Section 2.11, Section 2.12, Section 3.02, Section
3.03 or Section 10.01 or any other applicable section of this
Agreement on or prior to such date.
Facility B Mirror Note. See Section 7.04(i).
Facility B Notice Date. See Section 2.07(b)(II).
FASB. The Financial Accounting Standards Board and its predecessors.
FCC. The Federal Communications Commission or any Governmental Body
succeeding to the functions thereof.
FCC Debt. Amounts owing to the FCC with respect to the deferred purchase
price for FCC Licenses.
19
<PAGE>
FCC License(s). Licenses issued by the FCC for the provision of broadband
mobile personal communications services.
FCC License Partition. A sale, transfer or other disposition of the right
to provide PCS services to POPs within a geographic area specified in Schedule
1.01A (as the same may be supplemented from time to time by agreement of the
Borrower and the Required Lenders) that is within a Designated BTA.
FCC License Transfer. Any sale, assignment or other transfer of any FCC
License in its entirety or any Stock of a License Subsidiary, each as permitted
in Section 7.06(b) , other than any such transfer to a Qualified Joint Venture
permitted under Section 7.06(b)(iii)(C).
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.
First Optional Payment Date. With respect to any calendar month, the
second Trading Day after the fifth day of such calendar month (or if such day is
not a Trading Day, the next following Trading Day).
Fiscal Quarter. A fiscal quarter of the Borrower and its Consolidated
Subsidiaries.
GAAP. See Section 1.03.
Governmental Body. Any nation or government, any state or other political
subdivision thereof, 0any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government and any
court or arbitrator.
Gross Revenues. For any period, gross revenues, determined on a
Consolidated basis, of the Borrower and its Subsidiaries determined in
accordance with GAAP for such period.
GSM. Global standard for mobile communications designed to ensure
interoperability of digital telephony service.
Guaranteed Pension Plan. Any employee pension benefit plan within the
meaning of Section 3(2) of ERISA that is maintained or contributed to by any
Loan Party 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
20
<PAGE>
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.
Guaranties. At any date, any Limited Recourse Parent Guaranty, Subsidiary
Guaranty, C-Block Subsidiary Parent Limited Recourse Guaranty, D-, E- and F-
Block Subsidiary Parent Limited Recourse Guaranty or the OC Guaranty theretofore
delivered by any Person that shall not have been terminated or released in
accordance with its terms.
Guarantors. At any date, any Person that shall have delivered a Guaranty
that shall not have been terminated and released in accordance with its terms.
Indebtedness. As to any Person at any time (without duplication): (a) all
indebtedness, liabilities and obligations of such Person for borrowed money, (b)
all indebtedness, liabilities and obligations of such Person evidenced by bonds,
notes, debentures, or other similar instruments, (c) all indebtedness,
liabilities and obligations of such Person to pay the deferred purchase price of
property or services, except trade accounts payable of such Person arising in
the ordinary course of business that are not past due by more than 90 days, (d)
all Capital Lease Obligations of such Person, (e) all Indebtedness of others
guaranteed by such Person, (f) all indebtedness, liabilities and obligations
secured by a Lien existing on property owned by such Person, whether or not the
indebtedness, liabilities or obligations secured thereby have been assumed by
such Person or are non-recourse to such Person (other than carriers',
warehousemen's, mechanics', repairmen's or other like non-consensual liens
arising in the ordinary course of business), (g) all reimbursement obligations
of such Person (whether contingent or otherwise) in respect of letters of
credit, bankers' acceptances, surety or other bonds and similar instruments, (h)
all indebtedness, liabilities and obligations of such Person to redeem or retire
shares of capital Stock of such Person, (i) all indebtedness, liabilities and
obligations of such Person under Interest Rate Protection Agreements or Currency
Hedge Agreements, and (j) all indebtedness, liabilities and obligations of such
Person in respect of unfunded vested benefits under any pension plan.
Indianapolis BTA. BTA No. 204.
Initial Purchase Order. The unfilled amount of the irrevocable purchase
order for Nortel Goods and Services placed by the Borrower on or prior to the
Closing Date in an amount of at least $50,000,000 (or such amount as may be
agreed) accepted by Nortel scheduled for delivery on Site and Scheduled for
Installation during 1998 within the Designated BTAs.
Intercompany Note. A promissory note evidencing intercompany debt in
substantially the form of Exhibit O.
Intercreditor Agreement. See Section 8.23.
Interest Period. For each LIBOR Advance comprising part of the same Loan,
the period commencing on the date of such LIBOR Advance or the date of the
Conversion of any Base Rate
21
<PAGE>
Advance into such LIBOR 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. At the election of the
Borrower, the duration of each such Interest Period shall be one month, two
months, three months or six months; provided that:
(a) whenever the last day of any Interest Period would otherwise occur
on a day other than a Business Day, the last day of such Interest Period
shall be extended to occur on the next-succeeding 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 Business Day,
(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 calendar month for the appropriate following calendar month
(one, two, three or six months later), such Interest Period shall end on
the last Business Day of such appropriate following calendar month, and
(c) the Borrower may not have more than three Interest Periods in
effect at any one time.
Interest Rate Protection Agreements. With respect to the Borrower, an
interest rate swap, cap or collar agreement or similar arrangement between the
Borrower and one or more Lenders or a Permitted Counterparty providing for the
transfer or mitigation of interest rate risks either generally or under
specified contingencies.
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);
22
<PAGE>
(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;
(e) there shall not be deducted from the aggregate amount of
Investments any decrease in the value thereof; and
(f) there shall be included as an Investment (i) each receivable
(other than with respect to sales of handsets and accessories thereto) that
is payable more than three months following the date of the sale giving
rise thereto and (ii) each receivable with respect to sales of handsets and
accessories thereto that is payable more than six months following the date
of the sale giving rise thereto.
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.
Launch Date. Unless extended pursuant to the following sentence, June 30,
1999. The Launch Date for each market will be extended by a number of days
equal to the number of days by which the Borrower is delayed in construction of
that market by Events of Force Majeure or by the failure of Nortel to comply
with the terms of the Volume Purchase Agreement.
Lender. Nortel, and each of the banks or other lending institutions which
is a party hereto (as evidenced by the signature pages of this Agreement) or
which may from time to time become a party hereto or any successor assignee
thereof by reason of an Assignment and Acceptance in accordance with Section
12.07 hereof.
LIBOR. 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 the time period corresponding to the
requested Interest Period relating to such requested Loan, as shown under
the heading "USD" as of 11:00 a.m. (London time), two 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 LIBOR page of Reuters Money Service at approximately 11:00 a.m.
(London time), two Business Days before the first day of such Interest
Period in an amount approximately equal to the amount of the requested
Loan, divided by
23
<PAGE>
(b) one, minus the LIBOR Reserve Rate, stated as a decimal.
LIBOR Advance. A Facility A Advance or Facility B Advance bearing interest
calculated by reference to LIBOR.
LIBOR Business Day. Any Business Day on which commercial banks are open for
international business (including dealings in Dollar deposits) in London.
LIBOR Loans. Loans bearing interest calculated by reference to LIBOR.
LIBOR Reserve Rate. For any Interest Period for all LIBOR 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 Advances is determined) having a term equal to such
Interest Period.
License Subsidiary. At any date, each Wholly-Owned Subsidiary of the
Borrower, each C-Block Subsidiary and each D-, E- and F-Block Subsidiary which
holds an FCC License for any of the Designated BTAs, other than any C-Block
Subsidiary or D-, E- and F-Block Subsidiary the pledge of the shares or units of
Stock of which shall have been released pursuant to the applicable Security
Agreement.
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 agreement and any
Capitalized Lease or other financing lease having substantially the same
economic effect as any of the foregoing.
Limited Recourse Parent Guaranty. See Section 8.14(a).
Loan. A Facility A Loan or a Facility B Loan.
Loan Documents. This Agreement, the Notes, the Collateral Documents, the
Guaranties, the Subordination Agreements, including, without limitation, the
Subordination Agreement among OC, the Borrower and Operations, the Capital
Contribution Agreement, the Administrative Agent's Letter, any mortgage or deed
of trust entered into pursuant to Section 6.15 and any other agreements or
documents contemplated hereby or thereby and all schedules, exhibits and annexes
thereto.
24
<PAGE>
Loan Parties. Collectively, the Borrower, OC, the Parent and each other
Guarantor.
Management Services Agreement. The Services Agreement between OCSI and
Operations substantially in the form of Exhibit D-1.
Market Price. For any Trading Day and any share of OC Common Stock:
(a) if OC Common Stock is listed or admitted to trading on any
securities exchange, the closing price, regular way, per share on such day
on the principal securities exchange on which OC Common Stock is traded;
and
(b) if OC Common Stock is not then listed or admitted to trading on
any securities exchange but is traded on the NASDAQ - National Association
of Securities Dealers Automated Quotation system, the average of the
closing bid and asked prices per share for OC Common Stock on such day on
such system.
If OC Common Stock is not listed on any securities exchange or traded on such
system the Market Price of OC Common Stock shall be deemed to be indeterminable.
Marketing Expenses. With respect to any period, the sales and marketing
expenses of the Borrower and its Subsidiaries for such period, including,
without limitation, any such expenses incurred during such period in respect of
sales literature and advertising, promotions; subscriber acquisition services;
amounts allocable during such period to marketing expenses in respect of travel,
entertainment, sales training, office expenses and research, and compensation
and commissions in connection with the foregoing activities, if any; and the
difference (if negative) between revenues from sales of handsets during such
period and the cost of such handsets, as determined on a basis consistent with
the Borrower's accounting methods that are consistent with GAAP.
Material Adverse Effect. An effect resulting from any circumstance, event,
or development of whatever nature (including any adverse determination in any
litigation) that has had or could reasonably be expected to have a material
adverse effect on (i) the business, assets, financial condition, results of
operations or prospects of the Borrower and its Subsidiaries taken as a whole,
(ii) the validity or enforceability of any of the Loan Documents or the rights
and remedies of the Collateral Agent, the Administrative Agent and the Lenders
thereunder, (iii) the ability of any Loan Party to perform its obligations under
any Loan Document to which it is a party, or (iv) the value of Collateral
available to the Administrative Agent and the Lenders after giving effect to
Liens in favor of other parties.
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.
25
<PAGE>
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, by products or breakdown
products or any other material subject to regulation under any Environmental
Laws.
Maturity Date. With respect to Facility A Advances, the Facility A Maturity
Date and with respect to Facility B Advances, the Facility B Maturity Date.
Maximum Amount. As defined in Section 1 of the Capital Contribution
Agreement.
Maximum 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,
pursuant to this Agreement and the other Loan Documents under the laws
applicable to such Lender and the transactions contemplated by this Agreement.
MB Holdings. See Section 2.09(b)(i)(A)(I).
MB Loan Agreement. See Section 2.09(b)(i)(A)(I).
Measurement Period. As defined in Section 2.03.
Mortgages. See Section 8.15.
MTA. Any "major trading area" as on the Rand McNally 1992 Commercial Atlas
& Marketing Guide, 123rd Edition, at pages 38-39 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 any Loan Party 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 each FCC License held by a License Subsidiary and all grants,
approvals, licenses, filings and registrations under the Communications Act,
necessary in order to enable the Borrower and its Subsidiaries 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
26
<PAGE>
(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), determined on a
Consolidated basis, of the Borrower and its Subsidiaries determined in
accordance with GAAP for such period.
Network. The PCS Systems being constructed in all of the Designated BTAs.
Non-Affiliate Subordinated Debt. Indebtedness of a Loan Party to a
non-Affiliate as to which the holder thereof has executed a subordination
agreement substantially in the form of the Subordination Agreement
(Non-Affiliate) attached hereto as Exhibit G-2.
Non-Qualified Joint Venture. Any Person that fails to satisfy the
definition of a Wholly Owned Subsidiary or a Qualified Joint Venture.
Nortel. As defined in the preamble hereof.
Nortel Goods and Services. Sales, installation and commissioning of Nortel
PCS Equipment and related software, and RF or site engineering, project
management, network design, and services performed by Nortel personnel. Nortel
Goods and Services includes OEM products which are verified by (and effectuated
by purchase orders accepted by) Nortel, but excludes pass-through services (as
indicated on acceptance notices from Nortel) and handsets.
Notes. The Notes substantially in the forms of Exhibit A-1 through A-5
issued by the Borrower hereunder.
Obligations. All Indebtedness, obligations and liabilities of the Borrower
to the Administrative Agent and the Lenders, arising or incurred under this
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, or under Permitted Hedging Arrangements to the extent that the
counterparty thereof is a Lender, 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, arising by contract, operation of law or otherwise.
OC. Omnipoint Corporation, a Delaware corporation, together with its
successors.
27
<PAGE>
OC Common Stock. The common stock, par value $0.01 per share, of OC and its
successors.
OC Debt Default. With respect to any Indebtedness of OC in a principal
amount of $10 million or more, an event or circumstance which occurs that
constitutes (i) a default (other than a monetary default (an "OC Unmatured
Default")) which is not cured or waived within 180 days, (ii) a monetary
default, or (iii) acceleration of such Indebtedness.
OC Guaranty. See Section 8.14(e).
OC Unmatured Default. As defined in the definition of OC Debt Default.
OCF. For any period, the sum of (a) Adjusted Net Income for such period,
plus (b) all amounts in respect of depreciation and amortization for such
period, plus (c) Consolidated Interest Expense for such period, plus (d) the
amount of any taxes deducted in determining the Consolidated Net Income for such
period.
OCI. Omnipoint Communications Inc., a Delaware corporation, together with
its successors.
OCSI. Omnipoint Communication Services, LLC, a Delaware limited liability
company, together with its successors.
Operating Lease Obligations. As to any Person, the outstanding
Indebtedness, obligations and liabilities of such Person incurred under leases
that are not Capitalized Leases.
Operating Subsidiary. Each Wholly-Owned Subsidiary of the Borrower which
owns or will own the equipment for, and will construct and operate the PCS
Systems in one or more of the Designated BTAs.
Operations. Omnipoint Communications Midwest Operations, LLC, a Delaware
limited liability company, together with its successors.
Other Taxes. See Section 4.03(b).
Overadvance. See Section 2.01(a).
Parent. OPCS Two, LLC, a Delaware limited liability company, together with
its successors.
Parent Pledge Agreement. See Section 8.13(b).
28
<PAGE>
PBGC. The Pension Benefit Guaranty Corporation created by Section 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 an FCC License therefor held by a License Subsidiary.
Permitted Counterparty. A Person that is rated in one of the three highest
rating categories of Standard and Poors Corporation or Moody's Investors
Service, Inc.
Permitted Hedging Arrangements. Interest Rate Protection Agreements and
Currency Hedge Agreements, provided that each counterparty shall be a Lender or
a Permitted Counterparty, and provided that the maximum amount for which
interest may be fixed or capped under all such Interest Rate Protection
Agreements may not exceed one hundred percent (100%) of the Indebtedness of the
Borrower and its Subsidiaries, and provided further, however, that the maximum
amount of currency for which risk may be hedged under a Currency Hedge Agreement
may not exceed one hundred percent (100%) of the foreign currency at risk in the
transactions in which the Borrower and its Subsidiaries are engaged.
Permitted Liens. See Section 7.02.
Permitted Loan Agreement. As defined in the Intercreditor Agreement.
Permitted Third-Party Expenses. With respect to the Designated BTAs, (i)
amounts paid to vendors of equipment for the construction of the Network,
including Nortel, (ii) Network site acquisition costs excluding any lease costs,
and (iii) microwave relocation costs associated with construction of the
Network, whether paid directly or reimbursed to third parties who previously
performed the relocation, not to exceed $25,000,000 in the aggregate.
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 any Loan Party 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
(a) is maintained for the employees of the Borrower or any ERISA
Affiliate, or
29
<PAGE>
(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.
POPs. As of any date and with respect to any particular BTA or MTA or any
geographic area included therein, the population of such BTA or MTA according to
the 1990 census of the United States conducted by the United States Census
Bureau.
Property. All types of real, personal, tangible, intangible or mixed
property, including each FCC License held by a License Subsidiary.
QJV Amount. The greater of (I) $15,000,000 or (II) $40,000,000 minus the
sum of (i) (x) prior to the closing date of the Wichita Loan Facility, the
aggregate outstanding Dollar amount of Investments of the Borrower in Wichita
PCS pursuant to Section 7.04(l) and (y) on and after the closing date of the
Wichita Loan Facility, the amount on Schedule 1.01B relating to the committed
amounts under the Wichita Loan Facility and (ii) (x) prior to the closing date
of the D&E Loan Facility , the aggregate outstanding Dollar amount of
Investments of the Borrower in D&E/Omnipoint pursuant to Section 7.04(l) and (y)
on and after the closing date of the D&E Loan Facility the amount on Schedule
1.01B relating to the committed amounts under the D&E Loan Facility.
Qualified Joint Venture. An entity in which the Borrower or a Wholly Owned
Subsidiary of the Borrower (a) owns fifty percent (50%) or more of the economic
interest and at least fifty and one-tenth percent (50.1%) of the voting
interest; (b) the balance of the economic and voting interests are not owned by
Parent, OC or any of their respective Subsidiaries or Affiliates, (c) the
Borrower has the right by contract to manage, and does manage, the operations of
the entity; and (d) the charter agreement governing the entity prohibits all
Distributions to venture partners other than the Borrower except if such a
Distribution could have been made to the Borrower pursuant to (S) 7.05 hereof;
and such entity has guaranteed the obligations of the Borrower under the Credit
Facility, and the assets of and ownership interest in, such entity have been
pledged as security for the performance of the obligations of the Borrower under
the Credit Facility.
RCRA. The Resource Conservation and Recovery Act of 1976, as amended, 42
USCA Section 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 or any of its Subsidiaries.
Register. See Section 12.07(c).
Registered Note Register. See Section 12.07(h).
30
<PAGE>
Registered Notes. See Section 2.10(b).
Remaining Amount. At any date, that portion of the Maximum Amount that
remains unpaid by OC pursuant to the Capital Contribution Agreement.
Reportable Event. occurrence of any of the events in Section 4043(c) of
ERISA or the regulations thereunder with respect to a Plan.
Required Lenders. At any date, the Lenders holding two-thirds in dollar
amount of the outstanding Loans, or if no Loans are outstanding, two-thirds in
dollar amount of the Commitments (whether or not such Commitments have been
terminated or cancelled).
Scheduled for Installation. As defined in the Volume Purchase Agreement.
Second Optional Payment Date. With respect to any calendar month, the
second Trading Day after the twentieth (20th) day of such calendar month (or if
the twentieth (20th) day is not a Trading Day, the next following Trading Day).
Secured Parties. Collectively, the Administrative Agent, the Collateral
Agent, the Lenders and the other agents and lenders parties to the Intercreditor
Agreement.
Security Agreement. At any date, any Subsidiary Security Agreement,
Borrower Security Agreement, Parent Pledge Agreement, C-Block Subsidiary Parent
Pledge Agreement and D-, E- and F- Block Subsidiary Parent Pledge Agreement
theretofore delivered that shall not have been terminated and released in
accordance with its terms.
Senior Debt. At any particular time, Total Debt less Subordinated Debt.
Significant Subsidiary. Any of (a) OCI and (b) any "significant subsidiary"
within the meaning of Rule 1.02(w) of Regulation S-X promulgated under the
Securities Exchange Act of 1934, as amended, but excluding for the purposes of
clause (b) any such Subsidiary the sole asset of which is an FCC License
purchased from the FCC in its "C-block" auction.
Site. The physical premises owned or controlled pursuant to written
agreement by the Borrower or the License Subsidiary for any Designated BTA.
Solvent. With respect to any Person on a particular date, the condition
that on such date, (a) the fair value of the Property of such Person (both at
fair valuation and at present fair saleable value) is greater than the total
liabilities, including, without limitation, Contingent Obligations, of such
Person, (b) the present fair saleable value of the assets of such Person is not
less than the amount that will be required to pay the probable liability of such
Person on its debts as they become absolute and matured, (c) such Person is
paying its debts generally as and when they become due, (d) such Person does not
intend to, and does not believe that it will, incur debts or
31
<PAGE>
liabilities beyond such Person's ability to pay as such debts and liabilities
mature, and (e) such Person is not engaged in business or a transaction, and is
not about to engage in business or a transaction, for which such Person's
Property would constitute unreasonably small capital after giving due
consideration to current and anticipated future capital requirements and current
and anticipated future business conduct and the prevailing practice in the
industry in which such Person is engaged. In computing the amount of Contingent
Obligations at any time, such obligations shall be computed at the amount which,
in light of the facts and circumstances existing at such time, represents the
amount (net of contribution rights) that can reasonably be expected to become an
actual or matured liability.
Special Facility Fee. As defined in Section 2.03.
Stock. With respect to any Person, any and all shares of capital stock,
partnership or other interests or units, membership interests or other units in
limited liability companies, participations or equivalent rights of or in such
Person and interests, participations, warrants, convertible securities or other
equivalents (however designated) therein or with respect thereto, including,
without limitation, Financial Assets as that term is defined in Article 8 of the
UCC.
Subordination Agreement. A Subordination Agreement in substantially the
form of Exhibit G-1 (for Affiliate Subordinated Debt) or Exhibit G-2 (for
Non-Affiliate Subordinated Debt).
Subordinated Debt. Affiliate Subordinated Debt and Non-Affiliate
Subordinated Debt.
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.
Subsidiary Guaranty. See Section 8.14(d).
Subsidiary Security Agreement. See Section 8.13(e).
Taxes. See Section 4.03(a).
32
<PAGE>
Total Debt. As of any date, the aggregate principal amount of all
Indebtedness of the Borrower and its Subsidiaries outstanding, determined on a
Consolidated basis.
Total POPs. As of any date the aggregate number of POPs in the BTAs and
MTAs for which the License Subsidiaries hold FCC Licenses.
Trading Day. Any day on which the securities exchange or over-the-counter
market to be used for purposes of determining the Market Price for OC Common
Stock, as provided in the definition of Market Price, is open for trading in
securities.
Type. As to any Facility A Loan or Facility B Loan, its nature as a Base
Rate Loan or a LIBOR Loan.
Unencumbered Cash. As to any Person, cash and Cash Equivalents on hand of
such Person, the use and disposition of which are not restricted in any manner,
whether by Lien, agreement, contract, court order, judgment, decree, injunction
or any other restriction of any kind or nature.
Volume Purchase Agreement. That certain Volume Purchase Agreement, dated as
of September 22, 1994 by and among the Borrower, OC, its Subsidiaries party
thereto and Nortel, as amended, supplemented or restated from time to time.
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.
Wichita BTAs. BTA Nos. 472(Wichita), 200(Hutchinson) and 396(Salina).
Wichita Loan Facility. A loan facility in an amount to be agreed having
substantially the same terms as Facility A hereunder entered into by Wichita PCS
within 180 days of the date of this Agreement.
Wichita PCS. Wichita PCS, LLC., a Delaware limited liability company, and a
Non-Qualified Joint Venture, the joint venture partners of which are Omnipoint
Venture Partners II, LLC (having as its single member OPCS II, LLC), owning
50.1% of the membership interest and Western Wireless Corporation, owning
49.9%.
Wholly Owned. As applied to any Subsidiary of a Person, a Subsidiary all
the outstanding shares (other than directors' qualifying shares, if required by
law) of every class of Stock of which are at the time owned by such Person.
33
<PAGE>
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 "Section" or Exhibit refers to that
section or that exhibit to this Agreement, unless otherwise indicated.
(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 FASB in effect at December 31, 1996, 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;
34
<PAGE>
provided that, if FASB after the date hereof shall promulgate or adopt
principles that are materially different from those in effect at December 31,
1996, 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. The Advances.
(a) Facility A. Each Facility A Lender severally agrees, on the terms
and conditions hereinafter , to make advances (the "Facility A Advances")
to the Borrower of up to an aggregate principal amount not to exceed such
Facility A Lender's Facility A Commitment on any Business Day from the date
hereof until the Facility A Commitment Termination Date.
Each Facility A Loan shall be in an amount equal to at least $1,000,000 (or, if
less, the aggregate remaining unused amounts of all Facility A Lenders' Facility
A Commitments) (unless such Facility A Loan is made in order to pay Nortel any
amount owing to Nortel or any Affiliate thereof, in which case there shall be no
minimum amount for such Facility A Advance) and shall consist of Facility A
Advances of the same Type made on the same day by the Facility A Lenders ratably
according to their respective Facility A Commitments.
In no event shall the aggregate principal amount of all Facility A Advances
outstanding on any date exceed the lesser of:
(i) the Facility A Maximum Commitments as of such date, and
(ii) the Facility A Borrowing Base as of such date.
Notwithstanding the immediately preceding sentence, for the period from the date
of this Agreement to and including 180 days after the date of this Agreement,
the aggregate outstanding principal balance of Facility A Advances under
Tranche 2 may exceed the Facility A Borrowing Base for Tranche 2 of Facility A,
but not the Facility A Maximum Commitments for Tranche 2 of Facility A (the
"Overadvance") provided that, (I) the Overadvance shall not exceed at any one
time $20,000,000 in the aggregate, (II) any such Overadvance shall consist of
loans from the Borrower to either or both Wichita PCS and D&E/Omnipoint, which
loans:
35
<PAGE>
(1) shall be used by Wichita PCS and D&E/Omnipoint,
respectively, for the payment to Nortel for Nortel Goods and
Services used in the Wichita BTAs and the Denver & Ephrata BTAs,
respectively;
(2) are evidenced by Intercompany Notes that constitute
Collateral hereunder; and
(3) are repaid within 180 days of the date of this
Agreement; and
(III) the Collateral Agent shall be granted a duly perfected first priority
security interest in the Nortel Goods and Services purchased by or for Wichita
PCS and D&E/Omnipoint, respectively, used in the Wichita BTAs and Denver &
Ephrata BTAs, respectively, having a purchase price equal to at least the amount
of the Overadvance on any date; and (IV) the Borrower repays the aggregate
outstanding amount of such Overadvance, if any, together with accrued and unpaid
interest and applicable Breakage Costs related thereto, to the Administrative
Agent on or before the 180th day after the date of this Agreement in accordance
with Section 3.02(d).
(b) Facility B. Each Facility B Lender severally agrees, on the terms
and conditions hereinafter , to make advances (the "Facility B Advances")
to the Borrower of up to an aggregate principal amount not to exceed such
Facility B Lender's Facility B Commitment on any Business Day from the date
hereof until the Facility B Commitment Termination Date.
Each Facility B Loan shall be in an amount equal to at least $1,000,000 (or, if
less, the aggregate remaining unused amounts of all Facility B Lenders' Facility
B Commitments) (unless such Facility B Loan is to be comprised of Advances under
Tranche 3 of Facility B, in which case there shall be no minimum amount for such
Facility B Advance) and shall consist of Facility B Advances made on the same
day by the Facility B Lenders ratably according to their respective Facility B
Commitments.
In no event shall the aggregate principal amount of all Facility B Advances
outstanding on any date exceed the lesser of:
(i) the Facility B Maximum Commitments as of such date, and
(ii) the Facility B Borrowing Base as of such date.
Section 2.02. Making the Advances.
(a) Except as otherwise provided in Section 2.02(b), 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 Advances or the first Business Day prior to
the date of the proposed Loan in the case of
36
<PAGE>
a Loan consisting of Base Rate Advances by the Borrower to the
Administrative Agent. The Administrative Agent shall give to each
Applicable Lender prompt written notice thereof. Each such notice of a Loan
(a "Draw Request") shall be delivered in writing by telecopy, overnight or
regular mail substantially in the form of Exhibit B hereto, specifying
therein:
(i) the requested date of such Loan (which shall be a Business
Day);
(ii) whether such Loan is a Facility A Loan or a Facility B Loan
and from which tranche of such facility such Loan is requested;
(iii) the requested Type of Advances comprising such Loan;
provided that the Borrower may not request that Advances be LIBOR
Advances if, after giving effect to such Advances, there would be more
than three different Interest Periods then in effect;
(iv) if such Loan is a Facility B Loan under Tranche 3, whether
the proceeds of such Loan will be used to pay accrued and unpaid
interest on the outstanding Advances under Tranche 1 or under Tranche
2 of Facility B;
(v) the requested aggregate principal amount of such Loan; and
(vi) the account to which the proceeds of such Loan shall be
paid.
Each Draw Request:
(A) shall be accompanied by a Facility A Borrowing Base
Certificate or a Facility B Borrowing Base Certificate, as
appropriate, that, among other things, shows the Facility A
Borrowing Base or Facility B Borrowing Base, as applicable, as of
the date of such Draw Request;
(B) with respect to a Facility A Loan or a Facility B Loan
shall be accompanied by a certificate that shows the Facility A
Maximum Commitment or the Facility B Maximum Commitment, as
applicable, as of the date of such Draw Request and sets forth in
reasonable detail the calculation of the amount thereof; and
(C) shall be accompanied by such additional documents as may
be required by Article IX or the Draw Request.
Each Applicable Lender shall, before 12:00 noon (New York City time) on the
date of a scheduled Loan, make available for the account of its Applicable
Lending Office to the Administrative Agent at the Administrative Agent's Account
in same-day funds, such Lender's
37
<PAGE>
ratable portion of such Loan. After the Administrative Agent's receipt of such
funds and upon fulfillment of the applicable conditions 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 12:00 A.M.
(New York City time) on the date of any 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 2:00 P.M. (New York City time).
(b) Anything in subsection (a) above to the contrary notwithstanding,
(i) the Borrower may not select LIBOR Advances for any Facility A Loan or
Facility B Loan if the aggregate amount of such Loan is less than
$5,000,000 or if the obligation of the Facility A Lenders and Facility B
Lenders to make LIBOR Advances shall then be suspended pursuant to Section
2.05 or 4.01 and (ii) there shall be no more than three Interest Periods
for LIBOR Advances at any one time in effect.
(c) Each Draw Request shall be irrevocable and binding on the
Borrower. In the case of any Facility A Loan or Facility B Loan that the
related Draw Request specifies is to be comprised of LIBOR Advances, the
Borrower shall indemnify each Applicable Lender against any loss, cost or
expense incurred by such Applicable 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 in Articles 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 Applicable Lender to fund the Advance to be made by such Applicable
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 an
Applicable Lender prior to the date of any Loan that such Applicable 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 Section 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 Applicable Lender shall not have so made such ratable portion
available to the Administrative Agent, such Applicable Lender and the
Borrower severally agree to repay or pay 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
Applicable Lender, the Federal Funds Rate. If such Applicable Lender shall
repay to the Administrative Agent such corresponding amount,
38
<PAGE>
such amount so repaid shall constitute such Applicable 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 Applicable 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.
(f) During the period following the occurrence of an OC Unmatured
Default until such default is either cured, waived, or becomes an OC Debt
Default, no Advances shall be made under the Credit Facility. If Nortel
holds more than fifty percent (50%) of the Facility A Commitments at such time,
Advances up to $5,000,000 may be made to pay amounts owing Nortel on
outstanding purchase orders.
(g) Notwithstanding anything to the contrary contained in this
Agreement, if and to the extent that Nortel is a Lender under this
Agreement and all or a portion of the proceeds of an Advance is to be paid
to Nortel, the Borrower hereby irrevocably agrees that the portion of each
Loan to be advanced by Nortel to the Borrower in accordance with this
Agreement may in the discretion of Nortel be effectively disbursed on the
date in the Draw Request for such disbursement to the Borrower by virtue of
a credit in the amount of such Loan given to the Borrower under the Volume
Purchase Agreement.
Section 2.03. Fees.
The Borrower shall pay to the Administrative Agent for the ratable
benefit of the Facility A Lenders, (other than Nortel) a commitment fee (the
"Commitment Fee") of one-half of one percent (1/2 of 1%) per annum on the
average undrawn balance of Facility A, which accrual will commence January 1,
1999. The Commitment Fee shall be due quarterly in arrears commencing March 31,
1999, and continuing on the last day of each June, September, December and March
thereafter through the Facility A Commitment Termination Date. No Commitment Fee
will accrue and be due to Nortel in its capacity as Lender with respect to
Commitments held by Nortel during the time when Nortel is a Lender under the
Credit Facility.
In addition to the foregoing, if the average outstanding principal
balance of all Facility A Advances during the period commencing July 1, 1998 and
ending January 31, 1999 (the "Measurement Period") shall be less than
$40,000,000, then Borrower shall pay to the Administrative Agent for the ratable
benefit of the Lenders within two (2) Business Days of January 31, 1999 the
"Special Facility Fee" (as defined). "Special Facility Fee" means the product
of (x) one-half percent (1/2 of 1%) per annum times (y) the average undrawn
daily balance of Facility A during the Measurement Period. The Special Facility
Fee shall be due and payable whether or not Nortel is a Lender.
39
<PAGE>
The Borrower shall also pay the fees in the Administrative Agent's Letter
on the terms and conditions therein.
Section 2.04. Interest.
(a) Facility A. Except as provided in subsection (c) below, the
Borrower shall pay interest on the unpaid principal amount of each Facility
A Advance owing to each Applicable Lender from and including the date of
such Advance through but excluding the date on which 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 (x) the last day of each March, June, September and
December and (y) the Maturity Date with respect to such Advance.
(ii) During such periods as such Advance is a LIBOR Advance, a
rate per annum equal at all times during each Interest Period for such
Advance to the sum of (A) LIBOR 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 (x) the last day
of such Interest Period if the applicable Interest Period is one, two
or three months, or the date which is three months after the first day
of the Interest Period and the last date of the Interest Period if the
applicable Interest Period is six months, (y) the date on which such
Advance shall be Converted or repaid or prepaid, in whole or in part
(together with applicable Breakage Costs), and (z) the Maturity Date
with respect to such Advance.
(iii) If the Credit Facility is repaid by the Borrower in full
prior to the first anniversary of the Closing Date and the Commitments
of the Lenders are terminated, then so long as Nortel is the only
Lender at that time, Nortel will refund to the Borrower the difference
between the interest which would have accrued on Facility A if the
Applicable Margin for such time had been (i) three percent (3%) above
LIBOR for LIBOR Loans and (ii) two percent (2%) over the Base Rate for
Base Rate Loans, as applicable.
(b) Facility B. Except as provided in subsection (c) below, the
Borrower shall pay interest on the unpaid principal amount of each Facility
B Advance owing to each Applicable Lender from and including the date of
such Advance through but excluding the date on which such principal amount
shall be paid in full, at the following rates per annum:
40
<PAGE>
(i) During such periods as such Advance is a Base Rate Advance, a
rate per annum equal at all times to the sum of (I) the Base Rate in
effect from time to time, plus (II) the Applicable Margin in effect
from time to time and applicable to such Advance, payable in arrears
semi-annually on (x) the last day of each June and December during
such periods and (y) the Maturity Date with respect to such Advance.
(ii) During such periods as such Advance is a LIBOR Advance, a
rate per annum equal at all times during each Interest Period for such
Advance to the sum of (I) LIBOR for such Interest Period for such
Advance, plus (II) the Applicable Margin in effect from time to time
and applicable to such Advance, payable in arrears on (x) the last day
of such Interest Period if the applicable Interest Period is one, two
or three months, or the date which is three months after the first day
of the Interest Period and the last date of the Interest Period if the
applicable Interest Period is six months, (y) the date on which such
Advance shall be converted or repaid or prepaid, in whole or in part
(together with applicable Breakage Costs), and (z) the Maturity Date.
(c) Upon occurrence and during the continuance of a Default, 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) or
(b) above, at a rate per annum equal at all times to the lesser of (I)
4.00% per annum above the rate per annum then required to be paid on
such Advance pursuant to clause (a) or (b) above, and (II) the Maximum
Lawful Rate, 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 demand, at a rate
per annum equal at all times to the lesser of (I) 4.00% per annum
above the rate per annum then required to be paid on Base Rate
Advances pursuant to clause (a)(i) above and (II) the Maximum Lawful
Rate.
Section 2.05. Interest Rate Determination.
(a) If, with respect to any LIBOR Advances, the Required Lenders
notify the Administrative Agent that LIBOR 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 Advances for such
Interest Period, the Administrative Agent shall forthwith so notify the
Borrower and the Applicable Lenders, whereupon:
41
<PAGE>
(i) each LIBOR Advance will automatically, on the last day of the
then-existing Interest Period therefor, Convert into a Base Rate
Advance, and
(ii) the obligation of the Applicable Lenders to make, or to
Convert Advances into, LIBOR Advances shall be suspended immediately,
until such time as 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 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 Default:
(i) each LIBOR Advance will automatically, on the last day of the
then-existing Interest Period therefor, Convert into a Base Rate
Advance, and
(ii) the obligation of the Applicable Lenders to make, or to
Convert Advances into, LIBOR Advances shall be suspended immediately.
(d) If the Administrative Agent cannot determine LIBOR for any LIBOR
Advances:
(i) the Administrative Agent shall forthwith notify the Borrower
and the Applicable Lenders that the interest rate cannot be determined
for such LIBOR 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) the obligation of the Applicable Lenders to make, or to
Convert Advances into, LIBOR 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. 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 Section 2.07 and 2.09, Convert all
Facility A or Facility B Advances of one Type comprising the same Loan into
Facility A or Facility B Advances of the other Type; provided that,
42
<PAGE>
(a) any Conversion of LIBOR Advances into Base Rate Advances shall be
made only on the last day of an Interest Period for such LIBOR Advances,
and
(b) the Borrower may not Convert Base Rate Advances into LIBOR
Advances if, (A) after giving effect to such Conversion, there would be
more than three Interest Periods in effect or (B) the Advances to be
Converted would be less than the minimum amount specified in Section
2.02(b).
Each such notice of a Conversion shall, within the restrictions specified above,
specify (x) the date of such Conversion, and (y) the Advances to be Converted.
Each notice of Conversion shall be irrevocable and binding on the Borrower.
Section 2.07. Payments and Computations.
(a) Except as provided in subsection (b) below, 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.
(b) Subject to the terms and conditions contained in this subsection
(b) and except as otherwise provided herein, the Borrower shall have the
option to make:
(i) commencing after the sixth anniversary of the Closing Date,
any payment that is due in respect of interest or principal on any
Facility B Loan hereunder, and
(ii) at any date any such payment in connection with an optional
or mandatory prepayment of all or any portion of the Facility B Loans,
by delivering to the Administrative Agent in satisfaction of all or any part of
such payment on the date when due a whole number of shares of OC Common Stock
that is at least equal to:
(A) the amount of such payment that is to be made by
delivery of OC Common Stock, divided by
(B) ninety percent (90%) of (1) the Market Price of a share
of OC Common Stock, as determined as of the Trading Day
immediately preceding the Facility B Notice Date (including any
Facility B Initial Mandatory Payment Date) relating to such
payment; or (2) in the case of a mandatory prepayment on the
First Deferred Payment Date, the Market Price of a share of OC
Common Stock as determined as of the Trading Day immediately
preceding the Initial Prepayment Date immediately preceding such
First Deferred Payment Date.
43
<PAGE>
Such shares shall be delivered by 10:00 a.m. (New York City time) on the day of
any payment, at the election of each Facility B Lender by notice to the
Borrower, either by (x) delivery of certificates in the name of such Facility B
Lender or its designee evidencing such Shares, or (y) crediting such Shares in
the name of such Facility B Lender or its designee with a depository selected by
such Facility B Lender. Each Facility B Lender may notify the Borrower from time
to time of the manner in which it desires to receive such OC Common Stock. In
the absence of such notice, delivery to a Facility B Lender shall be made as
provided in clause (x) of the second-preceding sentence.
The Borrower shall have the option to make a payment by delivery of OC
Common Stock as provided in this subsection (b) only if each of the following
shall be true at the time of such payment:
(I) A registration statement shall then be effective with respect to
the shares to be delivered in connection with such payment, OC shall then be in
compliance with its obligations under (SS) 8 and 8A of the Capital Contribution
Agreement and the Facility B Lenders shall not then be prohibited from selling
such shares under such registration statement or otherwise;
(II) The Borrower shall have given irrevocable advance written notice
to the Administrative Agent and each Facility B Lender by 10:00 a.m. (New
York City time) on the Trading Day immediately preceding the date of such
payment that it is making such payment by delivery of OC Common Stock (the
date on which such notice is given being the "Facility B Notice Date").
(III) There shall be only one class or series of common stock of OC,
and the rights and benefits of OC Common Stock shall not have been amended
or otherwise modified in any material respect so as to differ from the
rights and benefits applicable to OC Common Stock as of the date hereof.
(IV) It shall be possible to determine the Market Price of shares of
OC Common Stock on the applicable Trading Day under clause (B) above.
(V) No Event of Default shall have occurred and be continuing, and no
event of the nature specified in Section 10.01(e), (f) or (t) shall have
occurred with respect to OC or any Significant Subsidiary of OC not
specified in such Section whether or not any requirement for the giving of
notice, the lapse of time or both, or any other condition has been
satisfied.
(VI) If such payment is a prepayment of the Facility B Advances
pursuant to Section 3.03, such payment shall occur only on the First
Optional Payment Date or the Second Optional Payment Date of any calendar
month.
44
<PAGE>
(VII) The delivery of shares of OC Common Stock to any Facility B
Lender would not in such Lender's opinion violate any FCC foreign-ownership
or other regulations then applicable or any other United States federal or
state law or regulation then applicable.
(VIII) Unless Facility B Lenders holding at least a majority in
aggregate principal amount of the Facility B Loans then outstanding shall have
waived compliance by the Borrower with the condition in this clause (VIII), the
aggregate number of shares of OC Common Stock delivered on the date of such
payment, together with the aggregate number of such shares delivered of such
payment, together with the aggregate number of such shares delivered since the
same date of the third calendar month immediately preceding the date of such
payment (including for purposes of counting such months the calendar month in
which such payment occurs) (or, if there is not a counterpart day in such third-
preceding calendar month, the last day of such third-preceding calendar month)
may not exceed 4.99% of the issued and outstanding shares of OC Common Stock
(after giving effect to any issuance of such shares in connection with any such
payment), except that (x) if any payment by way of delivery of OC Common Stock
is made on a First Optional Payment Date and no other payment by way of delivery
of OC Common Stock is made thereafter prior to the second next-following First
Optional Payment Date , a payment may be made by delivery of OC Common Stock up
to an additional 4.99% of the issued and outstanding shares of OC Common Stock
on such second next-following/First Optional Payment Date, and (y) if any
payment by way of delivery of OC Common Stock is made on a Second Optional
Payment Date and no other payment by way of delivery of OC Common Stock is made
thereafter prior to the second next following Second Optional Payment Date, a
payment may be made by way of delivery of OC Common Stock up to an additional
4.99% of the issued and outstanding shares of OC Common Stock on such second
next-following Second Optional Payment Date.
(IX) No such payment may be made unless, at the date of such payment,
OC shall have delivered to the Administrative Agent a certification that at
such date OC is not (and would not be with the passage of time) required to
file a report on form 8-K (or any successor thereto) with the Securities
and Exchange Commission and no event has occurred on or prior to such date
for which OC is required to file such a report within 15 days after the
date of such payment.
(X) With respect to payments due on or after the Launch Date, no such
payment may be made with OC Common Stock with respect to the portion, if
any, of the aggregate principal amount of Facility B Advances that are
treated as Facility A Advances pursuant to Section 2.12.
If the Borrower shall have elected to make any payment in respect of
Facility B Advances by delivery of OC Common Stock, it shall deliver OC Common
Stock to all Facility B Lenders ratably in accordance with the portion of any
such payment to be made by delivery of OC
45
<PAGE>
Common Stock and the respective amounts owing to the Facility B Lenders as of
such date, (VII) above is not met with respect only to certain Facility B
Lenders, the Borrower may pay such Facility B Lenders cash while paying the
other Facility B Lenders by delivery of OC Common Stock. To the extent that on
or after the Facility B Maturity Date, the Borrower cannot pay the entire
outstanding amount due on Facility B through the payment of OC Common Stock, the
Borrower may pay the maximum amount it can through the payment of OC Common
Stock on such date and shall pay the balance in cash on such date.
By notice to the Administrative Agent, the Borrower may irrevocably waive
its option to make any particular payment by delivery of OC Common Stock
pursuant to this subsection (b) so long as it has not previously delivered to
the Administrative Agent a notice referred to in (II) above with respect to such
particular payment.
Each Facility B Lender will observe any applicable Federal securities laws
in purchasing or selling OC Common Stock or options with respect thereto.
(c) The Administrative Agent will, promptly after its receipt thereof
cause:
(i) to be distributed funds of the kind received relating to the
payment of principal or interest or usage fees and other amounts ratably
(other than amounts payable pursuant to Section 4.02, 4.03 or 12.04(c)) to
the Applicable Lenders for the account of their respective Applicable
Lending Offices, and funds of the kind received 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, and
(ii) to be distributed to the Facility B Lenders entitled thereto
promptly after its receipt thereof any stock certificates distributed to it
pursuant to subsection (b) above.
Upon the Administrative Agent's acceptance of an Assignment and Acceptance and
recording of the information contained therein in the Register pursuant to
Section 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 (whether in cash or, if applicable, stock), 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.
(d) All computations of interest and fees 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 fees are
46
<PAGE>
payable. Each determination by the Administrative Agent of an interest rate
hereunder shall be conclusive and binding for all purposes, absent manifest
error.
(e) 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 usage fee, as
the case may be; provided that, if such extension would cause payment of
interest on or principal of LIBOR Advances to be made in the next-following
calendar month, such payment shall be made on the next-preceding Business
Day.
(f) 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
Applicable 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 Applicable Lender on such due date an amount equal to
the amount then due such Applicable Lender. If and to the extent the
Borrower shall not have so made such payment in full to the Administrative
Agent, each Applicable Lender shall repay to the Administrative Agent
forthwith on demand such amount distributed to such Applicable Lender
together with interest thereon, for each day from the date such amount is
distributed to such Applicable Lender until the date such Applicable Lender
repays such amount to the Administrative Agent, at the Federal Funds Rate.
(g) 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 for any reason whatsoever, including any failure of
the Collateral or any assets making up the Network, or any part
thereof, or any representation or service of any supplier,
manufacturer, installer or distributor, including Nortel;
(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 Nortel or any other Person;
(iii) any actual or alleged default by Nortel or any other Person
under the Volume Purchase Agreement; or
47
<PAGE>
(iv) any other fact or circumstance relating to the Volume
Purchase Agreement.
No payment hereunder shall affect any rights of the Borrower under any other
agreement with Nortel or any Affiliate of Nortel.
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 Section 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 (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 Section 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.
(a) Facility A.
(i) Subject to the limitations in this Agreement, the proceeds of
Facility A Advances for Tranche 1 of Facility A shall be available
(and the Borrower shall use such proceeds) for the general corporate
and working capital purposes of the Borrower and its Subsidiaries
related to their telecommunications businesses (including up to the
QJV Amount for Qualified Joint Ventures for use within the Designated
BTAs), but not for the purpose of purchasing equipment from
competitors of Nortel or for investing in markets (x) that are
supplied by competitors of Nortel and (y) in which Nortel is not a
major supplier of equipment.
All Facility A Advances under Tranche 1 of Facility A shall be made
either (A) by credit against the Volume Purchase Agreement, (B)
directly to Nortel to pay amounts due under the Volume Purchase
Agreement or (C) to the Borrower to reimburse the Borrower for Nortel
Goods and Services for the Designated BTAs
48
<PAGE>
for which the Borrower has previously paid, provided that, the
Administrative Agent shall have received satisfactory evidence of such
payment. For markets which constitute Designated BTAs on the Closing
Date, the Borrower is permitted to borrow funds hereunder to reimburse
the Borrower for cash purchases made prior to the Closing Date (upon
receipt by the Administrative Agent of satisfactory evidence of
payment for such purchase) with respect to such Designated BTAs. For
markets which are not Designated BTAs on the Closing Date,
reimbursement to the Borrower for cash purchases for markets made
before those markets became Designated BTAs are in the sole discretion
of the Lenders at the time the BTA is proposed for acceptance as a
Designated BTA.
(ii) Subject to the limitations in this Agreement, the proceeds
of Facility A Advances for Tranche 2 of Facility A shall be available
(and the Borrower shall use such proceeds):
(A) for the payment when due of certain invoices for
Permitted Third-Party Expenses for equipment and services for use
in the Designated BTAs (including up to $15,000,000 to finance up
to fifty percent (50%) of the purchase price of Nortel handsets
and up to $2,000,000 for the acquisition of Real Estate on which
switches or other Network operating equipment is to be located);
and
(B) from the date of this Agreement until 180 days after the
date of this Agreement (subject to documentation reasonably
acceptable to the Administrative Agent), to make intercompany
loans from the Borrower to either or both Wichita PCS and
D&E/Omnipoint, which loans
(I) shall be used by Wichita PCS and D&E/Omnipoint
to purchase Nortel Goods and Services under the Volume
Purchase Agreement to the extent that the requirements of a
Facility A Advance under Tranche 2 are otherwise met;
(II) are evidenced by Intercompany Notes that serve as
Collateral hereunder;
(III) do not exceed at any one time outstanding
$30,000,000 in the aggregate (inclusive of the aggregate
outstanding amount of any Overadvances at such time); and
(IV) are repaid within 180 days after the date of this
Agreement.
49
<PAGE>
All Facility A Advances under Tranche 2 of Facility A shall be made
either (A) directly to the third party to whom the Permitted
Third-Party Expense is owing, (B) to the Borrower to reimburse the
Borrower for Permitted Third-Party Expenses paid by the Borrower,
provided that the Administrative Agent shall have received
satisfactory evidence of such payment or (C) to the Borrower to be
loaned in accordance with subsection (a)(ii)(B) above.
(b) Facility B.
(i) Subject to the limitations in this Agreement, at the
Borrower's option, and subject to documentation reasonably acceptable
to the Administrative Agent, the proceeds of Facility B Advances for
Tranche 1 and Tranche 2 of Facility B shall be available and the
Borrower shall use such proceeds for any purpose for which the
Facility A Advances shall be permitted to be used and to make
intercompany loans from the Borrower to OC, which loans
(A) rank at least pari passu with
---- -----
(I) the loan from Omnipoint MB Holdings, Inc.
(predecessor in interest to Omnipoint MB Holdings, LLC) ("MB
Holdings") to OC made with the proceeds of a Tranche Y Loan
(as defined in a certain Loan Agreement (the "MB Loan
Agreement"), dated as of July 25, 1997, by and among MB
Holdings, Ericsson, as administrative agent and the lenders
named therein) to MB Holdings, from Ericsson (the "Ericsson
Tranche Y Loan") and
(II) the other senior obligations of OC, including OC's
11-5/8% Senior Notes due 2006,
(B) shall be used by OC only for working capital purposes
and general corporate purposes in the ordinary course of its
telecommunications business, but not for the purpose of
purchasing equipment from competitors of Nortel or for investing
in markets (x) that are supplied by competitors of Nortel and (y)
in which Nortel is not a major supplier of equipment;
(C) unless and until the occurrence of a Triggering Event
(as defined in the OC Guaranty), shall be repaid by OC prior to
any advance by OC to Borrower of Affiliate Subordinated Debt from
and after the date of incurrence of an intercompany loan
evidenced by a Facility B Mirror Note; and
50
<PAGE>
(D) are evidenced by a Facility B Mirror Note on the terms
and conditions in this subsection (b) and in Section 7.04(i)
hereof.
(ii) Subject to the limitations in this Agreement, the
proceeds of Facility B Advances for Tranche 3 of Facility B
shall be available (and the Borrower shall use such
proceeds) for the payment when due of accrued but unpaid
interest on Tranche 1, Tranche 2 and Tranche 3 of Facility
B.
Section 2.10. The Notes.
(a) The Borrower irrevocably authorizes each Lender to make or cause
to be made an appropriate notation on the Schedule(s) attached to such
Lender's Note(s) of the making of Loans or the receipt of payments. The
amount of the Loans on such Schedule(s), and the applicable tranches
thereof, 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(s) shall not limit or
otherwise affect the obligations of the Borrower hereunder or under the
Notes to make payments of principal of or interest on the Notes when due.
(b) Any Lender that is not a U.S. Person and that could become
completely exempt from withholding of U.S. taxes in respect of payment of
any Obligations due to such Lender hereunder relating to any of its Tranche
A Loans or Tranche B Loans if such Tranche A Loans or Tranche B Loans were
in registered form for U.S. federal income tax purposes may request the
Borrower (through the Administrative Agent), and the Borrower agrees
thereupon, to exchange such Lender's Notes evidencing its Tranche A Loans
or Tranche B Loans for a promissory note or notes registered as provided in
Section 12.07(h) hereof (a "Registered Note"). Registered Notes may not be
exchanged for Notes that are not in registered form.
Section 2.11. Reduction or Termination of the Commitments.
(a) The Borrower may, upon at least three Business Days' notice to the
Administrative Agent, permanently terminate in whole or reduce in part the
unused portions of any Commitments with respect to Facility A or Facility B
and any tranche of either such facility of Loans; provided that, each such
partial reduction:
(i) shall be in an aggregate amount of $5,000,000 or an integral
multiple of $1,000,000 in excess thereof (or, if less, the aggregate
remaining unused amounts of all Applicable Lenders' Commitments in
respect of such facility and tranche within such facility), and
51
<PAGE>
(ii) shall be made ratably among the Applicable Lenders in
accordance with their respective Commitments in respect of such
facility and tranche within such facility.
(b) The Facility A Maximum Commitments or the Facility B Maximum
Commitments, as applicable, shall be automatically and permanently reduced
as of any date on which Advances are prepaid pursuant to Section 3.02
(except to the extent in Section 3.02(d)(iii) and Section 3.02(d)(iv)) or
Section 3.03, by the aggregate principal amount of the Advances so prepaid.
Each such reduction shall be made ratably among the Lenders in accordance with
their respective Commitments.
(c) Termination. On the Facility A Commitment Termination Date and the
Facility B Commitment Termination Date, respectively, the then-remaining
undrawn Commitments of the Applicable Lenders shall be automatically
terminated.
(d) No reduction in the Facility A Maximum Commitments shall occur on
account of any agreement entered into in accordance with the provisions of
Section 7.11(a)(v).
Section 2.12. If the Network in the Detroit BTA and Indianapolis BTA has
not been placed in Commercial Service by the first anniversary of the Launch
Date, then (a) the unused portion of the Facility B Maximum Commitments shall
terminate and (b) the terms and conditions (including without limitation those
relating to interest rates, interest payment dates and principal amortization)
provided herein with respect to the portion, if any, of the then-outstanding
aggregate principal amount of Facility B Advances automatically shall be changed
so that in all respects the terms and conditions applicable to such portion
shall be the same as those applicable to Facility A Advances. If either (but not
both) the Detroit BTA or the Indianapolis BTA is in Commercial Service by the
first anniversary of the Launch Date, the termination of the unused portion of
the Facility B Maximum Commitments and conversion of the terms and conditions of
outstanding Facility B Advances to those applicable to Facility A Advances shall
only apply to an amount equal to the then outstanding principal balance of
Facility B Advances or then unused portion of Facility B Maximum Commitments
multiplied by (i) if the Detroit BTA is in Commercial Service by such first
anniversary, .30 and (ii) if the Indianapolis BTA is in Commercial Service by
such date, .70. If the Network in the Detroit BTA or Indianapolis BTA is not
placed in Commercial Service by the first anniversary date of the Launch Date,
the Borrower shall not be entitled to repay the portion, if any, of the
aggregate principal amount of Facility B Advances that are treated as Facility A
Advances under this (S)2.12 using OC Common Stock pursuant to (S)2.07(b).
52
<PAGE>
ARTICLE III
REPAYMENT AND PREPAYMENT OF THE LOANS
Section 3.01. Repayment.
(a) Facility A.
(i) On the last day of each quarter commencing on the last day of
the calendar quarter following the calendar quarter in which the
Facility A Commitment Termination Date occurs, and continuing on the
last day of each March, June, September and December for nineteen
consecutive calendar quarters thereafter (or, if such day is not a
Business Day, on the next-preceding Business Day), the Borrower shall
repay a portion of the aggregate principal amount of the Facility A
Advances equal to the percentage specified in the table below opposite
such periods of the greatest aggregate principal amount of Facility A
Advances outstanding on any date prior to the date of such repayment.
================================================================================
Payment Date Percentage
- --------------------------------------------------------------------------------
Last Day of Calendar Quarters 1-8 3.75
- --------------------------------------------------------------------------------
Last Day of Calendar Quarters 9-12 5.00
- --------------------------------------------------------------------------------
Last Day of Calendar Quarters 13-20 6.25
================================================================================
(ii) On the Facility A Maturity Date, the Borrower shall repay
the aggregate then-outstanding principal amount of all Facility A
Advances, together with any and all accrued and unpaid interest
thereon and all other amounts due and owing hereunder, under the Notes
and under the other Loan Documents.
(iii) Interest due with respect to Facility A Advances shall be
paid at the times and at the rates specified in Section 2.04 of this
Agreement.
(b) Facility B.
(i) On the Facility B Maturity Date, the Borrower shall repay the
aggregate then-outstanding principal amount of Facility B Advances,
together with any and all accrued or accreted and unpaid interest
thereon and all other amounts due and owing hereunder, under the Notes
and under the other Loan Documents.
(ii) Interest due with respect to Facility B Advances shall be
paid at the times and at the rates specified in Section 2.04 of this
Agreement.
53
<PAGE>
Section 3.02. Mandatory Prepayments of Loans.
(a) Sales of Assets. No later than three Business Days after its
receipt of any Net Cash Proceeds (after deducting the amount of any other
mandatory prepayment (x) arising in connection with the transaction
otherwise triggering a mandatory prepayment under this subsection (a) and
(y) required to be made pursuant to Section 3.02(i) hereof) referred to in
clause (i) of this subsection (a), the Borrower shall prepay Facility A
Advances in an aggregate principal amount equal to:
(i) the Net Cash Proceeds from insurance recoveries, condemnation
awards and the direct or indirect sale of any assets of the Borrower
and/or any of its Subsidiaries (other than any sale of inventory and
other goods in the ordinary course of business) that is otherwise
permitted under this Agreement during any calendar year, to the
extent, individually or in the aggregate, such Net Cash Proceeds
received during such calendar year shall exceed $250,000 and are not
reinvested in the Network within 60 days, or if deposited with the
Collateral Agent, 365 days after receipt, multiplied by
(ii) a fraction, (A) the numerator of which is the aggregate
principal amount of the Facility A Advances outstanding at the time of
such sale, insurance recovery or condemnation award 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, insurance recovery or condemnation award under all
Permitted Loan Agreements the loans under which are required to be
prepaid with such Net Cash Proceeds, to the extent the Intercreditor
Agreement permits such prepayment.
Any prepayment pursuant to this subsection (a) shall be applied to the
prepayment of the remaining principal installments of Facility A in inverse
order of maturity. No amounts prepaid pursuant to this subsection (a) shall be
available for reborrowing whether before or after the Facility A Commitment
Termination Date.
Each prepayment hereunder shall be allocated among the Facility A Lenders
on a pro rata basis. The Borrower shall pay such additional amounts as are
sufficient to pay the Lenders' Breakage Costs associated with such prepayments
in accordance with Section 3.04(b). All Net Cash Proceeds relating to sales of
assets, insurance recoveries and condemnation awards not reinvested in the
Network within sixty (60) days after receipt shall be deposited into a cash
collateral account held by the Collateral Agent until such time as they are
either reinvested or required to be applied to the Loans hereunder.
(b) Excess Cash Flow. By April 30 of each calendar year beginning on
the first April 30 following The Facility A Commitment Termination Date,
the Borrower shall prepay outstanding Facility A Advances in an aggregate
principal amount equal to:
54
<PAGE>
(i) fifty percent (50%) of any Excess Cash Flow in respect of the
immediately preceding fiscal year, multiplied by
(ii) a fraction, the numerator of which is the aggregate
principal amount of the Facility A Advances then outstanding, and the
denominator of which is the aggregate principal amount then
outstanding of all Facility A Advances and all other loans under each
Permitted Loan Agreement that are required to be prepaid out of Excess
Cash Flow, and to the extent the Intercreditor Agreement permits such
prepayment.
Any prepayment pursuant to this subsection (b) shall be applied to the
prepayment of the remaining principal installments of each Tranche of Facility A
in inverse order of maturity. No amounts prepaid pursuant to this subsection (b)
shall be available for reborrowing whether before or after the Facility A
Commitment Termination Date.
Each prepayment hereunder shall be allocated among the Facility A Lenders
on a pro rata basis. The Borrower shall pay such additional amounts as are
sufficient to pay the Lenders' Breakage Costs associated with such prepayments
in accordance with Section 3.04(b).
(c) Sale of Network. The Borrower shall prepay all outstanding
Advances, along with accrued or accreted but unpaid interest and applicable
Breakage Costs, and the Lenders' Commitments hereunder shall terminate,
upon the sale by the Borrower of the entire Network.
(d) Excess Borrowings.
(i) Subject to clause (ii) below as it applies to Tranche 2 of
Facility A, if on any date the aggregate principal amount of
outstanding Facility A Advances or Facility B Advances, respectively,
shall exceed either the Facility A Maximum Commitments or Facility B
Maximum Commitments, respectively, or the Facility A Borrowing Base or
the Facility B Borrowing Base, respectively, the Borrower shall
immediately prepay the then-outstanding balance of Facility A Advances
or Facility B Advances, as applicable, by an amount equal to such
excess together with all accrued (or accreted, in the case of Facility
B) but unpaid interest relating thereto.
(ii) Notwithstanding clause (i), above, with respect to
Overadvances permitted pursuant to the final paragraph of Section
2.01(a), the Borrower shall be required to repay such Overadvances, if
any, together with all accrued but unpaid interest relating thereto,
on the 180th day following the date of this Agreement.
55
<PAGE>
(iii) Beginning on December 31, 1999 amounts prepaid on Facility
B on or prior to such date pursuant to subsection (d)(i) hereof
because of borrowings in excess of the Facility B Borrowing Base, will
be available for reborrowing prior to the Facility B Commitment
Termination Date in accordance with the terms and conditions of this
Agreement otherwise applicable thereto. Except as provided in clause
(iv) below, no other amounts prepaid or repaid pursuant to subsection
(d)(i) or (d)(ii) shall be available for reborrowing whether before or
after the Facility A Commitment Termination Date or the Facility B
Commitment Termination Date, respectively.
(iv) Amounts prepaid in accordance with the provisions of Section
7.06(b)(iii)(A)(1)(IV) shall be available for reborrowing prior to the
Facility A Commitment Termination Date.
(v) Any such prepayment shall be applied to the prepayment of a
ratable aggregate principal amount of the applicable Advances.
Each prepayment hereunder shall be allocated among the applicable Lenders
on a pro rata basis. The Borrower shall pay such additional amounts as are
sufficient to pay the Lenders' Breakage Costs associated with such prepayments
in accordance with Section 3.04(b).
(e) OC Common Stock Prepayments. The Borrower shall prepay all
outstanding Facility B Advances:
(i) on October 1, 2003 (except as otherwise provided below) if,
on each Trading Day during the 547-day period preceding such date, the
Market Price of OC Common Stock exceeded $40.00 per share (adjusted
for any stock combinations or splits after the date hereof); and
(ii) on any date that is
(A) after October 1, 2003 and
(B) on the 365th day after any date after October 1, 2002
(except as otherwise provided below) on which the Market Price of
OC Common Stock shall have exceeded $40.00 per share (adjusted
for any stock combinations or splits after the date hereof) on
each Trading Day during a period of 182 consecutive days;
provided that the Borrower shall not be required to make such prepayment if the
Market Price of OC Common Stock shall have been less than $40.00 per share
(adjusted for any stock combinations or splits after the date hereof) on any
Trading Day after such period of 182 consecutive days and prior to the initial
prepayment date.
56
<PAGE>
Notwithstanding the preceding sentence of this subsection (e) or any other
provision of this Agreement pursuant to this subsection (e):
(1) If at the date on which a prepayment otherwise would be due (the
"Initial Prepayment Date") the Borrower shall have elected to repay the
Facility B Advances and interest thereon by delivery of OC Common Stock and
cannot pay all such amounts by such delivery by reason of Section
2.07(b)(VIII), on such date the Borrower shall be required to prepay by
delivery of OC Common Stock only a ratable aggregate principal amount of
such Facility B Advances forming part of the same Facility B Loans that is
equal to the maximum amount that may be prepaid subject to the limitations
of such Section. In such event, at the end of each 60-day period
thereafter, the Borrower (A) if electing to prepay such Facility B Advances
in cash, will repay all remaining Facility B Advances in cash, and (B)
otherwise will prepay the maximum ratable aggregate principal amount of
Facility B Advances forming part of the same Facility B Loan that may be
prepaid by delivery of OC Common Stock, subject to the limitations in such
Section.
(2) If on the date on which a prepayment otherwise would be required
under clause (i) or (ii) above, the Borrower shall have elected to make
such payment by delivery of OC Common Stock but shall be prevented from
making such payment on such date by reason of Section 2.07(b)(V) insofar as
the provisions thereof apply to a default by a Significant Subsidiary, such
prepayment shall not be required hereunder until the date that is six (6)
months after the date on which a prepayment would otherwise be required to
be made under clause (i) or (ii). If on such six-month anniversary, the
Borrower is prevented from making a payment using OC Common Stock for any
reason, the Borrower may pay the maximum amount it can through the payment
of Stock and shall pay the balance in cash on such date. Two Business Days
prior to such six-month anniversary, the Borrower shall deliver to the
Administrative Agent a notice indicating whether it has elected to make the
mandatory prepayment pursuant to this subsection (e) in OC Common Stock (or
a portion thereof), or in cash. In no event shall a deferral of payment
cause such payment to be made after the Maturity Date and in no event shall
a deferral of payment pursuant to this clause (3) postpone the payment of
any other mandatory prepayments required under this Agreement. In no event
shall a reduction in the Market Price of OC Common Stock during such six-
month period terminate the Borrower's requirement to make a mandatory
prepayment hereunder.
(3) With respect to any mandatory prepayment that is deferred pursuant
to clause (1), the Borrower shall be required to pay to the Administrative
Agent cash or that whole number of shares of OC Common Stock equal in
amount to the amount computed under Section 2.07(b)(ii) (x) in the case of
the payment due at the expiration of the first 60-day period following the
Initial Prepayment Date (the "First Deferred Payment Date"), on the Trading
Day immediately preceding the Facility B Notice Date relating to Initial
Prepayment Date; and (y) in the case of all subsequent 60-day periods, if
any, on the
57
<PAGE>
Trading Date immediately preceding the Facility B Notice Date relating to
each deferred payment.
With respect to any mandatory prepayment that is deferred pursuant to
clause (2), the Borrower shall be required to pay to the Administrative
Agent cash or that whole number of shares of OC Common Stock equal in
amount to the amount computed under Section 2.07(b)(ii) on the Trading Day
immediately preceding the Facility B Notice Date relating to each deferred
payment.
No amounts prepaid pursuant to this subsection (e) shall be available for
reborrowing. Each prepayment hereunder shall be allocated among the Facility B
Lenders on a pro rata basis. The Borrower shall pay such additional amounts as
are sufficient to pay the Lenders' Breakage Costs associated with such
prepayments in accordance with Section 3.04(b).
(f) Prepayments Under Other Permitted Loan Agreements. At the same
time that any prepayments are to be made under any Permitted Loan
Agreements pursuant to the Intercreditor Agreement, the Borrower shall
(without duplication of amounts required to be prepaid pursuant to Section
3.02 (a), (b) or (c) hereof) prepay Facility A Advances in an aggregate
principal amount equal to:
(i) the amount to be prepaid under any Permitted Loan Agreement,
multiplied by
(ii) a fraction, (A) the numerator of which is the aggregate
principal amount of the Facility A Advances outstanding at the time of
such prepayment and (B) the denominator of which is the sum of such
aggregate principal amount, plus the aggregate principal amount of all
Indebtedness outstanding under the Permitted Loan Agreement on account
of which the prepayment is to be made and under all other Permitted
Loan Agreements which are entitled to receive a pro rata share.
Any prepayment pursuant to this subsection (f) shall be applied to the remaining
principal installments of Facility A in inverse order of maturity.
No amounts prepaid pursuant to this subsection (f) shall be available for
reborrowing whether before or after the Facility A Commitment Termination Date.
Each prepayment hereunder shall be allocated among the Facility A Lenders on a
pro rata basis. The Borrower shall pay such additional amounts as are sufficient
to pay the Lenders' Breakage Costs associated with such prepayments in
accordance with Section 3.04(b).
(g) Termination of Volume Purchase Agreement. The Borrower shall
prepay all outstanding Advances, and the Lenders' Commitments shall
terminate, upon the termination of the Volume Purchase Agreement as a
result of a default thereunder by the Borrower beyond applicable grace and
cure periods.
58
<PAGE>
(h) Wichita PCS and D&E/Omnipoint Intercompany Loans. The Borrower
shall prepay all amounts advanced to Wichita PCS and D&E/Omnipoint (and all
accrued and unpaid interest thereon) on account of their respective
Intercompany Notes as required by Section 2.09, Section 6.22 and Section
7.04(l) within 180 days of the date of this Agreement.
Amounts prepaid on Tranche 2 of Facility A pursuant to subsection (h)
hereof (without duplication of and exclusive of any mandatory prepayment of any
Overadvance required under Section 3.02(d)) will be available for reborrowing
prior to the Facility A Commitment Termination Date.
A prepayment hereunder shall be allocated among the applicable Tranche 2
Facility A Lenders on a pro rata basis. The Borrower shall pay such additional
amounts as are sufficient to pay the Lenders' Breakage Costs associated with
such prepayment in accordance with Section 3.04(b).
(i) Adjusted Debt to Total POPs. If at the end of any fiscal quarter
during the term of this Agreement, the ratio of (i) Adjusted Debt
outstanding at the end of such fiscal quarter to (ii) Total POPs on the
last day of such fiscal quarter exceeds $32.00 to 1.00 (the "Maximum
Ratio"), the Borrower shall prepay within ten (10) Business Days after the
end of such fiscal quarter the dollar amount in cash which would cause the
Borrower not to exceed the Maximum Ratio for such fiscal quarter (including
accrued and unpaid interest thereon).
Any prepayment pursuant to this subsection (i) shall be applied to the
remaining principal installments of Facility A in inverse order of maturity and
pro rata between Tranche 1 and Tranche 2 of Facility A. Amounts prepaid on
Facility A pursuant to subsection (i) hereof will not be available for
reborrowing.
A prepayment hereunder shall be allocated among the applicable Facility A
Lenders on a pro rata basis. The Borrower will pay such additional amounts as
are sufficient to pay the Lender's Breakage Costs associated with such
prepayment in accordance with Section 3.04(b).
(j) Voluntary Transfers. Within ten (10) Business Days of the making
of a voluntary transfer of a C-block FCC License in respect of a Designated
BTA or portion thereof, to the FCC or to any Affiliate of the Borrower and
its Subsidiaries in either case in accordance with Section
7.06(b)(iii)(A)(1)(IV), the Borrower shall prepay an amount equal to the
sum of (x) the purchase price of all or a portion of the Nortel Goods and
Services previously purchased for use in the affected BTA or portion
thereof and (y) the amount of Permitted Third-Party Expenses incurred
(including accrued but unpaid interest thereon) in connection with the
affected BTA or portion thereof.
Any prepayment pursuant to this subsection (j) shall be applied to the
prepayment of the remaining principal installments of each Tranche of Facility A
in inverse order of maturity. No
59
<PAGE>
amounts prepaid pursuant to this subsection (j) shall be available for
reborrowing whether before or after the Facility A Commitment Termination Date.
Each prepayment hereunder shall be allocated among the Facility A Lenders
on a pro rata basis. The Borrower shall pay such additional amounts as are
sufficient to pay the Lenders' Breakage Costs associated with such prepayments
in accordance with Section 3.04(b).
Section 3.03. Optional Prepayments of Loans.
(a) Facility A.
The Borrower shall have the right, at its election, to prepay the principal
amount outstanding under either tranche of Facility A, as a whole or in part, at
any time without penalty or premium, provided that any full or partial
prepayment of the principal amount of any LIBOR Advances pursuant to this
Section 3.03(a) may be made only on the last day of the Interest Period relating
thereto unless such prepayments are accompanied by such additional amounts as
are sufficient to pay the Lenders' Breakage Costs associated with such
prepayments. The 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 Section 3.03(a) of Base Rate
Advances, and four (4) (or such shorter period as the Lenders may agree from
time to time) LIBOR Business Days' notice of any proposed prepayment pursuant to
this Section 3.03(a) of LIBOR Advances, in each case specifying the proposed
date of prepayment of Facility A Loans and the principal amount to be prepaid.
Each such partial prepayment of the Facility A Loans (i) shall be in a minimum
amount of $1,000,000 and in integral multiples of $100,000 (or, if less, the
aggregate outstanding principal balance of all Facility A Advances), (ii) shall
be accompanied by the payment of accrued interest on the principal prepaid to
the date of prepayment, (iii) shall require the payment of appropriate Breakage
Costs, if any, in accordance with Section 3.04(b), and (iv) shall be applied
ratably to Tranche 1 and Tranche 2 of Facility A and pro rata against the
remaining installment payments of principal on the applicable tranche. Each
partial prepayment shall be allocated among the Lenders on a pro rata basis.
No amounts so prepaid, whether before or after the Facility A Commitment
Termination Date, shall be available for reborrowing.
(b) Facility B.
(i) The Borrower shall have the right, at its election, to prepay
the principal amount outstanding under Facility B, as a whole or in part, at any
time without penalty or premium, provided that any full or partial prepayment of
the principal amount of any LIBOR Advances pursuant to this (S) 3.03(b)(i) may
be made only on the last day of the Interest Period relating thereto unless such
prepayments are accompanied by such additional amounts as are sufficient to pay
the Lenders' Breakage Costs associated with such prepayments. The Borrower
60
<PAGE>
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) 3.03(b)(i) of Base Rate Advances,
and four (4) (or such shorter period as the Lenders may agree from time to
time) LIBOR Business Days' notice of any proposed prepayment pursuant to
this (S) 3.03(b)(i) of LIBOR Advances, (or upon one Trading Day's notice,
in the case of prepayments by delivery of OC Common Stock (pursuant to (S)
2.07(b)(ii)), in each case specifying the proposed date of prepayment of
Facility B Loans and the principal amount to be prepaid. Each such partial
prepayment of the Facility B Loans (i) shall be in a minimum amount of
$1,000,000 and in integral multiples of $100,000 (or, if less, the
aggregate outstanding principal balance of all Facility B Advances), (ii)
shall be accompanied by the payment of accrued or accreted, but unpaid
interest on the principal prepaid to the date of prepayment, (iii) shall
require the payment of appropriate Breakage Costs, if any, in accordance
with (S) 3.04(b), and (iv) shall be applied ratably to Tranche 1 and
Tranche 2 of Facility B, with the balance, if any, applied to the principal
balance of Tranche 3. Each partial prepayment shall be allocated among the
Lenders on a pro rata basis.
--- ----
No amounts so prepaid, whether before or after the Facility B Commitment
Termination Date, shall be available for reborrowing.
(ii) The Borrower may irrevocably waive any rights it may have under
subsection (b)(i) above to make any particular optional prepayment of Facility B
Advances by delivery of OC Common Stock by delivery of a written waiver to that
effect so long as it has not previously delivered to the Administrative Agent a
notice referred to in (S) 2.07(b)(II) with respect to such particular payment.
Section 3.04. Certain Matters Relating to Repayments and Prepayments.
(a) On the date on which Advances are to be repaid or prepaid, and if
less than all Loans are to be repaid or prepaid, if both Base Rate Loans
and LIBOR Loans are outstanding, the Borrower will specify whether the Loan
to be repaid or prepaid shall be a Base Rate Loan or a LIBOR Loan and, if a
LIBOR Loan is to be repaid or prepaid and more than one LIBOR Loan is
outstanding, which such LIBOR Loan shall be prepaid.
(b) Subject to the following sentences of this subsection (b), all
prepayments and repayments pursuant to this Article III shall be
accompanied by such additional amounts as are sufficient to pay applicable
Breakage Costs and accrued and unpaid interest on the principal amount of
the Advances then being prepaid or repaid. A certificate of any Lender
setting forth the amount of any Breakage Costs which such Lender is
entitled to receive shall be furnished to the Borrower relating to any
prepayment for which the Administrative Agent has received notice in
accordance with the terms hereof, and shall be presumptively correct absent
manifest error. The Borrower shall pay all Breakage
61
<PAGE>
Costs to the Administrative Agent as in the Lender's certificate pursuant
to this Article III within one (1) Business Day after delivery of such
certificate.
ARTICLE IV
ILLEGALITY, INCREASED COSTS, CAPITAL ADEQUACY AND INDEMNITIES
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 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 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 Loans, if
any, shall be Converted automatically to Base Rate Loans on the last day of
each Interest Period applicable to such LIBOR 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,
62
<PAGE>
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,
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 Commitments (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 Section 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 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
Section 4.02 and will not, in the judgment of such Lender, be otherwise
disadvantageous to such Lender. By making any payment under this Section
4.02, the Borrower is not waiving its right to contest that the amounts in
the certificates are based on manifest error.
63
<PAGE>
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 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 Section 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
Section 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 such 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 Section 12.02, the original or
64
<PAGE>
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" and
"United States person" shall have the meanings specified in Section 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 Section 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 Section 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
Section 4.03(a) only with respect to those Taxes which would not have been
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 Section 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
65
<PAGE>
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.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders and the Administrative
Agent as follows:
Section 5.01. Corporate Authority; Limited Liability Company Authority.
(a) Each Loan Party in existence on the date hereof (or on any date on
which these representations and warranties are deemed repeated):
(i) is a corporation or a limited liability company duly
organized, validly existing and in good standing under the laws of its
state of incorporation or state of formation,
(ii) has all requisite corporate power or has taken all requisite
member and/or management action required to own its Property and
conduct its business (except in the case of the Atlantic City BTA with
respect to the absence of interconnection and Network services, as
described in (S) 6.23 hereof) as now conducted and as presently
contemplated, hereof, and
(iii) is in good standing as a foreign corporation or foreign
limited liability company 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) on Schedule 5.01(b) hereto (as updated pursuant to Section
6.13(r)) is a complete and accurate list of all Subsidiaries of the
Borrower, showing (as to each such Subsidiary) the jurisdiction of its
incorporation or formation, the number of shares of each class or units of
Stock authorized, and the number outstanding, on the date hereof and the
percentage of the outstanding shares or units of each such class owned
(directly or indirectly) by the Borrower, the number of shares or units
covered by all outstanding options, warrants, rights of conversion or
purchase and similar rights at the date hereof. All of the outstanding
Stock of each such Subsidiary has been validly issued, is fully paid
66
<PAGE>
and non-assessable and is owned by the Borrower or one or more of its
Subsidiaries free and clear of all Liens, except those created or permitted
under the Loan Documents or as disclosed in such Schedule (as so updated).
Each such Subsidiary:
(i) is a corporation or a limited liability company duly
organized, validly existing and in good standing under the laws of its
state of incorporation or state of formation,
(ii) has all requisite corporate power or has taken all requisite
member and/or management action required to own its Property and
conduct its business (except in the case of the Atlantic City BTA with
respect to absence of interconnection and Network services, as
described in (S) 6.23 hereof), as now described in Section 6.23
hereof), as now conducted and as presently contemplated and
(iii) is in good standing as a foreign corporation or foreign
limited liability company 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.
(c) The execution, delivery and performance by each Loan Party of this
Agreement and the other Loan Documents to which it is or is to become a
party, and the consummation of the transactions contemplated hereby and
thereby:
(i) are within the corporate or limited liability company
authority of such Loan Party,
(ii) have been duly authorized by all necessary corporate (in the
case of a corporation) or member and/or management (in the case of a
limited liability company) actions or proceedings,
(iii) do not conflict with or result in any breach or
contravention of any provision of law, statute, rule or regulation to
which such Loan Party is subject or any judgment, order, writ,
injunction, license or permit applicable to such Loan Party or its
Property and
(iv) do not conflict with any provision of the corporate or
limited liability company charter or bylaws of, or any agreement or
other instrument binding upon, the Loan Party or its Property, and
(v) will not result in the creation, or imposition of, or
obligation to create, any Lien upon the Property of any Loan Party,
other than Liens granted pursuant to the Collateral Documents.
67
<PAGE>
(d) This Agreement has been, and each of the Notes and each other Loan
Document when delivered hereunder will have been, duly executed and
delivered by each Loan Party thereto. This Agreement is, and each of the
Notes and each other Loan Document when delivered hereunder will be, the
legal, valid and binding obligation of each Loan Party thereto, enforceable
against such Loan Party in accordance with its terms, except as
enforceability may be 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.
Section 5.02. Governmental Approvals. The execution, delivery and
performance by each Loan Party of this Agreement and the other Loan Documents to
which such Loan Party 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 or approval contemplated by Section 5.07.
Section 5.03. Title to Properties. The Borrower and each of its
Subsidiaries own all of the assets reflected in the balance sheet of such
parties as at the Balance Sheet Date or acquired since that date (except FCC
Licenses owned by the C-Block Subsidiary or a D-, E- and F- Block Subsidiary and
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. The License Subsidiaries own
all of the FCC Licenses listed on Schedule 5.07 hereto.
Section 5.04. Financial Statements. There has been furnished to the
Administrative Agent a pro forma consolidated balance sheet of the Borrower and
its Subsidiaries as of the Balance Sheet Date. Such pro forma consolidated
balance sheet has been prepared in accordance with GAAP and fairly presents the
assets and liabilities of the Borrower and each of its Subsidiaries as at the
close of business on the date thereof. There are no Contingent Obligations of
the Borrower or its Subsidiaries as of such date involving material amounts,
known to the officers of the Borrower, which were not disclosed in such pro
forma balance sheet. Since the Balance Sheet Date, there has not occurred any
changes that would make the pro forma balance sheet delivered to the
Administrative Agent pursuant to this Section 5.04 untrue or misleading in any
material way.
Section 5.05. No Material Adverse Effect, Etc. There has occurred no
Material Adverse Effect with respect to the Borrower or any of its Subsidiaries
(i) since the Balance Sheet Date based on the pro forma balance sheet delivered
pursuant to Section 5.04 or (ii) since the date of the most recent audited
financial statements provided to the Lenders, and all information provided by or
on behalf of the Borrower to the Lenders prior to the date of the initial
Advance are true and
68
<PAGE>
correct in all material aspects. Except as permitted hereunder, the Borrower
has not made any Distribution.
Section 5.06. Franchises, Patents, Copyrights, Etc. The Borrower and each
of its Subsidiaries own or have rights under the franchises, licenses, patents,
copyrights, trademarks, trade names, other intellectual property and rights in
respect of the foregoing which are listed on Schedule 5.06, without known
conflict with any rights of others. Except as in Schedule 5.06, there are no
franchises, licenses, patents, copyrights, trademarks, trade names, or other
intellectual property, individually or in the aggregate, that are material for
the conduct of the business of the Borrower or any of its Subsidiaries, as now
conducted or as presently contemplated to be conducted.
Section 5.07. FCC Licenses, Etc.
(a) Part I of Schedule 5.07 lists all FCC Licenses held by License
Subsidiaries other than C-Block Subsidiaries and D-, E- and F-Block
Subsidiaries. Part II of Schedule 5.07 lists all FCC Licenses held by
License Subsidiaries of the C-Block Subsidiary Parent. Part III of Schedule
5.07 lists all FCC Licenses held by License Subsidiaries of the D-, E- and
F-Block Subsidiary Parent. The C-Block Subsidiary Parent and the D-, E- and
F-Block Subsidiary Parent have filed or caused to be filed applications
with the FCC for the transfer of all of the Stock of the License
Subsidiaries holding all of the FCC Licenses listed in Parts II and III of
Schedule 5.07 to the Borrower, and the Borrower expects that such transfer
shall take place within 180 days of the date of this Agreement.
(b) Neither any FCC License nor any material Necessary Authorization
is the subject of any pending or, to the best of the Borrower's knowledge,
threatened revocation or revocation proceeding.
Section 5.08. Litigation. Except as on Schedule 5.08 attached hereto, there
are no actions, suits, proceedings or investigations of any kind pending or, to
the best of the Borrower's knowledge, threatened against any Loan Party 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 such Loan Party, 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 such Loan Party, or
that questions the validity of this Agreement or any of the Loan Documents, or
any action taken or to be taken pursuant hereto or thereto.
Section 5.09. No Materially Adverse Contracts, Etc. None of the Loan
Parties is 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. None of the Loan Parties is a party to
any contract or agreement that has or is expected, in the judgment of such Loan
Party's officers, to have any Material Adverse Effect.
69
<PAGE>
Section 5.10. Compliance with Other Instruments, Laws, Etc. None of the
Loan Parties is 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. Each Loan Party and each of its Subsidiaries and
Affiliates
(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;
(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 in respect of any Loan Party or any of its
Subsidiaries or Affiliates, 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. Neither any Loan
Party nor any of its Subsidiaries is 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.
Neither any Loan Party nor any of its Subsidiaries is 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, as amended.
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 of its Subsidiaries or any
rights relating thereto.
70
<PAGE>
Section 5.15. FCC Matters. Except for the filing of tariffs with the FCC,
each Loan Party 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. No failure to pay any Indebtedness owing to the FCC in respect
of FCC Debt has occurred, except in accordance with the orders, rules and
regulations of the FCC.
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, the other Loan Documents and the
statements and documents referred to herein or therein delivered to the
Administrative Agent and/or the Lenders by or on behalf of the Borrower or any
Loan Party 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.
Section 5.18. Burdensome Obligations. No Loan Party is a party to or bound
by any franchise, agreement, deed, lease or other instrument, or subject to any
legal restriction which 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 such Loan Party, or the ability of
such Loan Party to perform the obligations to be performed by it under the Loan
Documents to which such Loan Party is a party. The Borrower does not presently
anticipate that future expenditures by the Borrower or any of its Subsidiaries
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 or any of its Subsidiaries.
Section 5.19. Solvency. Each Loan Party is, individually and together with
its Subsidiaries, 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 or as provided herein or in the Intercreditor
Agreement) in favor of the Collateral Agent, for the benefit of the Lenders.
71
<PAGE>
Section 5.21. Certain Transactions. 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 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, the Cash Management Agreement and the Management Services
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, the Management Services Agreement or as permitted under Section 7.11.
To the extent Intellectual Property of the Parent or OC is licensed to the
Borrower or its Subsidiaries, the terms of such license(s) and the fee charged
to the Borrower or its Subsidiaries relating thereto shall be subject to the
Required Lenders' reasonable approval.
Section 5.22. Business Plans. The Approved Full-Term Operating Business
Plan and each Approved Annual Operating Business Plan, if any, have been
prepared in all material respects in accordance with GAAP (except for the
treatment of Indebtedness owing to the FCC, which has been reflected in such
plans at historical cost) consistently applied to projections.
Section 5.23. Employee Benefit Plans.
(a) 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. The Borrower and each of its Subsidiaries 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 Section 103(d) of ERISA, with respect to each Guaranteed
Pension Plan.
(b) Terminability of Welfare Plans. Under each Employee Benefit Plan
that is an employee welfare benefit plan within the meaning of Section 3(1)
or Section 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, each of
its Subsidiaries and each ERISA Affiliate 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 such Loan Party or such ERISA
Affiliate without liability to any Person.
72
<PAGE>
(c) 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 Section 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, any of its
Subsidiaries 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. None of the Borrower, any of its Subsidiaries or
any ERISA Affiliate has instituted or intends to institute proceedings to
terminate a Guaranteed Pension Plan. No event requiring notice to the PBGC
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 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 Section 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) Multiemployer Plans. None of the Borrower, any of its Subsidiaries
or 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 Section 4201 of ERISA or as a result of a sale of assets described in
Section 4204 of ERISA. Neither any Loan Party nor any ERISA Affiliate has
been notified that any Multiemployer Plan is in reorganization or insolvent
under and within the meaning of Section 4241 or Section 4245 of ERISA or
that any Multiemployer Plan intends to terminate or has been terminated
under Section 4041A of ERISA.
Section 5.24. Regulations G, T, 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 G, T, 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:
73
<PAGE>
(a) The Borrower and each of its Subsidiaries is 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 or any of its Subsidiaries.
(b) 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 or any
of its Subsidiaries. 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 or any of its
Subsidiaries that could reasonably be expected to have an impact on the
Real Estate or facilities owned, operated or controlled by the Borrower or
any of its Subsidiaries.
(c) 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 and its Subsidiaries (whether conducted
by or on behalf of the Borrower, any of its Subsidiaries or a third party,
and whether done at the initiative of the Borrower or any of its
Subsidiaries or directed by a governmental entity or other third party)
which the Borrower or any of its Subsidiaries 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 and each of its Subsidiaries has filed all reports
and returns required to be filed by such Person under any Environmental
Laws. The Borrower and each of its Subsidiaries has obtained and 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 that requires, or after notice or lapse of time
or both would require, any modification or termination of any Environmental
Permit. Neither the Borrower nor any of its Subsidiaries (i) has received
any notice asserting the absence of any Environmental Permit or (ii) has
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 its Subsidiaries, 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
74
<PAGE>
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. Joint Ventures, Etc. Except as in Schedule 5.26, the Borrower
is not engaged in any joint venture or partnership with any other Person, and
each joint venture or partnership listed in such Schedule is a Qualified Joint
Venture or a NonQualified Joint Venture in which the Borrower is permitted to
invest pursuant to Section 7.04(g), (k) or (l) hereof.
Section 5.27. Material Contracts. As of the date of this Agreement, neither
the Borrower nor any of its Subsidiaries is a party to any Material Contract or
any agreement with any director, officer or employee, except as in Schedule
5.27.
Section 5.28. Representations in Other Loan Documents. Each of the
representations by any Loan Party in any of the other Loan Documents is true as
of the date hereof.
Section 5.29. Ericsson Tranche Y Loan. All requirements for mandatory
prepayments contained in the Ericsson Tranche Y Loan have been disclosed in
writing to the Administrative Agent and the Lenders.
Section 5.30. OC Stock Payment Date. The definitions of "First Optional
Payment Date" and "Second Optional Payment Date" as defined in this Agreement
are the same definitions as the definitions of those respective terms that are
contained in the Ericsson Tranche Y Loan.
ARTICLE VI
AFFIRMATIVE COVENANTS OF THE BORROWER
The Borrower covenants and agrees that, so long as any Loan or Note or any
fees or expenses are outstanding or any Lender has any Commitment hereunder:
Section 6.01. Maintenance of Office. The Borrower shall maintain, and shall
cause each of its Subsidiaries to maintain, its chief executive office at 3
Metro Center, Bethesda, MD 20814 (except in the case of an Operating Subsidiary,
at 16 Wing Drive, Cedar Knolls, NJ 07927), except that the Borrower or any such
Subsidiary may change its chief executive office on not less than 30 days'
advance written notice to the Administrative Agent and the Collateral 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, and shall cause
each of its Subsidiaries to:
75
<PAGE>
(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 and Limited Liability Company Existence;
Maintenance of Licenses. The Borrower shall do or cause to be done, and shall
cause each of its Subsidiaries to do or cause to be done, all things necessary
to:
(a) preserve and keep in full force and effect its corporate or
limited liability company existence;
(b) maintain in full force and effect:
(i) each FCC License with respect to the BTAs specified in Parts
I, II and III of Schedule 5.07 (other than any such FCC License that
has been previously sold or transferred in accordance with this
Agreement) and any other FCC Licenses from time to time held by any
License Subsidiary and cause each License Subsidiary at all times to
own each FCC License listed in Schedule 5.07 (other than any such FCC
License that has been previously sold or transferred in accordance
with this Agreement), free and clear of any Lien of any kind, other
than any Lien permitted under Section 7.02(g);
(ii) with respect to the construction, installation and
development of facilities for the Designated BTAs, all FCC 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 for such BTAs; and
(iii) with respect to the operation of those portions of
Designated BTAs the development of which has theretofore been
completed, all material FCC Licenses, copyrights, patents, franchises,
Necessary Authorizations and other rights as are necessary and
sufficient to operate such completed portions.
(c) subject to the provisions of Section 7.11(a)(v), cause OC, the C-
Block Subsidiary Parent and the D-, E-, and F-Block Subsidiary Parent to
cause the ownership of all Stock of License Subsidiaries holding the FCC
Licenses for the BTAs listed in Parts II and III of Schedule 5.07 to be
transferred to the Borrower within 180 days after the date of this
Agreement.
76
<PAGE>
The Borrower will, and will cause its Subsidiaries to, 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 FCC Licenses held by License Subsidiaries and not cause or permit to
exist any grounds for the FCC to revoke or suspend or not to renew such License
in accordance with Section 7.06(b).
Section 6.04. Maintenance of Properties. The Borrower shall do or cause to
be done, and shall cause each of its Subsidiaries to do or cause to be done, all
things necessary to preserve and keep in full force and effect its material
franchises, employment contracts and permits. The Borrower shall, and shall
cause each of its Subsidiaries to:
(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;
(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 the businesses now conducted by it as appropriate to
the then level of construction, development and operation of PCS Systems
covered by FCC Licenses held by License Subsidiaries;
provided that nothing in this Section 6.04 shall prevent the Borrower or any of
its Subsidiaries from discontinuing the operation and maintenance of any of its
Properties if such discontinuance is, in the judgment of the Borrower or such
Subsidiary, desirable in the conduct of its business and would not have a
Material Adverse Effect.
Section 6.05. Insurance. The Borrower shall obtain and maintain, and shall
cause each of its Subsidiaries to 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 Section 12 of each Security Agreement;
(b) with respect to all liability insurance, name the Administrative
Agent and the Collateral Agent as additional insured;
77
<PAGE>
(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 Section 8.19, 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 Section
6.05, each Security Agreement and each Mortgage, and setting forth any
deductibles applicable to any insurance coverage.
Section 6.06. Taxes. The Borrower shall duly pay and discharge, and cause
each of its Subsidiaries to duly pay and discharge, before the same shall become
overdue, all taxes, assessments and other governmental charges imposed upon it
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 no such tax, assessment, charge, levy or claim need be
paid if the validity or amount thereof shall currently be contested in good
faith by appropriate proceedings and if the Borrower or any of its Subsidiaries
has set aside on its books adequate reserves with respect thereto and such
reserves have been segregated to the extent required by GAAP; and provided
further that the Borrower shall 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, and shall cause each of its
Subsidiaries to permit, the Administrative Agent, the Lenders and their
other designated representatives to visit and inspect any of the Properties
of the Borrower or such Subsidiary, to examine the books of account of the
Borrower or such Subsidiary (and to make copies thereof and extracts
therefrom), and to discuss the affairs, finances and accounts of the
Borrower or such Subsidiary 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 business of the Borrower or any of its
Subsidiaries.
(b) The Borrower authorizes the Administrative Agent and each Lender
to communicate directly with the independent certified public accountants
of the Borrower or any of its Subsidiaries and authorizes such accountants
to disclose to the Administrative Agent and the Lenders any and all
financial statements and other supporting financial
78
<PAGE>
documents and schedules including copies of any management letter with
respect to the business, financial condition and other affairs of the
Borrower and its Subsidiaries. At the request of the Administrative Agent,
the Borrower shall deliver a letter addressed to such accountants
instructing them to comply with the provisions of this Section 6.07(b).
Section 6.08. Compliance with Laws, Contracts, FCC Licenses and Permits.
The Borrower shall comply, and shall cause each of its Subsidiaries to comply,
in all material respects with:
(a) the applicable laws, rules, regulations and orders wherever its
business is conducted, including without limitation compliance with all
Environmental Laws, all Environmental Permits, ERISA, the IRC, the
Communications Act and all FCC rules and regulations (including without
limitation compliance with FCC rules and regulations relating to
maintaining the status of the License Subsidiaries as designated entities
and small businesses);
(b) the provisions of its charter documents and by-laws;
(c) all material agreements and instruments to which it or any of its
Subsidiaries is a party and by which it or any of its Subsidiaries or any
of its or their Properties may be bound;
(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 or any of its Subsidiaries may fulfill any of the
Borrower's or such Subsidiary's obligations hereunder or any of the other Loan
Documents to which the Borrower or any of its Subsidiaries is a party, the
Borrower shall immediately take, or shall cause such Subsidiary immediately to
take, all reasonable steps within the power of the Borrower or such Subsidiary
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, and shall
cause each of its Subsidiaries to cooperate, with the Lenders and the
Administrative Agent, and shall execute and pay, and shall cause each of its
Subsidiaries to execute and pay, as applicable, for the filing of all such
further instruments and documents, including, without limitation, such Uniform
Commercial Code financing statements and other security documents as the
Required Lenders, the Collateral Agent or the Administrative Agent shall
reasonably deem appropriate at any time in order to effectuate the security
interests in favor of the Collateral Agent and to carry out to
79
<PAGE>
their satisfaction the transactions contemplated by the Loan Documents.
Specifically, the Borrower shall deliver to the Collateral Agent all
certificates representing its ownership interests in the C-Block License
Subsidiaries and the D-, E- and F-Block License Subsidiaries, along with stock
powers executed in blank, upon the transfer of the ownership of such Stock from
the C-Block Subsidiary Parent and the D-, E- and F-Block Subsidiary Parent,
respectively, to the Borrower.
Section 6.10. Attornment and Recognition Agreements; Consents to Collateral
Assignments. The Borrower shall obtain, and shall cause each of its Subsidiaries
to obtain, (a) all attornment and recognition agreements from any landlord or
landlord's mortgagee of Real Estate leased by the Borrower or any of its
Subsidiaries (i) upon which any equipment with a value, individually or in the
aggregate, in excess of $1,000,000 is stored or located, and (ii) as to all such
leased Real Estate, for locations where at least eighty percent (80%) in
aggregate value of all equipment (taking into account the value of all equipment
at locations owned by the Borrower and its Subsidiaries) of such the Borrower or
its Subsidiaries is located, as well as (b) consents to collateral assignments
as the Administrative Agent may reasonably require from all parties to Material
Contracts with the Borrower or its Subsidiaries, each in form and substance
satisfactory to the 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 by the Borrower or any of its
Subsidiaries upon which all other Collateral not covered by the immediately
preceding sentence is stored or located, in form and substance reasonably
satisfactory to the Required Lenders. The Borrower shall collaterally assign the
Management Services Agreement to the Collateral Agent for the ratable benefit of
the Lenders. If and to the extent that the Borrower is unable to obtain
attornment and recognition agreements on a best efforts basis in accordance with
the second sentence of this Section 6.10, then the Borrower shall and shall
cause its Subsidiaries to request that any landlord, mortgagee and easement
grantor of the Borrower or any of its Subsidiaries agree to give the Collateral
Agent and the Administrative Agent, on a best efforts basis, notice of any
default by the Borrower or such Subsidiary under the terms or conditions of any
agreement between the Borrower and/or such Subsidiary and any landlord,
mortgagee of any such landlord or easement grantor, and allow the Collateral
Agent to inspect or remove Collateral after the occurrence and continuance of an
Event of Default.
Section 6.11. 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 6.12. Maintenance of Subsidiary. The Borrower shall cause each
Operating Subsidiary and, after ownership thereof is transferred to the Borrower
in accordance with Section 6.03(c) of this Agreement, each License Subsidiary to
remain a Wholly Owned Subsidiary of the Borrower at all times at which this
Agreement is in force and effect.
80
<PAGE>
Section 6.13. 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) Approved Annual Operating Business Plan. No later than 15 days
prior to (or 31 days after, with respect to fiscal years 1998 and 1999) the
end of each fiscal year of the Borrower and until the first fiscal year
ending after the date on which EBITDA 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 Section 8.12 for the next-succeeding fiscal year. The
proposed annual operating business plan shall contain:
(i) internally prepared statements of income and expense of the
Borrower and its Subsidiaries 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 the Borrower
and its Subsidiaries need to raise additional capital to meet their
obligations when due during the period,
(iv) projected balance sheets of the Borrower and its
Subsidiaries,
(v) projected cash flow statements of the Borrower and its
Subsidiaries, and
(vi) a statement listing material 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 Section 8.12 and on a consistent basis.
(b) Variance Report. No later than August 14 of each fiscal year of
the Borrower, beginning with its 1999 fiscal year, a report, certified as
true and correct by the chief or principal financial or accounting officer
of the Borrower, that shows in reasonable detail, variances, if any,
between the actual operating performance of the Borrower and its
Subsidiaries and what was estimated for the first six months of such fiscal
year in the Approved Annual Operating Business Plan for such fiscal year
(or the Approved Full Term Operating Business Plan if the Required Lenders
have not approved a plan delivered
81
<PAGE>
pursuant to Section 6.13(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) Quarterly Financial Statements. 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 Consolidated balance sheets of the Borrower
and its Subsidiaries as of the end of such quarter and Consolidated and
consolidating statements of income and a Consolidated statement of cash
flows of the Borrower and its Subsidiaries for the period commencing at the
end of the previous fiscal quarter and ending with the end of such fiscal
quarter, and Consolidated and consolidating statements of income and a
Consolidated statement of cash flows of the Borrower and its Subsidiaries
for the period commencing at the end of the previous fiscal year of the
Borrower and ending with the end of such quarter, 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 Section 6.13(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 Section 6.13(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 and its Subsidiaries
on the date thereof (subject to year-end adjustments).
(d) Annual Financial Statements. 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 Consolidated balance sheets of the Borrower and its
Subsidiaries as at the end of such year, and the related audited
Consolidated statements of income and the audited Consolidated statement of
cash flows of the Borrower and its Subsidiaries for such year prepared in
accordance with GAAP, and so long as the Borrower is required to deliver an
operating business plan pursuant to Section 6.13(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 Section 6.13(a) with respect to such fiscal year) in reasonable
detail. Such balance sheets, statements of income and statement of cash
flows shall contain a certified audit report of a nationally recognized
independent certified public accounting firm satisfactory to the
Administrative Agent, which report shall contain an unqualified
82
<PAGE>
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,
(ii) perform the agreed upon review procedures applicable
thereto, and
(iii) confirm that in examining the financial statements of the
Borrower and its Subsidiaries 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 (to the extent one is prepared for the Borrower).
(e) Compliance Certificate. Simultaneously with the delivery of the
financial statements referred to in subsections (c) and (d) above,
(i) a statement certified by the principal financial or
accounting officer of the Borrower, in form and substance satisfactory
to the Administrative Agent, setting forth in reasonable detail
computations evidencing compliance with the covenants contained in
Section 6.14 and 7.05, and
(ii) a Facility A Borrowing Base Certificate and a Facility B
Borrowing Base Certificate showing the Facility A Borrowing Base and
Facility B Borrowing Base, respectively, as of the last day of such
fiscal quarter or fiscal year, as the case may be.
(f) Quarterly Key Barometer Report. Within 45 days after the end of
each fiscal quarter of the Borrower, a report on
(i) with respect to each Operating Subsidiary:
(A) the number of cell sites constructed and cell sites
where equipment with an aggregate purchase price in excess of
$1,000,000 is located,
(B) the total number of customers,
83
<PAGE>
(C) the number of new customers acquired,
(D) the number of customers who terminated their service,
(E) the average net monthly revenue per user, and
(F) aggregate roaming revenue.
(ii) payments by the Borrower or any of its Subsidiaries to OC or
any of its Affiliates (other than payments by the Borrower or any of
its Subsidiaries to one another), or to any Subsidiary of the Borrower
that is not a Subsidiary, whether as dividends, payments under any
management, service or tax-allocation agreement or otherwise; and
(iii) equity contributions to the Borrower, the Persons providing
the same and any issuance or sale of shares of Stock or other equity
interests in the Borrower or any of its Subsidiaries,
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 Section 6.13(a) with respect to such fiscal year),
along with an explanation of discrepancies between the actual numbers and
the estimated numbers.
(g) Securities and Exchange Commission Reports. Within three Business
Days after the filing or mailing thereof, copies of all
(i) materials filed with the Securities and Exchange Commission
by the Borrower, Parent, OC or any of their respective Subsidiaries;
(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 and its Subsidiaries or the Network that the Parent or OC
would be required to file with the Securities and Exchange Commission
pursuant to the Securities Exchange Act of 1934, if the Parent or OC
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
84
<PAGE>
(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 Securities and Exchange
Commission.
(h) Accounts Receivable Aging Report. Within 45 days after the end of
each fiscal quarter of the Borrower, an accounts-receivable-aging report in
respect of the Borrower and each Operating Subsidiary.
(i) Defaults. Within three Business Days after the Borrower shall have
knowledge of occurrence and continuance thereof, written notice of
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, the Parent, OC
or any of their Subsidiaries 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, 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) Environmental Events. 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 any
of its Subsidiaries or the security interests for the benefit of the
Secured Parties pursuant to any of the Collateral Documents.
(k) ERISA Events. 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
85
<PAGE>
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) Employee Benefit Plans. 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 Section 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
Section 302, 4041, 4042, 4043, 4063, 4065, 4066 and 4068 of ERISA, or
in respect of a Multiemployer Plan, under Section 4041A, 4202, 4219,
4242 or 4245 of ERISA, and
(iii) becoming aware of occurrence thereof, notice of (A) any
transaction that could result in the imposition of a penalty under
Section 502(i) of ERISA or an excise tax under Section 4975 against
the Borrower, any of its Subsidiaries or an ERISA Affiliate; (B) any
partial or complete withdrawal from a Multiemployer Plan by the
Borrower, any of its Subsidiaries or an ERISA Affiliate; (C) a failure
by the Borrower, any of its Subsidiaries 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; 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) Notification of Claims Against Collateral. 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) Notice of Litigation and Judgments. 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 any of
its Subsidiaries or to which the Borrower or any of its Subsidiaries
is or becomes a party that could
86
<PAGE>
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 or any of its Subsidiaries in an amount in excess
of $1,000,000, written notice thereof in form and detail satisfactory
to the Administrative Agent.
(o) FCC Notices. Within three Business Days after its receipt thereof,
copies of all material notices and correspondence received from or sent to
the FCC relating to any FCC License listed on Schedule 5.07.
(p) Change in Corporate or Limited Liability Company Name; Location of
Collateral. Not later than 30 days prior to occurrence thereof, written
notice to the Administrative Agent of a change in (i) the business,
corporate or limited liability company name of any of the Loan Parties,
(ii) the location of any of the Collateral or (iii) the chief executive
office or other locations of each Loan Party or the location where the
books and records of the Borrower or any of its Subsidiaries are kept.
(q) Indebtedness Report. 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.
(r) Update of Schedules. As soon as available and in any event within
30 days after the end of each fiscal year of the Borrower and when
necessary in connection with a repetition of any representation or warranty
referring thereto in connection with any Draw Request, a report
supplementing the Schedules hereto, including without limitation (i) new
Subsidiaries of the Borrower and ownership of the Stock thereof, (ii) any
change in the designation of any BTA as in, or any addition, deletion or
other change to, Schedule 1.01 and (iii) a description of such other
changes in the information included in such Schedules as may be necessary
for such Schedules to be accurate and complete in all material respects.
(s) FCC License Transfer. Within 10 Business Days following occurrence
thereof, written notice of any FCC License Transfer, specifying the
affected FCC License or geographic area, as applicable, and setting forth
in reasonable detail the terms of such disposition.
(t) Other Information. Such other information concerning the business
operations or financial condition of any Loan Party or any of its
Subsidiaries as the Administrative Agent or any Lender shall from time to
time reasonably request. The Borrower shall provide personnel of the
Borrower reasonably necessary to discuss business plans and reports with
the Administrative Agent and Lenders on request.
87
<PAGE>
Upon the Administrative Agent's receipt of any and all financial and other
information furnished by the Borrower pursuant to this Section 6.13 the
Administrative Agent shall promptly deliver copies thereof to each Lender.
Section 6.14. Financial Covenants of the Borrower. So long as any Loan,
Note or other of the obligations of the Borrower are outstanding hereunder or
any Lender has any Commitment, the Borrower and its Subsidiaries on a
Consolidated basis shall:
(a) Senior Debt to Contributed Capital. Not permit the ratio of (i)
Senior Debt outstanding at the end of any fiscal quarter during any period
shown below to (ii) the aggregate amount of Contributed Capital through the
last date of such fiscal quarter, to exceed the ratio below opposite such
period:
<TABLE>
<CAPTION>
================================================================================
Fiscal Quarter Ending: Ratio
- --------------------------------------------------------------------------------
<S> <C>
03/31/98 to 12/31/98 7.00:1.00
- --------------------------------------------------------------------------------
03/31/99 6.25:1.00
- --------------------------------------------------------------------------------
06/30/99 5.50:1.00
- --------------------------------------------------------------------------------
09/30/99 4.75:1.00
- --------------------------------------------------------------------------------
12/31/99 4.25:1.00
- --------------------------------------------------------------------------------
03/31/00 4.00:1.00
- --------------------------------------------------------------------------------
06/30/00 3.75:1.00
- --------------------------------------------------------------------------------
09/30/00 3.00:1.00
- --------------------------------------------------------------------------------
12/31/00 to 12/31/01 2.75:1.00
- --------------------------------------------------------------------------------
03/31/02 to 12/31/03 2.50:1.00
- --------------------------------------------------------------------------------
03/31/04 to 12/31/04 2.25:1.00
- --------------------------------------------------------------------------------
03/31/05 and thereafter 2.00:1.00
================================================================================
</TABLE>
(b) Adjusted Debt to Annualized EBITDA. Not permit the ratio of (i)
Adjusted Debt outstanding at the end of any fiscal quarter during any
period shown below to (ii) Annualized EBITDA at the end of each fiscal
quarter during such period to exceed the ratio below opposite such period:
<TABLE>
<CAPTION>
================================================================================
Fiscal Quarter Ending: Ratio
- --------------------------------------------------------------------------------
<S> <C>
06/30/01 26.00:1.00
- --------------------------------------------------------------------------------
09/30/01 25.50:1.00
================================================================================
</TABLE>
88
<PAGE>
<TABLE>
================================================================================
<S> <C>
12/31/01 25.00 : 1.00
- --------------------------------------------------------------------------------
03/31/02 16.50 : 1.00
- --------------------------------------------------------------------------------
06/30/02 12.75 : 1.00
- --------------------------------------------------------------------------------
09/30/02 10.50 : 1.00
- --------------------------------------------------------------------------------
12/31/02 9.00 : 1.00
- --------------------------------------------------------------------------------
03/31/03 7.25 : 1.00
- --------------------------------------------------------------------------------
06/30/03 6.25 : 1.00
- --------------------------------------------------------------------------------
09/30/03 5.75 : 1.00
- --------------------------------------------------------------------------------
12/31/03 5.00 : 1.00
- --------------------------------------------------------------------------------
03/31/04 4.50 : 1.00
- --------------------------------------------------------------------------------
06/30/04 4.00 : 1.00
- --------------------------------------------------------------------------------
09/30/04 3.75 : 1.00
- --------------------------------------------------------------------------------
12/31/04 3.50 : 1.00
- --------------------------------------------------------------------------------
03/31/05 3.25 : 1.00
- --------------------------------------------------------------------------------
06/30 05 and thereafter 3.00 : 1.00
================================================================================
</TABLE>
(c) Fixed Charge Coverage Ratio. Not permit the ratio, as of the end
of any fiscal quarter during a period shown below, of (A) the sum of (i) EBITDA
for the last completed fiscal quarter plus (ii) cash and Cash Equivalents on
hand, plus (iii) Availability, plus (iv) the lesser of (x) the Remaining Amount
and (y) fifty percent (50%) of the amount of OC's Unencumbered Cash to (B) the
sum of (i) amounts due in cash with respect to principal and interest on
Indebtedness of the Borrower during the next fiscal quarter, plus (ii) budgeted
Capital Expenditures scheduled to be made during the next fiscal quarter as
shown on the Approved Annual Operating Business Plan plus (iii) cash taxes due
in the next fiscal quarter, to be less than the ratio shown below opposite such
period.
<TABLE>
================================================================================
Period Ratio
- --------------------------------------------------------------------------------
<S> <C>
3/31/98 to 12/31/02: 1.05 to 1.0
- --------------------------------------------------------------------------------
3/31/03 and thereafter 1.10 to 1.0
================================================================================
</TABLE>
(d) Quarterly Minimum Adjusted OCF Levels. Not permit Adjusted OCF for
any fiscal quarter ending during a period shown below to be less than the
amount opposite such period:
89
<PAGE>
<TABLE>
<CAPTION>
================================================================================
Fiscal Quarter Ending: Amount
- --------------------------------------------------------------------------------
<S> <C>
03/31/99 ($4.6 million)
- --------------------------------------------------------------------------------
06/30/99 ($3.5 million)
- --------------------------------------------------------------------------------
09/30/99 ($0.9 million)
- --------------------------------------------------------------------------------
12/31/99 $0.1 million
- --------------------------------------------------------------------------------
03/31/00 $4.4 million
- --------------------------------------------------------------------------------
06/30/00 $6.7 million
- --------------------------------------------------------------------------------
09/30/00 $12.1 million
- --------------------------------------------------------------------------------
12/31/00 $14.4 million
- --------------------------------------------------------------------------------
03/31/01 $18.8 million
- --------------------------------------------------------------------------------
06/30/01 $20.0 million
- --------------------------------------------------------------------------------
09/30/01 $21.7 million
- --------------------------------------------------------------------------------
12/31/01 $22.9 million
- --------------------------------------------------------------------------------
03/31/02 $28.5 million
- --------------------------------------------------------------------------------
06/30/02 $30.4 million
- --------------------------------------------------------------------------------
09/30/02 $32.9 million
- --------------------------------------------------------------------------------
12/31/02 $34.8 million
- --------------------------------------------------------------------------------
03/31/03 $37.5 million
- --------------------------------------------------------------------------------
06/30/03 $40.0 million
- --------------------------------------------------------------------------------
09/30/03 $43.3 million
- --------------------------------------------------------------------------------
12/31/03 $45.8 million
- --------------------------------------------------------------------------------
03/31/04 $49.0 million
- --------------------------------------------------------------------------------
06/30/04 and thereafter $50.0 million
================================================================================
</TABLE>
(e) Quarterly Minimum Revenue Levels. Not permit Gross Revenues for
any fiscal quarter ending during a period shown below to be less than the
amount opposite such period:
<TABLE>
<CAPTION>
================================================================================
Fiscal Quarter Ending: Amount
- --------------------------------------------------------------------------------
<S> <C>
03/31/99 $3.3 million
- --------------------------------------------------------------------------------
06/30/99 $4.4 million
- --------------------------------------------------------------------------------
09/30/99 $6.7 million
- --------------------------------------------------------------------------------
</TABLE>
90
<PAGE>
<TABLE>
- --------------------------------------------------------------------------------
<S> <C>
12/31/99 $7.8 million
- --------------------------------------------------------------------------------
03/31/00 $12.1 million
- --------------------------------------------------------------------------------
06/30/00 $16.1 million
- --------------------------------------------------------------------------------
09/30/00 $24.2 million
- --------------------------------------------------------------------------------
12/31/00 $28.2 million
- --------------------------------------------------------------------------------
03/31/01 $30.8 million
- --------------------------------------------------------------------------------
06/30/01 $32.9 million
- --------------------------------------------------------------------------------
09/30/01 $35.6 million
- --------------------------------------------------------------------------------
12/31/01 $37.7 million
- --------------------------------------------------------------------------------
03/31/02 $42.9 million
- --------------------------------------------------------------------------------
06/30/02 $45.8 million
- --------------------------------------------------------------------------------
09/30/02 $49.6 million
- --------------------------------------------------------------------------------
12/31/02 $52.4 million
- --------------------------------------------------------------------------------
03/31/03 $54.3 million
- --------------------------------------------------------------------------------
06/30/03 $57.9 million
- --------------------------------------------------------------------------------
09/30/03 $62.8 million
- --------------------------------------------------------------------------------
12/31/03 $66.4 million
- --------------------------------------------------------------------------------
03/31/04 $69.2 million
- --------------------------------------------------------------------------------
06/30/04 to 09/30/04 $72.1 million
- --------------------------------------------------------------------------------
12/31/04 and thereafter $75.0 million
================================================================================
</TABLE>
Section 6.15. Mortgage Liens. If the Borrower or any of its Subsidiaries
shall acquire any Real Estate and shall not at the time of such acquisition
incur Indebtedness with respect thereto pursuant to Section 7.01(f)(i), the
Borrower shall grant, or cause such Subsidiary to grant, to the Collateral Agent
on behalf of the Secured Parties a first-mortgage Lien on such Real Estate in
form and substance satisfactory to the Required Lenders.
Section 6.16. New Subsidiaries; Qualified Joint Ventures. Upon the creation
of any Subsidiary or Qualified Joint Venture not in existence on the date
hereof, the Borrower shall at its expense:
(a) duly execute and deliver, or cause such Subsidiary or Qualified
Joint Venture to duly execute and deliver, to the Administrative Agent and
the Collateral Agent a Subsidiary Guaranty in respect of such Subsidiary or
Qualified Joint Venture (with such changes thereto as the Administrative
Agent may reasonably request);
91
<PAGE>
(b) duly execute and deliver, or cause such Subsidiary to duly execute
and deliver, to the Administrative Agent and the Collateral Agent, a
Subsidiary Security Agreement (with such changes thereto as either Agent
may reasonably request) and such other mortgages, pledges, assignments and
other security agreements, in form and substance reasonably satisfactory to
the Agents, securing payment of all of the obligations of such Subsidiary
or Qualified Joint Venture under its Guaranty and the obligations of the
Loan Parties under the Loan Documents and constituting Liens on all
Collateral described therein; and pledge, or cause to be pledged, to the
Collateral Agent on behalf of the Secured Parties, all authorized, issued
and outstanding Stock of such Subsidiary or Qualified Joint Venture; and
execute and/or deliver to the Administrative Agent each other document or
instrument required to be delivered in connection with the execution and
delivery of such Security Agreement pursuant to Section 8.13 with such
changes thereto as the Administrative Agent may reasonably request);
(c) take whatever action (including without limitation the recording
of mortgages, the filing of Uniform Commercial Code financing statements,
the giving of notices and the endorsement of notices on title documents)
which may be necessary or advisable in the opinion of Administrative Agent
to vest in the Collateral Agent (or in any representative of the Collateral
Agent designated by it) valid and subsisting Liens on the properties
purported to be subject to the security agreements delivered pursuant to
this Section 6.16, enforceable against all third parties in accordance with
their terms;
(d) deliver to the Administrative Agent a signed copy of favorable
opinions, addressed to the Agents and the Lenders, of counsel for the
Borrower acceptable to the Administrative Agent as to such matters relating
to such Subsidiary or Qualified Joint Venture as either Agent may
reasonably request; and
(e) at any time and from time to time, promptly execute and deliver
any and all further instruments and documents and take all such other
action as the Administrative Agent may deem desirable in obtaining the full
benefits of, or in preserving the Liens of, each security agreement
delivered pursuant to this Section 6.16 and mortgages and other agreements
and instruments entered into by such Subsidiary or Qualified Joint Venture.
Section 6.17. Subordinated Debt Rate Hedging Arrangements. At any time at
which Nortel owns or holds less than fifty percent (50%) of the aggregate
Commitments under the Credit Facility, and within 60 days after a request by the
Administrative Agent, the Borrower will either (i) enter into Interest Rate
Protection Agreements or Rate Hedging Agreements satisfactory to the Lenders
providing for the hedging of its interest rate risk with respect to one hundred
percent (100%) of the notional amount of the Affiliate Subordinated Debt and
Non-Affiliate Subordinated Debt (or such greater amount as the Borrower may
purchase at its option if evidenced by Permitted Hedging Arrangements to the
extent permitted under Section 7.01(g), but only so long as such amount does not
exceed at such time the total notional amount of
92
<PAGE>
Indebtedness of Borrower which bears interest at a floating rate) for a period
of at least three (3) years, (ii) cause the interest rate on the Affiliate
Subordinated Debt to be converted to a fixed rate at then-prevailing market
rates, or (iii) cause that portion of the Affiliate Subordinated Debt and Non-
Affiliate Subordinated Debt for which interest is payable currently to be
converted to equity. For purposes of this Section 6.17, Nortel shall not be
deemed to hold that portion of the Commitments in which Nortel has sold a
participation.
Section 6.18. Syndication. The Borrower and OC shall provide prompt
assistance to the Administrative Agent and the Lenders in connection with their
respective efforts in syndicating the Credit Facility. Such assistance includes
making senior officers of the Borrower and OC available for meetings with
potential Lenders, providing, in a timely manner, such assistance as may be
reasonably requested by the Administrative Agent or its advisors, including
providing information to and responding to inquiries from prospective Lenders
with respect to the business, operations, business plan, results and other
matters relating to the business of OC, the Borrower, and the other Guarantors,
and cooperating with a private placement of the Notes evidencing the Loans.
Section 6.19. Capital Contribution Agreement. The Borrower and OC shall
comply with the terms of the Capital Contribution Agreement and shall not
consent to any waiver, modification, or amendment thereto without the prior
written consent of the Required Lenders.
Section 6.20. Ericsson Tranche Y Loan. The Borrower shall not consent to
any modification or amendment to any requirement for mandatory prepayments
contained in the Ericsson Tranche Y Loan so as to create additional mandatory
prepayments or make existing ones more favorable to the holder of the Ericsson
Tranche Y Loan without the prior written consent of the Required Lenders.
Section 6.21. C-Block Subsidiaries and D-, E- and F-Block Subsidiaries.
While any C-Block Subsidiary or any D-, E- and F-Block Subsidiary shall be a
Guarantor hereunder the Borrower will cause such Persons to perform and observe
each covenant and condition hereunder applicable to, and as if such Person were,
a Subsidiary of the Borrower.
Section 6.22. Wichita PCS and a D&E/Omnipoint Intercompany Notes;
Overadvances. Borrower shall cause Wichita PCS and D&E/Omnipoint, respectively,
to repay all amounts outstanding under their respective Intercompany Notes to
the Borrower within 180 days of the date of this Agreement in accordance with
Section 2.01(a), Section 2.09(a)(ii)(B) and Section 7.04(l). Borrower covenants
and agrees that it shall make a mandatory prepayment to the Administrative Agent
in accordance with Section 3.02(h) hereof. Borrower covenants and agrees that it
shall repay the aggregate outstanding amount of any Overadvance, if any,
permitted by Section 2.01(a) within 180 days of the date of this Agreement.
Section 6.23. Atlantic City BTA. Within one hundred eighty (180) days of
the Closing Date, if the C-Block FCC License for the Designated BTA for Atlantic
City, New Jersey (the
93
<PAGE>
Atlantic City BTA") has not been disposed of in accordance with the provisions
of (S)7.6(b)(iii)(A)(1)(IV) or sublicensed in accordance with (S)7.11(a)(V),
Borrower shall cause switching interconnection services and other similar
Network services to be made available to the Atlantic City BTA pursuant to
long-term agreements in form and substance satisfactory to the Required
Lenders.
ARTICLE VII
CERTAIN NEGATIVE COVENANTS OF THE BORROWER
The Borrower covenants and agrees that, so long as any Loan or Note or fees
or expenses are outstanding or any Lender has any Commitment hereunder:
Section 7.01. Restrictions on Indebtedness.Subject to the other
limitations of this Agreement, the Borrower shall not create, incur, assume,
guarantee or suffer to exist, or permit any of its Subsidiaries to create,
incur, assume, guarantee or suffer to exist, contingently or otherwise, any
Indebtedness other than (without duplication):
(a) the Loans;
(b) Non-Affiliate Subordinated Debt, not to exceed $200 million in the
aggregate;
(c) Affiliate Subordinated Debt, not to exceed $200 million in the
aggregate (of which no more than $100 million owing to such Affiliates may
require the payment of current interest);
(d) Indebtedness under Permitted Loan Agreements;
(e) with respect to the License Subsidiaries, FCC Debt existing on the
Closing Date; and
(f)
(i) purchase-money Indebtedness (including not more than
$5,000,000 for Real Estate); and
(ii) Capital Lease Obligations
but only so long as:
94
<PAGE>
(A) the aggregate principal amount of Indebtedness under
clauses (i) and (ii) above at any one time outstanding does not
exceed $30,000,000 and
(B) such Indebtedness is in a principal amount that does not
exceed the fair market value of the property being acquired or
leased;
(g) Indebtedness under Permitted Hedging Arrangements;
(h) Indebtedness the proceeds of which are used solely for
working-capital purposes, but only so long as the aggregate principal
amount of such Indebtedness outstanding on any date does not exceed the
lesser of (i) $30,000,000 and (ii) an amount equal to two (2) dollars times
Total POPs determined as of any time; and
(i) Other Indebtedness (in addition to Indebtedness described in
clauses (a) through (h)) not to exceed $15,000,000 in the aggregate
outstanding at any one time.
Indebtedness to OC or to any of its Subsidiaries shall only be permitted
hereunder pursuant to this Section hereof.
Section 7.02. Restrictions on Liens. Neither the Borrower nor its
Subsidiaries shall (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; and
shall not permit any of its Subsidiaries to do any of the foregoing; provided
that the Borrower or any Subsidiary may create or incur or suffer to be created
or incurred or to exist the following (collectively, "Permitted Liens"):
(a) 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;
(b) deposits or pledges made in connection with, or to secure payment
of, worker's compensation and unemployment insurance;
95
<PAGE>
(c) 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;
(d) 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 the
Borrower or any of its Subsidiaries is a party, and other minor liens
or encumbrances none of which interferes materially with the use of
the property affected in the ordinary conduct of the business of the
Borrower or any of its Subsidiaries, which defects do not individually
or in the aggregate have a Material Adverse Effect on the business of
the Borrower or any of its Subsidiaries, and
(ii) with respect to Real Estate mortgage (or deed of trust)
Liens (collectively, "Mortgage Liens") to secure the payment of
Indebtedness permitted to be incurred under Section 7.01(f)(i);
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 or any of its Subsidiaries and (2) the cost of
any improvements constructed thereon; and
(B) the Borrower or such Subsidiary 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 and its Subsidiaries owing
to lenders that are parties to the Intercreditor Agreement,
or
(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 F;
(e) 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;
96
<PAGE>
(f) 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
(including, without limitation, letters of credit issued for the account of
the Borrower or its Subsidiaries to support any of the foregoing and the
reimbursement obligations related thereto) not to exceed in the aggregate
at any one time $5,000,000;
(g) Liens on FCC Licenses and proceeds of the sale or other
disposition thereof in favor of the FCC securing FCC Debt owing by License
Subsidiaries permitted pursuant to Section 7.01(e); and
(h) Liens securing purchase-money Indebtedness permitted under Section
7.01(f)(i) or (ii) 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 and the proceeds of such
property to the extent the applicable Uniform Commercial Code provides for
the automatic perfection of a security interest in such proceeds.
Section 7.03. No Contingent Obligations. Subject to the other limitations
of this Agreement, the Borrower shall not create, incur, assume, guarantee or
remain liable, or permit any of its Subsidiaries to create, incur, assume,
guarantee or remain liable, on any Contingent Obligations other than:
(a) the Guaranties,
(b) guaranties of Indebtedness under other Permitted Loan Agreements,
and
(c) guaranties of Indebtedness permitted under 7.01(f)(i) and (ii).
Section 7.04. Restrictions on Investments. The Borrower shall not make or
permit to exist or to remain outstanding, or permit any of its Subsidiaries to
make or permit to exist or to remain outstanding, any Investment except:
(a) Investments in Permitted Hedging Arrangements in a notional
principal amount on any date reasonably related to 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 or
any of its Subsidiaries, is accorded a rating of "A1" or better by Standard
& Poor's Ratings Group or "P1" or
97
<PAGE>
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
(ii) repurchase agreements fully secured by underlying securities
of the type described in clause (i) above and issued by a bank or
trust company meeting the requirements of Section 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 "A" 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) the Borrower's investments as of the date hereof in its
Subsidiaries;
(g) Investments by the Borrower in Qualified Joint Ventures relating
to the Designated BTAs; provided that the aggregate amount of such
Investments at any one time outstanding shall not exceed the QJV Amount;
(h) Investments existing on the date hereof and listed on Schedule
7.04;
(i) Investments consisting of loans to OC made with the proceeds of a
Facility B Loan under Tranche 1 or 2 of Facility B within two Business Days
after the date on which such Loan is made, but only if:
(i) such loan is payable on demand following the acceleration of
the Loans,
(ii) such loan ranks at least pari passu with all other senior
Indebtedness of OC,
98
<PAGE>
(iii) each advance under such loan (and the interest on each such
advance and any applicable Breakage Costs) shall be payable on or
before December 31, 2000 and such loan is otherwise on terms providing
for interest and principal amortization substantially as provided
herein for Facility B Loans,
(iv) such loan is evidenced by a promissory note that is an
instrument within the meaning of the New York Uniform Commercial Code
and is substantially in the form of Exhibit N (the "Facility B Mirror
Note"),
(v) such promissory note is pledged to the Collateral Agent as
security for the Borrower's obligations hereunder and under the other
loan documents and is delivered to the Collateral Agent; and
(vi) OC has delivered the OC Guaranty prior to the date of such
loan and the OC Guaranty has not been terminated.
(j) Investments consisting of loans between the Borrower and its
Wholly-Owned Subsidiaries, but only if:
(i) such loans are payable on demand following the acceleration
of the Loans;
(ii) such loan is evidenced by a promissory note that is an
instrument within the meaning of the New York Uniform Commercial Code
and is in form and substance satisfactory to the Required Lenders (the
"Intercompany Note");
(iii) such promissory note is pledged to the Collateral Agent as
security for the Borrower's obligations hereunder and under the other
loan documents and is delivered to the Collateral Agent;
(iv) the aggregate amount of such loans at any one time
outstanding cannot exceed the amount in Section 7.01(c); and
(v) the loans are subordinated pursuant to a Subordination
Agreement (Affiliate).
(k) Investments by the Borrower in Non-Qualified Joint Ventures
(exclusive of Wichita PCS and D&E/Omnipoint); provided that, the aggregate
amount of such Investments at any one time outstanding shall not exceed
$5,000,000.
(l) From the date of this Agreement until 180 days after the date of
this Agreement, Investments by the Borrower in Wichita PCS and
D&E/Omnipoint
99
<PAGE>
consisting of loans to Wichita PCS and D&E/Omnipoint, provided that, the
aggregate amount of such Investments at any one time outstanding shall not
exceed $30,000,000 (inclusive of the aggregate outstanding amount of any
Overadvance at such time), but only if:
(i) the proceeds of such loans are used by Wichita PCS and
D&E/Omnipoint, respectively, to purchase Nortel Goods and Services for
any one or more of the Wichita BTAs and the Denver & Ephrata BTAs in
accordance with Section 2.09(a)(ii)(B),
(ii) the loans are evidenced by Intercompany Notes which
constitute as Collateral hereunder,
(iii) within 180 days after the date of this Agreement, Wichita
PCS and D&E/Omnipoint repay the Borrower all outstanding amounts under
the Intercompany Notes (including accrued but unpaid interest and
applicable Breakage Costs) and invested in Wichita PCS and
D&E/Omnipoint pursuant to this Section 7.04(l) so that on the 180th
day after the date of this Agreement no amounts are outstanding under
such Intercompany Notes,
(iv) within 180 days of the date of this Agreement and upon
receipt of such funds from Wichita PCS and D&E/Omnipoint, Borrower
makes a mandatory prepayment to the Administrative Agent in accordance
with Section 3.02(h) hereof;
(m) Investments to the extent permitted by Section 7.05(a); and
(n) Investments by the Borrower and its Subsidiaries consisting of
seller take-back financing permitted under Section 7.06(b)(iii)(A).
The aggregate amount of any Investment consisting of non-cash consideration in
any Qualified Joint Venture shall be the greater of (A) the net book value of
the assets (as determined in accordance with GAAP) contributed thereto (or, in
the case of a contribution by way of an FCC License Partition, a ratable portion
of such net book value, determined with respect to the total POPs of such BTA),
net of any purchase-money Indebtedness of the Borrower or a Subsidiary in
respect thereof that is assumed by the acquiror thereof, and (B) the fair-market
value of the assets so contributed as determined in good faith by the Board of
Directors of OC.
Section 7.05. Distributions. The Borrower shall not make, or permit any of
its Subsidiaries to make, any Distributions, including Distributions to any
Affiliates, officers, directors or employees of the Borrower or its Subsidiaries
(other than Distributions that
100
<PAGE>
constitute salaries paid in the ordinary course of business) in respect of the
Borrower's Stock or any Subordinated Debt of the Borrower, except that the
Borrower may:
(a) make loans or advances in the ordinary course of business not to
exceed $500,000 in the aggregate at any one time to its officers, directors
or employees for expenses (including moving expenses related to a transfer)
incidental to carrying on the business of the Borrower or any of its
Subsidiaries;
(b) make Distributions to Affiliates to repay that portion of
outstanding Affiliate Subordinated Debt that was used by the Borrower or
the Affiliate on behalf of the Borrower to make Capital Expenditures that
would have been permitted to be made under this Credit Facility pursuant to
Section 2.09 hereof, provided (I) that from and after June 30, 1999 such
Distribution (x) shall only be permitted if made to an Affiliate within 180
days of the date such Capital Expenditure was made by or on behalf of the
Borrower and (y) shall not exceed the lesser of (i) the Affiliate
Subordinated Debt incurred by Borrower during such 180-day period or (ii)
the amount of all Advances made during such 180-day period, and the
Administrative Agent receives satisfactory evidence as to the matters in
clauses (x) and (y), and (II) that, prior to June 30, 1999 the limitations
of clause (I) shall also apply if (x) on or after December 31, 1998 Nortel
has syndicated or sold participations in 50.01% or more of the Commitments
and Advances outstanding hereunder to a Person that is not an Affiliate of
Nortel and (y) Administrative Agent has provided the Borrower with thirty
days' prior written notice that the 180 day period shall commence within 30
days.
(c) pay interest in respect of Affiliate Subordinated Debt as and when
due in accordance with the terms of any Subordination Agreement (Affiliate)
substantially in the form attached hereto as Exhibit G-1, but only so long
as, with respect to (a), (b) or (c) of this Section 7.05, no event or
circumstance which would constitute a Default or Event of Default exists
under the Credit Facility (including an OC Debt Default) or would result
from such payment or Distribution.
(d) make Distributions with respect to any Stock of the Borrower,
which Stock is subject to the pledge by the Parent in favor of the
Collateral Agent under the Parent Pledge Agreement, out of Excess Cash Flow
that remains after all required prepayments are made hereunder;
(e) permit a Qualified Joint Venture to make a Distribution to a
venture partner other than the Borrower but only if the conditions in the
definition of "Qualified Joint Venture" have been satisfied.
(f) make Distributions to Affiliates to repay that portion of
Affiliate Subordinated Debt arising under the Expense Allocation Agreement;
101
<PAGE>
but only so long as, with respect to (d) or (e) or (f) of this
Section 7.05,
(i) no event or circumstance which would constitute a Default or
Event of Default exists under the Credit Facility (including an OC
Debt Default) or would result from such payment or Distribution, and
(ii) the ratio of Total Debt to Adjusted OCF for the four most
recently completed fiscal quarters ending prior to the date of such
Distribution is no greater than 8.0 to 1.0.
Section 7.06. Merger, Consolidation, Disposition of Assets, Etc.
(a) The Borrower shall not merge into or consolidate with any Person
or permit any Person to merge into it, and shall not permit any of its
Subsidiaries to do any of the foregoing.
(b) The Borrower shall not, and shall not permit any Subsidiary to,
become a party to or agree to or effect any disposition of assets
(including without limitation any disposition of any right to use any
portion of any wavelength covered by any FCC License or any right to
provide PCS services to any POPs in any geographic area within any
Designated BTA), 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 or any Subsidiary's
business, consistent with sound and prudent practices,
(iii) so long as no Default shall have occurred and be continuing
at the time thereof any:
(A) FCC License Transfer, FCC License Partition and any
disposition of equipment or other assets used primarily for the
operation of a BTA with respect to which such FCC License
Transfer or FCC License Partition shall have occurred, but, in
each case, only if:
(1) one of the following shall be true:
(I) after giving effect to such disposition and
all other FCC License Transfers and FCC License
Partitions, the number of POPs included in BTAs as to
which such FCC License Transfers shall have occurred
and geographic
102
<PAGE>
areas for which the right to provide PCS services
shall have been disposed of pursuant to FCC License
Partitions (other than dispositions as to which a
condition specified in clause (II), (III) or (IV) below
shall have been satisfied) shall not exceed 5% of the
total POPs of all BTAs that are Designated BTAs as of
the date of this Agreement, plus the number of total
POPs of any BTA that becomes a Designated BTA after the
date of this Agreement but before such disposition, and
the BTAs affected by the FCC License Transfer or FCC
License Partition are not core BTAs; or
(II) such disposition is an FCC License Transfer
and all of the following are true: (a) the sole
consideration paid in connection with the disposition
is the FCC License in respect of which the FCC License
Transfer shall have occurred; (b) in consideration for
such disposition an FCC License is acquired for the
same BTA as that for the FCC License being disposed of,
and such acquired FCC License covers at least the same
amount of spectrum as the FCC License being disposed
of; (c) no asset other than such FCC License is
disposed of in connection with such disposition; (d) no
License Subsidiary or other Loan Party shall be liable
for the payment of any FCC Debt for the FCC License
being disposed of; and (e) no Indebtedness is incurred
by the Borrower and its Subsidiaries in connection with
such disposition except FCC Debt in an aggregate
principal amount not exceeding the aggregate principal
amount of FCC Debt in respect of the FCC License being
disposed of; or
(III) the Required Lenders shall have accepted as
a Designated BTA a BTA in substitution for the BTA as
to which such FCC License Transfer shall have occurred;
or
(IV) (A) a voluntary transfer (including a
transfer to any Affiliate of the Borrower), whether or
not for any consideration other than forgiveness of
Indebtedness or assumption thereof by the transferee,
of a C-block FCC License or (B) up to 15 MHz of
spectrum of a C-block FCC License in respect of a
Designated BTA or portion thereof to the FCC, but only
so long as with respect to (A), within ten (10)
Business Days of the date of such transfer, the
Borrower makes a mandatory prepayment pursuant to
103
<PAGE>
Section 3.02(j) in an amount equal to the sum of (x)
the purchase price of all or that portion of the Nortel
Goods and Services used in the Designated BTA or
portion thereof and (y) the amount of Permitted
Third-Party Expenses incurred (plus accrued but unpaid
interest thereon) in connection with the affected BTA
or any portion thereof.
(2) no equipment or other assets that are disposed of
shall be assets that are necessary for the normal commercial
operation of any Designated BTA remaining after such
disposition;
(3) such disposition shall not relate to a Core BTA;
(4) with respect to clause (I), the transferee of the
BTA has agreed that such BTA will utilize GSM technology for
the operation of its Network, and
(5) with respect to clause (I), roaming agreements and
other technology agreements shall be (or remain) in place so
as to allow the transferred BTA to coordinate its operations
with the Network.
(B) dispositions of the right to use spectrum in respect of
any FCC License, so long as
(1) the remaining License covers at least 10 MHz of
spectrum;
(2) the consideration received therefor shall be at
least equal to the fair-market value thereof
(3) roaming agreements and other technology agreements
shall remain in place so as to allow the transferred BTA to
coordinate its operations with the Network,
(4) the Borrower provides the Administrative Agent with
an engineering report satisfactory to the Administrative
Agent and the Required Lenders demonstrating that there will
be no significant decrease in quality of service as a result
of such disposition, and
(5) no asset other than such FCC License is disposed of
in connection with such disposition.
104
<PAGE>
(C) sublicensing of FCC Licenses from a License Subsidiary
to Qualified Joint Ventures and contributions of any equipment
and other assets used primarily for the operation of the related
Designated BTA or applicable geographic area thereof to Qualified
Joint Ventures, so long as:
(1) such disposition shall be in compliance with
Section 7.04(g),
(2) such disposition shall not relate to an FCC License
for a Core BTA and
(3) the aggregate value of the consideration received
by the Borrower and its Subsidiaries for such sublicensing
or contribution shall at least be equal to the fair-market
value (as determined in good faith by the Board of Directors
of the OC) of the assets so contributed or sublicensed;
(iv) to the extent not otherwise subject to (i) through (iii) and
(v) hereof, other voluntary dispositions of assets for their fair-
market value solely for cash consideration in an amount not to exceed
$5,000,000 in the aggregate during the term of this Agreement, the
proceeds of which are subject to mandatory prepayment pursuant to
Section 3.02 hereof; and
(v) to the extent not otherwise subject to (i) through (iv)
above, transfers of assets from the Borrower to any Wholly-Owned
Subsidiary or from a Subsidiary to the Borrower or another
Wholly-Owned Subsidiary, in each case to the extent that, no Default
shall have occurred and be continuing at the time and that after
giving effect to such transfer, the transferee would be in compliance
with its obligations under Section 7.12.
If the Borrower or any of its Subsidiaries shall make any disposition of
any assets pursuant to clause (iii)(C) above to a Qualified Joint Venture, the
Borrower shall not thereafter permit such Qualified Joint Venture to fail to
continue to qualify as a Qualified Joint Venture, except in a transaction
involving a disposition of the assets of such Qualified Joint Venture that is
otherwise permitted under this subsection (b). The Borrower shall not, and shall
not permit any Subsidiary to, contribute any assets to a Qualified Joint Venture
except to the extent reasonably necessary for the contemplated operations of
such Qualified Joint Venture.
(c) Except with the agreement of the Required Lenders, the Borrower
shall not permit any Subsidiary to issue or sell any Stock or other equity
interest in itself, other than to the Borrower or another Subsidiary of the
Borrower and only if such Stock is pledged as security under the Collateral
Documents.
105
<PAGE>
Section 7.07. Sale and Leaseback. The Borrower shall not enter into, or
permit any of its Subsidiaries to enter into, any arrangement, directly or
indirectly, whereby the Borrower or any of its Subsidiaries 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 or such Subsidiary 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,
and shall not permit any of its Subsidiaries to:
(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, nor shall the Borrower permit any of its Subsidiaries to:
(a) engage in any "prohibited transaction" within the meaning of
Section 406 of ERISA or Section 4975 of the IRC which could result in a
material liability for the Borrower;
(b) permit any Guaranteed Pension Plan to incur an "accumulated
funding deficiency", as such term is defined in Section 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
106
<PAGE>
of a lien or encumbrance on the assets of the Borrower pursuant to
Section 302(f) or Section 4068 of ERISA;
(d) permit or take any action which would result in the aggregate
benefit liabilities (with the meaning of Section 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 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 the Borrower or an ERISA
Affiliate.
Section 7.10. New Subsidiaries. The Borrower shall not create or acquire
any Person other than Operating Subsidiaries, Licenses Subsidiaries,
Non-Qualified Joint Venturers and Qualified Joint Ventures, provided that, the
Borrower may only create or acquire a Qualified Joint Venture that owns an FCC
License relating to a BTA that is not a Designated BTA with the prior written
consent of the Administrative Agent and the Required Lenders. The Borrower shall
not permit any of its Subsidiaries to create or acquire any Person.
Section 7.11. Transactions with Affiliates. The Borrower shall not enter
into, or permit any of its Subsidiaries to enter into:
(a) any agreement or arrangement providing for the payment of any
amounts to any of its Affiliates, except that:
(i) the Borrower may enter into the Expense Allocation Agreement;
and any Operating Subsidiary may enter into (A) the Cash Management
Agreement, (B) a Management Services Agreement substantially in the
form of Exhibit D-1 hereto, between such Operating Subsidiary and OCSI
and (C) one or more operating agreements substantially in the form of
Exhibit D-2 hereto,
107
<PAGE>
between such Operating Subsidiary and a License Subsidiary, provided,
however, that the foregoing agreements may not be amended unless such
amendment is first approved in writing by the Required Lenders;
(ii) the Borrower and its Subsidiaries may enter into a
tax-sharing agreement or arrangement pursuant to which the Borrower
and its Subsidiaries 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 and its Subsidiaries would have paid if the Borrower and its
Subsidiaries had always filed income-tax returns as separate entities;
and
(iii) the Borrower and its Subsidiaries may enter into 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 or such Subsidiary than it
would obtain in a comparable arm's-length transaction with a
Person not an Affiliate; and
(2) does not provide for the performance of services or
purchase or delivery of property by the Borrower or such
Subsidiary 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 or such Subsidiary to build-out or operate
any BTA or MTA for which it owns the applicable FCC License,
or
(B) is approved in writing by the Required Lenders,
(iv) the Borrower may enter into an agreement with an Affiliate
with respect to purchases of equipment and provision of services for
the Network at the lower of fair market value or cost.
(v) subject to compliance with applicable FCC rules and
regulations, the Borrower and its Subsidiaries may within one hundred
eighty (180) days of the Closing Date enter into an agreement, in form
and substance satisfactory to the Required Lenders, with Omnipoint
Communications Enterprises, L.P., a Delaware limited partnership, the
operating subsidiary of the Grand Parent for the Philadelphia BTA, to
sublicense all of the right, title and interest of the Borrower
108
<PAGE>
and its Subsidiaries to use, operate and manage the FCC C-Block License for the
Atlantic City BTA and all or a portion of the Nortel Goods and Services and
related property for use in the Atlantic City BTA and the FCC C-Block License
therefor, which agreement shall include, without limitation, the continued
security interest (and pledge) in favor of the Collateral Agent with respect to
(I) all assets currently subject to Security Agreements in respect of the
Atlantic City BTA and (II) all cash flow derived from such sublicense agreement.
(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 or such
Subsidiary than it would obtain in a comparable arm's-length transaction
with a Person not an Affiliate.
Section 7.12. Permitted Business.The Borrower shall not:
(a) engage in any business other than the holding of Stock of
Operating Subsidiaries, License Subsidiaries, Wholly Owned Subsidiaries,
Qualified Joint Ventures and Non-Qualified Joint Ventures to the extent
permitted under Section 7.04 and Section 7.10 of this Agreement, and the
purchasing and reselling to any of the foregoing of equipment used in
connection with the build-out and operation of PCS Systems for which FCC
Licenses for BTAs are held by License Subsidiaries or Qualified Joint
Ventures or Non-Qualified Joint Ventures or hold any assets other than such
Stock and the Facility B Mirror Note,
(b) permit any License Subsidiary to engage in any business other than
the holding of FCC Licenses and the licensing thereof to other Persons to
the extent permitted hereunder or hold any assets other than FCC Licenses,
(c) permit any Operating Subsidiary to engage in any business other
than the development, construction and operation of PCS Systems and related
businesses, and
(d) permit any Qualified Joint Venture to engage in any business other
than that permitted by subparagraphs (b) or (c) above.
Section 7.13. Charter Amendments. The Borrower shall not, and shall not
permit any of its Subsidiaries to, amend its charter documents 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
and shall not permit any Subsidiary:
109
<PAGE>
(a) 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 or any of its Subsidiaries, other than the prepayment of the
Advances in accordance with the terms of this Agreement, except for
prepayments, redemptions, purchases or other satisfactions by the Borrower
as to which lenders under the Intercreditor Agreement are not required to
pay any amount to other lenders party thereto or FCC Debt, or
(b) to 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 or any of its Subsidiaries and the Borrower or such
Subsidiary shall not pay in full all such amounts as are then due and owing, the
Borrower shall not pay, or permit such Subsidiary to 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 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 or such Subsidiary
to such lender.
Section 7.16. Amendment, Etc., of Material Contracts. The Borrower shall
not, and shall not permit any Subsidiary to, 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, and shall not permit any of its Subsidiaries to do
any of the foregoing, that, in any such case, could, at the time thereof,
reasonably be expected to have a material adverse effect on the ability of the
Borrower or any of its Subsidiaries to perform its obligations under this
Agreement or any other Loan Document.
Section 7.17. Restrictions on Subsidiaries.
(a) 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 or limiting the
ability of any Subsidiary to declare and pay dividends and Distributions or
make Investments in the Borrower.
110
<PAGE>
(b) So long as any Advances are outstanding or any other amount is
owing under the Loan Documents, no Distribution shall be made by any
Qualified Joint Venture except in cash or to any Person other than the
Borrower and its Subsidiaries, except as permitted pursuant to Section 7.05
hereof.
Section 7.18. Partnerships. The Borrower shall not become, or permit any of
its Subsidiaries to become, a general partner in any general or limited
partnership other than any Subsidiary the sole asset of which consists of its
interest in such partnership.
Section 7.19. Default Under the Volume Purchase Agreement. The Borrower
shall not and shall not permit any of its Subsidiaries to default in the
performance or observance of any covenants or conditions on its part to be
performed or observed under the Volume Purchase Agreement.
Section 7.20. Collections of Receivables. Except as provided in the
Management Services Agreement, the Borrower shall not, and shall not permit any
of its Subsidiaries and Affiliates to, collect any receivables arising from
providing PCS or other services or sales of handsets or other assets, except
through the Operating Subsidiary.
Section 7.21. Management Fees. The Borrower shall not and shall not permit
its Subsidiaries to pay any management fees, except pursuant to the terms of the
Management Services Agreement and Cash Management Agreement.
Section 7.22. Operating Leases. The Borrower shall not and shall not permit
any of its Subsidiaries to incur Operating Lease Obligations (excluding real
estate expenses such as rental and tower leasing), that individually or in the
aggregate, provide for an annual payment in excess of $5,000,000, unless with
Required Lenders prior written approval.
Section 7.23. Restrictions Regarding License Subsidiaries. The Borrower
shall not and shall not permit any of its License Subsidiaries to, (i) acquire
any assets other than FCC Licenses, (ii) engage in any business other than as
owner of FCC Licenses for use by the Borrower and the Operating Subsidiaries or
a Qualified Joint Venture or NonQualified Joint Venture and take the actions
authorized and contemplated in this Agreement in connection with the Credit
Facility, or (iii) incur any Indebtedness other than as a Guarantor or as an
obligor to the FCC for FCC Debt that constitutes permitted Indebtedness
hereunder.
111
<PAGE>
ARTICLE VIII
CONDITIONS TO THE CLOSING
The obligations of each Lender to make any initial Advance shall be subject
to the satisfaction of the following conditions precedent on or prior to the
date of the initial Advance (the "Closing Date"):
Section 8.01. Terms and Conditions of Transaction.
(a) Each Lender shall have received one or more Notes, payable to the
order of such Lender, duly executed and delivered by the Borrower, as well
as copies of 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.
(b) The Lenders shall be satisfied with the final terms and conditions
of the transactions contemplated hereby and by the other Loan Documents,
including, without limitation, all legal and tax aspects thereof.
(c) The Lenders shall be satisfied with the corporate and legal
structure and capitalization of the Borrower and its Subsidiaries,
including, without limitation, their respective charters and bylaws and
each agreement or instrument relating thereto.
(d) The Administrative Agent and the Required Lenders shall have
completed satisfactory review and approval of the Borrower's Network
build-out plan, budget and schedule, including financial projections of the
Borrower and its Consolidated Subsidiaries for the ten-year period
beginning January 1, 1998, certified by the principal or chief accounting
or financial officer of the Borrower as having been prepared in accordance
with GAAP except for the absence of footnotes and the recording of FCC
licenses and related obligations on a cost basis, such projections giving
effect to the indebtedness to be incurred under the Credit Facility as well
as the other indebtedness to be incurred by the Borrower and its
Consolidated Subsidiaries during such ten-year period.
Section 8.02. Due Diligence. The Lenders shall have completed a
due-diligence investigation of the Borrower and its Subsidiaries in scope, and
with results, satisfactory to the Lenders and shall have been given such access
to the management, records, books of account, contracts and properties of the
Borrower and shall have received such financial, business and other information
regarding the Borrower and its Subsidiaries as they shall have requested.
Section 8.03. Validity of Liens. The Borrower Security Agreement, the
Parent Pledge Agreement and each other Collateral Document required to be
entered into on the date hereof
112
<PAGE>
shall be effective to create in favor of the Collateral Agent a legal, valid and
enforceable first-priority security interest (except for Liens that have
priority under applicable law and which are Permitted Liens or Liens which are
pari passu pursuant to the Intercreditor Agreement and are Permitted Liens) 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,
all such documents shall have been duly executed by the applicable Loan Party
and all filing and recording fees and taxes relating to any of the foregoing
shall have been duly paid. 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 Uniform Commercial Code, 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 (other than Permitted Liens)
in such official's office covering any Collateral or showing any Loan Party
as a debtor thereunder;
(b) a certificate of each Loan Party signed by an authorized officer
of such Loan Party, 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) acknowledgment copies or duly executed file-stamped copies of
UCC-1 and UCC-3 financing statements with respect to the Collateral filed
in each office in each jurisdiction that the Administrative Agent may deem
necessary or appropriate to perfect and protect a first-priority 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 Collateral Documents 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, with the
standard mortgage endorsement (without contribution) 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, the Parent, and OC in form and
113
<PAGE>
substance satisfactory to the Administrative Agent and the Lenders, dated as of
the Closing Date as to the Borrower, the Parent and OC being Solvent after
giving effect to the consummation of the transactions contemplated herein and in
the other Loan Documents.
Section 8.07. Opinions of Counsel to the Borrower and its Subsidiaries.
Each of the Lenders and the Administrative Agent shall have received favorable
legal opinions addressed to the Lenders and the Administrative Agent, each dated
as of the Closing Date, in form and substance satisfactory to the Lenders and
the Administrative Agent, from (i) Piper & Marbury, L.L.P., counsel to the
Borrower, (ii) Piper & Marbury, L.L.P., counsel to the Borrower's Subsidiaries,
and (iii) local counsel to the Borrower's Subsidiaries in such jurisdictions as
the Administrative Agent may reasonably request as to, among other things, the
authorization, execution and enforceability of the Loan Documents, creation,
validity and perfection of the security interests in the Collateral, the
applicability of New York law, and the absence of any violations of, or conflict
with, credit agreements, indentures, and other material agreements, in form and
substance acceptable to the Administrative Agent and the Lenders.
Section 8.08. Opinion of Counsel to the Parent and OC. Each of the Lenders
and the Administrative Agent shall have received a favorable legal opinion
addressed to the Lenders and the Administrative Agent, from Piper & Marbury,
L.L.P., counsel to the Parent, the C-Block Subsidiary Parent, the D-, E- and F-
Block Subsidiary Parent and OC, 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 Piper & Marbury, L.L.P., FCC counsel
to the Borrower, the Parent and the License Subsidiaries, dated as of the
Closing Date, in form and substance satisfactory to the Lenders and the
Administrative Agent.
Section 8.10. Payment of Fees. The Borrower shall have paid all accrued
fees and expenses of the Administrative Agent, the Collateral Agent and the
Lenders, to the extent payable by the Borrower hereunder and under the other
Loan Documents.
Section 8.11. Approvals, Permits; FCC Licenses.
(a) The Borrower and each of the License Subsidiaries and Operating
Subsidiaries shall have obtained all federal, state and local governmental
and regulatory consents, approvals, FCC Licenses and permits, including any
third-party consents, as required or necessary for the Borrower to accept
Loans and for the Borrower and each of the License Subsidiaries and
Operating Subsidiaries to construct and operate the Network and their
businesses pursuant to the Approved Full Term Operating Business Plan and
shall maintain in effect each of the foregoing; 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
114
<PAGE>
materially adverse conditions upon the Loans or the operation of the
businesses of the Borrower and each of the License Subsidiaries and
Operating Subsidiaries as currently operated, 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, and, to the
extent requested by the Administrative Agent or any Lender, a favorable
opinion of regulatory counsel dated as of the Closing Date.
(b) The Lenders shall have received evidence satisfactory to the
Lenders that each FCC License listed in Schedule 5.07 has been won by OC
and its Subsidiaries in FCC PCS auctions, has been transferred to a License
Subsidiary, and that no such FCC License is subject or likely to be subject
to any revocation action commenced or threatened by the FCC or to being
purchased by any Person other than a License Subsidiary.
(c) The Administrative Agent and the Lenders shall have received
satisfactory evidence that the Borrower or the License Subsidiaries, as
applicable, have complied with all initial and on-going applicable
conditions of issuance of any licenses, including without limitation FCC
PCS Licenses. To the extent that the License Subsidiaries hold one or more
FCC PCS Licenses under which the Borrower or the Operating Subsidiaries
will operate, the Borrower or the Operating Subsidiaries must have the
exclusive, unrestricted right to use such licenses pursuant to a license
agreement in form and substance acceptable to the Administrative Agent and
the Lenders, and the applicable License Subsidiaries must agree that the
Administrative Agent, for the benefit of the Lenders, may enforce the
license agreement in its favor or in favor of a transferee.
(d) The Administrative Agent and the Lenders shall have received
satisfactory evidence that all Loan Parties have received all applicable
waivers and consents required under all credit agreements, indentures and
other material agreements to which each of them is a party to permit them
to execute, deliver and perform the obligations under the Loan Documents.
Section 8.12. Delivery of Full-Term Operating Business Plan. The Borrower
shall have delivered to the Administrative Agent and each Lender a full-term
operating business plan, which shall be in form and substance satisfactory to
the Administrative Agent and each Lender, together with (i) a certificate of the
chief or principal financial or accounting officer of the Borrower 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 such plan misleading in any material respect and
(ii) such pro-forma financial statements and projections for the Borrower and
its Subsidiaries, in form and substance satisfactory to the Lenders, as shall be
reasonably requested by the Lenders.
115
<PAGE>
Section 8.13. Security Agreements. The Borrower shall have delivered to the
Administrative Agent and each Lender copies of each of the following:
(a) a pledge and security agreement (as amended from time to time, the
"Borrower Security Agreement"), in substantially the form of Exhibit E-1,
duly executed by the Borrower, that, among other things, grants to the
Collateral Agent for the benefit of the Secured Parties a Lien on such
assets of the Borrower (including without limitation all issued and
outstanding Stock of each License Subsidiary and each Operating Subsidiary
owned by the Borrower) as the Lenders may request;
(b) a pledge agreement (as amended from time to time, the "Parent
Pledge Agreement"), in substantially the form of Exhibit E-2, duly executed
by the Parent, that, among other things, pledges to the Collateral Agent
for the benefit of the Secured Parties all issued and outstanding Stock of
the Borrower;
(c) a pledge agreement (as amended from time to time, a "C-Block
Subsidiary Pledge Agreement"), in substantially the form of Exhibit E-3,
duly executed by the C-Block Subsidiary Parent, that, among other things,
pledges to the Collateral Agent for the benefit of the Secured Parties all
issued and outstanding Stock of each C-Block Subsidiary;
(d) a pledge agreement (as amended from time to time, a "D-, E- and
F-Block Subsidiary Pledge Agreement"), in substantially the form of Exhibit
E-4, duly executed by the D-, E- and F-Block Subsidiary Parent, that, among
other things, pledges to the Collateral Agent for the benefit of the
Secured Parties all issued and outstanding Stock of each D-, E- and F-Block
Subsidiary;
(e) pledge and security agreements (together with each other pledge
and security agreement delivered pursuant to Section 6.16(b), in each case
as amended from time to time, a "Subsidiary Security Agreement"),
substantially in the form of Exhibit E-5 hereto, duly executed by the
Guarantors (other than the Parent, the C-Block Subsidiary Parent, the D-,
E- and F-Block Subsidiary Parent and OC), each of which, among other
things, grants to the Collateral Agent for the benefit of the Secured
Parties a Lien on such assets of such Guarantor (including, in the case of
any Operating Subsidiary, all issued and outstanding Stock of each of its
Subsidiaries that is a License Subsidiary or an Operating Subsidiary) as
the Lenders may request; and
in each case together with:
(i) if applicable, certificates representing the shares or units
of Stock pledged under such Security Agreement, accompanied by undated
stock powers executed in blank,
(ii) duly executed financing statements, in proper form for
filing under the Uniform Commercial Code of all jurisdictions that the
Administrative Agent may deem necessary or desirable in order to
perfect and protect the first priority
116
<PAGE>
liens and security interests created under such Security Agreement
covering the Collateral described in such Security Agreement,
(iii) evidence of any insurance required by the terms of such
Security Agreement,
(iv) evidence that all other action that the Administrative Agent
may deem necessary or desirable in order to perfect and protect the
first priority liens and security interests created under such
Security Agreement has been taken.
Section 8.14. Guaranties. The Borrower shall have delivered to the
Administrative Agent and each Lender copies of each of the following:
(a) from the Parent, a limited-recourse guaranty in substantially the
form of Exhibit H-1 hereto (as amended, supplemented or otherwise modified
from time to time in accordance with its terms, the "Limited Recourse
Parent Guaranty"), duly executed by the Parent,
(b) from the C-Block Subsidiary Parent, a limited-recourse guaranty in
substantially the form of Exhibit H-2 hereto (as amended, supplemented or
otherwise modified from time to time in accordance with its terms, the
"C-Block Subsidiary Parent Limited Recourse Guaranty"), duly executed by
the C-Block Subsidiary Parent,
(c) from the D-, E- and F-Block Subsidiary Parent, a limited-recourse
guaranty in substantially the form of Exhibit H-3 hereto (as amended,
supplemented or otherwise modified from time to time in accordance with its
terms, the "D-, E- and F-Block Subsidiary Parent Limited Recourse
Guaranty"), duly executed by the D-, E- and F- Block Subsidiary Parent, and
(d) from each Operating Subsidiary and each License Subsidiary, a
guaranty in substantially the form of Exhibit H-4 hereto (together with
each other such guaranty delivered pursuant to Section 6.16(a), in each
case as amended, supplemented or otherwise modified from time to time in
accordance with its terms, a "Subsidiary Guaranty"), duly executed by each
Operating Subsidiary and each License Subsidiary, and
(e) from OC, a guaranty in substantially the form of Exhibit H-5
hereto (as amended, supplemented or otherwise modified from time to time in
accordance with its terms, the "OC Guaranty"), duly executed by OC.
Section 8.15. Mortgages, Etc. The Borrower shall have delivered to the
Administrative Agent and each Lender copies of deeds of trust, trust deeds,
mortgages, leasehold mortgages and leasehold deeds of trust in form and
substance satisfactory to the Administrative Agent and covering the properties
listed on Schedule 8.15 hereto (together with each other mortgage
117
<PAGE>
delivered pursuant to Section 6.16(b), in each case as amended, supplemented or
otherwise modified from time to time in accordance with their terms, the
"Mortgages"), duly executed by each party thereto, in each case together with:
(a) evidence that counterparts of the Mortgages have been duly
recorded on or before the day of the initial Advance (or, with respect to
any such Mortgage entered into after the date of the initial Advance in
accordance with this Agreement, on or within twenty (20) days of the date
of execution and delivery of such Mortgage) in all filing or recording
offices that the Administrative Agent may deem necessary or desirable in
order to create a valid first and subsisting Lien (other than Permitted
Liens) on the property described therein in favor of the Secured Parties
and that all filing and recording taxes and fees have been paid;
(b) evidence of the title insurance required by the terms of such
Mortgage, with the survey exception deleted, and a current survey certified
to the Collateral Agent and the Lenders,
(c) an appraisal (to the extent required by laws or regulations
applicable to any Lender) with respect to the realty complying with all
applicable regulatory requirements,
(d) an environmental survey in form and substance acceptable to the
Administrative Agent, and
(e) evidence that all other action that the Administrative Agent or
Collateral Agent may deem necessary or desirable in order to create valid
first and subsisting Liens on the property described in such Mortgage has
been taken.
Section 8.16. Landlord Waivers, Attornment and Recognition Agreements,
Consents to Collateral Assignments. The Borrower shall have delivered to the
Administrative Agent and each Lender copies of each landlord waiver, attornment
and recognition agreement and consent to collateral assignment required by
Section
Section 8.17. Material Agreements. Subject to confidentiality restrictions,
the Administrative Agent and each of the Lenders shall have received a complete
and correct copy, in form and substance satisfactory to the Lenders, of (a) the
Expense Allocation Agreement and the servicing agreement and form of licensing
agreement referred to in Section 7.11(a)(i), in each case (if applicable) as
then in effect and duly executed by the parties thereto, and (b) each other
contract 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 8.18. Litigation. Except as disclosed on Schedule 5.08, there shall
exist no action, suit, investigation, litigation or proceeding pending or
threatened in any court or before any
118
<PAGE>
arbitrator or governmental instrumentality affecting any of OC, the Parent, the
Borrower or any of their respective Subsidiaries that
(i) could have a Material Adverse Effect, or
(ii) purports to affect the legality, validity or enforceability of
this Agreement, any Note, any other Loan Document or the consummation of
the transactions contemplated hereby or thereby or challenges any of the
Lenders' rights under this Agreement, any Note or any other Loan Agreement.
Section 8.19. Insurance Certificates. The Administrative Agent shall have
received one or more insurance certificates to the effect in Section 6.05.
Section 8.20. No Default. No default shall have occurred and be continuing
under the Volume Purchase Agreement on account of a breach by the Borrower or
any of its Subsidiaries.
Section 8.21. No Material Adverse Effect. There shall have occurred no
material adverse change in the business, condition (financial or otherwise),
operations, performance, properties or prospects of the Borrower or any of its
Subsidiaries since the date of the most recent audited financial statements
provided to the Lenders, and all information provided by or on behalf of the
Borrower to the Lenders prior to the date of the initial Advance shall be true
and correct in all material aspects and the Administrative Agent shall have
received a certificate executed by the chief financial or principal accounting
officer of the Borrower, to that effect.
Section 8.22. Corporate or Limited Liability Company Documents. The
Administrative Agent shall have received on the Closing Date each of the
following, each dated such day (unless otherwise specified), in form and
substance satisfactory to each Lender (unless otherwise specified) and in
sufficient copies for each Lender:
(a) Certified copies of the resolutions of the Board of Directors, in
the case of a corporation, or all requisite actions of members and/or the
management, in the case of a limited liability company, of the Borrower and
each other Loan Party approving this Agreement, the Notes and each other
Loan Document to which it is or is to be a party, and of all documents
evidencing other necessary corporate or limited liability company action
and governmental and other third party approvals and consents, if any, with
respect to this Agreement, the Notes and each other Loan Document.
(b) A copy of the charter documents of the Borrower, OC, the Parent
and each other Loan Party and each amendment thereto, certified (as of a
date reasonably near the date of the initial Advance) by the Secretary of
State of the jurisdiction of its incorporation or formation as being a true
and correct copy thereof.
119
<PAGE>
(c) A copy of a certificate of the Secretary of State of the
jurisdiction of incorporation or formation of the Borrower, OC, the Parent
and each other Loan Party, dated reasonably near the date of the initial
Advance, listing the charter of such Person and each amendment thereto on
file in his office and certifying that
(i) such amendments are the only amendments to such Person's
charter on file in his office,
(ii) such Person has paid all franchise taxes to the date of such
certificate, and
(iii) such Person is duly incorporated or formed and in good
standing under the laws of the state of incorporation or formation of
such Person.
(d) A copy of a certificate of the Secretary of State or other
appropriate representative of each state in which each of OC, the Parent,
the Borrower and each other Loan Party is engaged in any business, dated
reasonably near the Closing Date, stating that each of OC, the Parent , the
Borrower and each other Loan Party is duly qualified and in good standing
as a foreign corporation or foreign limited liability company in such state
and has filed all annual reports required to be filed to the date of such
certificate.
(e) A certificate of the Borrower, the Parent and each other Loan
Party, signed on behalf of the Borrower, the Parent and such other Loan
Party by its President or a Vice President and its Secretary or any
Assistant Secretary, dated the Closing Date (the statements made in which
certificate shall be true on and as of the date of the Closing Date),
certifying as to
(A) the absence of any amendments to the charter or
certificate of formation of the Borrower, or each other Loan
Party since the date of the Secretary of State's certificate
referred to in Section 8.22(c),
(B) a true and correct copy of the bylaws (in the case of a
corporation) or the limited liability company agreement (in the
case of a limited liability company), and all amendments thereto,
of the Borrower and each other Loan Party as in effect on the
Closing Date,
(C) the due incorporation or formation and good standing of
the Borrower and such other Loan Party as a corporation or
limited liability company organized under the laws of the
jurisdiction in which such Loan Party is incorporated or formed,
and the absence of any proceeding for the dissolution or
liquidation of the Borrower, the Parent or such other Loan Party,
120
<PAGE>
(D) the truth of the representations and warranties and
compliance with the covenants of such Person contained in the
Loan Documents as though made on and as of the date of the
initial Advance, and
(E) the absence of any event occurring and continuing, or
resulting from the closing, that constitutes a Default.
(f) A certificate of the Secretary or an Assistant Secretary of the
Borrower, the Parent, OC and each other Loan Party certifying as to the
names and true signatures of the officers of the Borrower, the Parent and
such other Loan Party authorized to sign this Agreement, the Notes and each
other Loan Document to which they are or are to be parties and the other
documents to be delivered hereunder and thereunder.
(g) All other documents, instruments, financial information and
opinions from the Borrower, OC, the Parent or any of the Borrower's
Subsidiaries (including opinions of counsel for the Borrower, OC, the
Parent or any such Subsidiary) as the 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 Advance.
Section 8.23. Intercreditor Agreement. The Borrower shall have delivered to
the Administrative Agent an intercreditor agreement substantially in the form of
Exhibit I, duly executed by the Collateral Agent and Nortel in its capacity as
Administrative Agent and initial Lender, (as the same may be amended from time
to time, the "Intercreditor Agreement").
Section 8.24. Capital Contribution Agreement. The Borrower shall have
delivered to the Administrative Agent a Capital Contribution Agreement
substantially in the form of Exhibit J, duly executed by OC and the Borrower (as
the same may be amended from time to time, the "Capital Contribution
Agreement").
Section 8.25. Amendment to Volume Purchase Agreement. The Administrative
Agent shall have received evidence satisfactory to it that the Volume Purchase
Agreement has been amended and has been executed by each of Nortel, the Borrower
and OC and such amendment shall contain terms and conditions satisfactory to the
Administrative Agent.
Section 8.26. Management Services Agreement and Other Agreements;
Acknowledgement of Assignment. The Administrative Agent and the Lenders shall
have reviewed and approved the Management Services Agreement under which OCSI
will provide billing, customer care and other services to the Operations. The
Administrative Agent shall have received from Operations a written statement to
it in which OCSI (a) consents to the assignment by the Operating Subsidiary
party to the Management Services Agreement of all of its right, title and
interest in and to the Management Services Agreement (including, without
limitation, the right to receive any
121
<PAGE>
monies due thereunder) to the Collateral Agent pursuant to the Collateral
Documents, (b) agrees not to cancel or terminate the Management Services
Agreement except upon at least 30 days written notice to the Administrative
Agent and (c) agrees that the Administrative Agent or the Collateral Agent shall
be entitled to make any payment or otherwise perform any obligation or cure any
default of the Borrower or any of its Subsidiaries under the Management Services
Agreement.
The Administrative Agent and the Lenders shall have reviewed and approved
the form of Operating Agreement attached hereto as Exhibit D-2 under which
Operations will provide certain services to the License Subsidiaries. The
Administrative Agent shall have received from the License Subsidiaries a written
statement to it in which Operations (a) consents to the assignment by the
License Subsidiary party to the Operating Agreement of all of its right, title
and interest in and to the Operating Agreement (including, without limitation,
the right to receive any monies due thereunder) to the Collateral Agent pursuant
to the Collateral Documents, (b) agrees not to cancel or terminate the Operating
Agreement except upon at least 30 days written notice to the Administrative
Agent and (c) agrees that the Administrative Agent or the Collateral Agent shall
be entitled to make any payment or otherwise perform any obligation or cure any
default of the Borrower or any of its Subsidiaries under the Operating
Agreement.
The Administrative Agent and the Lenders shall have reviewed and approved
the Cash Management Agreement between Operations and OC. The Administrative
Agent shall have received from Operations a written statement to it in which OC
(a) consents to the assignment by the Operating Subsidiary party to the Cash
Management Agreement of all of its right, title and interest in and to the Cash
Management Agreement (including, without limitation, the right to receive any
monies due thereunder) to the Collateral Agent pursuant to the Collateral
Documents, (b) agrees not to cancel or terminate the Cash Management Agreement
except upon at least 30 days written notice to the Administrative Agent and (c)
agrees that the Administrative Agent or the Collateral Agent shall be entitled
to make any payment or otherwise perform any obligation or cure any default of
the Borrower or any of its Subsidiaries under the Cash Management Agreement.
Section 8.27. Interest. The Administrative Agent shall have received
evidence satisfactory to the Administrative Agent of the payment by OC to Nortel
of interest for Nortel Goods and Services pursuant to the Volume Purchase
Agreement within the Designated BTAs and the Wichita BTAs prior to the Closing
Date, such interest having accrued at LIBOR plus 4.45% per annum from the
original due date of the invoices for such Nortel Goods and Services.
Section 8.28. No Misrepresentations. All representations and warranties are
true as of the Closing Date and the Administrative Agent and the Lenders shall
have received a certificate of the chief executive officer of the Borrower and
each Guarantor to the effect that neither the Borrower nor any Guarantor has
failed to disclose to the Administrative Agent or any Lender any material fact
with respect to the Network or their respective financial conditions (including
122
<PAGE>
any contingent liabilities), or has failed to disclose any information, the
absence of which makes any information previously disclosed to the
Administrative Agent or any Lender materially misleading.
Section 8.29. Compliance Certificate. The Lenders and the Administrative
Agent shall have received a Compliance Certificate in the form attached hereto
as Exhibit K.
Section 8.30. Administrative Agent Letter. The Borrower shall have
delivered to the Administrative Agent the Administrative Agent Letter duly
executed by the Borrower.
Section 8.31. Other Information. The Lenders and the Administrative Agent
shall have received such other information respecting the business, condition
(financial or otherwise), operations, performance, properties or prospects of
any Loan Party or any of its Subsidiaries as any Lender (through the
Administrative Agent) may from time to time reasonably request.
Section 8.32. Applications for Transfer of Ownership. The Administrative
Agent shall have received satisfactory evidence and opinions of Borrower's and
OC's counsel that, as of the Closing Date, all necessary and appropriate
applications have been filed with the FCC to authorize the transfer of the Stock
of the C-Block Subsidiaries and each D-, E- and F- Block Subsidiary to the
Borrower, and that all other necessary or appropriate actions have been taken by
the Borrower, the Guarantors, and OC to cause such transfer to take place.
ARTICLE IX
CONDITIONS TO ADVANCES
Section 9.01. Conditions Precedent to an Initial Advance. The obligations
of each Applicable Lender to make any initial Advance shall be subject to the
satisfaction of the following conditions precedent on or prior to the date of
such initial Advance:
(a) The Administrative Agent shall have received on or before the date
of the initial Advance the following, each dated such day (unless otherwise
specified), in form and substance satisfactory to each Lender (unless
otherwise specified) and in sufficient copies for each Lender;
(i) a certificate of the Borrower signed on behalf of the
Borrower by its President or a Vice President, dated the date of the
initial Advance (the statements made in which certificate shall be
true on and as of the date of the initial Advance), certifying as to
123
<PAGE>
(A) the truth of the representations and warranties and
compliance with the covenants of the Borrower contained in the
Loan Documents;
(B) the absence of any event occurring and continuing, or
resulting from the initial Advance, that constitutes a Default;
(C) absence of any material adverse change in the business,
condition (financial or otherwise), operations, performance,
properties or prospects of the Borrower or any of its
Subsidiaries since the date of the most recent audited financial
statements provided to the Lenders, and all information provided
by or on behalf of the Borrower to the Lenders prior to the date
of the initial Advance shall be true and correct in all material
aspects;
(D) neither the Borrower nor any Guarantor has failed to
disclose to the Administrative Agent or any Lender any material
fact with respect to the Network or their respective financial
conditions (including any contingent liabilities), or has failed
to disclose any information, the absence of which makes any
information previously disclosed to the Administrative Agent or
any Lender materially misleading.
(ii) The Administrative Agent shall have received on or before
the date of the initial Advance a Compliance Certificate dated the
date of such initial Advance.
Section 9.02. Conditions to All Advances. The obligation of each Applicable
Lender to make any Advance, including its initial Advance, shall also be subject
to the satisfaction of the conditions precedent that on the date of such
Advance:
(a) The Administrative Agent shall have received a properly completed
Draw Request.
(b) Each of the representations and warranties of the Borrower and
each other Loan Party contained in this Agreement, the other Loan Documents
or in any document or instrument delivered pursuant to or in connection
with this Agreement or any other Loan Document is true and correct in all
material respects immediately prior to, and after giving effect to, the
making of such Advance and the application of the proceeds therefrom, as
though made on and as of such date (except 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 the Borrower to such effect.
124
<PAGE>
(c) No event has occurred and is continuing, or would result from such
Advance or from the application of the proceeds therefrom, that constitutes
a Default or a default under any other Loan Document.
(d) 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.
(e) 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.
(f) The Administrative Agent shall have received such other approvals,
opinions or documents as any Lender through the Administrative Agent may
reasonably request.
(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 expense for Nortel Goods and Services
that have been incurred by the Borrower and its Subsidiaries through the
date of such Advance.
(h) No Material Adverse Effect has occurred and is continuing.
(i) Neither the Borrower nor any Guarantor has failed to disclose to
the Administrative Agent or any Lender any material fact with respect to
the Network or their respective financial conditions (including any
contingent liabilities), or has failed to disclose any information, the
absence of which makes any information previously disclosed to the
Administrative Agent or any Lender materially misleading.
(j) The Administrative Agent shall have received a properly completed
Borrowing Base Certificate executed by an authorized officer of the
Borrower.
ARTICLE X
EVENTS OF DEFAULT; ACCELERATION; ETC.
Section 10.01. Events of Default and Acceleration. Upon occurrence and
during the continuance of any of the following events,
125
<PAGE>
(a) the Borrower shall fail to pay any principal of the Loans, any
fee, any interest on the Loans or any other Obligations or any other sum
hereunder or under any of the other Loan Documents to which it is a party,
in any such case when the same shall become due and payable; or
(b) the Borrower shall fail to perform or observe any term, covenant
or agreement contained in Article VII or Sections 6.01, 6.03, 6.04(c),
6.04(d), 6.08, 6.09, 6.12, 6.13(i), 6.14, 6.15, 6.16, 6.17 or 6.22;
provided that the Borrower shall have the right to comply with the
covenants contained in Sections 6.14(a) and (c) for any one or more fiscal
quarters, and in Sections 6.14(b) and (d) for any two fiscal quarters per
covenant, by providing, prior to the delivery of the financial statement or
other report to the Administrative Agent disclosing the existence of such
default, additional cash equity to the extent that if such equity were
included in Gross Revenue, EBITDA or OCF, the Borrower would be in
compliance with Sections 6.14(a), (b) (c) and (d), as the case may be; or
(c) any Loan Party 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 Section 10.01) and such failure
shall continue for a period of 30 days; or
(d) any representation or warranty made by any Loan Party or any of
its Subsidiaries (or any of its officers) under this Agreement or any of
the other Loan Documents or in any certificate, statement, 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 confirmed or deemed to have been made, confirmed or
repeated; or
(e) any Loan Party or shareholder of the Borrower shall
(i) make an assignment for the benefit of creditors, or
(ii) generally not pay its debts as such debts become due or
admit in writing its inability to generally pay or generally fail to
(iii) petition or apply for the appointment of a trustee or other
custodian, liquidator or receiver of any Loan Party or any such
shareholder or of any substantial part of the assets of any Loan Party
or any such shareholder, or
(iv) shall commence any case or other proceeding relating to any
Loan Party or any such shareholder 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
126
<PAGE>
(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 any Loan Party or any such
shareholder and such Loan Party or shareholder 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 any Loan Party or any such shareholder shall take any corporate
action to authorize any of the actions above in this subsection (e); or
(f) the Borrower or any of its License Subsidiaries or any Guarantor
or other Loan Party other than OC shall fail to pay any principal of,
premium or interest on or any other amount payable in respect of any
Indebtedness (other than Indebtedness owing to the FCC) that is outstanding
in an aggregate principal amount of at least $3,000,000 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
(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), or any
material non-monetary judgment or order, 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
127
<PAGE>
written agreement, consent or approval of the Lenders, or any action at
law, or in equity or other suit or legal proceeding to cancel, revoke or
rescind any of the Loan Documents shall be commenced by or on behalf of any
Loan Party or any of its or their 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 or any of its Subsidiaries, or the Parent shall be
the subject of writs of attachment or garnishment and the like (a) relating
to Collateral which in the judgment of the Required Lenders is subject to
imminent execution or levy thereon, or (b) 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
(k) the FCC or any other Governmental Body shall cancel, revoke,
suspend or fail to renew any FCC License held by any License Subsidiary
relating to any right held by any Subsidiary to provide PCS services to any
POPs included in any Designated BTA, in either case for which the
cancellation, revocation, suspension or failure to renew the FCC License
relating to any Designated BTA.
(l) the FCC or any other Governmental Body shall commence any
proceeding to cancel, revoke or suspend any FCC License held by any License
Subsidiary relating to BTAs described in clause (k) above, which proceeding
has not been stayed or enjoined within five Business Days after the
commencement of any such proceeding, or
(m) any License Subsidiary or any of its Affiliates shall fail to pay
any amount when due FCC Debt or shall otherwise default on such
Indebtedness, if such failure to pay or default constitutes or would with
the passage of time constitute a default under any Indebtedness owing to
the FCC in respect of any other FCC Licenses in respect of a Designated
BTA; or
128
<PAGE>
(n) any License Subsidiary shall fail to pay when due amounts owing to
the FCC relating to BTAs described in clause (k) above unless (i) such
failure to pay can reasonably be expected, in the reasonable judgment of
the Required Lenders, not to result in any cancellation, revocation or
suspension of such FCC License or (ii) the Borrower has obtained a stay or
injunction against any action by the FCC to cancel, revoke or suspend such
FCC License notwithstanding such failure to pay and such injunction or stay
shall then be in effect; or
(o) the Collateral Agent shall cease to have a valid and perfected
first-priority Lien on any Collateral securing any Loan Party's obligations
under any Loan Document, or any Loan Party shall so assert (subject,
however, to Permitted Liens entitled to priority in accordance with the
terms of the Loan Documents); or
(p) at any time any of the following shall occur:
(i) there occurs a Change in Control;
(ii) any Person (other than Nortel 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, legally or beneficially, more than twenty
percent (20%) of the Voting Stock of the Borrower then outstanding;
or
(iii) all of each series and class of issued and outstanding
shares or units of Stock of the Borrower and each of its Subsidiaries
shall cease to be pledged as security for the obligations of the
Borrower, the other Loan Parties and their respective Subsidiaries
hereunder and under the other Loan Documents; or
(q) 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 any Loan Party that could
reasonably be expected to have a material adverse effect on the ability of
such Loan Party to perform its obligations under the Loan Documents to
which it is a party; or
(r) the Borrower, the Parent or any Subsidiary shall default after any
applicable grace period, under any equipment-acquisition agreement (other
than the Volume Purchase 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.
(s) there shall occur an event or circumstance which constitutes a
default or an event of default under any other Loan Document or Collateral
Document or any other
129
<PAGE>
agreement included in the Collateral, provided that any requirement for the
giving of notice, the lapse of time, or both, or any other circumstance,
has been satisfied;
(t) there shall occur an OC Debt Default unless:
(i) the Maximum Amount, as defined in the Capital Contribution
Agreement (assuming full funding of the Credit Facility), has already
been contributed to the Borrower;
(ii) OC, an Affiliate or a third party contributes the Remaining
Amount (assuming full funding of the Credit Facility), within 15 days
of the occurrence of OC Debt Default, and no advances will be made
until the Remaining Amount has been received;
(iii) The Borrower provides a replacement for OC of investment
grade credit quality which commits to provide the Remaining Amount
(assuming full funding of the Credit Facility), or otherwise provides
a letter of credit or standby commitment to provide such Remaining
Amount acceptable to the Administrative Agent and the Required
Lenders; or
(iv) The ratio of (a) Total Debt (as of the end of a fiscal
quarter) to (b) EBITDA for that fiscal quarter multiplied by four, is
no greater than 8 to 1, and the Borrower continues to meet that ratio
at the end of each succeeding fiscal quarter.
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 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 notice, presentment,
demand, notice of dishonor, notice of acceleration, notice of intent to
accelerate, protest or any notice or other formalities of any kind, all of which
are hereby expressly waived by the Borrower.
130
<PAGE>
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 Section 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
(whether written or oral) 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;
(e) shall not be responsible to any Lender for the due execution,
legality, validity, enforceability, genuineness, sufficiency or value of,
or the perfection or priority of any lien or security interest created or
purported to be created under or in connection
131
<PAGE>
with, any Loan Document or any other instrument or document furnished
pursuant thereto;
(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. Nortel and Affiliates. With respect to its Commitments, the
Advances made by it and the Note issued to it, Nortel 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 Nortel in its individual
capacity or any other Administrative Agent in its individual capacity. Nortel or
any other Administrative Agent in its individual capacity and its affiliates may
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 the
Borrower or any of its Affiliates, all as if Nortel 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
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
132
<PAGE>
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 Section 12.04, to the extent that the Administrative Agent is
not promptly reimbursed for such costs and expenses by the Borrower. It is the
express intent of the parties that the Administrative Agent shall be indemnified
hereunder for all negligent acts or omissions other than those resulting from
the Administrative Agent's gross negligence or willful misconduct. For purposes
of this Section 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. Without prejudice to the survival of any
other agreement of any Lender hereunder, the agreements and obligations of each
Lender contained in this Section 11.05 shall survive the payment in full of
principal, interest and all other amounts payable hereunder and under the other
Loan Documents.
Section 11.06. Successor Administrative Agents. The Administrative Agent
may resign at any time by giving written notice thereof to the Lenders. Upon any
such resignation, 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, 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 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
hereunder, 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.
133
<PAGE>
ARTICLE XII
MISCELLANEOUS
Section 12.01. Amendments, Etc. No amendment or waiver of any provision of
this Agreement or the Notes or any other Loan Document, 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 Advance, 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, the Collateral Agent and the
Administrative Agent under the Loan Documents and other than
Indebtedness owing to any other Person;
(v) amend this Section 12.01;
(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;
134
<PAGE>
(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; and
(d) no amendment, waiver or consent with respect to Section 2.09 (Use
of Proceeds) or the definition of either "Facility A Borrowing Base" or
"Facility B Borrowing Base" shall be effective without the prior written
consent of Nortel whether or not Nortel is a Lender at the time of such
proposed amendment, waiver or consent.
Section 12.02. Notices, Etc. All notices and other communications provided
for hereunder shall be in writing and mailed, telecopied or delivered,
(a) if to the Borrower, at:
Omnipoint Midwest Holdings, LLC
16 Wing Drive
Cedar Knolls, New Jersey 07927
Attn: Vice President Finance
(973) 257-2539 (fax) - prior to April 14, 1998
(973) 290-2539 (fax) - on and after April 14, 1998
with copies to:
Omnipoint Corporation
3 Metro Center
Bethesda, MD 20814
Attn: Vice President Finance
(301) 951-2580 (fax)
Piper & Marbury, L.L.P.
1200 19th Street, N.W.
Washington, DC 20036
Attn: Edwin Martin, Esq.
(202) 861-6317 (fax)
135
<PAGE>
(b) if to any Lender, at its Domestic Lending Office; and
(c) if to the Administrative Agent, at:
Northern Telecom Inc.
2221 Lakeside Boulevard
Richardson, TX 75082
Attn: Vice President
Customer Finance - North America
(972) 684-3679 (fax)
Northern Telecom Inc.
2221 Lakeside Boulevard
Richardson, TX 75082
Attn: Vice President
Finance - Wireless Networks
(972) 684-3929 (fax)
with a copy to:
Hale and Dorr L.L.P.
60 State Street
Boston, MA 02109
Attn: Andrew Cohn, Esq.
(617) 526-5000 (fax)
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 be effective when deposited in the mails, 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.
136
<PAGE>
Section 12.04. Costs, Expenses.
(a)
(i) Except as specified in clause (ii) or (iii) below, Nortel
will pay its own legal and other out-of-pocket costs in connection
with the drafting, negotiation and closing of this Agreement and the
other Loan Documents.
(ii) The Borrower shall pay on demand all out-of-pocket closing
costs, fees and reasonable expenses that are incurred in connection
with any necessary or desirable filings or recordations by the
Administrative Agent, the Collateral Agent or Nortel in connection
with the closing of this Agreement, the other Loan Documents and the
transactions contemplated hereby and thereby, whether or not any such
transactions are consummated, including, without limitation, stamp or
other recording costs and related taxes or charges, filing fees, costs
and expenses, (but excluding legal fees).
(iii) The Borrower shall also pay on demand:
(A) So long as Nortel has assigned any Loans or Commitments
or has granted a participation in a portion of its Loans or
Commitments under the Credit Facility, all ongoing costs,
including, without limitation, all reasonable legal fees and
charges, recording costs and related taxes or charges, filing
fees, costs and expenses of the Administrative Agent (if other
than Nortel) and (except with respect to legal fees) the
Lenders related to (1) 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, (2) the perfection, protection or
preservation of any of their respective rights or interests under
the Loan Documents or to or in the Collateral, (3) the
administration of this Agreement or any other Loan Document and
(4) any amendments, waivers or supplements related to this
Agreement and the other Loan Documents;
(B) to the extent not paid pursuant to clause (a)(ii) above,
all out-of-pocket costs and expenses of the Collateral Agent
(including allocated costs and reasonable expenses of in-house
counsel and legal staff) in connection with the preparation,
execution, delivery, performance, administration, enforcement,
modification and amendment of this Agreement, the Intercreditor
Agreement, the Collateral Documents, the Guaranties 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
137
<PAGE>
of performing its duties and obligations as Collateral Agent,
whether or not the transactions contemplated hereby are
consummated;
(C) all reasonable legal fees and expenses relating to the
matters described in clause (A) above incurred by Nortel as
Administrative Agent or a Lender if a Default shall have occurred
and be continuing under this Agreement; and
(D) all reasonable legal fees and expenses relating to the
matters described in clause (A) above incurred by any Lender
other than Nortel or an Affiliate thereof or for which such
Lender would have an indemnification obligation (whether or not
contingent on non-payment thereof by the Borrower) under this
Agreement.
(b) If, at any time any payment of principal of, or Conversion of, any
LIBOR 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 or Conversion thereof, acceleration of
the maturity of the Notes pursuant to Section 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 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
138
<PAGE>
(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 Section 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 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 Section 12.04 shall survive the payment in full of
principal and interest hereunder and the termination of the Commitments.
Section 12.05. Right of Set-off. Upon the occurrence and during the
continuance of any Event of Default, 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 Section 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 Administrative Agent shall have been notified by each Lender that such
Lender 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
139
<PAGE>
written consent of the Lenders. Sections 12.04(a) and (d), 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) without the consent of the Borrower;
provided that
(i) 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/or 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.
(ii) 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 $3,500, and
(B) deliver a copy of such Assignment and Acceptance to the
Borrower at the time it delivers a copy to the Administrative
Agent;
(iii) prior to the Facility A Commitment Termination Date for
assignments relating to Facility A Commitments or Advances and the
Facility B Commitment Termination Date for assignments relating to
Facility B Commitments or Advances, assignments to Persons that have a
combined capital and surplus in excess of $50 million;
(iv) assignments to Persons, other than a commercial bank or
other financial institution, that is engaged in, or has an Affiliate
that is engaged in the business of providing PCS telecommunications
services to the public may be made no sooner than fifteen (15) days
after acceleration of the Loans hereunder pursuant to (S)10.01
hereof;
140
<PAGE>
(v) the assigning Lender's rights under Article IV and
Section 12.04 accrued through the date of assignment shall continue,
and
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, the Intercreditor Agreement and each other Loan Document,
together with copies of the financial statements referred to in
Section 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;
141
<PAGE>
(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 in subsection
(a)(iv) above; and
(viii) such assignee confirms that it is bound by the
confidentiality provisions in Section 12.10.
(c) The Administrative Agent shall maintain at its address referred to
in Section 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,
(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
142
<PAGE>
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 Section 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 in this Agreement, any Lender
may at any time create a security interest in all or any portion of its
rights under this 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.
(h) The Borrower shall maintain, or cause to be maintained, a register
(the "Registered Note Register") (which, at the request of the Borrower,
shall be kept by the Administrative Agent on behalf of the Borrower at no
extra charge to the Borrower at the address to which notices to the
Administrative Agent are to be send hereunder) on which it enters the name
of the registered owner of each of the Loans evidenced by a Registered
Note. Notwithstanding anything to the contrary contained in this
Section 12.07(h), a Registered
143
<PAGE>
Note and the Loans evidenced thereby may be assigned or otherwise
transferred in whole or in part only by registration of such assignment or
transfer of such Registered Note and the Loans evidenced thereby on the
Registered Note Register (and each Registered Note shall expressly so
provide). Any assignment or transfer of all or part of such Loans and the
Registered Note evidencing the same shall be registered on the Registered
Note Register only upon surrender for registration of assignment or
transfer of the Registered Note evidencing such Loans, duly endorsed by (or
accompanied by a written instrument of assignment or transfer duly executed
by) the registered noteholder thereof, and thereupon one or more new
Registered Notes in the same aggregate principal amount shall be issued to
the designated assignee(s) or transferee(s). Prior to the due presentment
for registration of transfer of any Registered Note, the Borrower and the
Administrative Agent shall treat the Person in whose name such Loans and
the Registered Note(s) evidencing the same are registered as the owner
thereof for the purpose of receiving all payments thereon and for all other
purposes, notwithstanding any notice to the contrary. The Registered Note
Register shall be available for inspection by the Borrower and any Lender
at any reasonable time upon reasonable prior notice.
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.
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 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 Subsidiaries and 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
144
<PAGE>
(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 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 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 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 the Borrower
at its address specified in Section 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 Section 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
145
<PAGE>
Agent or any Lender to bring any action or proceeding against any the 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 reasonable expenses of in-house counsel and legal staff) in
connection with the preparation, execution, delivery, performance,
administration, enforcement, modification and amendment of this Agreement,
the Intercreditor Agreement, the Borrower Security Agreement, the
Subsidiary Security Agreement, the Parent Pledge Agreement, the Subsidiary
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. Limitation of Liability. None of the Administrative Agent,
any Lender or any Affiliate, officer, director, employee, attorney or agent
thereof shall be liable for any error of judgment or act done in good faith, or
be otherwise liable or responsible under any circumstances whatsoever (including
such Person's negligence), except for such Person's gross negligence or willful
misconduct. None of the Administrative Agent, any Lender or any Affiliate,
officer, director, employee, attorney or agent thereof shall have any liability
with respect to, and the Borrower hereby waives, releases and agrees not to sue
any of them upon any claim for any special, indirect, incidental or
consequential damages suffered or incurred by the Borrower or any other Loan
Party in connection with, arising out of or in any way related to this Agreement
or any of the other Loan Documents, or any of the transactions contemplated by
this Agreement or any of the other Loan Documents. The Borrower hereby waives,
releases and agrees not to sue the Administrative Agent or any Lender or any of
their respective Affiliates, officers, directors, employees, attorneys or agents
for exemplary or punitive damages in respect
146
<PAGE>
of any claim in connection with, arising out of or in any way related to this
Agreement or any of the other Loan Documents, or any of the transactions
contemplated by this Agreement or any of the other Loan Documents.
Section 12.15. No Duty. All attorneys, accountants, appraisers and other
professional Persons and consultants retained by the Administrative Agent and
the Lenders shall have the right to act exclusively in the interest of the
Administrative Agent and the Lenders and shall have no duty of disclosure, duty
of loyalty, duty of care or other duty or obligation of any type or nature
whatsoever to the Borrower of any of its Subsidiaries or any of their
shareholders or any other Person.
Section 12.16. No Fiduciary Relationship; No Agency Relationship. The
relationship between the Borrower and each Lender is solely that of debtor and
creditor, and neither the Administrative Agent nor any Lender has any fiduciary
or other special relationship with the Borrower or any other Loan Party, and no
term or condition of any of the Loan Documents shall be construed so as to deem
the relationship between the Borrower and any Lender, or any other Loan Party
and any Lender, to be other than that of debtor and creditor. No joint venture
or partnership is created by this Agreement among the Lenders or among the
Borrower or any other Loan Party and the Lenders. The Administrative Agent shall
not be deemed to have any fiduciary relationship with any Lender or any Loan
Party, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or otherwise exist
against the Administrative Agent. Without limiting the generality of the
foregoing, the use of the term "agent" in this Agreement with respect to the
Administrative Agent is not intended to connote any fiduciary or other express
or implied obligation arising under agency doctrine of any applicable law;
instead, such term is used merely as a matter of market custom and is intended
to create or reflect only an administrative relationship among independent
contracting parties.
Section 12.17. 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.
147
<PAGE>
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as a
sealed instrument as of the date first above.
OMNIPOINT MIDWEST
HOLDINGS, LLC
By:________________________________________
Harry Plonskier
Vice President
NORTHERN TELECOM INC.,
as Administrative Agent
By: ________________________________________
Name: Michael W. McCorkle
Title: Director, Customer Finance-
North America
<PAGE>
Facility A Commitment Percentage: 100% NORTHERN TELECOM INC., as
Facility B Commitment Percentage: 100% a Lender
Domestic Lending Office and By: ________________________
LIBOR Lending Office: Name: Michael W. McCorkle
Title: Director, Customer Finance-
- -------------------------------- North America
A copy of any notice delivered pursuant
to Section 12.02 also should be delivered
to the address above to the attention of
the ______________________.
<PAGE>
Schedule 1.01
Designated BTAs
025 Atlantic City, New Jersey
CORE 155 Fort Wayne, Indiana
CORE 424 South Bend/Mishawaka, Indiana
126 Elkhart, Indiana
039 Benton Harbor, Michigan
CORE 169 Grand Rapids, Michigan
CORE 444 Toledo, Ohio
390 Saginaw/Bay City, Michigan
CORE 145 Flint, Michigan
CORE 241 Lansing, Michigan
255 Lima, Ohio
033 Battle Creek, Michigan
310 Muskegon, Michigan
209 Jackson, Michigan
143 Findlay-Tiffin, Ohio
307 Mt. Pleasant, Michigan
005 Adrian, Michigan
CORE 204 Indianapolis, Indiana
235 Lafeyette, Indiana
442 Terre Haute, Indiana
047 Bloomington/Bedford, Indiana
233 Kokomo-Logansport, Indiana
309 Muncie, Indiana
015 Anderson, Indiana
093 Columbus, Indiana
280 Marion, Indiana
373 Richmond, Indiana
457 Vincennes-Washington, Indiana
CORE 112 Detroit, Michigan
103 Danville, Illinois
<PAGE>
Schedule 1.01A
Certain Geographic Areas of Designated BTAs
<PAGE>
Schedule 1.01B
Wichita Loan Facility and D&E/Omnipoint Loan Facility
<PAGE>
Schedule 1.01C
Excluded Purchases/Invoices
[$8.3 million relating to D&E/Omnipoint -- Schedule to be provided]
<PAGE>
================================================================================
LOAN AGREEMENT
dated as of February 17, 1998
among
OMNIPOINT COMMUNICATIONS INC.,
as Borrower,
OMNIPOINT CORPORATION,
as Grand Parent,
THE LENDERS PARTY HERETO,
DLJ CAPITAL FUNDING, INC.,
as Syndication Agent,
GOLDMAN SACHS CREDIT PARTNERS L.P.,
as Documentation Agent,
BANK OF AMERICA NATIONAL TRUST & SAVINGS ASSOCIATION,
as Administrative Agent, and
NATIONSBANK, N.A.
as Co - Agent
================================================================================
<PAGE>
LOAN AGREEMENT
--------------
This Loan Agreement is made as of the __ day of February, 1998 (this
"Agreement"), by and among (a) OMNIPOINT COMMUNICATIONS INC. (the "Borrower"), a
Delaware corporation, (b) OMNIPOINT CORPORATION (the "Grand Parent"), for the
purposes set forth in Section 12.14, (c) the Lenders party hereto, (d) DLJ
CAPITAL FUNDING, INC., as Syndication Agent, (e) GOLDMAN SACHS CREDIT PARTNERS
L.P., as Documentation Agent, (f) BANK OF AMERICA NATIONAL TRUST & SAVINGS
ASSOCIATION, as administrative agent for the Lenders (together with any
successor thereto appointed pursuant to Section 11.6, the "Administrative
--------------
Agent") and (g) NATIONSBANK, N.A., as Co-Agent.
- ------
ARTICLE I
DEFINITIONS AND RULES OF INTERPRETATION
---------------------------------------
Section 1.1 Definitions.
-----------
The following terms shall have the meanings set forth in this Section 1.1
or elsewhere in the provisions of this Agreement referred to below:
Access Agreements. Agreements, in form and substance satisfactory to the
-----------------
Administrative Agent, pursuant to which Grand Parent agrees to provide the
Borrower and its Subsidiaries access to its Intellectual Property assets on the
terms on which such access is provided as of the Closing Date or is contemplated
to be provided in the plans of Grand Parent delivered to the Administrative
Agent prior to the Closing Date.
Action Letter. As defined in Paragraph 7 of Schedule 5.23.
-------------
Additional Lenders. As defined in Section 2.1.
------------------
Adjusted Annualized EBITDA. As of any date of determination, Adjusted
--------------------------
EBITDA for the two most recently completed fiscal quarters (including the fiscal
quarter ending on such date of determination) multiplied by two.
Adjusted EBITDA. For any period, EBITDA for such period plus, to the
--------------- ----
extent subtracted to calculate the Net Income of the Borrower and its
Subsidiaries for such period, selling, marketing, advertising and promotional
expenses (including, without limitation, compensation and commissions incurred
in connection with the foregoing activities) incurred during such period, in
each case in accordance with GAAP.
Administrative Agent. As defined in the preamble hereto.
--------------------
Administrative Agent's Office. The Administrative Agent's office set forth
-----------------------------
in Section 12.2 and, upon the appointment of a successor Administrative Agent
pursuant to Section 11.6, 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.
<PAGE>
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 10% 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.
Agent's Fee Letter. The letter agreement between the Administrative Agent
------------------
and the Borrower dated as of February 9, 1998, as the same may be amended,
supplemented or otherwise modified from time to time.
Agents. The Administrative Agent, the Syndication Agent, the Documentation
------
Agent and the Co-Agent.
Annual Operating Business Plan. With respect to the Borrower's fiscal year
------------------------------
ending December 31, 1998, the Borrower's annual operating business plan
delivered pursuant to Section 8.11(a) and, with respect to each subsequent
fiscal year of the Borrower, the annual business operating plan delivered by the
Borrower pursuant to Section 6.13(a) with respect to such fiscal year.
Annualized EBITDA. As of any date of determination, EBITDA for the two
-----------------
most recently completed fiscal quarters (including the fiscal quarter ending on
such date of determination) multiplied by two.
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 LIBO Rate Loans, the office of such Lender specified as its LIBOR lending
office, in either case on Schedule I hereto 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. As of any date of determination, the applicable margin
-----------------
(expressed as a percentage) with respect to Base Rate Loans shall be equal to
2.25% per annum and with respect to LIBO Rate Loans shall be equal to 3.25% per
annum; provided that 5 Business Days after the Borrower notifies the
Administrative Agent that an Equity Issuance to a Qualified Investor has
occurred, the applicable margin with respect to Base Rate Loans shall be equal
to 2.0% per annum and with respect to LIBO Rate Loans shall be equal to 3.0% per
annum.
Approved Fund. With respect to any Lender that is a fund that invests in
-------------
bank loans, any other fund that invests in bank loans and is advised or managed
by the same investment advisor as such Lender or by an Affiliate of such
investment advisor.
Assignment and Acceptance. An Assignment and Acceptance substantially in
-------------------------
the form of Exhibit C.
2
<PAGE>
Base Rate. For any day, the higher of (a) 0.50% per annum above the latest
---------
Federal Funds Rate; and (b) the rate of interest in effect for such day as
publicly announced from time to time by the Administrative Agent in San
Francisco, California, as its "reference rate." (The "reference rate" is a rate
set by the Administrative Agent based upon various factors including the
Administrative Agent's costs and desired return, general economic conditions and
other factors, and is used as a reference point for pricing some loans, which
may be priced at, above, or below such announced rate.) Any change in the
reference rate announced by the Administrative Agent shall take effect at the
opening of business on the day specified in the public announcement of such
change.
Base Rate Loans. Loans bearing interest calculated by reference to the
---------------
Base Rate plus the Applicable Margin.
Book Capitalization. As of the end of each fiscal quarter after December
-------------------
31, 1997, an amount equal to $1,700,000,000 plus (A) on a cumulative basis after
----
December 31, 1997, all interest expense paid by the Borrower or the License
Subsidiary in respect of Indebtedness owed to the FCC, plus (B) on a cumulative
----
basis after December 31, 1997, all cash Capital Expenditures made by the
Borrower, plus (C) the aggregate amount of the absolute value of EBITDA for all
----
fiscal quarters ended following December 31, 1997, to the extent EBITDA for such
quarter was negative and substantially consistent with the Annual Operating
Business Plan and Full-Term Operating Business Plan; provided that no amounts
shall be added under this clause (C) following the time that EBITDA is positive
for three consecutive fiscal quarters, plus (D) the aggregate amount of any
----
Working Capital Requirements of the Borrower for all fiscal quarters ended since
December 31, 1997.
Working Capital Requirements of the Borrower for all fiscal quarters ended since
December 31, 1997.
Borrower. As defined in the preamble hereto.
--------
Borrower Securities Account Control Agreement. The Borrower Securities
---------------------------------------------
Account Control Agreement in substantially the form of Exhibit G.
Borrower Pledge Agreement. The Pledge Agreement between the Borrower and
-------------------------
the Administrative Agent for the benefit of the Lenders and other Secured
Creditors under the Intercreditor Agreement, providing for the pledge of 100% of
the limited liability company interests of the License Subsidiary, substantially
in the form of Exhibit F, as amended from time to time in compliance with the
Loan Documents.
Borrower Security Agreement. The Borrower Security Agreement among the
---------------------------
Borrower and the Administrative Agent for the benefit of the Lenders and the
other Secured Creditors under the Intercreditor Agreement, substantially in the
form of Exhibit E, as amended from time to time in compliance with the Loan
Documents.
Borrowing. The incurrence of one Type of Loan from all Lenders on a given
---------
date (or resulting from Conversions on a given date) having, in the case of LIBO
Rate Loans, the same Interest Period.
3
<PAGE>
BTA. Any "basic trading area" as set forth on the Rand McNally 1992
---
Commercial Atlas & Marketing Guide, 123rd Edition, and utilized by the FCC in
dividing the 50 States, the District of Columbia and the United States
Territories into 493 BTAs for the purpose of licensing PCS systems.
Business Day. Any day other than a Saturday, a Sunday or a day on which
------------
commercial banks located in New York City or San Francisco, California are
authorized or required by law or other governmental action to close, provided
--------
that, when used in connection with a LIBO Rate Loan, the term Business Day shall
also exclude any day on which commercial banks are not open for dealings in
dollar deposits in the London interbank market.
"C" Block Licenses. FCC Licenses issued in the FCC's C-Block auction under
------------------
47 CFR Section 24.229(b).
Cap Re Notes. The Senior Notes due November, 2000 in the original
-------------
aggregate principal amount of $25,000,000, issued by Grand Parent pursuant to a
Note and Warrant Purchase Agreement, dated as of November 22, 1995, by and among
Grand Parent, The Bond Fund of America, Inc. and the American High-Income Trust.
Capital Expenditures. Amounts paid or Indebtedness incurred by any Person
--------------------
in connection with the purchase or lease by such Person of assets that would be
required to be capitalized and shown on the balance sheet of such Person in
accordance with GAAP.
Capital Stock. With respect to any Person, any and all shares, interests,
-------------
participations or other equivalents (however designated, whether voting or non-
voting) in equity of such Person, whether now outstanding or issued after the
Closing Date, including, without limitation, all Common Stock and Preferred
Stock.
Capitalized Leases. With respect to any Person, (i) any lease of property,
------------------
real or personal, the obligations under which are capitalized on the balance
sheet of such Person, and (ii) any other such lease to the extent that the then
present value of the minimum rental commitment thereunder should, in accordance
with GAAP, be capitalized on a balance sheet of the lessee.
Cash Management Agreement. The Amended and Restated Cash Management Agency
-------------------------
Agreement dated as of December 29, 1997 between the Borrower 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.
Change of Control. (a) The sale, lease, transfer, conveyance or other
-----------------
disposition of all or substantially all of the assets of Grand Parent to any
"person" or "group" (within the meaning of Sections 13(d)(3) and 14(d)(2) of the
Exchange Act or any successor provision to either of the foregoing, including
any group acting for the purpose of acquiring, holding
4
<PAGE>
or disposing of securities within the meaning of Rule 13d-5(b)(1) under the
Exchange Act) other than the Existing Shareholders (except in connection with a
liquidation or dissolution of Grand Parent that does not constitute a Change of
Control under clause (b) below), (b) the approval by the requisite shareholders
of Grand Parent of a plan of liquidation or statutory dissolution (which shall
not be construed to include a plan of merger or consolidation) of Grand Parent
unless the Existing Shareholders "beneficially own" (as defined in Rule 13d-3
under the Exchange Act) at least the same percentage of voting power after the
consummation of such plan as before or otherwise retain the right or ability, by
voting power, to control the Person that acquires the proceeds of such
liquidation or dissolution, (c) any "person" or "group" (within the meaning of
Sections 13(d)(3) and 14(d)(2) of the Exchange Act or any successor provision to
either of the foregoing; including any group acting for the purpose of
acquiring, holding or disposing of securities within the meaning of Rule 13d-
5(b) under the Exchange Act), other than the Existing Shareholders becomes the
"beneficial owner" (as so defined) of more than 35% of the total voting power of
all classes of the Voting Stock of Grand Parent and/or warrants or options to
acquire such Voting Stock, calculated on a fully diluted basis, provided that
Existing Shareholders "beneficially own" (as so defined) in the aggregate a
percentage of such Voting Stock or warrants having a lesser percentage of voting
power than such other "person" or "group" and do not have the right or ability
by voting power, contract or otherwise to elect or designate for election a
majority of Grand Parent's Board of Directors, (d) during any period of two
consecutive years, individuals who at the beginning of such period constituted
Grand Parent's Board of Directors (together with any new directors whose
election or appointment by such board or whose nomination for election by the
stockholders of Grand Parent was approved by a vote of the Existing Shareholders
or a majority of the directors then still in office who were either directors at
the beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of Grand
Parent's Board of Directors then in office, or (e) Grand Parent ceases to own
100% of the Capital Stock of Parent (except as permitted in accordance with
clause (v) of the definition of "Permitted Asset Sale," or Parent ceases to own
95.6% of the Capital Stock of the Borrower. Notwithstanding clause (c) above,
the acquisition by a Qualified Investor (as certified to the Administrative
Agent by the Borrower) of 49.0% or less of the Voting Stock of Grand Parent
shall not constitute a "Change of Control," so long as not more than $15,000,000
of the Senior Notes are (and Grand Parent has not received notice of an election
to cause such Senior Notes to be) redeemed or repurchased by Grand Parent from
the holders thereof as a result of a mandatory offer to purchase under the
Indenture on account of such an acquisition.
Closing Date. The meaning specified in the introductory clause of Article
------------
VIII.
Co-Agent. NationsBank, N.A., as Co-Agent under this Agreement.
--------
Collateral. All of the property, rights and interests of the Borrower,
----------
Parent, OIT, OHI and the License Subsidiary now existing or acquired in the
future that are or are intended to be subject to the security interests created
by the Collateral Documents.
5
<PAGE>
Collateral Documents. The Borrower Security Agreement, the Borrower Pledge
--------------------
Agreement, the Borrower Securities Account Control Agreement, the Mortgage, the
Parent Guaranty, the Parent Pledge Agreement, the Subsidiary Guaranty, the
Subsidiary Security Agreement, the OHI Guaranty, the OHI Pledge Agreement, the
OIT Guaranty, the OIT Securities Account Control Agreement, and any other
agreements or documents contemplated hereby or thereby and all schedules,
exhibits and annexes thereto.
Commitment. At any time, for any Lender, the amount set forth opposite
----------
such Lender's name in Annex I hereto under the heading "Commitment," as the same
may be reduced (or increased) from time to time pursuant to this Agreement.
Commitment Percentage. For each Lender at any given time, the percentage
---------------------
equivalent of such Lender's Commitment divided by the Total Commitment.
Common Stock. With respect to any Person, any and all shares, interests,
------------
participations or other equivalents (however designated, whether voting or non-
voting) in equity of such Person, whether now outstanding or issued after the
Closing Date, including, without limitation, all series and classes of such
common stock, but excluding Preferred Stock of such Person.
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 or its Affiliates
------------------------
furnish 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 or its Affiliates.
Consent Agent. As defined in Section 8.21.
-------------
Consolidated Cash Interest Expense. For any period, Consolidated Interest
----------------------------------
Expense for such period minus the amount of such Consolidated Interest Expense
-----
not paid or payable in cash.
Consolidated Interest Expense. For any fiscal period of any Person, the
-----------------------------
total interest expense (including, without limitation, interest expense
attributable to Capitalized Leases in accordance with GAAP) of such Person and
its Subsidiaries for such period determined on a consolidated basis in
accordance with GAAP.
Contingent Obligation. As to any Person, any obligation of such Person
---------------------
guaranteeing or in effect guaranteeing any Indebtedness, lease, dividend or
other obligation ("pri mary 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,
6
<PAGE>
(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
benefi ciary 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.
Convert, Conversion and Converted. A conversion of Loans of one Type into
------- ---------- ---------
Loans of the other Type pursuant to Section 2.5 or 2.6.
Current Phase I Audit. As defined in Paragraph 6 of Schedule 5.23.
---------------------
Default. Subject to Section 1.4, 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. With respect to any Person, 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 such Person, other than dividends payable solely in shares
of Common Stock of such Person;
(b) the purchase, redemption, or other retirement of any shares of any
class of Capital Stock of such Person;
7
<PAGE>
(c) the return of capital by such Person to its shareholders as such;
or
(d) any other distribution on or in respect of any shares of any class
of Capital Stock of such Person.
DLJ. DLJ Capital Funding, Inc.
---
DLJSC. Donaldson, Lufkin & Jenrette Securities Corporation.
-----
Documentation Agent. GSCP, as Documentation Agent under this Agreement.
-------------------
Dollars or $. Dollars in lawful currency of the United States of America.
------------
Draw Request. As defined in Section 2.2.
------------
EBITDA. With respect to any Person for any period,
------
(a) Net Income of such Person and its Subsidiaries for such period,
plus
(b) to the extent deducted in determining Net Income for such period,
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, and
(c) to the extent included in determining Net Income for such period,
minus net gains from Permitted Asset Sales or extraordinary net gains, and
plus losses from Permitted Asset Sales or extraordinary non-cash losses.
(d) to the extent included in determining Net Income for such period,
minus non-cash undistributed earnings, and plus non-cash losses from
permitted Investments.
Employee Benefit Plan. Any employee benefit plan within the meaning of
---------------------
Section 3(3) of ERISA maintained or contributed to by any of the Borrower or any
ERISA Affiliate, other than a Multiemployer Plan.
Environmental Affiliate. With respect to any Person, any other Person
-----------------------
whose liability for any Environmental Claim such Person has or may have
retained, assumed or otherwise become liable for (contingently or otherwise),
either contractually or by operation of law.
Environmental Claim. The meaning provided in Section 5.23(a).
-------------------
8
<PAGE>
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;
(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. As defined in Section 5.23(e).
---------------------
Equity Issuance. The issuance or sale of Capital Stock (other than (i)
---------------
Preferred Stock with mandatory redemption rights in favor of the holder and (ii)
employee stock options and warrants) by Grand Parent, the Net Cash Proceeds from
which is equal to or greater than $250,000,000.
9
<PAGE>
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
---------------
Grand Parent or the Borrower under (S) 414 of the IRC.
ERISA Event. With respect to the Borrower, Grand Parent or any ERISA
-----------
Affiliate,
(a) a Reportable Event,
(b) the withdrawal of Grand Parent, 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 Section 10.1.
----------------
Excess Cash Flow. With respect to any fiscal year of the Grand Parent and
----------------
its Subsidiaries on a consolidated basis (except where otherwise indicated), a
positive number, if any, equal to (i) EBITDA for such fiscal year, plus (ii) any
----
Net Cash Proceeds received by (x) Grand Parent or any other Loan Party from a
Permitted Asset Sale (to the extent not required to be paid to the Lenders
pursuant to Section 3.2), and (y) any Non-Party Subsidiary from a Permitted
Asset Sale (to the extent such Net Cash Proceeds are permitted to be distributed
to Grand Parent pursuant to any agreement to which such Non-Party Subsidiary is
a party) plus (or minus) (iii) decreases (or increases) in Working Capital
---- -----
(other than decreases or increases in any cash included therein) from the last
day of the preceding fiscal year to the last day of such fiscal year, minus (iv)
-----
all amounts paid in cash in respect of taxes in such fiscal year, minus (v) cash
-----
Capital Expenditures for such fiscal year, minus (vi) Consolidated Cash Interest
-----
Expense for such fiscal year, minus (vii) all principal payments made during
-----
such fiscal year in respect of Indebtedness to the extent such Indebtedness and
payments are permitted to be incurred and made hereunder.
Exchange Act. The Securities Exchange Act of 1934, as amended.
------------
10
<PAGE>
Existing Bank Debt. All indebtedness, principal, interest, premium, fees,
------------------
indemnities, expenses or other obligations of any nature owed under or in
connection with the Existing Loan Agreement.
Existing Loan Agreement. The Loan Agreement, dated as of December 29,
-----------------------
1997, among the Borrower, as borrower, the lenders party thereto, DLJ, as
syndication agent, GSCP, as documentation agent, Bank of America NT & SA, as
administrative agent, and NationsBank, N.A., as Co-Agent.
Existing Shareholders. Douglas G. Smith, Madison Dearborn Capital
---------------------
Partners, L.P., Allen & Company Incorporated and Chatterjee Management Company
and their respective Affiliates at the Closing Date and the one Investment Grade
Company (if any) that acquires 49.0% or less of the Capital Stock of Grand
Parent pursuant to the definition of "Change of Control."
Expense Allocation Agreement. The Amended and Restated Expense Allocation
----------------------------
Agreement among the Borrower, Parent and Grand Parent dated as of December 29,
1997, as amended from time to time as permitted hereunder.
"F" Block Licenses. FCC Licenses issued in the FCC's F-Block auction
------------------
under 47 CFR Section 24.229(b).
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.
Fee Letter. As defined in Section 2.3.
----------
Final Loans. As defined in Section 2.1.
-----------
Fixed Charges. As of the end of any fiscal quarter of the Borrower, the
-------------
sum of the following for the last consecutive 12 months ending on such date:
(i) the aggregate amount of Consolidated Cash Interest Expense paid or required
to be paid in cash by Borrower on all Indebtedness of the Borrower outstanding
during all or any part of any such period plus (ii) the aggregate amount of
----
scheduled principal payments made or required to be made by the Borrower and its
Subsidiaries with respect to any Indebtedness of the Borrower and its
Subsidiaries plus (iii) all Capital Expenditures (net of that portion which is
----
expressly
11
<PAGE>
financed pursuant to Indebtedness permitted under Section 7.1) of the Borrower
and its Subsidiaries.
Full-Term Operating Business Plan. The operating business plan of the
---------------------------------
Borrower delivered pursuant to Section 8.11(b), as updated from time to time
pursuant to this Agreement.
GAAP. As defined in Section 1.3.
----
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.
------------
GSCP. Goldman Sachs Credit Partners L.P.
----
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 4062, 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.
Guarantors. Each of OHI, OIT, the License Subsidiary and the Parent.
----------
Holder. The holder of any Senior Secured Notes under the Note Purchase
------
Agreement.
Increased Commitments. As defined in Section 2.1(b)(i).
---------------------
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 (including
the principal amount of all Intercompany Indebtedness) 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;
12
<PAGE>
(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 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 Licenses for the
New York PCS Network; and
(h) all Contingent Obligations of such Person.
Indentures. Each of (i) the Indenture, dated as of December 2, 1996,
----------
between Grand Parent, as issuer, and Marine Midland Bank, as trustee, in respect
of the 11 5/8% Senior A Notes due 2006 and (ii) the Indenture, dated as of
August 27, 1996, between Grand Parent, as issuer, and Marine Midland Bank, as
trustee, in respect of the 11 5/8% Senior Notes due 2006, in each case as
amended from time to time.
Initial Draw Amount. $450,000,000.
-------------------
Initial Loans. The Tranche A Loans and the Tranche B Loans.
-------------
Initial Payment Date. June 30, 1998.
--------------------
Installment Amount. With respect to (i) each Payment Date other than the
------------------
Maturity Date, an amount equal to 0.25% of the aggregate principal amount of
Loans outstanding on the Last Drawdown Date, as such amount may be reduced from
time to time pursuant to Section 3.2 or 3.3, and (ii) the Maturity Date, the
aggregate then outstanding principal amount of all Loans, all accrued and unpaid
interest thereon, all fees and other amounts owed hereunder and all other
Obligations of the Borrower then outstanding.
Intellectual Property. All copyrights, trademarks, service marks, patents,
---------------------
trade names and service names, Licenses and the like.
Intercompany Indebtedness. All Indebtedness of any Omnipoint Loan Party
-------------------------
(other than Grand Parent) to the Parent, Grand Parent or any Affiliate of the
Parent or Grand Parent; provided that such Indebtedness must (i) be subject to a
Subordination Agreement, (ii) have no scheduled or mandatory amortization
payments prior to its maturity date, (iii) have a maturity date no earlier than
six months later than the Maturity Date and (iv) bear interest at a rate per
annum not to exceed 12.0%.
13
<PAGE>
Intercreditor Agreement. The Intercreditor Agreement, dated as of the date
-----------------------
hereof, among Bank of America National Trust & Savings Association, as
Administrative Agent for the benefit of the Lenders and Collateral Agent for the
benefit of the Secured Creditors, substantially in the form of Exhibit __, as
the same may be supplemented, amended or modified from time.
Interest Period. For each LIBO Rate Loan comprising part of the same
---------------
Borrowing, the period commencing on the date of such LIBO Rate Loan or the date
of the Conversion of any Base Rate Loan into such LIBO Rate Loan 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 one, two,
three or six months as selected by the Borrower pursuant to Section 2.2 and 2.6;
provided that:
- --------
(a) whenever the last day of any Interest Period would otherwise occur
on a day other than a Business Day, the last day of such Interest Period
shall be extended to occur on the next-succeeding 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 Business Day, and
(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 following calendar month, such Interest Period shall end on the
last Business Day of such following calendar month.
Investment Grade Company. Any company the senior unsecured long-term debt
------------------------
of which is rated no lower than Baa3 by Moody's Investor Service, Inc. and BBB-
by Standard & Poor's Corporation (or a comparable rating from another recognized
national ratings agency to be substituted for either, but not both, of Moody's
Investor Service, Inc. or Standard & Poor's Corporation).
Investments. With respect to any Person, all expenditures made and all
-----------
liabilities incurred (contingently or otherwise) for the acquisition of Capital
Stock or Indebtedness of, or for loans, advances or other extensions of credit
(but excluding advances to customers in the ordinary course of business that
are, in conformity with GAAP, recorded on the balance sheet of such Person as
accounts receivable), 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 other 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 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;
14
<PAGE>
(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.
Joinder Agreement. A Joinder Agreement substantially in the form of
-----------------
Exhibit V.
Last Drawdown Date. April 1, 1998
------------------
Lender. The banks and other financial institutions signatory hereto in
------
their capacity as Lenders, and any other Person that becomes a Lender by reason
of an Assignment and Acceptance in accordance with the terms of this Agreement.
LIBO 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 the requested Interest
Period, as shown under the heading "USD" as of 11:00 a.m. (London
time), two 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 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.
15
<PAGE>
LIBO Rate Loan. Any Loan bearing interest calculated by reference to the
--------------
LIBO Rate, plus the Applicable Margin.
LIBOR Reserve Rate. For any Interest Period for all LIBO Rate Loans
------------------
comprising part of the same Borrowing, 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 LIBO Rate Loans 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.
License Subsidiary. The wholly owned subsidiary of the Borrower to be
------------------
organized pursuant to the terms and provisions of Section 6.16.
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 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 Intercreditor Agreement, the Notes,
--------------
the Agent's Fee Letter, each Collateral Document, the Subordination Agreement
among Grand Parent, the Borrower and the Administrative Agent and any other
Subordination Agreement entered into from time to time, the Access Agreements
and any other agreements or documents contemplated hereby or thereby and all
schedules, exhibits and annexes thereto.
Loan Party. Any party to any Loan Document.
----------
Loans. As defined in Section 2.1.
-----
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
(a) materially and adversely impair the validity or enforceability of
any of the Loan Documents or the Administrative Agent's or any Lender's
rights or remedies with respect thereto;
16
<PAGE>
(b) materially and adversely impair the ability of any Omnipoint Loan
Party to pay its Obligations in accordance with their terms;
(c) cause a Default;
(d) materially and adversely affect the business, property, prospects,
operations, or financial or other condition of the Omnipoint Loan Parties,
taken as a whole; or
(e) materially and adversely 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 $10,000,000 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 petroleum products, by products or breakdown
products or any other material subject to regulation under any Environmental
Laws.
Maturity Date. February 17, 2006, as such Maturity Date may be accelerated
pursuant to Section 10.1.
Mortgage. The Mortgage and Security Agreement, substantially in the form
--------
of Exhibit H, granted by the Borrower in favor of the Administrative Agent, as
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 FCC Licenses for the New York PCS Network and all grants,
approvals, licenses, filings and registrations under the Communications Act,
necessary in order to enable the Borrower and its Subsidiaries to own,
construct, maintain and operate PCS Systems.
17
<PAGE>
Net Cash Proceeds. With respect to any Person, (a) with respect to any
-----------------
Permitted Asset Sale, the proceeds of such Permitted Asset Sale in the form of
cash net of (i) brokerage commissions and other fees and expenses (including
fees and expenses of counsel and investment bankers) related to such Permitted
Asset Sale, (ii) provisions for all taxes as a direct result of such Permitted
Asset Sale, without regard to the consolidated results of operations of such
Person and its Subsidiaries, taken as a whole, (iii) payments made to repay
Indebtedness or any other obligation outstanding at the time of such Permitted
Asset Sale that either (A) is secured by a Lien on the property or assets sold
or (B) is required to be paid as a result of such sale and (iv) appropriate
amounts to be provided by such Person or any Subsidiary of such Person as a
reserve against any liabilities associated with such Permitted Asset Sale,
including, without limitation, pension and other post-employment benefit
liabilities, liabilities related to environmental matters and liabilities under
any indemnification obligations associated with such Permitted Asset Sale, all
as determined in conformity with GAAP and (b) with respect to any issuance or
sale of Capital Stock, the proceeds of such issuance or sale in the form of cash
or cash equivalents, including payments in respect of deferred payment
obligations (to the extent corresponding to the principal, but not interest,
component thereof) when received in the form of cash or cash equivalents (except
to the extent such obligations are financed or sold with recourse to such Person
or any Subsidiary of such Person) and proceeds from the conversion of other
property received when converted to cash or cash equivalents, net of attorney's
fees, accountants' fees, underwriters' or placement agents' fees, discounts or
commissions and brokerage, consultant and other fees incurred in connection with
such issuance or sale and net of taxes paid or payable as a result thereof.
Net Income. With respect to any Person for any period, net income (or
----------
loss) of such Person determined in accordance with GAAP for such period.
New York MTA. MTA No. 1.
------------
New York PCS Network. The PCS networks in the New York MTA to be
--------------------
constructed pursuant to the FCC License for such MTA awarded to the Borrower.
Non-Party Subsidiary. Any Subsidiary of Grand Parent which is not an
--------------------
Omnipoint Loan Party.
Non-U.S. Lender. As defined in Section 4.3(e).
---------------
Note Purchase Agreement. The Note Purchase Agreement, dated as of the date
-----------------------
hereof, among the Borrower, the purchasers of notes listed therein, DLJ, GSCP
and NationsBank, N.A. as the same may be amended, supplemented or otherwise
modified from time to time.
Notes. The Promissory Notes substantially in the form of Exhibit A issued
-----
by the Borrower hereunder.
Notice of Conversion or Continuation. As defined in Section 2.6.
------------------------------------
18
<PAGE>
Obligations. All indebtedness, obligations and liabilities of each
-----------
Omnipoint Loan Party to the Administrative 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.
ODCI. Omnipoint Data Company, Inc., a Delaware corporation.
----
OHI. Omnipoint Holdings, Inc., a Delaware corporation.
---
OHI Guaranty. The Guaranty issued by OHI to the Administrative Agent,
------------
substantially in the form of Exhibit N, as amended from time to time in
compliance with the Loan Documents.
OHI Pledge Agreement. The Pledge Agreement between OHI and the
--------------------
Administrative Agent substantially in the form of Exhibit O, as amended from
time to time in compliance with the Loan Documents, which agreement shall secure
the OHI Guaranty of the Obligations of the Borrower with respect to the Tranche
B Loans only.
OII. Omnipoint Investments, Inc., a Delaware corporation, created solely
---
for the purpose of investing all or a portion of Grand Parent's and its
Subsidiaries' cash and cash equivalents.
OIT. Omnipoint Investments Two, Inc., a Delaware corporation, created
---
solely for the purpose of investing all or a portion of Grand Parent's and its
Subsidiaries' cash and cash equivalents.
OIT Guaranty. The Guaranty issued by OIT to the Administrative Agent,
------------
substantially in the form of Exhibit P, as amended from time to time in
compliance with the Loan Documents.
OIT Securities Account Control Agreement. The OIT Securities Account
----------------------------------------
Control Agreement between OIT and the Administrative Agent for the benefit of
the Lenders and the Secured Creditors under the Intercreditor Agreement,
substantially in the form of Exhibit Q, as amended from time to time in
compliance with the Loan Documents, which agreement shall secure the OIT
Guaranty of the Borrower's Obligations with respect to the Tranche B Loans only.
Omnipoint Entity. Grand Parent and each of its direct and indirect
----------------
Subsidiaries.
Omnipoint Loan Parties. Each Guarantor, the Borrower and Grand Parent.
----------------------
Operating Agreement. The agreement between the Borrower and the License
-------------------
Subsidiary pursuant to which the License Subsidiary grants a sublicense in, or a
right to
19
<PAGE>
operate, use and manage, its FCC Licenses to the Borrower, substantially in the
form of Exhibit R.
Other Taxes. As defined in Section 4.3(b).
-----------
OTI. Omnipoint Technologies, Inc., a Delaware corporation.
---
Parent. Omnipoint PCS, Inc., a Delaware corporation.
------
Parent Guaranty. The 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 Pledge Agreement among Parent and the
-----------------------
Administrative Agent for the benefit of the Lenders and the Secured Creditors
under the Intercreditor Agreement, substantially in the form of Exhibit J, as
amended from time to time in compliance with the Loan Documents.
Participant. As defined in Section 12.7(f).
-----------
Payment Date. Subject to Section 2.7(c), the last Business Day of each
------------
September, December, March and June.
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 wireless communications services consistent
---
with FCC guidelines.
PCS System. A PCS radio telephone system constructed and operated pursuant
----------
to a License therefor.
Permitted Asset Sale. Any of the following:
--------------------
(i) sales of assets of Grand Parent or any of its Subsidiaries in the
ordinary course of business;
(ii) sales of obsolete equipment or inventory of Grand Parent or any
of its Subsidiaries;
(iii) with respect to the Borrower, sales of assets (other than the
FCC Licenses for the New York PCS Network) the proceeds of which do
not exceed $25,000,000 in any fiscal year or $50,000,000 in the
aggregate prior to the Maturity Date; provided however that such sales
must be at fair market value and the consideration therefor must
consist of at least 75% cash or cash equivalents; and provided further
that the Net Cash Proceeds must be reinvested
20
<PAGE>
in the Borrower's business within 270 days from the receipt of
such proceeds or, if not so reinvested, applied on the 271st day
following such receipt to repay the Loans in accordance with
Section 3.4;
(iv) with respect to Grand Parent and each Non-Party Subsidiary, sales
of assets for fair market value, provided that Grand Parent or such
Non-Party Subsidiary must receive consideration for such sales
consisting of at least 75% cash or cash equivalents; provided further
that the Net Cash Proceeds of such sales must be reinvested in Grand
Parent or its Non-Party Subsidiar ies within 270 days from the
receipt of such proceeds or, if not so rein vested, applied on the
271st day following such receipt to repay (a) senior secured
Indebtedness of Grand Parent or such Non-Party Subsidiaries as
required thereby or (b) the Loans; and provided further that in the
case of "C" Block Licenses and "F" Block Licenses, such sales may be
in consider ation (which shall be counted as cash consideration) for
forgiveness or assumption of Indebtedness equal to the value of such
Licenses (or portion thereof sold pursuant to a Permitted
Disaggregation) as determined in good faith by Grand Parent's board of
directors.
(v) a sale of up to 35% of the Capital Stock of the Parent, provided
that (i) such sale is a single private placement to a Qualified
Investor (as certified to the Administrative Agent by the Borrower),
(ii) such sale is for 100% cash consideration and (iii) the proceeds
of such sale are applied in the manner specified in clause (iii)
above.
Permitted C-Block FCC License Transfer. A disposition of a C-Block
--------------------------------------
License, in whole, including any Permitted Disaggregation, in respect of any BTA
as to which (a) the transferee of such C-Block License is the FCC and (b) after
giving effect to such disposition no Omnipoint Entity shall have any liability
in respect of Indebtedness to the FCC for the deferred purchase price of such
FCC License, except in the case of any Permitted Disaggregation any Omnipoint
Entity may remain liable in respect of a portion of the Indebtedness in respect
of such FCC License equal to the amount of Indebtedness owing to the FCC
immediately prior to such transfer, multiplied by a fraction, the numerator of
which is the amount of spectrum (measured in MHz) retained by any Omnipoint
Entity in connection with such Permitted Disaggregation and the denominator of
which is 30 MHz.
Permitted Disaggregation. A disposition of a portion of or any rights to
------------------------
use spectrum under any FCC License in connection with a disaggregation thereof
approved by the FCC pursuant to which Grand Parent or any of its Non-Party
Subsidiaries retains either (i) the right to use a portion of spectrum under
such FCC License or (ii) an FCC License covering a portion of the spectrum
formerly covered by such FCC License.
Permitted Liens. Liens, security interests and other encumbrances
---------------
permitted by Sections 7.2.
21
<PAGE>
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 Grand Parent 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 Grand Parent 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.
Post Default Investments. So long as no payment default exists at the
------------------------
Borrower, Investments made pursuant to Section 7.4(i) after and during the
existence and continuance of a Default to the extent (but only to the extent)
that such Investments are made to (a) avoid the occurrence of a new Default, or
where the failure to make such Investments could be reasonably expected to have
a Material Adverse Effect, provided that no Event of Default has occurred and
the entire outstanding principal balance of the Loans has not been accelerated
prior to the Maturity Date; (b) cure the event which has given rise to such
Default; (c) make payments as and when due to the FCC for the deferred purchase
price of FCC Licenses; (d) make Investments in the Borrower or the License
Subsidiary; and (e) comply with the terms of any equity or loan commitment of
Grand Parent in existence prior to the date of such Default.
Potential Lender. As defined in Section 2.1(b)(ii).
----------------
Preferred Stock. With respect to any Person, any and all shares,
---------------
interests, participations or other equivalents (however designated, whether
voting or non-voting) of such Person's preferred or preference equity, whether
now outstanding or issued after the Closing Date, including, without limitation,
all series and classes of such preferred or preference equity.
Prepayment Premium. As defined in Section 3.3(b).
------------------
Property. All types of real, personal, tangible, intangible or mixed
--------
property, including the FCC Licenses for the New York PCS Network.
Qualified Investor. An Investment Grade Company which either (i) is in
------------------
the telecommunications industry or (ii) engages in a business which will benefit
from strategic synergies from an Investment in Grand Parent.
22
<PAGE>
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,
----
42USCA (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 any Omnipoint Entity.
Register. As defined in Section 12.7(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 Amount. The amount of the Total Commitment minus amounts borrowed
---------------
(excluding any Increased Commitments).
Required Lenders. At any time that (i) Commitments are outstanding, at
----------------
least 51% of the aggregate of (a) the then-outstanding aggregate unpaid
principal amount of Loans and (b) the then-unfunded Commitments; and (ii)
Commitments are not outstanding, at least 51% of the aggregate of the then-
outstanding aggregate unpaid principal amount of Loans.
Required Secured Creditors. With respect to the Secured Creditors, (i) at
--------------------------
any time that Commitments are outstanding, at least 51% of the aggregate of (a)
the then-outstanding aggregate unpaid principal amount of Loans, (b) the then-
outstanding aggregate unpaid principal amount of Senior Secured Notes and (c)
the then-unfunded Commitments; and (ii) at any time that Commitments are not
outstanding, at least 51% of the aggregate of (a) the then-outstanding aggregate
unpaid principal amount of Loans and (b) the then-outstanding aggregate unpaid
principal amount of Senior Secured Notes.
Revenue. For any period, the revenues of the Borrower and its
-------
Subsidiaries during such period, determined on a consolidated basis in
accordance with GAAP.
Secured Creditors. The meaning specified in the Intercreditor Agreement.
-----------------
Senior Notes. The notes issued by Grand Parent under the Indentures.
------------
Senior Secured Notes. The Notes issued under the Note Purchase Agreement.
--------------------
23
<PAGE>
Services Agreement. The Services Agreement between Omnipoint
------------------
Communications Services, Inc. and the Borrower, substantially in the form of
Exhibit S.
Significant Entities. Each of the Borrower, Grand Parent and each of its
--------------------
Significant Subsidiaries, and each Guarantor.
Significant Subsidiary. With respect to Grand Parent at any date of
----------------------
determination, any Subsidiary of Grand Parent that, together with its
Subsidiaries, (i) for the most recent fiscal year of Grand Parent, accounted for
more than 10% of the consolidated revenues of Grand Parent and its Subsidiaries
or (ii) as of the end of such fiscal year, was the owner of more than 10% of the
consolidated assets of Grand Parent and its Subsidiaries (or, in the case of any
Subsidiary which owns "C" Block Licenses, 10% of the net consolidated assets of
Grand Parent and its Subsidiaries), all as set forth on the most recently
available consolidated financial statements of Grand Parent for such fiscal
year.
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;
(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.
The determination referred to in clause (a) above of the "present fair salable
value" of the FCC License for the New York PCS Network shall disregard the
effect of restrictions on transfer of such License by the FCC during the initial
three-year period.
Subordination Agreement. Any Subordination Agreement executed by an
-----------------------
Omnipoint Entity and in substantially the form of Exhibit K.
Subscriber. Each user in the Borrower's or any of its Affiliates' Home
----------
Location Registers in respect of registration to receive service within the
territory of the New York MTA and with respect to which the Borrower is entitled
to recognize, receive and collect billable revenues for its own account.
Subsequent Drawdown Date. The date of any Borrowing after the Closing Date
------------------------
and prior to the Last Drawdown Date.
Subsequent Loans. As defined in Section 2.1(a).
----------------
24
<PAGE>
Subsidiary. With respect to any Person, any corporation, partnership,
----------
association, joint venture or other entity in which such Person, directly or
indirectly through one or more Subsidiaries, owns more than 50% of the
outstanding Voting Stock.
Subsidiary Guaranty. The Guaranty issued by the License Subsidiary to the
-------------------
Administrative Agent, substantially in the form of Exhibit L, as amended from
time to time in compliance with the Loan Documents.
Subsidiary Security Agreement. The Subsidiary Security Agreement between
-----------------------------
the License Subsidiary and the Administrative Agent, substantially in the form
of Exhibit M, as amended from time to time in compliance with the Loan
Documents, which agreement shall secure the Subsidiary Guaranty of the
Obligations of the Borrower with respect to the Tranche B Loans only.
Syndication Agent. DLJ Capital Funding, Inc., as Syndication Agent under
-----------------
this Agreement.
Total Commitment. At any time, the sum of the Commitments of all of the
----------------
Lenders at such time.
Total Covenant Indebtedness. The amount of Total Indebtedness minus all
---------------------------
Intercompany Indebtedness.
Total Indebtedness. At any time, the aggregate principal amount of all
------------------
Indebtedness of the Borrower and its Subsidiaries outstanding.
Total Interest Expense. For any period, the aggregate amount of interest
----------------------
required to be accrued by the Borrower or its Subsidiaries during such period on
all Indebtedness of the Borrower and its Subsidiaries 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, 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 pursuant to Section 2.3 under all circumstances shall be treated
as accrued on the date when payable.
Tranche A Lender. Any Lender which makes or has Commitments with respect
----------------
to Tranche A Loans.
Tranche A Loan Amount. The total amount of Tranche A Commitments as set
---------------------
forth in Annex 1 hereto.
25
<PAGE>
Tranche A Loans. The portion of the Initial Loans in an amount equal to
---------------
$229,500,000 (which amount together with the Tranche A Amount under the Note
Purchase Agreement is equal to the amount of Existing Bank Debt outstanding as
of the Closing Date), as the same may be increased pursuant to Section 12.7(i).
Tranche B Lender. Any Lender which makes or has Commitments with respect
----------------
to Tranche B Loans.
Tranche B Loan Amount. The total amount of Tranche B Commitments as set
---------------------
forth in Annex 1 hereto.
Tranche B Loans. All Loans which are funded on the Closing Date but which
---------------
are not Tranche A Loans, as the same may be increased pursuant to Section
12.7(i).
Tranche C Lender. Any Lender which makes or has Commitments with respect
----------------
to Tranche C Loans.
Tranche C Loans. All Loans which are Subsequent Loans or Final Loans.
---------------
Type. As to any Loan, its nature as a Base Rate Loan, or a LIBO Rate Loan.
----
Unrestricted Cash. Cash and cash equivalents of the Borrower or OIT which
-----------------
are not subject to any Lien or restriction, except Liens in favor of the
Administrative Agent for the benefit of the Lenders.
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 Person on any date of determination,
---------------
the difference between (i) such Person's "current assets" (excluding such
Person's cash and cash equivalents) and (ii) such Person's "current
liabilities," (excluding Indebtedness), each calculated as of such date of
determination in accordance with GAAP.
Working Capital Requirement. With respect to any period, the extent, if
---------------------------
any, by which such Person's Working Capital for such period exceeds such
Person's Working Capital for the immediately preceding period.
Section 1.2 Rules of Interpretation.
-----------------------
(a) A reference to any document or agreement shall include such
document or agreement as amended, restated, modified or supplemented from
time to time in accordance with its terms and the terms of this Agreement.
26
<PAGE>
(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) Reference to a particular "Section", "(S) " or Exhibit refers to
that section, "(S)" or that exhibit to this Agreement, unless otherwise
indicated.
(h) 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 1.3 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, 1996, 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,
1996, 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.
Section 1.4 Certain Calculations. Any calculation to determine whether
--------------------
the incurrence of Indebtedness under Section 7.1 or the making of a Distribution
under Section 7.5 would give rise to a Default under Section 7.19 shall be on a
pro forma basis and
27
<PAGE>
calculated on the assumption that such Indebtedness has been incurred or such
Distribution made, and the proceeds thereof applied, in the case of (i) Section
7.19(c) and (e), on the last day of the most recently ended fiscal quarter prior
to the incurrence of such Indebtedness or the making of such Distribution and
(ii) Section 7.19(d), on the first day of the relevant twelve full month period
immediately preceding the incurrence of such Indebtedness or such Distribution.
ARTICLE II
THE LOANS
---------
Section 2.1 Loans
-----
(a) (i) Subject to and upon the terms and conditions herein set
forth, each Tranche A Lender severally and not jointly agrees to make
Tranche A Loans to the Borrower on the Closing Date, of a sum not to exceed
such Lender's Commitment Percentage of the Tranche A Loan Amount.
Immediately upon the making of the Tranche A Loans, the Commitments of the
Tranche A Lenders shall be automatically terminated.
(ii) Subject to and upon the terms and conditions herein set
forth, each Tranche B Lender severally and not jointly agrees to make
Tranche B Loans to the Borrower on the Closing Date, of a sum not to exceed
such Lender's Commitment Percentage of the Tranche B Loan Amount.
Immediately upon the making of the Tranche B Loans, the Commitments of the
Tranche B Lenders shall be automatically terminated.
(iii) Each Tranche C Lender severally and not jointly agrees to
make Tranche C Loans to the Borrower (x) from time to time after the
Closing Date but prior to the Last Drawdown Date, on the date specified in
the relevant Draw Request, of a sum equal to (A) such Lender's Commitment
Percentage multiplied by (B) the amount requested by the Borrower pursuant
to the relevant Draw Request (each such loan, together with the Final Loans
(as defined below), a "Subsequent Loan"); and (y) on the Last Drawdown Date
if any Commitments remain outstanding, of a sum equal to (A) such
Lender's Commitment Percentage multiplied by (B) the sum of (1) the Total
Commitment minus (2) the aggregate amount previously borrowed (each such
loan, a "Final Loan" and together with the Initial Loans and the Subsequent
Loans, the "Loans").
(iv) The aggregate principal amount of the Loans outstanding
shall not exceed $595,000,000, as such amount may be increased (i) pursuant
to Section 2.1(b) or (ii) by the joinder hereto of new Lenders in
accordance with Section 12.7(i).
28
<PAGE>
(b) (i) In the event that after the Closing Date the Borrower
consummates an Equity Issuance, the Borrower may, upon at least 30 days'
notice to the Administrative Agent (who shall promptly provide a copy of
such notice to the other Agents and the Lenders) propose to increase the
aggregate amount of the Commitments by an amount not to exceed $250,000,000
(the amount of any such increase, the "Increased Commitments"). Each
Lender party to this Agreement at such time shall have the right (but no
obligation), prior to the expiration of the 30 day period, to elect by
written notice to the Borrower and the Administrative Agent to increase its
Commitments by a principal amount equal to such Lender's Commitment
Percentage multiplied by the Increased Commitments. Each of the Agents
shall assist and cooperate with (but shall not be obligated to commit to
any Increased Commitments to) the Borrower in connection with obtaining the
Increased Commitments.
(ii) If any Lender party to this Agreement shall elect not to
increase its Commitment pursuant to clause (i) above, the Borrower may
designate another financial institution or institutions or investment fund
or funds (which may be, but need not be, one or more of the existing
Lenders) consented to by the Agents and the Borrower and which would
otherwise be permitted to be a Lender pursuant to Section 12.7 (such
consent not to be unreasonably withheld or delayed) (each, a "Potential
Lender") which at the time agree to (i) in the case of such Potential
Lender that is an existing Lender, increase its Commitment and (ii) in the
case of any other such Potential Lender (an "Additional Lender"), become a
party to this Agreement. The sum of the increases in the Commitments of
the existing Lenders pursuant to this clause (ii) plus the Commitments of
the Additional Lenders shall not in the aggregate exceed the amount of the
Increased Commitments.
(iii) An increase in the aggregate amount of the Commitments pursuant
to this Section 2.1(b) shall become effective upon the receipt by the
Administrative Agent of an agreement in form and substance satisfactory to
the Administrative Agent signed by the Borrower, by each Additional Lender
and by each other Lender whose Commitment is to be increased, setting forth
the new Commitments of such Lenders and setting forth the agreement of each
Additional Lender to become a party to this Agreement and to be bound by
all the terms and provisions hereof, together with such evidence of
appropriate corporate authorization on the part of the Borrower with
respect to the Increased Commitments and such opinions of counsel for the
Borrower with respect to the Increased Commitments as the Administrative
Agent may reasonably request. So long as no Default is in existence or
would result therefrom, the Borrower may borrow under the Increased
Commitments by following the procedures with respect to Borrowings set
forth herein; provided that (i) Installment Amounts shall be payable with
respect to Loans under the Increased Commitment on the next succeeding date
on which Installment Amounts would otherwise be due and shall be paid on
such dates thereafter, and (ii) the Maturity Date with respect to Loans
under the Increased Commitments shall be the same as for the other Loans.
29
<PAGE>
(c) Any failure by the Borrower to borrow the Required Amount on or
before the Last Drawdown Date, or any voluntary termination of the
Commitments prior to the Last Drawdown Date, shall result in the immediate
and automatic termination of all of the remaining Commitments, and the
Borrower shall, immediately upon such failure to borrow or termination,
pay to the Administrative Agent (for distribution to the Lenders) a fee
equal to the product of (i) the then prevailing Prepayment Premium
multiplied by (ii) the sum of (x) the Total Commitment (excluding the
-------------
Increased Commitments) minus (y) all amounts borrowed by the Borrower prior
-----
to the date thereof.
(d) The Initial Loans shall consist of Tranche A Loans and Tranche B
Loans. Except with respect to the Collateral (as provided in the Loan
Documents), the Tranche A Loans and the Tranche B Loans shall be treated
the same under each of the Loan Documents. The Administrative Agent shall
designate in the Register the amount of each Lender's Loans and the nature
of each such Loan as a Tranche A Loan, Tranche B Loan or Tranche C Loan.
(e) The aggregate amount at any time outstanding under the Loans may
not exceed the then Total Commitments. The Commitments of each Lender (and
the Total Commitments) shall be reduced by an amount equal to the amount of
each Borrowing applicable to each such Lender's Commitment hereunder. The
Commitments (excluding any Increased Commitments) shall expire on April 2,
1998 if not utilized on or prior to such date.
Section 2.2 Making the Loans.
----------------
(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 LIBO Rate Loans, or the
first Business Day prior to the date of the proposed Loan in the case of a
Loan consisting of Base Rate Loans, by the Borrower to the Administrative
Agent, which shall give to each Lender prompt notice thereof by telecopier.
Each such notice of a Loan (a "Draw Request") shall be by telecopier
------------
substantially in the form of Exhibit B, specifying therein
(i) the requested date of such Loan (which shall be a Business
Day);
(ii) the portion of such Loan which will be made as a Base Rate
Loan and the portion of such Loan which will be made as a LIBO Rate
Loan;
(iii) the requested aggregate principal amount of such Loan;
(iv) the account to which the proceeds of such Loan shall be
paid; and
30
<PAGE>
(v) the initial Interest Periods applicable to any such Loan
which will be made as a LIBO Rate Loan.
Each Draw Request shall be accompanied by such additional documents as may
be required by Article VIII and Article IX. Each Lender shall, upon
fulfillment of the applicable conditions set forth in Articles VIII and IX,
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 Administrative Agent's Office, in same-day
funds, such Lender's Loan (determined by multiplying the amount of the
Borrowing by such Lender's Commitment Percentage). 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. (New
York Time) on the date of any 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. (New York Time).
(b) Anything in subsection (a) above to the contrary notwithstanding,
(i) the aggregate principal amount of any Borrowing comprised of LIBO Rate
Loans shall not be less than $5,000,000 and (ii) the Borrower may not
request LIBO Rate Loans if the obligation of the Lenders to make LIBO Rate
Loans shall then be suspended pursuant to Section 2.5 or 4.1.
(c) Each Draw Request shall be irrevocable and binding on the Bor
rower.
(d) Unless the Administrative Agent shall have received notice from a
Lender prior to the date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender's portion of such
Borrowing, 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 Section 2.2 and the
Administrative Agent may, at its option, 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 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 Loans comprising such
Borrowing 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 a Loan by such Lender for
purposes of this Agreement.
31
<PAGE>
(e) The failure of any Lender to make the Loan to be made by it shall
not relieve any other Lender of its obligation, if any, hereunder to make
its Loan hereunder, but neither the Administrative Agent nor any Lender
shall be responsible for the failure of any other Lender to make the Loan
to be made by such other Lender.
Section 2.3 Fees.
----
(a) The Borrower shall pay to the Agents such fees as are set forth in
the Omnipoint Corporation Senior Credit Facility Fee Letter dated January
12, 1998 (the "Fee Letter"), among Grand Parent, the Borrower, the
Syndication Agent, DLJSC and GSCP, as amended to, among other things,
include the Administrative Agent and NationsBank, N.A. as parties,
pertaining to the Permanent Facility (as defined in the Fee Letter).
(b) The Borrower shall pay to the Administrative Agent, for the
account of each Tranche C Lender, a commitment fee for the period
commencing on the date hereof and ending on the Last Drawdown Date (or such
earlier date that all of the Commitments shall have been fully utilized) of
0.50% per annum of the daily average undrawn Commitments of such Lender.
Such fee shall be due and payable on the Last Drawdown Date or such earlier
date on which the Commitments are terminated in full. The term "Commitment"
as used in this clause (b) shall exclude any Increased Commitment.
(c) The Borrower shall pay to the Administrative Agent an
administrative agent's fee as set forth in the Agent's Fee Letter.
Section 2.4 Interest.
--------
(a) The Borrower shall pay interest on the unpaid principal amount of
each Loan from the date of such Loan until such principal amount shall be
paid in full, at the following rates per annum:
(i) for all Base Rate Loans, 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 Appli cable Margin applicable to such Base Rate Loan, payable in
arrears quarterly on the last Business Day of each March, June,
September, December, and on the date any such Base Rate Loan shall be
paid in full;
(ii) for all LIBO Rate Loans, a rate per annum equal at all times
during each Interest Period for such LIBO Rate Loan to the sum of (A)
the LIBO Rate for such Interest Period for such LIBO Rate Loan, plus
(B) the Applicable Margin applicable to such LIBO Rate Loan, payable
in arrears on the last day of such Interest Period, in the case of an
Interest Period of six months, on the date occurring three months from
the first day of such
32
<PAGE>
Interest Period and on the date such LIBO Rate Loan shall be paid in
full or Converted.
(b) Upon the occurrence and during the continuance of any Event of
Default, the Borrower shall pay interest on the unpaid principal amount of
each Loan owing to each Lender, payable on demand, at a rate per annum
equal to the rate which is the greater of (i) 2.0% per annum in excess of
the rate per annum then borne by such Loan and (ii) a rate per annum equal
to the Base Rate plus 2% per annum plus the Applicable Margin. With
respect to 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, the Borrower shall pay interest
thereon, to the extent permitted under applicable law, in arrears on the
date such amount shall be paid in full and on demand, at a rate per annum
equal at all times to 2% per annum above the rate per annum required to be
paid on Base Rate Loans pursuant to clause (a)(i) above.
Section 2.5 Interest Rate Determination.
----------------------------
(a) If, with respect to any LIBO Rate Borrowing, the Required Lenders
notify the Administrative Agent that the LIBO Rate for any Interest Period
for such Borrowing will not adequately reflect the cost to such Required
Lenders of making, funding or maintaining their respective LIBO Rate Loans
comprising such Borrowing for such Interest Period, the Administrative
Agent shall forthwith so notify the Borrower and the Lenders, whereupon
(i) each such LIBO Rate Loan comprising such Borrowing will
automatically, on the last day of the then-existing Interest Period
therefor, Convert into a Base Rate Loan, and
(ii) the obligation of the Lenders to make, or to Convert Loans
into, LIBO Rate Loans 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 any
LIBO Rate Borrowing shall be reduced, by payment or prepayment or
otherwise, to less than $5,000,000, the Loans comprising such Borrowing
shall, subject to the provisions of Section 3.4(a) and 12.4(b),
automatically Convert into Base Rate Loans.
(c) Upon the occurrence and during the continuance of any Event of
Default,
(i) each LIBO Rate Loan will automatically, on the last day of
the then-existing Interest Period therefor, Convert into a Base Rate
Loan and
33
<PAGE>
(ii) the obligation of the Lenders to make, or to Convert Loans
into, LIBO Rate Loans shall be suspended immediately.
(d) If the Administrative Agent cannot determine the LIBO Rate for any
LIBO Rate Loans proposed to be made or Converted from Base Rate Loans,
(i) the Administrative Agent shall forthwith notify the Borrower
and the Lenders that the interest rate cannot be determined for such
LIBO Rate Loans,
(ii) each such Loan will automatically, on the last day of the
then-existing Interest Period therefor, Convert into a Base Rate Loan,
and
(iii) the obligation of the Lenders to make, or to Convert Loans
into, LIBO Rate Loans 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 2.6 Conversion or Continuation of Loans.
-----------------------------------
(a) Subject to the other provisions hereof, the Borrower shall have
the option (i) to Convert at any time all or any part of outstanding Base
Rate Loans to LIBO Rate Loans, (ii) to Convert all or any part of
outstanding LIBO Rate Loans which comprise part of the same Borrowing to
Base Rate Loans, on the expiration date of the Interest Period applicable
thereto, or (iii) to continue all or any part of outstanding LIBO Rate
Loans which comprise part of the same Borrowing as LIBO Rate Loans for an
additional Interest Period, on the expiration date of the Interest Period
applicable thereto; provided that no Loan may be continued as, or converted
--------
into, a LIBO Rate Loan when any Event of Default has occurred and is
continuing. Notwithstanding anything to the contrary set forth herein, if
the Borrower shall fail to give notice of any continuation of a LIBO Rate
Loan as set forth herein, or if such continuation shall not be permitted
pursuant to the terms hereof, any such LIBO Rate Loans shall be
automatically converted to Base Rate Loans on the last day of such then
expiring Interest Period.
(b) In order to elect to Convert or continue a Loan under this Section
2.6, the Borrower shall deliver an irrevocable notice thereof substantially
in the form of Exhibit U (a "Notice of Conversion or Continuation") to the
Administrative Agent no later than 11:00 A.M., New York time, (i) at least
one Business Day in advance of the proposed conversion date in the case of
a Conversion to a Base Rate Loan and (ii) at least three Business Days in
advance of the proposed Conversion or continuation date in the case of a
Conversion to, or a continuation of, a LIBO Rate Loan. A Notice of
Conversion or Continuation shall specify (w) the requested Conversion or
continuation date (which shall be a Business Day), (x) the amount of the
Loan to be Converted or continued, (y) whether a Conversion or continuation
is requested, and
34
<PAGE>
(z) in the case of a Conversion to, or a continuation of, a LIBO Rate Loan,
the requested Interest Period. Promptly after receipt of a Notice of Conver
sion or Continuation under this Section 2.6(b), the Administrative Agent
shall notify each Lender of such conversion.
Section 2.7 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 Office in
same-day funds to such account as the Administrative Agent shall have
notified the Borrower. Payments received by the Administrative Agent after
such time shall be deemed to have been received on the next Business Day.
The Administrative Agent will promptly thereafter cause to be distributed
(i) like funds relating to the payment of principal or interest and other
amounts ratably (other than amounts payable pursuant to Sections 4.2, 4.3
or 12.4) to the Lenders for the account of their respective Applicable
Lending Offices, and (ii) 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.
(b) All computations of interest or fees shall be made by the
Administra tive 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 LIBO Rate Loans 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 Adminis trative 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 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 distrib uted to such
Lender together with interest thereon, for each day from the date such
amount
35
<PAGE>
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.
Section 2.8 Sharing of Payments, Etc. Subject to the Intercreditor
------------------------
Agreement, 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 Loans owing to it (other than pursuant to Sections 4.2, 4.3 or
12.4) in excess of its share of payments on account of the Loans obtained by all
the Lenders, such Lender shall forthwith purchase from the other Lenders such
participations in the Loans 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 (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 Section 2.8 may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of set-off upon and
during the continuance of an Event of Default) with respect to such participa
tion as fully as if such Lender were the direct creditor of the Borrower in the
amount of such participation.
Section 2.9 Use of Proceeds. The proceeds of the Loans shall be available
---------------
(and the Borrower shall use such proceeds)
(i) with respect to the Tranche A Loans (together with the
Tranche A Amounts (as defined in, and under, the Note Purchase
Agreement)) only, to repay in full the Existing Bank Debt on the
Closing Date;
(ii) subject to Section 7.5 hereof, to make direct or indirect
(through another Subsidiary of Grand Parent) Distributions to Grand
Parent, so long as such Distributions are immediately invested in the
business of Grand Parent's Subsidiaries; and
(iii) for general corporate purposes of the Borrower and the
License Subsidiary;
provided that all proceeds not applied as specified under clauses (i), (ii) or
(iii) above shall, together with any remaining funded amounts under Tranche B
Loans, be held until used for the purposes described in clauses (ii) and (iii)
above, in a cash account of the Borrower pursuant to the Borrower Securities
Account Control Agreement.
36
<PAGE>
Section 2.10 The Notes.
---------
(a) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the indebtedness owed to such Lender
resulting from each Loan made from time to time, including the amounts of
principal and interest payable and paid to such Lender from time to time
under this Agreement.
(b) The Administrative Agent shall maintain accounts in which it will
record (i) the amount of each Loan made hereunder, the Type of each Loan
and the Interest Period applicable thereto, (ii) the amount of any
principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (iii) the amount of any sum received
by the Administrative Agent hereunder from the Borrower and each Lender's
share thereof.
(c) The entries made in the accounts maintained pursuant to paragraphs
(a) and (b) of this Section 2.10 shall be prima facie evidence (absent
manifest error) of the existence and amounts of the obligations therein
recorded; provided, however, that the failure of any Lender or the
Administrative Agent to maintain such accounts or any error therein shall
not in any manner affect the obligations of the Borrower to repay the Loans
in accordance with their terms.
(d) Any Lender may request that Loans made by it be evidenced by a
promissory note. In such event, the Borrower shall prepare, execute and
deliver to such Lender a Note payable to the order of such Lender (or, if
requested by such Lender, so such Lender and its registered assigns).
Thereafter, the Loans evidenced by such Note and interest thereon shall at
all times (including after assignment pursuant to Section 12.7) be
represented by one or more Notes payable to the order of the payee named
therein (or, if such Note is a registered Note, to such payee and its
registered assigns).
(e) In the event a Lender receives a Note pursuant to the terms
hereof, 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 (absent manifest error) 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 Obligations of the Borrower hereunder or under the
Notes to make payments of principal of or interest on the Notes when due.
37
<PAGE>
ARTICLE III
REPAYMENT AND PREPAYMENT OF THE LOANS
-------------------------------------
Section 3.1 Term/Amortization. The Borrower shall repay the outstanding
-----------------
principal amount of the Loans on the Initial Payment Date and each Payment Date
thereafter until (and including) the Maturity Date, in an amount equal to the
Installment Amount for each such date.
Section 3.2 Mandatory Prepayments of Loans.
------------------------------
(a) The Borrower shall prepay the outstanding Loans (and Notes in
accordance with Section 8.2 of the Note Purchase Agreement) in an amount
equal to 100% of the amount of the Net Cash Proceeds of a Permitted Asset
Sale (other than a sale described in clauses (i) and (ii) of the definition
of "Permitted Asset Sales" in Article I) in excess of $5,000,000 from all
such sales in the aggregate to the extent such excess Net Cash Proceeds
have not been reinvested or otherwise applied in accordance with clause
(iii) or (iv), as applicable, of the definition of "Permitted Asset Sales."
(b) No later than 100 days after the end of any fiscal year
commencing on or after January 1, 2000 during which Grand Parent shall have
any Excess Cash Flow, the Borrower shall prepay the outstanding Loans (and
Notes in accordance with Section 8.2 of the Note Purchase Agreement) in an
amount equal to 50% of such Excess Cash Flow.
(c) All prepayments of the Loans required by Section 3.2(a) and (b)
shall be applied against the Installment Amounts on a pro rata basis among
(i) all such Installment Amounts and (ii) Tranche A Loans, Tranche B Loans
and Tranche C Loans.
Section 3.3 Voluntary Prepayments of Loans.
------------------------------
(a) Subject to Section 3.3(b), upon provision of written notice to
the Administrative Agent at least three Business Days prior to a prepayment
of LIBO Rate Loans and at least one Business Day prior to a prepayment of
Base Rate Loans, the Borrower shall have the right to prepay the Loans (and
Notes pursuant to Section 3.4(d)) in whole or in part from time to time in
an aggregate principal amount of $5,000,000 or any integral multiple of
$1,000,000 in excess thereof, in accordance with Section 3.4.
(b) Any prepayment of the Loans by the Borrower pursuant to Section 3.3(a)
shall be subject to a prepayment premium to be paid to the Administrative Agent
for the benefit of the Lenders determined in accordance with the table set
forth below (a "Prepayment Premium") and payable at the time of such prepayment,
which Prepayment Premium shall not reduce the principal amount owed by the
Borrower.
38
<PAGE>
<TABLE>
<CAPTION>
Date of Prepayment Amount of Premium (percentage amount
multiplied by principal amount to be re-
From and To and paid)
Including Including
- ---------------------------------------------------------------------------------------
<S> <C>
The Closing Date to the 6 month anniver- 4.00%
sary thereof
- ---------------------------------------------------------------------------------------
The day after the 6 month anniversary of 3.00%
the Closing Date to the 12 month anniver-
sary thereof
- ---------------------------------------------------------------------------------------
The day after the 12 month anniversary of 2.00%
the Closing Date to the 18 month anniver-
sary thereof
- ---------------------------------------------------------------------------------------
The day after the 18 month anniversary of 1.50%
the Closing Date to the 24 month anniver-
sary thereof
- ---------------------------------------------------------------------------------------
The day after the 24 month anniversary of 0.50%
the Closing Date to the 30 month anniver-
sary thereof
- ---------------------------------------------------------------------------------------
At any time after the 30 month anniversary 0.0%
of the Closing Date
- ---------------------------------------------------------------------------------------
</TABLE>
Section 3.4 Certain Matters Relating to Repayments and Prepayments.
------------------------------------------------------
(a) On the earlier of the date on which Loans are to be repaid or
prepaid and the date on which notice of such payment or prepayment is
required to be given under this Agreement, if less than all Loans are to be
repaid or prepaid, the Borrower will specify whether the Loan to be
repaid or prepaid shall be a Base Rate Loan or a LIBO Rate Loan and, if a
LIBO Rate Loan is to be repaid or prepaid and more than one LIBO Rate Loan
is outstanding, which such Loan shall be prepaid. Prepayments and
repayments of LIBO Rate Loans made other than on the last day of the
Interest Period applicable thereto shall be subject to the payment by the
Borrower of amounts owed under Section 12.4(b).
(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 Loans then being prepaid
or repaid.
(c) Loans that are prepaid or repaid may not be reborrowed.
(d) All prepayments and repayments of outstanding Loans and Notes
shall be paid to the Secured Creditors on a pro rata basis according to the
sum of (i)
39
<PAGE>
aggregate outstanding principal amount of Loans and Commitments
owed to such Lenders (ratably among all Installment Amounts) and (ii)
amounts owing under the Senior Secured Notes.
ARTICLE IV
ILLEGALITY, INCREASED COSTS, CAPITAL ADEQUACY AND INDEMNITIES
-------------------------------------------------------------
Section 4.1 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
LIBO 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 LIBO 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 LIBO Rate Loans,
if any, shall be Converted automatically to Base Rate Loans on the last day
of each Interest Period applicable to such LIBO 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 4.2 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,
40
<PAGE>
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,
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 Loans 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 on an after-tax basis 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 or Loans, 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 on an after-tax basis 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 Section 4.2 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 Section 4.2 and will not, in the judgment of such
Lender, be otherwise disadvantageous to such Lender. By making any payment
under this Section 4.2, the Borrower is not waiving its right to contest
that the amounts set forth in the certificates are based on manifest error.
41
<PAGE>
Section 4.3 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 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 Section 4.3) 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
Section 4.3) 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 Section 12.2, 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
42
<PAGE>
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" and "United States person"
------------- --------------------
shall have the meanings specified in (S) 7701 of the IRC.
(e) Each Lender organized under the laws of a jurisdiction outside the
United States which is a "bank" within the meaning of Section 881(c)(3)(A)
of the IRC, on or prior to the date of its execution and delivery of this
Agreement (if such Lender is an initial Lender and on the date of the
Assignment and Acceptance pursuant to which it becomes a Lender in the case
of each other such 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 and the Administrative
Agent 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. Each Lender organized under the laws of a
jurisdiction outside the United States which is not a "bank" within the
meaning of Section 881(c)(3)(A) of the IRC and which intends to claim
exemption from U.S. Federal withholding tax under Section 871(h) or 881(c)
of the IRC with respect to payments of "portfolio interest" (each a "Non-
U.S. Lender"), on or prior to the date of its execution and delivery of
this Agreement (if such Lender is an initial Lender and on the date of the
Assignment and Acceptance pursuant to which it becomes a Lender in the case
of each other such 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 and the Administrative
Agent with Internal Revenue Service Form W-8, or any subsequent versions
thereof or successors thereto (and, if such Non-U.S. Lender delivers a Form
W-8, a certificate representing that such Non-U.S. Lender is not a bank for
purposes of Section 881(c) of the IRC, is not a 10-percent shareholder
(within the meaning of Section 871(h)(3)(B) of the IRC) of the Borrower and
is not a controlled foreign corporation related to the Borrower (within the
meaning of Section 864(d)(4) of the IRC)), properly completed and duly
executed by such Non-US. Lender claiming complete exemption from, or a
reduced rate of, U.S. Federal withholding tax on payments of interest by
the Borrower under 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 consid ered excluded from Taxes. 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 or W-8, 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.
43
<PAGE>
(f) For any period with respect to which a Lender has failed to
provide the Borrower with the appropriate form described in Section 4.3 (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
Section 4.3 (c) 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 Section 4.3, 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 4.4 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.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
------------------------------
Each of Grand Parent and the Borrower represents and warrants to the
Lenders and the Administrative Agent as follows:
Section 5.1 Corporate Authority.
-------------------
(a) (i) Each Omnipoint Entity is identified on the
organizational chart attached as Schedule 5.1; is a corporation (or
other entity as indicated thereon) duly organized, validly existing
and in good standing under the laws of its state of incorporation or
organization; and its share or other ownership is as indicated
thereon,
(ii) Each Omnipoint Loan Party has all requisite corporate power
to own its Property and conduct its business as now conducted and as
presently contemplated, and
(iii) Each Omnipoint Loan Party 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
44
<PAGE>
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 any Omnipoint Loan Party is or is to become a
party and the transactions contemplated hereby and thereby
(i) are within the corporate or other authority of such Omnipoint
Loan Party,
(ii) have been duly authorized by all necessary corporate or
other proceedings,
(iii) do not conflict with or result in any breach or
contravention of any provision of material law, statute, rule or
regulation to which such Omnipoint Loan Party is subject or any
judgment, order, writ, injunction, license (including without
limitation, any License) or permit applicable to such Omnipoint Loan
Party or their Property, and
(iv) do not conflict with any provision of the corporate charter
or bylaws of, or any agreement or other instrument binding upon, such
Omnipoint Loan Party or its Property.
(c) The execution and delivery of this Agreement and the other Loan
Documents to which any Omnipoint Loan Party is or is to become a party will
result in valid and legally binding obligations of such Omnipoint Loan
Party enforceable against such Omnipoint Loan Party 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.
Section 5.2 Governmental Approvals. The execution, delivery and
----------------------
performance by each Omnipoint Loan Party of this Agreement and the other Loan
Documents to which such Omnipoint Loan Party 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 Body other than those already
obtained and for any subsequent informational filing with the Securities and
Exchange Commission.
Section 5.3 Title to Properties. Each Omnipoint Loan Party owns through
-------------------
one or more direct and indirect Subsidiaries all of the assets reflected in the
consolidated balance sheet of Grand Parent as at December 31, 1996 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.
45
<PAGE>
Section 5.4 Financial Statements.
--------------------
(a) The Administrative Agent has been provided the audited
consolidated balance sheet of Grand Parent and its Subsidiaries and the
Borrower and its Subsidiaries, as at December 31, 1996, and the audited
consolidated statement of income and cash flow statement of Grand Parent
and its Subsidiaries and the Borrower and its Subsidiaries for the fiscal
year then ended, and such balance sheet and statement of income and cash
flow have been certified by Grand Parent's and the Borrower's respective
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 Grand Parent and its Subsidiaries and the Borrower
and its Subsidiaries, respectively, as at the close of business as of such
date and the results of operations for the fiscal year then ended. There
are no Contingent Obligations of Grand Parent or its Subsidiaries or the
Borrower or its Subsidiaries as of such date involving material amounts,
known to the officers of Grand Parent or the Borrower, respectively, that
were not disclosed in such balance sheet and the notes related thereto.
(b) The Administrative Agent has been provided the unaudited
consolidated balance sheet of Grand Parent and its Subsidiaries and the
Borrower and its Subsidiaries as of September 30, 1997, and the unaudited
consolidated statement of income and cash flow statement of Grand Parent
and its Subsidiaries and the Borrower and its Subsidiaries for the nine
months then ended. Such balance sheet and statement of income and cash flow
have been prepared in accordance with GAAP and fairly present the financial
condition of Grand Parent and its Subsidiaries and the Borrower and its
Subsidiaries, respectively, as at the close of business on the date thereof
and the results of operations for the nine months then ended, subject to
normal year-end adjustments. There are no Contingent Obligations of Grand
Parent or its Subsidiaries or the Borrower or its Subsidiaries as of such
date involving material amounts known to the officers of Grand Parent or
the Borrower, respectively, that were not disclosed in such balance sheet
and the notes related thereto.
Section 5.5 No Material Adverse Effect, Etc. Since December 31, 1996,
-------------------------------
there has occurred no Material Adverse Effect (other than continuing losses of
the Borrower (x) as disclosed in the Borrower's unaudited consolidated balance
sheet and statement of cash flow delivered to the Administrative Agent pursuant
to (S) 5.4(b) and (y) materially in compliance with such losses as projected to
continue in the Full-Term Operating Business Plan).
Section 5.6 Franchises, Patents, Copyrights, Etc. Except for the FCC
------------------------------------
Licenses for the New York PCS Network and the other Intellectual Property set
forth on Schedule 5.6, 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.
46
<PAGE>
Section 5.7 License, Etc. The Borrower (or the License Subsidiary) has
------------
secured
(a) with respect to the construction, installation and development of
facilities for the New York PCS Network, the FCC Licenses for the New York
PCS Network 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 FCC
Licenses for the New York PCS Network, 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 FCC Licenses for the New York PCS Network nor any such material
Necessary Authorization is the subject of any pending or, to the best of any
Omnipoint Entity's knowledge, threatened appeal, revocation, revocation
proceeding or any other similar action or proceeding. The Borrower (or the
License Subsidiary, as the case may be) is in compliance with the FCC Licenses
for the New York PCS Network and all material Necessary Authorizations. The
Borrower (or the License Subsidiary, as the case may be) reasonably expects to
obtain, in the ordinary course of business, without the imposition of burdensome
conditions all Necessary Authorizations not currently obtained, that will be
required under the License in the future or that will be required to operate the
Borrower's or the License Subsidiary's business substantially in accordance with
the Full-Term Operating Business Plan.
Section 5.8 Litigation. There are no actions, suits, proceedings or
----------
investigations of any kind pending or, to the best of any Omnipoint Entity's
knowledge, threatened, against any Omnipoint Loan Party 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 any Omnipoint Loan
Party 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 such
Omnipoint Loan Party, 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 5.9 Compliance with Other Instruments, Laws, Etc. No Omnipoint
--------------------------------------------
Loan Party is 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
(including, without limitation, any 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 5.10 Tax Status. Each Omnipoint Entity
----------
47
<PAGE>
(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;
(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 for which such Omnipoint Entity has set aside on its books adequate
reserves; and
(c) has set aside on its books provisions reasonably adequate for the
payment of all taxes for all elapsed periods.
There are no unpaid taxes in any material amount claimed to be due by the taxing
authority of any jurisdiction, and the officers of each Omnipoint Entity know of
no basis for any such claim.
Section 5.11 No Default. No Default has occurred and is continuing.
----------
Section 5.12 Holding Company and Investment Company Acts. No Omnipoint
-------------------------------------------
Loan Party is 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 5.13 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 any Omnipoint Loan Party or any rights relating
thereto.
Section 5.14 FCC Matters. Each Omnipoint Loan Party 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 5.15 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 any Omnipoint Loan Party to be
under consideration.
48
<PAGE>
Section 5.16 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 any Omnipoint Entity 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.
Section 5.17 Burdensome Obligations. No Omnipoint Loan Party is 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
Grand Parent or 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 such Omnipoint Loan Party, or the
ability of such Omnipoint Loan Party to perform obligations under the Loan
Documents. No Omnipoint Loan Party presently anticipates that future
expenditures by such Omnipoint Loan Party 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 such Omnipoint Loan Party.
Section 5.18 Solvency. Each Omnipoint Loan Party is, and after giving
--------
effect to the incurrence of all Indebtedness as and when contemplated by the
Loan Documents will be, Solvent.
Section 5.19 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 Administrative Agent, for
the benefit of the Administrative Agent and the Lenders.
Section 5.20 Certain Transactions. Except as set forth in Schedule 5.20,
--------------------
none of the officers, directors, or employees of any Omnipoint Loan Party is
presently a party to any transaction with any other Omnipoint Loan Party (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 Omnipoint Loan Party, 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. No Omnipoint Loan Party is 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 Section 7.10.
Section 5.21 Employee Benefit Plans.
----------------------
(a) 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
49
<PAGE>
the extent applicable, the IRC, including the provisions thereunder
respecting prohibited transactions. Grand Parent, Borrower and each ERISA
Affiliate has made all required contributions to each Employee Benefit Plan
and each Multiemployer Plan. To the extent applicable, Grand Parent,
Borrower and each ERISA Affiliate has heretofore delivered to the
Administrative Agent the most recently completed annual report, Form 5500,
with all required attachments, and actuarial statements 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). Grand Parent 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 Grand Parent 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 Grand Parent 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 Grand Parent 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 Grand Parent, 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 Grand
Parent, the Borrower nor any ERISA
50
<PAGE>
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 5.22 Regulations G, T, 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 G, T, U and X of the
Board of Governors of the Federal Reserve System, 12 C.F.R. Parts 221 and 224.
Section 5.23 Environmental Compliance. Each Omnipoint Entity has taken all
------------------------
steps as are reasonable for companies in similar lines of business and size with
respect to similarly situated and like Real Estate to investigate the past and
present condition and usage of its and its Subsidiaries' Real Estate and the
operations conducted thereon and, based upon such diligent investigation, makes
the following representations:
(a) Except as set forth in the Current Phase I Audit and the Action
Letter, each Omnipoint Entity is, to the best of its knowledge, 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, to the best of its knowledge, threatened civil or criminal
litigation, written notice of violation, administrative proceeding, or
investigation, inquiry or information request by any person, entity or
governmental authority relating to any applicable Environmental Law
(collectively "Environmental Claims") involving such Omnipoint Entity or
--------------------
any person or entity for whom an Omnipoint Entity may be responsible by law
or contract.
(b) Except as set forth in Schedule 5.23, there are no past or
present actions, activities, circumstances, conditions, events or
incidents, including, without limitation, the release, emission, discharge,
presence or disposal of any Material of Environmental Concern, that could
form the basis of any Environmental Claim against the Company or, to the
Company's best knowledge after due inquiry, against any person or entity
whose liability for any Environmental Claim the Company has retained or
assumed either contractually or by operation of law.
(c) Set forth in Schedule 5.23 is a list of all environmental reports,
investigations and audits relating to premises currently or previously
owned or operated by any Omnipoint Loan Party (whether conducted by or on
behalf of any Omnipoint Loan Party or a third party, and whether done at
the initiative of any Omnipoint Loan Party or directed by a governmental
entity or other third party) which such Omnipoint Loan Party 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) Each Omnipoint Entity has filed all reports and returns required
to be filed by such Omnipoint Entity under any applicable Environmental
Laws. Each
51
<PAGE>
Omnipoint Entity has obtained and 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 that requires,
or after notice or lapse of time or both would require, any modification or
termination of any Environmental Permit. No Omnipoint Entity (i) has
received any notice asserting the absence of any Environmental Permit or
(ii) has knowledge of any environmental law proposed or under
consideration, which, if effective, could have a Material Adverse Effect.
(e) Except as set forth in the Current Phase I Audit and the Action
Letter, no Omnipoint Entity 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 5.24 Material Contracts. As of the date of this Agreement, no
------------------
Omnipoint Loan Party is a party to any Material Contract or any agreement with
any director, officer or employee of any Omnipoint Loan Party, and no
shareholder of any Omnipoint Loan Party is a party to any shareholder, share-
voting or similar agreement relating to any Omnipoint Loan Party, except as set
forth in Schedule 5.24.
Section 5.25 Payment of Existing Debt. After giving effect to the use of
------------------------
the proceeds of the Loans borrowed on the Closing Date, all obligations in
respect of the Existing Bank Debt shall have been repaid in full and all
documents and agreements in connection therewith shall have been irrevocably
terminated, other than customary indemnification provisions which by the terms
thereof survive repayment.
ARTICLE VI
AFFIRMATIVE COVENANTS
---------------------
Each of Grand Parent and the Borrower covenants and agrees that, so long as
any Loan or Note is outstanding or any of the Obligations remain unsatisfied or
any Lender has any Commitment to make any Loans:
Section 6.1 Maintenance of Office. Each Omnipoint Loan Party's chief
---------------------
executive office shall be located at its address for notices specified in
Section 12.2, except that any Omnipoint Loan Party 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 Administrative Agent to continue the perfection
and priority of the Administrative Agent's security interest in the Collateral.
52
<PAGE>
Section 6.2 Records and Accounts. Grand Parent and the Borrower shall,
--------------------
and shall cause the other Omnipoint Loan Party to:
(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 6.3 Corporate Existence; Maintenance of Licenses. Grand Parent
--------------------------------------------
and the Borrower shall do or cause to be done all things necessary to preserve
and keep in full force and effect its corporate existence and shall cause the
other Omnipoint Loan Parties to do or cause to be done all things necessary to
preserve and keep in full force and effect their existence. Grand Parent and/or
the Borrower shall maintain or cause to be maintained in full force and effect,
(a) with respect to the construction, installation and development of
facilities for the New York PCS Network, the FCC Licenses for the New York
PCS Network 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 FCC Licenses for the New York PCS Network, 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.
Grand Parent and the Borrower will, and will cause the other Omnipoint Entities
to, at all times perform and observe all covenants and conditions on its part to
be performed and observed under FCC rules and regulations or with respect to the
FCC License for the New York PCS Network and not cause or permit to exist any
grounds for the FCC to revoke or suspend or not to renew such License.
Section 6.4 Maintenance of Properties. Grand Parent and the Borrower
-------------------------
shall, and shall cause the other Omnipoint Loan Parties to, do or cause to be
done all things necessary to preserve and keep in full force and effect its
franchises, employment contracts and permits. Each of Grand Parent and the
Borrower shall, and shall cause the other Omnipoint Loan Parties to
(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;
53
<PAGE>
(b) cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, all as in the judgment of Grand
Parent or the Borrower may be necessary so that the business carried on in
connection therewith may be properly and advantageously conducted at all
times;
(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, each Omnipoint Loan Party shall not be required to do any of the
foregoing set forth in clauses (a) or (b) if any such requirement is no longer
desirable or necessary in the conduct of such Omnipoint Loan Party's business
and no Material Adverse Effect could reasonably be expected to occur as a result
thereof.
Section 6.5 Insurance. Grand Parent and the Borrower shall, and shall
---------
cause each other Omnipoint Loan Party, to the extent such Omnipoint Loan Party
owns applicable Properties, to, 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) be at least in such amounts and against at least such risks as are
customarily insured against by companies engaged in the same or a similar
business, which insurance shall in any event not provide for materially
less coverage than the insurance in effect on the Closing Date;
(b) with respect to all liability insurance (other than with respect
to the Property of Grand Parent), name the Administrative Agent as an
additional insured;
(c) with respect to casualty insurance (other than with respect to
Grand Parent), name the Administrative Agent as loss payee as its interest
may appear; and
(d) provide that the insurer will give the Administrative 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, no later than March 31
in each calendar year and otherwise promptly on request by the Administrative
Agent, certificate(s) of insurance confirming compliance with the requirements
of this Section 6.5.
Section 6.6 Taxes. Grand Parent and the Borrower shall, and shall cause
-----
each other Omnipoint Entity to, 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 FCC Licenses for the New York PCS Network) and its Real
Estate, sales and activities, or any
54
<PAGE>
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 the relevant
Omnipoint Entity has set aside on its books adequate reserves with respect
thereto; and provided further that each Omnipoint Entity 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 6.7 Inspection of Properties and Books.
----------------------------------
(a) Grand Parent and the Borrower shall, and shall cause each other
Omnipoint Loan Party to, permit the Administrative Agent, the Lenders and
their other designated representatives to visit and inspect any of the
Properties of the Omnipoint Loan Parties, to examine the books of account
of the Omnipoint Loan Parties (and to make copies thereof and extracts
therefrom), and to discuss the affairs, finances and accounts of the
Omnipoint Loan Parties 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.
(b) Grand Parent and the Borrower authorize the Administrative Agent
and each Lender to communicate directly with Grand Parent's and 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 Grand Parent and the
Borrower. At the reasonable request of the Administrative Agent, Grand
Parent or the Borrower shall deliver a letter addressed to such accountants
instructing them to comply with the provisions of this Section 6.7(b).
Section 6.8 Compliance with Laws, Contracts, License, and Permits. Each
-----------------------------------------------------
of Grand Parent and the Borrower shall, and shall cause each other Omnipoint
Loan Party to, 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;
(d) all obligations with respect to any Employee Benefit Plan or
Multiemployer Plan; and
55
<PAGE>
(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 any Omnipoint Loan Party may fulfill any of the Obligations
hereunder or under any of the other Loan Documents to which such Omnipoint Loan
Party is a party, Grand Parent and the Borrower shall, and cause each other
Omnipoint Loan Party to, immediately take or cause to be taken all reasonable
steps within the power of Grand Parent, the Borrower or such other Omnipoint
Loan Party to obtain such authorization, consent, approval, permit or license
and furnish the Administrative Agent evidence thereof.
Section 6.9 Further Assurances. Grand Parent and the Borrower shall, and
------------------
shall cause each other Omnipoint Loan Party to, 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 Secured Creditors or the Administrative
Agent shall reasonably deem appropriate in order to effectuate the grant of the
Liens and security interests to the Administrative Agent contemplated by the
Loan Documents and to carry out to their satisfaction the transactions
contemplated by the Loan Documents.
Section 6.10 Authorization from Landlord/Mortgagee, Etc. The Borrower
------------------------------------------
shall request that any landlord, mortgagee and easement grantor of the Borrower
agree to give the 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 landlord, mortgagee of any such landlord or easement
grantor, and allow the Administrative Agent to inspect or remove any Property of
the Borrower after the occurrence and continuance of an Event of Default.
Section 6.11 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 $1,000,000 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 sentence is stored or located, in form and substance reasonably
satisfactory to Required Secured Creditors.
Section 6.12 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 6.13 Reporting Requirements; Notices. Grand Parent or the
-------------------------------
Borrower, as appropriate, 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):
56
<PAGE>
(a) No later than 10 days after the end of each fiscal year of the Bor
rower an Annual Operating Business Plan containing the information listed
in items (i) through (vi) in this paragraph and the exhibits contained in
the Annual Operating Business Plan delivered pursuant to Section 8.11(a)
for the next-succeeding fiscal year. The Annual Operating Business Plan
shall contain
(i) internally prepared statements of income and expense of the
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 the Borrower
needs to raise additional capital to meet its obligations when due during
the period,
(iv) a projected balance sheet of the Borrower,
(v) a projected cash flow statement of the Borrower, and
(vi) a statement listing all material assumptions which formed
the basis for all information provided pursuant to clauses (i) through (v),
each together with supporting schedules in sufficient detail as needed and
in all material aspects in accordance with the Annual Operating Business
Plan delivered pursuant to Section 8.11(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 or principal financial
or accounting 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
Annual Operating Business Plan for such fiscal year and explains in
reasonable detail in form satisfactory to the Required Secured Creditors
the reasons for the discrepancies between them, if any.
(c) (i) 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
consolidated balance sheet of the Borrower, as at the end of such quarter,
and the related consolidated 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
(A) the figures for the prior year's corresponding fiscal quarter
and
(B) any variances from the Annual Operating Business Plan,
57
<PAGE>
prepared in all material respects 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 normal year-end adjustments).
(ii) 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 Grand Parent, copies of the internally prepared unaudited
consolidated balance sheet of Grand Parent, as at the end of such quarter,
and the related consolidated statement of income and statement of cash flow
for the portion of Grand Parent's fiscal year then elapsed, all in
reasonable detail, prepared in all material respects in accordance with
GAAP, together with a certification by the principal financial or
accounting officer of Grand Parent that the information contained in such
financial statements fairly presents the financial position of Grand Parent
on the date thereof (subject to normal year-end adjustments).
(d) (i) As soon as practicable, but in any event no later than 90
days after the end of each fiscal year (commencing with the fiscal year
ended December 31, 1997) of the Borrower, the audited consolidated balance
sheet of the Borrower as at the end of such year, and the related audited
consolidated statement of income and audited consolidated statement of cash
flow for such year prepared in accordance with GAAP, and 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
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 satisfactory to the Administrative Agent and the Lenders,
which report shall contain an unqualified opinion of such accounting firm.
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).
(ii) As soon as practicable, but in any event no later than 90
days after the end of each fiscal year (commencing with the fiscal year
ended December 31, 1997) of Grand Parent, the audited consolidated balance
sheet of Grand Parent as at the end of such year, and the related audited
consolidated statement of income and audited consolidated statement of cash
flow for such year prepared in accordance with GAAP. Such balance sheet
shall contain a certified audit report of a nationally recognized
independent certified public accounting firm satisfactory to the
Administrative Agent and the Lenders, which report shall contain an
unqualified opinion of such accounting firm. The annual financial
statements shall also be accompanied by a management letter of Grand
Parent's accountants (only to the extent otherwise obtained by Grand
Parent).
(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 Grand Parent or the Borrower,
as the case may be, substantially
58
<PAGE>
in the form of Exhibit D setting forth in reasonable detail computations
evidencing compliance with the covenants contained in Section 7.19, 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 Subscribers,
(iii) the average net revenue per subscriber,
(iv) payments to Parent, Grand Parent and other Affiliates of
Grand Parent, whether under the Expense Allocation Agreement or other wise
and
(v) equity contributions to and Indebtedness incurred by the
Borrower or any of its Subsidiaries, and the Persons providing the same,
during such fiscal quarter, together with a report showing variances from
the estimates previously provided to the Administrative Agent and each
Lender in the Annual Operating Business Plan, 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
any Omnipoint Loan Party;
(ii) information sent to the stockholders of any Omnipoint Loan
Party or lenders to any Omnipoint Loan Party (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 Exchange Act, 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 the Person that is the source of the
information or reports is required to file periodic reports with the
Securities and Exchange Commission
59
<PAGE>
pursuant to the Exchange Act and such Person would be required to report
such information as part of such filings.
(h) Within three Business Days after any director or officer of any
Omnipoint Loan Party 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 Grand Parent, the Borrower or such
Omnipoint Loan Party 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 any Omnipoint Loan Party 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 the documents governing such indebtedness to accelerate
such indebtedness, and such acceleration would have a Material Adverse
Effect, Grand Parent or the Borrower shall, or shall cause such other
Omnipoint Loan Party to, forthwith give written notice thereof to the
Administrative Agent, describing the notice or action and the nature of the
claimed default.
(i) 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 any Omnipoint Loan Party reports in
writing or is reportable by any Omnipoint Loan Party 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 any Omnipoint Loan Party 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 (x) materially affect the assets,
liabilities, financial condition or operations of any Omnipoint Loan
Party or the Liens and security interests for the benefit of the
Lenders granted pursuant to the Collateral Documents or (y) result in
a Material Adverse Effect.
(j) As soon as possible, and in any event within 10 days after the
Grand Parent, 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 Grand Parent 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 Grand
Parent, Borrower or such ERISA Affiliate proposes to take with respect
thereto.
(k) Promptly after
60
<PAGE>
(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 Borrower,
Grand Parent or an ERISA Affiliate; (B) any partial or complete
withdrawal from a Multiemployer Plan by any of Borrower, Grand Parent
or an ERISA Affiliate; (C) a failure by any of Borrower, Grand Parent
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.
(l) Within three Business Days after 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
Administrative Agent's or the Lenders' rights with respect to the
Collateral, are subject, written notice thereof.
(m) Within 10 days after becoming aware of
(i) any litigation or proceedings threatened in writing or any
pending litigation and proceedings affecting Grand Parent or any
Significant Subsidiary or to which Grand Parent or any Significant
Subsidiary is or becomes a party that could reasonably be expected to
have a Material Adverse Effect, written notice thereof (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 Grand Parent or any Significant Subsidiary in an amount in
excess of $1,000,000, written notice thereof.
61
<PAGE>
(n) Within 100 days after the end of each fiscal year of Grand Parent,
beginning with its fiscal year ended December 31, 2000 a report that
includes calculations showing in reasonable detail Grand Parent's Excess
Cash Flow for such fiscal year, if any, certified as correct by Grand
Parent's chief or principal accounting or financial officer.
(o) Within three Business Days after its receipt or dispatch thereof,
copies of all material notices and correspondence received from or sent to
the FCC relating to the New York PCS Network License.
(p) Not later than 30 days prior to the occurrence thereof, written
notice to the Administrative Agent of a change in (i) the business of any
Omnipoint Entity, (ii) the location of the Collateral (subject to the
provisions of the relevant Collateral Document), or (iii) the location
where any Omnipoint Loan Party's books and records are kept.
(q) From time to time upon the reasonable request of the
Administrative Agent at the direction of the Required Lenders (but in no
event more frequently than once per year), an update of the Full-Term
Operating Plan, including projections of the Borrower's performance through
the Maturity Date, in reasonable detail and covering matters substantially
similar to those covered in the Full-Term Operating Plan delivered on the
Closing Date.
(r) Such other information concerning its or any other Omnipoint Loan
Party's business, operations or financial condition as shall be reasonably
requested by any Lender.
Upon the Administrative Agent's receipt of any and all financial and other
information furnished by Grand Parent or the Borrower pursuant to this Section
6.13 the Administrative Agent shall promptly deliver copies thereof to each
Lender.
Section 6.14 Certified Copies of Insurance Policies. Within 30 days after
--------------------------------------
the Closing Date, the Borrower shall, to the extent not otherwise delivered on
the Closing Date pursuant to Section 8.16, deliver to the Administrative Agent
copies of all insurance policies that shall have been required to have been
delivered to the Administrative Agent by the Closing Date pursuant to Section
8.5, certified by the applicable insurer(s).
Section 6.15 Access Agreements. Grand Parent and the Borrower shall comply
-----------------
with the provisions of the Access Agreements and shall ensure that the Access
Agreements remain in full force and effect during the term of this Agreement.
Section 6.16 Creation of License Subsidiary. The Borrower agrees that it
------------------------------
shall (i) within 30 Business Days after the Closing Date, both organize a
wholly-owned Subsidiary and file all appropriate applications and other
regulatory filings necessary in order to transfer all of the FCC Licences held
by the Borrower to the License Subsidiary, which License Subsidiary shall hold
no other properties and assets other than such FCC Licenses
62
<PAGE>
for the New York PCS Network and engage in no other business other than holding
such License and sublicensing such License to the Borrower pursuant to the
Operating Agree ment, and (ii) use reasonable best efforts to effectuate such
transfer, by taking all reasonable actions as may be necessary, including all
actions with respect to the FCC, as promptly as practical after the Closing
Date. Upon creation of such License Subsidiary, the License Subsidiary shall
guaranty the Obligations of the Borrower pursuant to the Subsidiary Guaranty,
the License Subsidiary shall enter into a security agreement substantially in
the form of the Borrower Security Agreement (except for provisions thereof
relating to lockbox accounts) granting (to the extent permitted by law) a first
priority perfected security interest in the FCC License for the New York PCS
Network, and the Borrower shall grant a Lien on, and pledge of, all of the
Capital Stock (or membership interests) of the License Subsidiary owned by the
Borrower (representing 100% of the issued and outstanding Capital Stock or
membership interests of the License Subsidiary) to the Administrative Agent as
security for the Obligations of the Borrower pursuant to the Borrower Pledge
Agreement, and the Borrower shall, and shall cause such License Subsidiary to,
provide authorizing resolutions, certified organizational documents and opinions
of counsel in connection with the foregoing, in each case in form and substance
reasonably satisfactory to the Administrative Agent. In addition, the Borrower
shall make such elections as shall be required to cause the Capital Stock of the
License Subsidiary to be considered a "general intangible" for purposes of the
Uniform Commercial Code.
Section 6.17 Proceeds of Loans. The Borrower shall maintain the proceeds
-----------------
from the Loans either (i) at OIT or (ii) in the account created under the
Borrower Securities Account Control Agreement, and in either case shall cause
the Administrative Agent to have a first priority perfected security interest in
such proceeds, until such time as such proceeds are used for the purposes
specified in Section 2.9.
ARTICLE VII
NEGATIVE COVENANTS
------------------
Each of Grand Parent and the Borrower covenants and agrees that, so long as
any Loan or Note is outstanding or any of the Obligations remain unsatisfied or
any Lender has any Commitment to make any Loans:
Section 7.1 Restrictions on Indebtedness. Grand Parent and the Borrower
----------------------------
shall not, and shall not permit any other Omnipoint Entity to, create, incur,
assume, suffer to exist or otherwise become or remain directly or indirectly
liable with respect to, any Indebtedness, other than:
(i) Indebtedness hereunder and under the other Loan Documents;
(ii) Indebtedness outstanding on the Closing Date and, with respect to the
Omnipoint Loan Parties, set forth on Schedule 7.1 hereto (on a pro forma basis,
after
63
<PAGE>
giving effect to the refinancing, retirement and payment of amounts outstanding
under the Existing Loan Agreement);
(iii) Indebtedness permitted under Section 7.3;
(iv) Additional Loans hereunder as permitted pursuant to Section 2.1(b);
(v) Indebtedness of Grand Parent that is (i) unsecured or secured solely
by the assets of any one or more Non-Party Subsidiaries, (ii) not guaranteed or
supported by the Borrower or any Guarantor (other than limited recourse
guaranties by OHI secured by Liens permitted pursuant to Section 7.2(x)), (iii)
on terms and conditions at least as favorable as then prevailing "market terms"
and (iv) the proceeds of which are used in Grand Parent's and its Subsidiaries'
telecommunications business.
(vi) Provided that the Administrative Agent has received a certificate of
the chief or principal accounting or financial officer of the Borrower to the
effect that no Default is in existence or would result therefrom, Indebtedness
of the Borrower (including vendor financing) secured on a pari passu basis with
the Loans and Senior Secured Notes (pursuant to an intercreditor arrangement to
be negotiated in good faith and without unreasonable delay with the Secured
Creditors, providing sharing of the proceeds of collateral on a pro rata basis
similar to the Intercreditor Agreement, which arrangement shall be satisfactory
to the Administrative Agent and the Required Secured Creditors);
(vii) So long as no Default is in existence or would result therefrom, (A)
Indebtedness secured in accordance with Section 7.2(vi), (vii) and (viii), as
applicable, incurred in the acquisition of Real Estate capital lease obligations
and (B) other purchase money financing, in an aggregate amount (including any
refinancing thereof pursuant to clause (x) below) not to exceed $20,000,000;
(viii) Intercompany Indebtedness of the Guarantors on the terms and
conditions set forth herein;
(ix) Indebtedness of any Non-Party Subsidiary, so long as such Indebtedness
is not secured by any of the Collateral, and neither the Borrower nor any
Guarantor has any Contingent Obligations with respect to such Indebtedness;
(x) Indebtedness providing for the refinance, refunding, renewal or
replacement of Indebtedness incurred pursuant to clauses (v), (vi) and (vii)
above (so long as such Indebtedness could have been incurred under such clauses
(v), (vi) and (vii); provided that (i) any such Indebtedness does not exceed the
amount so refinanced, refunded, renewed or replaced plus the amount of any
premium, accrued interest, fees and other related expenses incurred in
connection with the consummation of any such Indebtedness, (ii) the maturity
date of such Indebtedness is no earlier than the maturity date of such original
Indebtedness; (iii) no collateral is used to secure such Indebtedness other than
the collateral pledged in connection with such original Indebtedness; and (iv)
if such refinancing, refunding, renewal or replacement applies to the Borrower's
FCC Indebtedness and is incurred by a lender
64
<PAGE>
other than the FCC, such refinancing, refunding, renewal or replacement and any
Liens in connection therewith shall not be senior in any respect to the position
of the Secured Creditors.
(xi) Indebtedness under the Note Purchase Agreement; and
(xii) Indebtedness in respect of performance, surety or appeal bonds
provided in the ordinary course of business.
For purposes of determining compliance with this Section 7.1, in the event
that an item of Indebtedness meets the criteria of more than one of the types of
Indebtedness described in the above clauses, the Borrower, in its sole
discretion, shall classify such item of Indebtedness and only be required to
include the amount and type of such Indebtedness in one of such clauses.
Section 7.2 Liens. Grand Parent and the Borrower shall not, and shall
------
not permit any other Omnipoint Entity to, create, incur, assume or suffer to
exist, directly or indirectly, any Lien on any of its property now owned or
hereafter acquired, other than the following (each a "Permitted Lien"):
(i) Liens existing on the Closing Date and, with respect to the Omnipoint
Loan Parties, set forth on Schedule 7.2 hereto;
(ii) Liens for taxes not yet due or which are being contested in good faith
by appropriate proceedings diligently conducted and with respect to which
adequate reserves are being maintained in accordance with GAAP;
(iii) Statutory Liens of landlords and Liens of carriers, warehousemen,
mechanics, materialmen and other Liens imposed by Law (other than any Lien
imposed by ERISA or pursuant to any Environmental Law) created in the ordinary
course of business for amounts not yet due or which are being contested in good
faith by appropriate proceedings diligently conducted and with respect to which
adequate reserves are being maintained in accordance with GAAP;
(iv) Easements, rights-of-way, zoning and similar restrictions and other
similar charges or encumbrances not interfering with the ordinary conduct of the
business of the Omnipoint Entity subject thereto and which do not detract
materially from the value of the property to which they attach or impair
materially the use thereof by the Omnipoint Entity subject thereto or materially
adversely affect the security interests of the Administrative Agent or the
Lenders therein;
(v) Liens granted to the Administrative Agent for the benefit of the
Lenders pursuant to the Loan Documents securing the Obligations and Liens
securing Indebtedness permitted under Section 7.1(iv) and (vi);
65
<PAGE>
(vi) Purchase money security interests (securing Indebtedness permitted
under Section 7.1(vii)) on any property acquired or held by any Omnipoint Loan
Party in the ordinary course of business, securing Indebtedness incurred or
assumed for the purpose of financing all or any part of the cost of acquiring
such property; provided that (i) any such Lien attaches to such property
concurrently with or within 20 days after the acquisition thereof or such longer
period as may be permitted under the applicable Uniform Commercial Code for
purchase money security interest treatment, (ii) such Lien attaches solely to
the property so acquired in such transaction and (iii) the principal amount of
the debt secured thereby does not exceed the purchase price of the asset so
financed;
(vii) Liens created pursuant to Capitalized Leases permitted under
Section 7.1(vii), provided that such Liens are only in respect of the property
--------
or assets subject to, and secure only, the respective Capitalized Lease;
(viii) Mortgage (or deed of trust) Liens to secure the payment of
Indebtedness permitted to be incurred under Section 7.1(vii), provided that the
amount secured by any such Lien shall not exceed the sum of the acquisition cost
of the Real Estate acquired and the cost of any improvements constructed
thereon;
(ix) Liens on the Capital Stock of OTI and ODCI, and the Intellectual
Property of Grand Parent used by OTI and not required for the operation of the
business of any of the other Subsidiaries of Grand Parent, so long as Grand
Parent has executed and complied with the Access Agreements;
(x) Liens on the notes made payable by Non-Party Subsidiaries evidencing
the Intercompany Indebtedness owed to OHI;
(xi) Liens on the assets of Non-Party Subsidiaries;
(xii) Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment insurance and
other types of social security;
(xiii) Liens incurred or deposits made to secure the performance of
tenders, bids, leases, statutory or regulatory obligations, bankers'
acceptances, surety and appeal bonds, government contracts, performance and
return of money bonds and other obligations of a similar nature incurred in the
ordinary course of business (exclusive of obligations for the payment of
borrowed money);
(xiv) Liens (including extensions and renewals thereof) upon real or
personal property; provided that such Liens are created solely for the purpose
of securing Indebtedness incurred in accordance with Section 7.1(x) to
refinance refund, renew or replace any such Indebtedness previously so secured;
and provided further that such Liens do not attach to assets other than those
assets to which they attached prior to such refinancing;
66
<PAGE>
(xv) Liens arising from filing Uniform Commercial Code financing statements
in connection with leases permitted hereunder;
(xvi) Liens arising from the rendering of a final judgment or order against
any Omnipoint Entity that do not give rise to an Event of Default; and
(xvii) Liens in connection with the Note Purchase Agreement.
Section 7.3 Contingent Obligations. Grand Parent and the Borrower shall
----------------------
not, and shall not permit any other Omnipoint Entity to, create, incur, assume,
suffer to exist or become or be liable with respect to any Contingent
Obligation, except:
(i) Contingent Obligations for the benefit of the Lenders and the Secured
Creditors under the Intercreditor Agreement pursuant to the Collateral Documents
securing or supporting the Obligations, including Indebtedness permitted under
Section 7.1(iv), (vi) and (xi);
(ii) Contingent Obligations which are in existence on the Closing Date and,
with respect to the Omnipoint Loan Parties, which are set forth on Schedule 7.3;
(iii) Grand Parent may provide unsecured guarantees of Indebtedness of its
Subsidiaries permitted hereunder;
(iv) Contingent Obligations of the Omnipoint Entities constituting
Indebtedness permitted under Section 7.1; and
(v) Any commitments provided by Grand Parent in favor of any of its
Subsidiaries to make any Investments in any such Subsidiaries permitted under
Section 7.4.
Section 7.4 Restrictions on Investments. Grand Parent and the Borrower
---------------------------
shall not, and shall not permit any other Omnipoint Entity to, 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 thereof, 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
67
<PAGE>
(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
(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) 7.4(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, 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 (other than loans and advances to officers,
directors and employees to be used to exercise options with respect to
Grand Parent's stock) not to exceed $5,000,000 in the aggregate outstanding
at any time 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 Omnipoint
Entities;
(g) Investments existing on the date hereof and listed on Schedule
7.4;
(h) Investments in the License Subsidiary by the Borrower consisting
of (x) all FCC Licenses held by the Borrower, (y) a capital contribution in
an aggre gate amount not to exceed $100,000 (including any previous
contribution in connec tion therewith) in connection with the organization
thereof and (z) capital contribu tions to the License Subsidiary to the
extent necessary to service scheduled principal and amortization of the
Indebtedness owed to the FCC;
(i) Provided that no Default is in existence (except with regard to
Post Default Investments) or would result therefrom, Investments by Grand
Parent in any of its directly or indirectly owned Subsidiaries; provided
that Investments in indirectly owned Subsidiaries shall be made by way of a
direct Investment in either OHI or Parent, which in turn may make
corresponding Investments in any of OHI's or Parent's respective
Subsidiaries;
(j) Investments by Grand Parent or the Borrower in OHI (and the
corresponding Investment by OHI) which are earmarked for Investments by OHI
68
<PAGE>
in joint ventures with other Persons in an amount not to exceed $50,000,000
at any one time; provided that such amount shall be increased by an amount
equal to 50% of the cumulative Net Cash Proceeds of any and all equity
capital raised by Grand Parent from and after the Closing Date through and
including any such date of determination, up to a limit of $200,000,000
less any previous Investments in joint ventures pursuant to this clause (j)
which subsequently become Subsidiaries of Grand Parent and are in
substantially the same line of business as any one or more Omnipoint
Entities; provided further that such $200,000,000 limit shall not apply at
any time after which the Borrower's EBITDA for the previous 12 consecutive
months exceeds $50,000,000;
(k) Transfers of assets of a Non-Party Subsidiary to another Omnipoint
Entity;
(l) Loans or advances to Grand Parent by another Omnipoint Entity used
for the purposes set forth in Section 7.5; and
(m) Seller take-back financing with respect to any dispositions of
assets of any Omnipoint Entity permitted pursuant to Section 7.6 hereof.
Section 7.5 Distributions. Grand Parent and the Borrower shall not, and
-------------
shall not permit any other Omnipoint Entity to, make any Distributions, except
that, (a) any Non-Party Subsidiary may make Distributions to any Omnipoint
Entity, and (b) provided that the Administrative Agent has received a
certificate of the chief or principal accounting or financial officer of the
Borrower to the effect that no Default under Section 7.19(e) or otherwise is in
existence or would result therefrom, (x) OIT may make distributions to Grand
Parent in respect of Investments by Grand Parent in OIT and (y) the Borrower and
the Guarantors may make Distributions to Guarantors, and Guarantors may make
corresponding Distributions to Grand Parent (or to OIT for immediate
distribution to Grand Parent) to (i) repay or prepay principal in respect of
Intercompany Indebtedness owing to Grand Parent or any other Omnipoint Loan
Party and to pay current interest as and when due in respect of such
Indebtedness, (ii) pay interest on other Indebtedness of Grand Parent, (iii)
make Investments in Subsidiaries of Grand Parent permitted hereunder or repay or
prepay any Indebtedness of Grand Parent to any of its Subsidiaries, or (iv) to
prepay (whether optional or mandatory), repurchase, redeem or make scheduled
payments of principal on, the Cap Re Notes.
Section 7.6 Merger, Consolidation, Disposition of Assets, Etc.
-------------------------------------------------
(a) Grand Parent and the Borrower shall not, and shall not permit any
other Omnipoint Entity to, be a party to any merger or consolidation,
unless (i) the surviving entity is a United States corporation controlled
directly or indirectly by Grand Parent, (ii) no Default is in existence or
would arise immediately after giving effect to such merger or
consolidation, (iii) with respect to any merger or consolida tion of any
Omnipoint Loan Party, the surviving entity executes and delivers an
assignment and assumption agreement (covering all obligations under the
Loan
69
<PAGE>
Documents) satisfactory to the Administrative Agent and the Required
Secured Creditors and (iv) immediately after giving effect to such
transaction, on a pro forma basis, the consolidated net worth of the Person
formed by or surviving any such consolidation or merger, or to which such
sale, assignment, transfer, lease, conveyance or other disposition will
have been made, will be at least equal to the consolidated net worth of the
Omnipoint Entity prior to such transaction; provided that any Omnipoint
Entity (other than an Omnipoint Loan Party) may consolidate with, merge
into, sell, convey, transfer, lease or otherwise dispose of all or part of
its Property to another Omnipoint Entity (other than an Omnipoint Loan
Party).
(b) Grand Parent and the Borrower shall not, and shall not permit any
other Omnipoint Entity to, become a party to or agree to or effect any
disposition of assets, other than (i) Permitted Asset Sales, (ii)
dispositions as permitted in accordance with Section 7.16 hereof, (iii)
Permitted C-Block FCC License Transfers and (iv) permitted Investments in
accordance with Section 7.4(k) hereof; provided that nothing contained
herein shall prohibit the issuance and sale of the Capital Stock of Grand
Parent, OHI or any Non Party Subsidiary.
Section 7.7 Sale and Leaseback. Grand Parent and the Borrower shall not,
------------------
and shall not permit any other Omnipoint Entity to, enter into any arrangement,
directly or indirectly, whereby such Omnipoint Entity shall sell or transfer any
Property owned by it in order then or thereafter to lease such Property or lease
other property that it intends to use for substantially the same purpose as the
Property being sold or transferred.
Section 7.8 Compliance with Environmental Laws. Except as set forth in
----------------------------------
the Current Phase I Audit and the Action Letter, Grand Parent and the Borrower
shall not, and shall not permit any other Omnipoint Entity to,
(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 applicable 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 applicable Environmental
Laws;
(c) generate any Materials of Environmental Concern on any of the Real
Estate, except in compliance with applicable 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 applicable Environmental Laws; or
70
<PAGE>
(e) otherwise conduct any activity at any Real Estate, except in
compliance with applicable Environmental Laws, or use any Real Estate in
any manner that would violate any applicable Environmental Law or bring
such Real Estate in violation of any Environmental Law.
Section 7.9 Employee Benefit Plans. Neither Grand Parent, 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;
(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 (within 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 Grand
Parent 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 Grand Parent 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 Grand Parent or an ERISA
Affiliate.
71
<PAGE>
Section 7.10 Transactions with Affiliates. Grand Parent and the Borrower
----------------------------
shall not, and shall not permit any other Omnipoint Entity to, enter into any
transaction or series of related transactions, whether or not in the ordinary
course of business, with any Affiliate, other than those (i) in existence on the
date hereof and with respect to the Omnipoint Loan Parties set forth on Schedule
7.10 or (ii) on terms and conditions substantially as favorable to such
Omnipoint Entity as would be obtainable at the time in a comparable arm's-length
transaction with a Person other than an Affiliate or (iii) the payment of
reasonable and customary fees to directors of an Omnipoint Entity who are not
employees of such Omnipoint Entity and any employment agreement entered into by
such Omnipoint Entity in the ordinary course of business.
Section 7.11 Change in Nature of Business.
----------------------------
(a) Grand Parent and the Borrower shall not, and shall not permit any
other Omnipoint Entity or any future Subsidiary of any Omnipoint Entity to,
make any fundamental change in its business as carried on and as proposed
to be carried on at the date hereof.
(b) Grand Parent and the Borrower shall not, and shall not permit OHI
or Parent to, conduct any business other than holding the Capital Stock of
its Subsidiaries now or hereafter existing and the other activities
currently conducted by it and associated with its status as a holding
company and, with respect to OHI, making loans and Investments in and to
its Subsidiaries.
(c) Grand Parent and the Borrower shall not permit OII or OIT to
conduct any business other than cash management and related activities.
(d) Grand Parent and the Borrower shall not permit the License
Subsidiary to conduct any business other than the holding of the FCC
Licenses for the New York PCS Network and the licensing thereof to the
Borrower.
Section 7.12 Charter Amendments. Grand Parent and the Borrower shall not,
------------------
and shall not permit any other Omnipoint Entity to, amend its certificate of
incorporation or bylaws in any manner adverse to the Lenders except as may be
necessary to comply with applicable law. Grand Parent and the Borrower shall
not, and shall not permit any other Omnipoint Entity to, amend its limited
liability company agreement, operating agreement or other organizational
documents in any manner adverse to the Lenders except as may be necessary to
comply with applicable law.
Section 7.13 Accounting Changes. Grand Parent and the Borrower shall not,
------------------
and shall not permit any other Omnipoint Entity to, make or permit any change in
accounting policies or reporting practices, except as required by GAAP, or any
change in its fiscal year.
Section 7.14 Prepayments, Etc., of Indebtedness. Grand Parent and the
----------------------------------
Borrower shall not, and shall not permit any other Omnipoint Loan Party (other
than Grand Parent)
72
<PAGE>
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 such Omnipoint Loan Party
(except that Grand Parent may prepay (whether optional or mandatory) any
Indebtedness owing by it or any of its Non-Party Subsidiaries, so long as in the
case of a voluntary prepayment no payment default exists at the Borrower under
this Agreement or the Note Purchase Agreement), other than the prepayment of the
Loans in accordance with the terms of this Agreement, the Intercreditor
Agreement or as the Required Secured Creditors may otherwise agree; provided
that the foregoing shall not apply to (i) Indebtedness owing to the FCC; (ii)
prepayment of Intercompany Indebtedness to the extent the proceeds of
Distributions may be used in compliance with Section 7.5; and (iii)
notwithstanding anything contained in this Section 7.14, Grand Parent may
refinance the Senior Notes provided that such refinancing (x) is unsecured and
is not guaranteed or supported by the Borrower or any Guarantor, (y) does not
have a maturity date prior to the maturity date of the Senior Notes or any manda
tory amortization provisions more favorable to the lenders thereunder than those
contained in the Senior Notes and (z) is on terms no more restrictive in any
material respect to Grand Parent or any Affiliate of Grand Parent than the terms
of this Agreement are to Grand Parent or the applicable Affiliate.
Section 7.15 Amendment, Etc., of Material Contracts. Grand Parent and the
--------------------------------------
Borrower shall not, and shall not permit any other Omnipoint Entity to, 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
any Omnipoint Loan Party.
Section 7.16 Asset Swaps. Grand Parent and the Borrower shall not, and
-----------
shall not permit any other Omnipoint Entity to, enter into any agreement for or
effect the exchange of its telecommunication assets for the telecommunication
assets of another Person, unless (i) such Omnipoint Entity receives like
telecommunication assets of a fair market value at least equal to the
telecommunication assets it disposes of, as appraised by an independent third
party appraiser acceptable to the Administrative Agent, and (ii) no Default is
in existence or would result therefrom; provided that no such swap may be made
of any material License of any Omnipoint Loan Party.
73
<PAGE>
Section 7.17 Certain Restrictions. Grand Parent and the Borrower shall
--------------------
not, and shall not permit (i) any other Omnipoint Loan Party to, enter into any
agreement (other than the Loan Documents and the other agreements set forth on
Schedule 7.17) which restricts the ability of such Omnipoint Loan Party to enter
into amendments, modifications or waivers of the Loan Documents or (ii) Grand
Parent or any Non-Party Subsidiary to, enter into any agreement (other than the
Loan Documents and the other agreements set forth on Schedule 7.17) which
contains (a) covenants exclusively with respect to the Borrower which are more
restrictive than the Senior Notes or (b) any other provisions which prohibit or
restrict the Borrower from making any payment or prepayment under this Agreement
or the Note Purchase Agreement.
Section 7.18 No Additional Subsidiaries. The Borrower shall not form or
--------------------------
acquire any new Subsidiaries, other than the License Subsidiary.
Section 7.19 Financial Covenants.
-------------------
(a) Minimum Subscribers. The Borrower shall not have fewer
-------------------
Subscribers as of each of the dates indicated below than the number indicated
below opposite each such date:
<TABLE>
<CAPTION>
Date Number of Subscribers
-------------------- ---------------------
<S> <C>
March 31, 1998 121,000
June 30, 1998 152,000
September 30, 1998 183,000
December 31, 1998 242,000
March 31, 1999 259,000
June 30, 1999 291,000
September 30, 1999 330,000
December 31, 1999 364,000
March 31, 2000 364,000
June 30, 2000 364,000
September 30, 2000 364,000
December 31, 2000 511,000
March 31, 2001 511,000
June 30, 2001 511,000
September 30, 2001 511,000
December 31, 2001 636,000
March 31, 2002 636,000
June 30, 2002 636,000
</TABLE>
74
<PAGE>
<TABLE>
<S> <C>
September 30, 2002 636,000
December 31, 2002 781,000
March 31, 2003 781,000
June 30, 2003 781,000
September 30, 2003 781,000
December 31, 2003 909,000
March 31, 2004 909,000
June 30, 2004 909,000
September 30,2004 909,000
December 31, 2004 1,015,000
March 31, 2005 1,015,000
June 30, 2005 1,015,000
September 30, 2005 1,015,000
December 31, 2005 1,106,000
</TABLE>
(b) Minimum Revenues. The Borrower shall not permit its Revenues for
----------------
each of the periods indicated below (tested as of the end of the relevant fiscal
period) to be less than the amount indicated below opposite each such period:
<TABLE>
<CAPTION>
Period Revenues
--------------------------------------------- ------------
<S> <C>
Three months ended March 31, 1998 $18,800,000
Six months ended June 30, 1998 $40,200,000
Nine months ended September 30, 1998 $66,600,000
Twelve months ended December 31, 1998 $101,000,000
Twelve months ended March 31, 1999 $123,000,000
Twelve months ended June 30, 1999 $145,900,000
Twelve months ended September 30, 1999 $169,300,000
Twelve months ended December 31, 1999 $188,100,000
Twelve months ended March 31, 2000 $188,100,000
Twelve months ended June 30, 2000 $188,100,000
Twelve months ended September 30, 2000 $188,100,000
Twelve months ended December 31, 2000 $262,300,000
Twelve months ended March 31, 2001 $262,300,000
Twelve months ended June 30, 2001 $262,300,000
Twelve months ended September 30, 2001 $262,300,000
Twelve months ended December 31, 2001 $360,200,000
Twelve months ended March 31, 2002 $360,200,000
</TABLE>
75
<PAGE>
<TABLE>
<S> <C>
Twelve months ended June 30, 2002 $360,200,000
Twelve months ended September 30, 2002 $360,200,000
Twelve months ended December 31, 2002 $461,900,000
Twelve months ended March 31, 2003 $461,900,000
Twelve months ended June 30, 2003 $461,900,000
Twelve months ended September 30, 2003 $461,900,000
Twelve months ended December 31, 2003 $553,400,000
Twelve months ended March 31, 2004 $553,400,000
Twelve months ended June 30, 2004 $553,400,000
Twelve months ended September 30, 2004 $553,400,000
Twelve months ended December 31, 2004 $630,800,000
Twelve months ended March 31, 2005 $630,800,000
Twelve months ended June 30, 2005 $630,800,000
Twelve months ended September 30, 2005 $630,800,000
Twelve months ended December 31, 2005 $695,200,000
and thereafter the twelve month period
ending on the last day of each fiscal quarter
</TABLE>
(c) Leverage Ratio. (i) The Borrower shall not permit the ratio of
---------------
Total Covenant Indebtedness to Adjusted Annualized EBITDA to exceed at any time
during any of the periods indicated below, the ratio set forth below opposite
such period:
<TABLE>
<CAPTION>
Period Ratio
---------------------------------------- -----
(from and including, to and including)
<S> <C>
Closing Date to September 30, 1999 11.8
October 1, 1999 to December 31, 1999 10.0
January 1, 2000 to March 31, 2000 10.0
April 1, 2000 to June 30, 2000 9.0
July 1, 2000 to September 30, 2000 6.5
October 1, 2000 to December 31, 2000 5.9
</TABLE>
(ii) The Borrower shall not permit the ratio of Total Covenant
Indebtedness to Annualized EBITDA to exceed at any time, during any of the
periods indicated below, the ratio set forth below opposite such period:
<TABLE>
<CAPTION>
Period Ratio
---------------------------------------- -----
(from and including, to and including)
<S> <C>
January 1, 2001 to March 31, 2001 18.0
</TABLE>
76
<PAGE>
<TABLE>
<S> <C>
April 1, 2001 to June 30, 2001 16.0
July 1, 2001 to September 30, 2001 14.0
October 1, 2001 to December 31, 2001 11.2
January 1, 2002 to March 31, 2002 11.2
April 1, 2002 to June 30, 2002 11.2
July 1, 2002 to September 30, 2002 11.2
October 1, 2002 to December 31, 2002 6.5
January 1, 2003 to March 31, 2003 6.5
April 1. 2003 to June 30, 2003 6.5
July 1, 2003 to September 30, 2003 6.5
October 1, 2003 to December 31, 2003 4.7
January 1, 2004 to March 31, 2004 4.7
April 1, 2004 to June 30, 2004 4.7
July 1, 2004 to September 30, 2004 4.7
October 1, 2004 and thereafter 4.0
</TABLE>
(d) Fixed Charge Ratio. The Borrower shall not permit the ratio of
------------------
Annualized EBITDA to Fixed Charges at any time during any of the periods set
forth below to be less than the ratio set forth below with respect to such
period.
<TABLE>
<CAPTION>
Period Ratio
---------------------------------------- -----
(from and including, to and including)
<S> <C>
October 1, 2001 to September 30, 2002 0.6
October 1, 2002 to September 30, 2003 1.1
October 1, 2003 to September 30, 2004 1.4
October 1, 2004 to September 30, 2005 1.6
October 1, 2005 to the Maturity Date 1.8
</TABLE>
(e) Total Covenant Indebtedness to Book Capitalization. The Borrower
--------------------------------------------------
shall not, at any time, permit the ratio of (i) Total Covenant Indebtedness
minus Unrestricted Cash pledged to the Administrative Agent for the benefit of
the Lenders and the Secured Creditors under the Intercreditor Agreement to (ii)
Book Capitalization to exceed 55% or, following any Equity Issuance, 60%.
77
<PAGE>
ARTICLE VII
CONDITIONS TO THE INITIAL LOANS
-------------------------------
The obligations of the Lenders to make their initial Loans shall be subject
to the satisfaction of the following conditions precedent on or prior to the
date of such initial Loans (the "Closing Date"):
------------
Section 8.1 Loan Documents. Each Lender shall, to the extent requested
--------------
prior to the Closing Date, 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 8.2 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 shall have received
such secretary's certificates, certificates of the Secretary of State of the
state of organization or incorporation of each Omnipoint Loan Party and other
copies of documents with respect thereto as it may reasonably request.
Section 8.3 Validity of Liens. The Collateral Documents shall be
-----------------
effective to create in favor of the Administrative Agent a legal, 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 Administrative Agent to protect, perfect and
preserve such security interests shall have been duly effected and all such
documents shall have been duly executed by the Borrower, Parent, License
Subsidiary, OHI and OIT, as applicable. The Administrative Agent shall have
received evidence thereof in form and substance satisfactory to the
Administrative Agent.
Section 8.4 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 (other than Permitted Liens) of record in such official's office
covering any Collateral or showing the Borrower, Parent, License
Subsidiary, OHI or OIT as a debtor thereunder;
(b) a certificate of the Borrower, Parent, License Subsidiary, OHI and
OIT, 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
78
<PAGE>
(c) acknowledgment copies or duly executed file-stamped copies of
UCC-1 and UCC-3 financing statements with respect to the Collateral filed
in each office where such filing is necessary or appropriate to perfect a
Lien on the Collateral.
Section 8.5 Certificates of Insurance. The Administrative Agent shall
-------------------------
have received a certificate of insurance from an independent insurance broker
naming the Administrative Agent as an additional insured and/or a loss payee,
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.
Section 8.6 Solvency Certificate. The Administrative Agent shall have
--------------------
received an officer's certificate of the Borrower and Grand Parent dated as of
the Closing Date as to the Borrower and each other Omnipoint Loan Party being
Solvent following the consummation of the transactions contemplated herein and
in form and substance satisfactory to the Administrative Agent and Lenders.
Section 8.7 Opinion of Counsel to Omnipoint Loan Parties. Each of the
--------------------------------------------
Lenders and the Administrative Agent shall have received a favorable legal
opinion of counsel to the Omnipoint Loan Parties 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 8.8 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 8.9 Payment of Fees. The Borrower shall have paid all fees and
---------------
expenses payable on the Closing Date by the Borrower or any other Omnipoint Loan
Party, including, without limitation, all fees payable on the Closing Date
pursuant to Section 2.3 and, to the extent invoiced, the reasonable fees and
expenses of Skadden, Arps, Slate, Meagher & Flom LLP, counsel to the Lenders and
the Agents, Pillsbury Madison & Sutro LLP, counsel to the Administrative Agent
and any FCC and local counsel to the Lenders.
Section 8.10 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 borrow Loans hereunder and continue 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 Full Term Operating Business Plan, and all such
consents, approvals, Licenses and permits 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 or the operation of
79
<PAGE>
the Borrower's business pursuant to the Full Term Operating Business Plan and
the Administrative Agent shall receive a certificate of an authorized officer of
the Borrower to that effect dated the Closing Date.
Section 8.11 Delivery of Operating Business Plans. The Borrower shall have
------------------------------------
delivered to Administrative Agent and each Lender
(a) an Annual Operating Business Plan for its 1998 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 or principal
accounting or 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 8.12 Material Agreements. Subject to confidentiality restrictions,
-------------------
the Administrative Agent shall have received a complete and correct copy,
certified by an authorized officer of the Borrower, of (a) the Expense
Allocation Agreement and the Cash Management Agreement, in each case as then in
effect, and (b) each other contract set forth on Schedule 5.24, 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 8.13 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 in the reasonable opinion
of the Lenders have a Material Adverse Effect.
Section 8.14 Existing Bank Debt. The Administrative Agent shall have
------------------
received evidence satisfactory to it (i) that the proceeds of the Initial Loans
shall repay in full all of the Existing Bank Debt (including, without
limitation, all fees payable pursuant to (S) 2.3 of the Existing Loan Agreement)
and that all lenders of the Existing Bank Debt shall have released (or shall,
effective immediately upon receipt of such proceeds, release) the Borrower from
any and all obligations under the Existing Bank Debt, (ii) that all commitments
of the lenders of such Existing Bank Debt to make loans or advances to the
Borrower shall be terminated on or prior to the Closing Date and (iii) that all
Liens securing obligations of the Borrower under the Existing Bank Debt shall be
released and terminated on or prior to the Closing Date (or shall, effective
immediately upon receipt of the proceeds of the initial Loan in an amount
sufficient to repay all amounts owing in respect of the Existing Bank Debt,
release and terminate all such Liens).
80
<PAGE>
Section 8.15 Creation of OHI Subsidiary. The Borrower shall have caused
--------------------------
the establishment of a new Subsidiary of OHI (the "OHI Subsidiary") and shall
have taken all steps necessary to enable OHI to pledge its Capital Stock in the
OHI Subsidiary in favor of the Administrative Agent for the benefit of the
Lenders and the Secured Creditors under the Intercreditor Agreement pursuant to
the OHI Pledge Agreement.
Section 8.16 Title Insurance. The Administrative Agent shall have received
---------------
a paid policy of mortgage title insurance with respect to each parcel of Real
Estate to be subject to a Mortgage, in amount satisfactory to the Administrative
Agent and issued by a title insurance company satisfactory to the Administrative
Agent.
Section 8.17 Financial Statements. The Administrative Agent shall have
--------------------
received the audited financial statements of Grand Parent and its Subsidiaries
and the Borrower and its Subsidiaries for the fiscal year ending December 31,
1996 and the unaudited financial statements of Grand Parent and its Subsidiaries
and the Borrower and its Subsidiaries for the fiscal quarter ending
September 30, 1997.
Section 8.18 Environmental Matters. The Administrative Agent shall (i) be
---------------------
satisfied that no Omnipoint Loan Party is subject to any Environmental Claim
which could have a Material Adverse Effect and (ii) have received an
environmental audit report in form and substance satisfactory to the Agent and
the Lenders prepared by an independent environmental consultant acceptable to
the Administrative Agent and the Lenders with respect to the Real Estate of the
Borrower and its Subsidiaries.
Section 8.19 Access Agreements. The Administrative Agent shall have
-----------------
received executed copies of the Access Agreements, which shall be in full force
and effect and the terms of which shall not have been waived, amended or
otherwise modified without the prior consent of the Administrative Agent.
Section 8.20 Subordination Agreements. The Administrative Agent shall have
------------------------
received executed Subordination Agreements subordinating to all Obligations all
Intercompany Indebtedness owed by the Borrower or any Guarantor, which
documentation shall be consistent with the terms and conditions of this
Agreement. The Administrative Agent shall have received documentation
satisfactory to it and the Required Secured Creditors that the Intercompany
Indebtedness is evidenced by notes and is "back to back" or otherwise documented
to provide the intended benefits to the Lenders of such subordination.
Section 8.21 Consent Agent. The Administrative Agent shall have received a
-------------
consent letter from the C. T. Corporation System, presently located at 1633
Broadway, New York, New York 10019 (together with any successor thereto, the
"Consent Agent"), indicating its consent to its appointment as agent to receive
service of process on behalf of each of the Omnipoint Loan Parties.
Section 8.22 Other Documents. The Administrative Agent and each Lender
---------------
shall receive all other documents, instruments and opinions from the Borrower
and Grand Parent
81
<PAGE>
(including opinions of counsel for the Borrower and Grand Parent) as the
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 Closing Date.
Section 8.23 Note Purchase Agreement. The Holders under the Note Purchase
-----------------------
Agreement shall have purchased, or contemporaneously with the making of the
Initial Loans shall purchase, the Senior Secured Notes.
Section 8.24 Other Conditions. The conditions in Section 9.1 shall have
----------------
been satisfied.
By their execution and delivery of this Agreement, each Lender agrees and
acknowledges that as of the Closing Date it has received an unexecuted form of
each of the Loan Documents required to be delivered pursuant to Section and each
other document and agreement required to be delivered to it pursuant to this
Article VIII, and that the form of each Loan Document and each other such
document and agreement is satisfactory to it.
ARTICLE IX
ADDITIONAL CONDITIONS TO LOANS
------------------------------
Section 9.1 Conditions to All Loans. The obligation of each Lender to
-----------------------
make any Loan, including its initial Loan, shall also be subject to the
satisfaction of the following conditions precedent:
(a) The Administrative Agent shall have received a timely and properly
completed Draw Request.
(b) Each of the representations and warranties of the Borrower and the
other Omnipoint Entities 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 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 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).
(c) No Default shall have occurred and be continuing.
(d) No Material Adverse Effect shall have occurred (other than
continuing losses of the Borrower materially in compliance with the
projections provided pursuant to the Full-Term Operating Business Plan).
82
<PAGE>
(e) No change shall have occurred in any law or regulation 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 shall have been entered prohibiting the consummation
of the transactions contem plated by the Loan Documents.
(f) 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.
(g) The Administrative Agent shall have received such other approvals,
opinions or documents as it or any Lender through the Administrative Agent
may reasonably request.
Each delivery of a Draw Request shall constitute a representation and warranty
by the Borrower as to the matters specified in clause (b) and (c) above.
ARTICLE X
EVENTS OF DEFAULT; ACCELERATION; ETC.
-------------------------------------
Section 10.1 Events of Default and Acceleration. Upon the occurrence and
----------------------------------
during the continuance of any of the following events (each an "Event of
Default"),
(a) the Borrower shall fail to pay (i) any principal of the Loans when
due or (ii) any fee payable pursuant to Section 2.3 or 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 each such case, with respect to this clause
(ii), within three days after the date on which the same shall become due
and payable; or
(b) Grand Parent or the Borrower shall fail to comply with any of the
covenants contained in Section 6.13(h), 6.16 or Article VII; or
(c) Any Omnipoint Loan Party 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 Section 10.1) and such failure shall
continue for a period of 30 consecutive days after the earlier of (i)
written notice thereof from the Administrative Agent or (ii) actual
knowledge thereof by such Omnipoint Loan Party; or
(d) any representation or warranty of any Omnipoint Entity under this
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
83
<PAGE>
Document shall not be correct in any material respect upon the
date when made or deemed to have been made or repeated; or
(e) (i) any Significant Entity shall
(A) make an assignment for the benefit of creditors, or
(B) 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
(C) petition or apply for the appointment of a trustee or other
custodian, liquidator or receiver for itself or for any substantial
part of its assets, or
(D) shall commence any case or other proceeding 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
(ii) any petition or application described in (i)(C) or (D) above
shall be filed or any such case or other proceeding shall be commenced
against any Significant Entity and (x) any Significant Entity shall
indicate its approval thereof, consent thereto or acquiescence therein, or
(y) such petition, application or proceeding is not dismissed within 45
days thereof, or (z) any of the actions sought in such petition,
application or 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
(iii) any Significant Entity shall take any corporate action to
authorize any of the actions set forth above in this subsection (e); or
(f) any Significant Entity 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 $10 million in the
aggregate (but excluding Indebtedness outstanding hereunder and
Indebtedness owed to the FCC), 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 of any
Significant Entity, 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 of any
Significant Entity 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
84
<PAGE>
made, other than (i) the redemption or repurchase of not more than
$15,000,000 of Senior Notes as permitted in the last sentence of the
definition of "Change of Control" in Article I and (ii) from the Net Cash
Proceeds of asset sales (in accordance with Section 3.2), or equity or debt
issuances, in each case prior to the stated maturity thereof; or
(g) any final judgment or order for the payment of money in an amount
of $10,000,000 or more (excluding any portion thereof that an insurance
company of recognized standing and creditworthiness reasonably satisfactory
to the Administrative Agent has agreed to pay) shall be rendered against
one or more Significant Entities and shall not be paid, discharged or
bonded 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 any Omnipoint Entity, or any Guarantor shall assert that its
respective guaranty of the Obligations of the Borrower is invalid, 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 any material
respect in accordance with the terms thereof; or
(i) with respect to any Guaranteed Pension Plan: an ERISA Event shall
have occurred and the Required Secured Creditors shall have determined in
their reasonable discretion that such event reasonably could be expected to
result in liability of Grand Parent or any of its Subsidiaries to the PBGC
or such Guaranteed Pension Plan in an aggregate amount of $10,000,000 or
more; or a trustee shall have been appointed by the United States District
Court to administer such Guaranteed Pension 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) (i) any Environmental Claim shall have been asserted against any
Omnipoint Entity or any Environmental Affiliate thereof which, if
determined adversely, could reasonably be expected to have a Material
Adverse Effect, (ii) any release, emission, discharge or disposal of any
Material of Environmental Concern shall have occurred, and such event could
form the basis of an Environmental Claim
85
<PAGE>
against any Omnipoint Entity or any Environmental Affiliate thereof which,
if determined adversely, could have a Material Adverse Effect, or (iii) any
Omnipoint Entity or its Environmental Affiliate shall have failed to obtain
any Environmental Permit necessary for the management, use, control,
ownership, or operation of its business, property or assets or any such
Environmental Permit shall be revoked, terminated, or otherwise cease to be
in full force and effect, in each case, if the existence of such condition
could have a Material Adverse Effect;
(k) the FCC or any other Governmental Body shall cancel, revoke or
suspend (i) any of the Borrower's Licenses for the New York PCS Network, or
any License held by the License Subsidiary, or fail to renew any such
License or (ii) any other License or group of Licenses held by Grand Parent
or any of its Significant Subsidiaries (other than "C" Block Licenses) the
loss of which could reasonably be expected to have a Material Adverse
Effect on Grand Parent and its Significant Subsidiaries, taken as a whole;
or
(l) the FCC or any other Governmental Body shall commence any
proceeding to cancel, revoke or suspend any of the Borrower's or the
License Subsidiary's 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 or the License Subsidiary within five business
days after the commencement of any such proceeding; or
(m) the Borrower or the License Subsidiary shall fail to pay when due
amounts owing the FCC unless (i) such failure to pay can reasonably be
expected, in the sole reasonable judgment of the Required Secured
Creditors, not to result in any cancellation, revocation or suspension of
any of the Borrower's or the License Subsidiary's Licenses for the New York
PCS Network or (ii) the Borrower or the License Subsidiary has obtained a
stay or injunction against any action by the FCC to cancel, revoke or
suspend such License notwithstanding such failure to pay; or
(n) the Administrative Agent shall cease to have a valid and perfected
first-priority Lien on any Collateral (subject only to Permitted Liens)
securing the Obligations of the Borrower (or in the case of Collateral
pledged by Parent, License Subsidiary, OHI or OIT, each such Person's
respective guaranty of the Obligations of the Borrower) or the Borrower,
Parent, License Subsidiary, OHI or OIT shall so assert; or
(o) a Change of Control shall occur.
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 Secured Creditors
shall, by notice to the Borrower, (i) declare the Commitments of each Lender to
make Loans to be terminated, whereupon the same shall forthwith terminate,
and/or (ii) declare the amount of all outstanding principal of the Loans, the
Notes, all interest thereon and all other amounts
86
<PAGE>
payable under this Agreement and the other Loan Documents to be forthwith due
and payable, whereupon the outstanding principal amount of the Loans, 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
Commitments of each Lender to make Loans shall automatically be terminated and
(B) the amount of all outstanding principal of the Loans, the Notes, all such
interest and all such amounts shall automatically become and be immediately due
and payable, without presentment, demand, protest or any notice of any kind, all
of which are hereby expressly waived by the Borrower; and provided further that
----------------
any action taken pursuant to this paragraph shall be subject to the terms of the
Intercreditor Agreement.
ARTICLE XI
THE ADMINISTRATIVE AGENT
------------------------
Section 11.1 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 and
indemnified in so acting or refraining from acting) upon the instructions of
the Required Lenders or, if applicable, the Required Secured Creditors (unless
otherwise provided herein), 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. Notwithstanding any provision to the
contrary elsewhere in this Agreement, the Administrative Agent shall not have
any duties or responsibilities to any Lender, except those expressly set forth
herein, or any fiduciary relationship with any Lender, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities to any Lender
shall be read into this Agreement or otherwise exist against the Administrative
Agent. The Borrower agrees to pay the Administrative Agent such compensation
for services rendered hereunder as may be separately agreed between the Borrower
and the Administrative Agent in the Agent's Fee Letter.
Section 11.2 Administrative Agent's Reliance, Etc. Neither the Administrative
------------------------------------
Agent nor any of its respective directors, officers, agents or employees shall
be (a) 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 or (b) responsible in any manner to any of the
Lenders for any recitals, statements, representations
87
<PAGE>
or warranties made by the Borrower or any officer thereof contained in this
Agreement, any other Loan Document or any certificate, report, statement or
other document referred to or provided for in, or received by the Administrative
Agent under or in connection with, this Agreement or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document for any failure of the Borrower to perform its
obligations or satisfy any condition hereunder or thereunder. The Administrative
Agent shall not be under any obligation to any Lender to ascertain or to inquire
as to the observance or performance of any of the agreements contained in, or
conditions of, this Agreement or any other Loan Document, or to inspect the
properties, books or records of the Borrower. Without limitation of the
generality of the foregoing, the Administrative Agent:
(a) may treat the Lender that made any Loan 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) 12.7;
(b) 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;
(c) 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;
(d) 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;
(e) shall be fully justified in failing or refusing to take action
under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Required Lenders or Required
Secured Creditors, as applicable, as it deems appropriate or it shall first
be indemnified to its satisfaction by the Lenders against any and all
liability and expense which may be incurred by it by reason of taking or
continuing to take any such action;
(f) 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;
(g) may act by or through its agents or attorneys-in-fact;
88
<PAGE>
Section 11.3 Administrative Agent's Rights as Lender. With respect to its
---------------------------------------
Commitments, any Loans made by it and any Note issued to it, the 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 any Administrative Agent in its
individual capacity. Any Administrative Agent in its individual capacity and
its affiliates may 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 the Borrower or any of its Affiliates, all as if any
Administrative Agent in its individual capacity were not the Administrative
Agent and without any duty to account therefor to the Lenders.
Section 11.4 Lender Credit Decision. Each Lender acknowledges that it has,
----------------------
independently and without reliance upon any 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. Except for
notices, reports and other documents expressly required to be furnished to the
Lenders by the Administrative Agent hereunder, the Administrative Agent shall
not have any duty or responsibility to provide any Lender with any credit or
other information concerning the business, operations, property, condition
(financial or otherwise), prospects or creditworthiness of the Borrower which
may come into the possession of the Administrative Agent or any of its
officers, directors, employees, Administrative Agents, attorneys-in-fact or
Affiliates.
Section 11.5 Indemnification. Each Lender severally will indemnify the
---------------
Administrative Agent (to the extent not promptly reimbursed by the Borrower and
without limiting the obligation of the Borrower to do so) 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 or any documents contemplated hereby or thereby; provided
that no Lender 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 Section 12.4, to the extent
that the Administrative Agent is not promptly reimbursed for such costs and
expenses by the Borrower. For purposes of this Section 11.5, 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 Loans
outstanding at such time and owing to the respective Lenders and (b) the
aggregate unused portions of their respective Commit ments. The failure of any
Lender to reimburse the Administrative Agent promptly upon demand for
89
<PAGE>
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 11.6 Successor Administrative Agents. The Administrative Agent may
-------------------------------
resign upon 30 days' written notice to the Lenders and the Borrower and may be
removed at any time by the Required Secured Creditors or the Borrower with or
without cause upon 30 days' notice from the Required Secured Creditors or the
Borrower, as the case may be. If the Administrative Agent shall be so removed or
resign, the Required Secured Creditors during such 30 day period shall appoint
from among the Lenders a successor agent, whereupon such successor agent shall
succeed to the rights, powers and duties of the Administrative Agent and the
term "Administrative Agent" as used herein and in all other Loan Documents shall
mean such successor agent, and the former Administrative Agent's rights, powers
and duties as Administrative Agent shall be terminated, without any other or
further act or deed on the part of such former Administrative Agent or any of
the parties to this Agreement. 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.
Section 11.7 Other Agents. Without limiting any provision contained in
------------
this Section 11 neither the Syndication Agent, the Documentation Agent nor the
Co-Agent shall have, except if any such Persons shall also be Lenders, as to and
to the limited extent expressly provided herein, any obligation, responsibility
or duty under this Agreement other than those applicable to all Lenders as such.
Each Lender acknowledges that it has not relied, and will not rely, on the
Syndication Agent, the Documentation Agent or the Co-Agent, in deciding to enter
into this Agreement or in taking or not taking action hereunder.
Section 11.8 Notice of Default and Other Notices. The Administrative Agent
-----------------------------------
shall not be deemed to have knowledge or notice of the occurrence of any Default
or Event of Default hereunder unless the Administrative Agent has received prior
written notice from a Lender or the Borrower referring to this Agreement,
describing such Default or Event of Default and stating that such notice is a
"notice of default." In the event that the Administrative Agent receives such a
notice, the Administrative Agent shall give notice thereof to the Lenders.
Without limiting the generality of the foregoing or subsection 10.1, the
Administrative Agent shall not be required to take any action with respect to
any Default or Event of Default except as directed by the Required Secured
Creditors, provided that unless and until the Administrative Agent shall have
--------
received such directions, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deemed advisable in the best
interests of the Lenders.
90
<PAGE>
ARTICLE XII
MISCELLANEOUS
-------------
Section 12.1 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 Secured Creditors (and the terms of effectiveness set
forth in such amendment, waiver or consent shall be satisfied), 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 definition of Required Secured Creditors (or,
without the vote of the Required Lenders only, change the definition
of Required Lenders);
(iii) release any Collateral, other than as contemplated by the
Loan Documents or release the Parent Guaranty, the Subsidiary
Guaranty, the OHI Guaranty or the OIT Guaranty;
(iv) amend this Section 12.1;
(v) amend or waive any mandatory prepayment provisions;
(vi) increase the Commitments of the Lenders or subject the
Lenders to any additional obligations;
(vii) reduce the principal of, or interest on, the Loans or 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; and
(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.
Section 12.2 Notices, Etc. All notices and other communications provided
------------
for hereunder shall be in writing (including telegraphic, telecopy or cable
communication) and mailed, telegraphed, telecopied, cabled or delivered,
91
<PAGE>
(a) if to the Borrower, at:
Omnipoint Communications Inc.
16 Wing Drive
Cedar Knolls, New Jersey 07927
Attn: Harry Plonskier
(fax no. (973) 257-2539) - prior to April 15, 1998
(fax no. (973) 290-2539) - from and after April 15, 1998
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)
(b) if to Grand Parent, at:
Omnipoint Corporation
Three Bethesda Metro Center
Suite 400
Bethesda, MD 20814
Attn: Bradley E. Sparks
(fax no. (301) 951-2518)
with a copy to Piper & Marbury, L.L.P. as set forth under clause
(a) above;
(c) if to OHI, OIT or the License Subsidiary, in care of
Omnipoint Corporation
Three Bethesda Metro Center
Suite 400
Bethesda, MD 20814
Attn: Bradley E. Sparks
(fax no. (301) 951-2518)
(d) if to any Lender, at its domestic lending office or other address
provided by the Lender; and
(e) if to the Administrative Agent,
(i) for notices with respect to Draw Requests and Requests for
Conversations/Continuation:
92
<PAGE>
Bank of America National Trust & Savings Association
1850 Gateway Boulevard
5/th/ Floor
Concord, CA 94520
Attention: Sang Lee
Tel: (510) 675-8416
Fax: (510) 675-8500
(ii) for all other notices:
Bank of America National Trust & Savings Association
1455 Market Street
San Francisco, CA 94103
Attention: Leandro Balidoy
(fax no. (415) 436-3425)
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 or cabled, be effective when
deposited in the mails, delivered to the telegraph company, transmitted by
telecopier 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 12.3 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 12.4 Costs, Expenses.
---------------
(a) The Borrower will pay on demand
(i) all costs and expenses of the Agents incurred in connection
with the preparation, execution, delivery, administration,
modification and amendment of the Loan Documents and any consents or
waivers in connection therewith (including (A) all search, filing and
recording fees and expenses and (B) the reasonable fees and expenses
of counsel for the Agents with respect to the Loan Documents, with
respect to advising the Agents as to their rights and
responsibilities, or the perfection, protection or preservation of
rights or interests, under the Loan Documents and with respect to
negotiations with the Omnipoint Loan Parties or with other creditors
of the Omnipoint Loan Parties in connection with the Loan Documents,
or 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
93
<PAGE>
or monitoring any bankruptcy, insolvency or other similar proceeding
or negotiation involving creditors' rights generally and any
proceeding ancillary thereto), and
(ii) all costs and expenses of the Agents and the other Lenders
in connection with the enforcement of the Loan Documents, including 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 Agents
and each other Lender with respect thereto).
(b) If, at any time any payment of principal of, or Conversion of, any
LIBO Rate Loan 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 Loan, as a
result of any repayment, prepayment or Conversion thereof, acceleration
of the maturity of the Notes or Loans pursuant to (S) 10.1 or for any other
reason, or any payment of principal of or Conversion of any LIBO Rate Loan
is not made on any date specified in any notice of prepayment or Notice of
Conversion or Continuation, the Borrower shall, upon demand by such Lender
(with a copy of such demand to the Administrative Agent), pay to 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 LIBO Rate Loan on a day that is not the last day of the
applicable Interest Period with respect thereto or as a consequence of not
making any such payment or Conversion on such specified date. In the case
of any Loan that the related Draw Request specifies is to be comprised of
LIBO Rate Loans, 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 Loan to be made by such Lender when
such Loan, as a result of such failure, is not made on such date.
(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, each Agent and their
respective Affiliates and their officers, directors, partners, employees,
agents and advisors (each an "Indemnified Party") and hold each Indemnified
-----------------
Party harmless from and against any and all claims, damages, losses,
liabilities and expenses (including reasonable fees and expenses of counsel
including, with respect to the Agents and each other Lender, 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
94
<PAGE>
(i) the Notes, this Agreement and other Loan Documents and the
enforcement thereof, any of the transactions contemplated herein or
therein or the actual or proposed use of the proceeds of the Loans, or
(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) 12.4(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 agrees not to assert any claim against the Agents, any other 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 Loans.
(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) 12.4 shall survive the payment in full of principal
and interest hereunder and under the Notes and the termination of this
Agreement and the Commitments hereunder.
Section 12.5 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) 10.1 to authorize the Administrative Agent to declare, or the
Administrative Agent's declaration of, the Loans to be due and payable pursuant
to the provisions of (S) 10.1, 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, any Note or Notes held by such
Lender and the other Loan Documents, irrespective of whether such Lender shall
have made any demand under this Agreement or such Note or the other Loan
Documents and although such obligations may be unmatured. Each Lender agrees
promptly to notify the Borrower and the Administrative Agent 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) 12.5 are in addition to other rights and
remedies (including other rights of set-off) that such Lender and its Affiliates
may have.
95
<PAGE>
Section 12.6 Binding Effect. This Agreement shall become effective when it
--------------
shall have been executed by the Borrower and the Administrative Agent and when
each Lender shall have executed it and thereafter shall be binding upon and
inure to the benefit of the Borrower, the Administrative Agent, each Lender 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 all of the Lenders.
Section 12.7 Assignments and Participations.
------------------------------
(a) Each Lender may assign to one or more banks or other entities
(including any fund, trust or other Person in connection with a
securitization or monetization of the Loans 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, the Loans owing to
it and/or the Note or Notes held by it); provided that
--------
(i) except in the case of an assignment to a Person that,
immediately prior to such assignment, was a Lender or an Approved Fund
or an assignment of all of a Lender's rights and obligations under
this Agreement, the amount of the Commitment and Loans 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 $1,000,000
and shall be an integral multiple of $500,000. Notwithstanding the
foregoing, within three days of the Closing Date assignments may be
made in an amount not less than $100,000, and such assigned amounts
may be further assigned (in whole but not in part) in the future in
amounts equal to the amount originally assigned;
(ii) 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, and except for assignments to an Affiliate of the
Lender or an Approved Fund and except for assignments on the
Closing Date or in connection with the initial syndication, a
processing and recordation fee of $500 for each such assignment,
(B) deliver a copy of such Assignment and Acceptance to the
Borrower at the time it delivers a copy to the Administrative
Agent; and
(iii) unless the Borrower and the Administrative Agent 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 or assets of at least $50,000,000, and
96
<PAGE>
(B) except to a Person, other than a commercial bank or
other financial institution or fund, 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; and
(iv) the parties to such assignment shall, to the extent
applicable, arrange with the Borrower for the execution and delivery
of a substitute Note or Notes replacing any Note or Notes subject to
such assignment.
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 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, in the case
of an Assignment and Accep tance 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) other than as provided in such Assignment and Acceptance,
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, together with copies of the financial statements referred
97
<PAGE>
to in (S) 5.4 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 and the other Loan
Documents;
(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 and the other Loan
Documents, and to take such action as Collateral Agent under the
Intercreditor Agreement and the Collateral Documents, as are delegated
to the Administrative Agent and the Collateral Agent by the terms
hereof and thereof, 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 Loan Documents are required to be performed by it as a Lender;
(vii) such assignee makes the representations set forth in
subsection (b)(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) 12.2 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 Loans 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 timely completed and is substantially in the form of
Exhibit C, together with the processing and recordation fee referred to in
Section 12.7(a)(ii),
(i) accept such Assignment and Acceptance,
98
<PAGE>
(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, to the extent applicable, execute and deliver to the
Assignee in exchange for the surrendered Note or Notes a new Note to the order
of such assignee in an amount equal to the Loans and/or Commitments assumed by
it pursuant to such Assignment and Acceptance and, if the assigning Lender has
retained Loans or Commitments hereunder, a new Note to the order of the
assigning Lender in an amount equal to the Loans 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) Upon the Administrative Agent's acceptance of an Assignment and
Acceptance and recording of the information contained therein in the
Register pursuant to (S) 12.7(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.
(f) Any Lender may, without the consent of the Borrower or the
Administrative Agent, sell participations to one or more banks or other
entities (other than other entities that are engaged in, or have Affiliates
that are engaged in, the business of providing PCS telecommunications
services to the public) (a "Participant") in all or a portion of such
Lender's rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans owing to it); provided that (i)
--------
such Lender's obligations under this Agreement shall remain unchanged, (ii)
such Lender shall remain solely responsible to the other parties hereto for
the performance of such obligations and (iii) 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. No Lender shall transfer or grant any
participation under which the Participants shall have rights to approve any
amendment to or waiver of this Agreement except to the extent that such
amendment or waiver would (i) extend the Maturity Date in which the
Participant is participating, or reduce the rate or extend the time of
payment of interest or fees thereon (except in connection with a waiver of
applicability of any post-default increase in interest rates) or reduce the
principal amount thereof, or increase the amount of the Participant's
participation over the amount thereof then in effect (it being understood
that a waiver of any Default or Event of Default shall not constitute a
change in the terms of such participation and that an increase in any
Commitment or Loan shall be permitted without the consent of any
Participant if such Participant's participation is not increased as a
result thereof), or (ii) consent to the
99
<PAGE>
assignment by the Borrower of any of its rights and obligations under this
Agreement. A Participant shall not be entitled to receive any greater
payment under (S) 4.2, 4.3 or 12.4(b) than the applicable Lender would have
been entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is
made with the Borrower's prior written consent.
(g) Any Lender may, in connection with any assignment or participation
or proposed assignment or participation pursuant to this Section 12.7,
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 Informa
tion received by it from such Lender, and any Lender that is an investment
fund that invests in bank loans may, without the consent of the
Administrative Agent or the Borrower, pledge all or any portion of its
interest, rights and obligations to any trustee or any other representative
of holders of obligations owed or securities issued by such investment fund
as security for such obligations or securities.
(h) 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 Agreement (including the Loans 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.
(i) Notwithstanding the foregoing, in the event that any Holder
exercises its option pursuant to the Intercreditor Agreement to exchange
its Senior Secured Note or Senior Secured Notes for Loans hereunder, upon
satisfaction of the requirements of the Note Purchase Agreement and
execution and delivery to the Administrative Agent by such Holder of a
Joinder Agreement, such Holder shall become a party hereto and shall have
the rights and obligations of a Lender hereunder. The amount of such new
Lender's Tranche A Amount (as defined in the Note Purchase Agreement) so
exchanged shall be converted into a Tranche A Loan, and the amount of such
new Lender's Tranche B Amount (as defined in the Note Purchase Agreement)
so exchanged shall be converted into a Tranche B Loan, and such Loans shall
be entered into the Register by the Administrative Agent (and, at the
request of such new Lender, Notes shall be issued in accordance with
Section 2.10). Once a Holder becomes a Lender pursuant to this Section
12.7(i), such new Lender shall not be entitled to exchange its Loans for
Senior Secured Notes.
Section 12.8 GOVERNING LAW. THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED
-------------
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (WITHOUT
GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES THEREOF).
Section 12.9 Execution in Counterparts. This Agreement may be executed in
-------------------------
any number of counterparts and by different parties hereto in separate
counterparts, each of
100
<PAGE>
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. So long as this Agreement shall be in
---------------
effect and any Loans or Commitments remain outstanding, 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 assignees and participants, and then only on a confidential
basis,
(b) as required by any law, rule or regulation or judicial process,
(c) as requested or required by any state, Federal or foreign
authority or examiner (or the national association of insurance
commissioners) regulating banks or banking or such Lender or such Lender's
Affiliates, and
(d) to any direct or indirect contractual counterparty in swap
agreements or such contractual counterparty's professional advisor (so long
as such counterparty or advisor agrees to be bound by the provisions of
this Section 12.10).
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 the extent that such terms or transactions become
generally available to the public,
(ii) to their respective Affiliates and their officers,
directors, employees, agents, advisors and (in the case of the
Lenders) to actual or prospective assignees and participants, in each
case to the extent that the Administrative Agent, any Lender or the
Borrower deems necessary or appropriate,
(iii) as required by any law, rule or regulation or judicial
process and
(iv) as requested by any state, Federal or foreign regulatory
authority (or the national association of insurance commissioners).
Within a reasonable period of time prior to making any disclosure with respect
to such terms and transactions that is permitted under clause (iii) or (iv) of
the preceding sentence,
101
<PAGE>
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. Each of Grand Parent and 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 Grand Parent or
the Borrower at its address specified in (S) 12.2; and
(e) irrevocably designates, appoints and empowers, and shall cause
each other Omnipoint Loan Party to designate, appoint and empower, the
Consent Agent, as its designee, appointee and agent to receive, accept and
acknowledge for and on its behalf, and in respect of its properties,
service of any and all legal process, summons, notices and documents which
may be served in any such action or proceeding. If for any reason the
Consent Agent shall cease to be available to act as such, each of Grand
Parent and the Borrower agrees to, and shall cause each other Omnipoint
Loan Party to, designate a new Consent Agent in New York City on the terms
and for the purposes of this provision satisfactory to the Administrative
Agent.
(f) 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 the Borrower or its property in the courts of other
jurisdictions.
Section 12.12 Matters Relating to the Administrative Agent. (a) The
--------------------------------------------
Borrower will pay the Administrative Agent a fee in an amount, computed as
provided and payable at the times separately agreed to by the Administrative
Agent and the Borrower. In addition, the Borrower will pay on demand all costs
and expenses of the Administrative Agent (including allocated costs and
reasonable expenses of in-house counsel and legal staff) in connection with the
preparation, execution, delivery, performance, administration, enforcement,
modification and amendment of the Collateral Documents and/or any other Loan
Document
102
<PAGE>
at any time, including without limitation the reasonable fees and expenses of
counsel (including reasonable allocated costs and expenses of outside counsel,
in-house counsel and legal staff) and the costs and expenses incurred by the
Administrative Agent in the course of performing its duties and obligations as
Administrative Agent.
Section 12.13 WAIVER OF JURY TRIAL. EACH OF GRAND PARENT, 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
LOANS OR THE ACTIONS OF THE ADMINISTRATIVE AGENT OR ANY LENDER IN THE
NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.
Section 12.14 Grand Parent Not a Guarantor. The parties hereto acknowledge
----------------------------
and agree that Grand Parent shall be a party hereto solely for the purposes of
providing the covenants and representations expressly specified herein, and
shall not be a guarantor of the Obligations of any Loan Party under the Loan
Documents.
Section 12.15 Loans Not Securities. It is the intent of the parties
--------------------
hereto, and their expectation, that the Loans hereunder (and Notes evidencing
the same, if any) and the lenders' interests therein, are commercial loans and
not securities subject to the Securities Act of 1933, as amended, or any related
federal or state securities laws, statutes or regulations.
103
<PAGE>
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., as
Borrower
By
------------------------------
Name: Harry Plonskier
Title: Vice President Finance
S-1
<PAGE>
OMNIPOINT CORPORATION, as a party for
----------------------
the purposes set forth in Section
12.14 of this Agreement
By
------------------------------
Title:
S-2
<PAGE>
DLJ CAPITAL FUNDING, INC., as Lender
and Syndication Agent
By
------------------------------
Title:
S-3
<PAGE>
GOLDMAN SACHS CREDIT PARTNERS L.P., as
a Lender and Documentation Agent
By
------------------------------
Title:
S-4
<PAGE>
BANK OF AMERICA NATIONAL TRUST
& SAVINGS ASSOCIATION, as
Lender
By
------------------------------
Title:
BANK OF AMERICA NATIONAL TRUST
& SAVINGS ASSOCIATION, as
Administrative Agent
By
------------------------------
Title:
S-5
<PAGE>
NATIONSBANK, N.A., as Lender and
Co-Agent
By
------------------------------
Title:
S-6
<PAGE>
CIBC INC., as Lender
By
------------------------------
Title:
S-7
<PAGE>
CITIBANK N.A., as Lender
By
------------------------------
Title:
S-8
<PAGE>
BANKBOSTON N.A., as Lender
By
------------------------------
Title:
S-9
<PAGE>
CREDIT LYONNAIS NEW YORK
BRANCH, as Lender
By
------------------------------
Title:
S-10
<PAGE>
CAPITAL RESEARCH AND MANAGEMENT
COMPANY on behalf of THE BOND
FUND OF AMERICA, INC.
By
------------------------------
Title:
S-11
<PAGE>
CAPITAL RESEARCH AND MANAGEMENT
COMPANY on behalf of AMERICAN
VARIABLE INSURANCE SERIES - HIGH-
YIELD BOND FUND
By
------------------------------
Title:
S-12
<PAGE>
OMNIPOINT COMMUNICATIONS INC.
$155,000,000
Floating Rate Senior Notes due February 17, 2006
---------------
NOTE PURCHASE AGREEMENT
---------------
Dated February 17, 1998
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Section Page
- ------- ----
<S> <C>
1. AUTHORIZATION OF NOTES......................................................1
2. SALE AND PURCHASE OF NOTES..................................................1
3. CLOSING.....................................................................2
4. CONDITIONS TO CLOSING..................................................... 3
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY............................. 9
Section 5.1 Corporate Authority................................... 9
-------------------
Section 5.2 Governmental Approvals................................ 10
----------------------
Section 5.3 Title to Properties................................... 10
-------------------
Section 5.4 Financial Statements.................................. 11
--------------------
Section 5.5 No Material Adverse Effect, Etc....................... 12
-------------------------------
Section 5.6 Franchises, Patents, Copyrights, Etc.................. 12
------------------------------------
Section 5.7 License, Etc.......................................... 12
------------
Section 5.8 Litigation............................................ 13
----------
Section 5.9 Compliance with Other Instruments, Laws, Etc.......... 13
---------------------------------------------
Section 5.10 Tax Status............................................ 13
----------
Section 5.11 No Default............................................ 14
----------
Section 5.12 Holding Company and Investment Company Acts........... 14
-------------------------------------------
Section 5.13 Absence of Financing Statements, Etc.................. 14
------------------------------------
Section 5.14 FCC Matters........................................... 14
-----------
Section 5.15 Tariffs............................................... 14
-------
Section 5.16 Disclosure............................................ 15
----------
Section 5.17 Burdensome Obligations................................ 15
----------------------
Section 5.18 Solvency.............................................. 15
--------
Section 5.19 Security Interests.................................... 15
------------------
Section 5.20 Certain Transactions.................................. 15
--------------------
Section 5.21 Employee Benefit Plans................................ 16
----------------------
Section 5.22 Regulations G, T, U and X............................. 17
-------------------------
Section 5.23 Environmental Compliance.............................. 17
------------------------
Section 5.24 Material Contracts.................................... 19
------------------
Section 5.25 Payment of Existing Debt.............................. 19
------------------------
</TABLE>
S-i
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
Section 5.27 Foreign Assets Control Regulations, etc............... 20
----------------------------------------
6. REPRESENTATIONS OF THE PURCHASER.......................................... 20
Section 6.1 Purchase for Investment............................... 20
-----------------------
Section 6.2 Source of Funds....................................... 20
---------------
7. INFORMATION AS TO COMPANY................................................. 22
Section 7.1 Financial and Business Information.................... 22
----------------------------------
Section 7.2 Inspection of Properties and Books.................... 29
----------------------------------
8. PREPAYMENT OF THE NOTES................................................... 30
Section 8.1 Required Prepayments.................................. 30
--------------------
Section 8.2 Optional Prepayments.................................. 30
--------------------
Section 8.3 Allocation of Partial Prepayments..................... 31
---------------------------------
Section 8.4 Maturity; Surrender, etc.............................. 31
-------------------------
Section 8.5 Purchase of Notes..................................... 32
-----------------
Section 8.6 Certain Matters Relating to Repayments and Prepayments 32
------------------------------------------------------
9. AFFIRMATIVE COVENANTS..................................................... 33
Section 9.1 Maintenance of Office................................. 33
---------------------
Section 9.2 Records and Accounts.................................. 33
--------------------
Section 9.3 Corporate Existence; Maintenance of Licenses.......... 33
--------------------------------------------
Section 9.4 Maintenance of Properties............................. 34
-------------------------
Section 9.5 Insurance............................................. 35
---------
Section 9.6 Taxes................................................. 36
-----
Section 9.7 Compliance with Laws, Contracts, License, and Permits. 36
-----------------------------------------------------
Section 9.8 Further Assurances.................................... 37
------------------
Section 9.9 Authorization from Landlord/Mortgagee, Etc............ 37
------------------------------------------
Section 9.10 Attornment and Recognition Agreements................. 37
-------------------------------------
Section 9.11 Allocation Agreement.................................. 37
--------------------
Section 9.12 Certified Copies of Insurance Policies................ 38
--------------------------------------
Section 9.13 Access Agreements..................................... 38
-----------------
Section 9.14 Creation of License Subsidiary........................ 38
------------------------------
Section 9.15 Proceeds of Note Issuance............................. 38
-------------------------
Section 9.16 Book-Entry Form....................................... 39
---------------
Section 9.17 Notices to Clearing Agency............................ 40
--------------------------
</TABLE>
S-ii
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
10. NEGATIVE COVENANTS.........................................................40
Section 10.1 Restrictions on Indebtedness...........................40
----------------------------
Section 10.2 Liens..................................................42
-----
Section 10.3 Contingent Obligations.................................45
----------------------
Section 10.4 Restrictions on Investments............................45
---------------------------
Section 10.5 Distributions..........................................48
-------------
Section 10.6 Merger, Consolidation, Disposition of Assets, Etc......48
--------------------------------------------------
Section 10.7 Sale and Leaseback.....................................49
------------------
Section 10.8 Compliance with Environmental Laws.....................49
----------------------------------
Section 10.9 Employee Benefit Plans.................................50
----------------------
Section 10.10 Transactions with Affiliates...........................51
----------------------------
Section 10.11 Change in Nature of Business...........................52
----------------------------
Section 10.12 Charter Amendments.....................................52
------------------
Section 10.13 Accounting Changes.....................................52
------------------
Section 10.14 Prepayments, Etc., of Indebtedness.....................53
----------------------------------
Section 10.15 Amendment, Etc., of Material Contracts.................53
--------------------------------------
Section 10.16 Asset Swaps............................................53
-----------
Section 10.17 Certain Restrictions...................................54
--------------------
Section 10.18 No Additional Subsidiaries.............................54
--------------------------
Section 10.19 Financial Covenants....................................54
-------------------
11. EVENTS OF DEFAULT..........................................................59
Section 11.1 Events of Default and Acceleration.....................59
----------------------------------
12. REMEDIES ON DEFAULT, ETC...................................................63
Section 12.1 Acceleration...........................................63
------------
Section 12.2 Other Remedies.........................................64
--------------
Section 12.3 Rescission.............................................64
----------
Section 12.4 No Waivers or Election of Remedies, Expenses, etc......65
---------------------------------------------
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES..............................65
Section 13.1 Registration of Notes..................................65
---------------------
Section 13.2 Transfer and Exchange of Notes.........................66
------------------------------
Section 13.3 Replacement of Notes...................................66
--------------------
Section 13.4 Exchange of Notes for Loans............................67
---------------------------
14. PAYMENTS ON NOTES..........................................................67
Section 14.1 Place of Payment.......................................67
----------------
</TABLE>
S-iii
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
Section 14.2 Home Office Payment....................................68
-------------------
15. EXPENSES, ETC..............................................................68
Section 15.1 Transaction Expenses...................................68
--------------------
Section 15.2 Survival...............................................69
--------
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT...............69
17. AMENDMENT AND WAIVER.......................................................69
Section 17.2 Solicitation of Holders of Notes.......................70
--------------------------------
Section 17.3 Binding Effect, etc....................................71
--------------------
Section 17.4 Notes held by Company, etc.............................71
---------------------------
18. NOTICES....................................................................71
19. REPRODUCTION OF DOCUMENTS..................................................72
20. CONFIDENTIAL INFORMATION...................................................72
21. SUBSTITUTION OF PURCHASER..................................................74
22. MISCELLANEOUS..............................................................74
Severability.................................................................75
Construction.................................................................75
Section 1.3 Accounting Terms.......................................45
----------------
</TABLE>
S-iv
<PAGE>
FLOATING RATE SENIOR NOTES DUE FEBRUARY 17, 2006
This Note Purchase Agreement is made as of the 17th day of February, 1998
(this "Agreement"), by and among (a) OMNIPOINT COMMUNICATIONS INC. (the
"Company"), a Delaware corporation, (b) OMNIPOINT CORPORATION, a Delaware
corporation (the "Grand Parent"), for the purposes set forth herein, (c) IBJ
SCHRODER BANK & TRUST COMPANY and (d) the Purchasers set forth in Schedule A
hereto (the "Purchasers"). Certain capitalized terms used in this Agree ment
are defined in Schedule B; references to a "Section", "Schedule" or an "Exhibit"
are, unless otherwise specified, to a Section of this Agreement or to a Schedule
or an Exhibit attached to this Agreement.
1. AUTHORIZATION OF NOTES.
The Company has authorized the issue and sale of $155,000,000
aggregate principal amount of its Floating Rate Senior Notes due February 17,
2006 (the "NOTES", such term to include any such notes issued in substitution
therefor pursuant to Article 13 of this Agreement or in the form of Book-Entry
Notes pursuant to Section 9.16). The Notes shall be represented by the Book-
Entry Note substantially in the form set out in Exhibit 1, with such changes
therefrom, if any, as may be approved by the Purchasers and the Company.
2. SALE AND PURCHASE OF NOTES.
Subject to the terms and conditions of this Agreement, the Company
will issue and sell to each Purchaser and each Purchaser will purchase from the
Company, at the Closing provided for in Section 3, Notes in the principal amount
specified opposite such Purchaser's name in Schedule A at the purchase price of
100% of the principal amount thereof. Contemporaneously with entering into this
Agreement, the Company is entering into a separate Loan Agreement (the "Loan
Agreement") among the Company, as Borrower, Omnipoint Corporation, as Grand
Parent, the Lenders party thereto (the "Lenders"), DLJ Capital Funding, Inc., as
Syndication Agent, Goldman, Sachs Credit Partners L.P., as Documentation Agent,
Bank of America National Trust & Savings Association, as Administrative Agent,
and NationsBank, as Co-Agent, pursuant to which the Lenders will make
<PAGE>
loans at such Closing and thereafter to the Company in the aggregate principal
amount of $[595,000,000] (the "Loans"). The Purchasers' obligation hereunder and
the obliga tions of the Lenders under the Loan Agreement are several and not
joint obligations and no Purchaser shall have any obligation under the Loan
Agreement and no liability to any Person for the performance or non-performance
by any Lender thereunder. Each Purchaser's obligation hereunder is a several and
not a joint obligation, and no Purchaser shall have any obligation or liability
to any Person for the performance or non-performance by any other Purchaser
hereunder.
3. CLOSING.
The sale and purchase of the Notes to be purchased by the Purchasers
shall occur at the offices of Skadden, Arps, Slate, Meagher & Flom LLP, counsel
to the Syndication Agent, at 1440 New York Avenue, N.W., Washington, D.C.
20005, at a closing (the "Closing") on such Business Day as may be agreed upon
by the Company and the Purchasers (such date, the "Closing Date"). At the
Closing, (i) the Company will deliver the Book-Entry Note and a Company's Order
to the Paying Agent, as custodian for DTC and registered in the name of Cede &
Co., as nominee for DTC, and the Paying Agent will cause delivery of the Notes
represented by the Book-Entry Note by book-entry transfer in DTC for credit to
the account of each Purchaser indicated on Schedule A hereof and (ii) each
Purchaser shall pay, or cause the payment through the DTC of, immediately
available funds in the amount of the purchase price therefor by wire transfer of
immediately available funds for the account of the Paying Agent for further
credit to the account of the Company. If at the Closing the Company shall fail
to tender such Notes to the Purchasers as pro vided above in this Section 3, or
any of the conditions specified in Section 4 shall not have been fulfilled to
the Purchasers' satisfaction, each Purchaser shall, at its elec tion, be
relieved of all further obligations under this Agreement, without thereby
waiving any rights it may have by reason of such failure or such nonfulfillment.
4. CONDITIONS TO CLOSING.
Each Purchaser's obligation to purchase and pay for the Notes to be
sold to it at the Closing is subject to the fulfillment to its satisfaction,
prior to or at the Closing, of the following conditions:
2
<PAGE>
(a) Representations and Warranties. Each of the representations
------------------------------
and warranties of the Company and the other Omnipoint Entities contained in
this Agreement, the other Note Documents or in any document or instrument
delivered pursuant to or in connection with this Agreement shall be true as
of the Closing Date.
(b) No Default. No Default shall have occurred and be continuing
----------
as of the Closing Date.
(c) No Material Adverse Effect. No Material Adverse Effect shall
--------------------------
have occurred as of the Closing Date (other than continuing losses of the
Company materially in compliance with the projections provided pursuant to
the Full-Term Operating Business Plan).
(d) No Change in Law. No change shall have occurred in any law
----------------
or regulation or interpretations thereof that in the reasonable opinion of
any Purchaser would make it illegal for such Purchaser to purchase its
Notes and no order of any court or Governmental Body shall have been
entered prohibiting the consummation of the transactions contemplated by
the Note Documents.
(e) Note Documents. Each Purchaser shall, to the extent
--------------
requested prior to the Closing, have received a Definitive Note or a Book
Entry Note, duly executed and delivered by the Company, as well as each of
the other Note Documents, which shall have been duly executed and deliv
ered by the respective parties thereto, shall be in full force and effect
and shall be in form and substance satisfactory to each of the Purchasers
and their counsel.
(f) Proceedings and Documents. All corporate and other
-------------------------
proceedings in connection with the transactions contemplated hereby and by
the other Note Documents shall be satisfactory to each of the Purchasers
and their counsel, and each Purchaser shall have received such secretary's
certifi cates (including a certificate that the conditions under clauses
(a) and (b) of this Article 4 have been satisfied) , certificates of the
Secretary of State of the state of organization or incorporation of each
Omnipoint Note Party and other copies of documents with respect thereto as
it may reasonably request; provided, however, that any Purchaser may notify
-------- -------
the Company and the Grand Parent that such Purchaser elects not to receive
any or
3
<PAGE>
all material non-public documentation of the Omnipoint Entities (not
including the Confiden tial Memorandum referred to in Section 5.16)
without affecting the Com pany's compliance with this clause (f).
(g) Validity of Liens. The Collateral Documents shall be
-----------------
effective to create in favor of the Collateral Agent a legal, 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 Purchasers to protect, perfect
and preserve such security interests shall have been duly effected and all
such documents shall have been duly executed by the Company, Parent,
License Subsidiary, OHI and OIT, as applicable. The Purchasers shall have
received evidence thereof in form and substance satisfactory the
Purchasers.
(h) Search Reports and Related Documents. The Purchasers 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 Purchasers, disclosing that there are
no Liens (other than Permitted Liens) of record in such official's office
covering any Collateral or showing the Company, Parent, License Subsidiary,
OHI or OIT as a debtor there under;
(ii) a certificate of the Company, Parent, License Subsidiary,
OHI and OIT, 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) acknowledgment copies or duly executed file-stamped copies
of UCC-1 and UCC-3 financing statements with respect to the Collateral
filed in each office where such filing is necessary or appropriate to
perfect a Lien on the Collateral.
(i) Certificates of Insurance. The Collateral Agent shall have
-------------------------
received a certificate of insurance from an independent insurance
4
<PAGE>
broker naming the Collateral Agent as an additional insured and a loss
payee, 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, the Loan Agreement, this Agreement and the other Note
Agreements.
(j) Solvency Certificate. The Purchasers shall have received an
--------------------
officer's certificate of the Company and Grand Parent dated as of the
Closing Date as to the Company and each other Omnipoint Note Party being
Solvent following the consummation of the transactions contemplated herein
and in form and substance satisfactory to the Purchasers.
(k) Opinion of Counsel to Omnipoint Note Parties. Each of the
--------------------------------------------
Purchasers shall have received a favorable legal opinion of counsel to the
Omnipoint Note Parties addressed to the Purchasers, dated as of the Closing
Date, in form and substance satisfactory to the Purchasers.
(l) Opinion of FCC Counsel. Each of the Purchasers shall have
----------------------
received a favorable legal opinion addressed to the Purchasers from FCC
counsel to the Company and Parent, dated as of the Closing Date, in form
and substance satisfactory to the Purchasers.
(m) Payment of Fees. The Company shall have paid all fees and
---------------
expenses payable on the Closing Date by the Company or any other Omnipoint
Note Party, including, without limitation, all fees payable on the Closing
Date pursuant to Section 15.1.
(n) Approvals, Permits. The Company 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 Company to issue Notes hereunder and continue with the
construction and development of the New York PCS Network as contem plated
for the current stage of construction and development on the Closing Date
and operate its business pursuant to the Full Term Operating Business Plan,
and all such consents, approvals, Licenses and permits 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 applica ble in the judgment of the Purchasers that
5
<PAGE>
restrains, prevents or imposes materially adverse conditions upon the Notes
or the construction and develop ment of the New York PCS Network referred
to above or the operation of the Company's business pursuant to the Full
Term Operating Business Plan and the Purchasers shall receive a certificate
of an authorized officer of the Company to that effect dated the Closing
Date.
(o) Delivery of Operating Business Plans. The Company shall have
------------------------------------
delivered to the Purchasers (except that any Purchaser may decline receipt
by notice to the Company, in which case the Company shall not deliver the
following to such Purchaser):
(i) an Annual Operating Business Plan for its 1998 fiscal
year and
(ii) a Full-Term Operating Business Plan,
each of which shall be in form and substance satisfactory to the Purchasers,
together with a certificate of its chief or principal accounting or 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.
(p) Material Agreements. Subject to confidentiality restrictions
-------------------
in Section 20, the Purchasers shall have received (except that any
Purchaser may decline receipt by notice to the Company, in which case the
Company shall not deliver the following to such Purchaser) a complete and
correct copy, certified by an authorized officer of the Company, of (a) the
Expense Allocation Agreement and the Cash Management Agreement, in each
case as then in effect, and (b) each other contract set forth on Schedule
5.24 of the Loan Agreement, as such other contract is then in effect and as
to which any Purchaser shall have requested a copy on or before the Closing
Date.
(q) Litigation. There shall exist no action, suit, investiga
----------
tion, litigation or proceeding pending or threatened in any court or before
any arbitrator or governmental instrumentality that could in the reasonable
opinion of the Purchasers have a Material Adverse Effect.
6
<PAGE>
(r) Existing Bank Debt. The Purchasers shall have received
------------------
evidence satisfactory to them (i) that the proceeds of the Notes, together
with the proceeds of the Loans, shall repay in full all of the Existing
Bank Debt (including, without limitation, all fees payable pursuant to
Section 2.3 of the Existing Loan Agreement) and that all lenders of the
Existing Bank Debt shall have released (or shall, effective immediately
upon receipt of such proceeds, release) the Company from any and all
obligations under the Existing Bank Debt, (ii) that all commitments of the
lenders of such Existing Bank Debt to make loans or advances to the Company
shall be terminated on or prior to the Closing Date and (iii) that all
Liens securing obligations of the Company under the Existing Bank Debt
shall be released and terminated on or prior to the Closing Date (or shall,
effective immediately upon receipt of the proceeds of the initial Loan in
an amount sufficient to repay all amounts owing in respect of the Existing
Bank Debt, release and terminate all such Liens).
(s) Creation of OHI Subsidiary. The Company shall have caused
--------------------------
the establishment of a new Subsidiary of OHI (the "OHI Subsidiary") and
shall have taken all steps necessary to enable OHI to pledge its Capital
Stock in the OHI Subsidiary in favor of the Collateral Agent for the
benefit of the Secured Creditors under the Intercreditor Agreement pursuant
to the OHI Pledge Agreement.
(t) Title Insurance. The Purchasers shall have received a paid
---------------
policy of mortgage title insurance with respect to each parcel of Real
Estate to be subject to a Mortgage, in amount satisfactory to the
Purchasers and issued by a title insurance company satisfactory to the
Purchasers.
(u) Financial Statements. The Purchasers shall have received the
--------------------
audited financial statements of Grand Parent and its Subsidiaries and the
Company and its Subsidiaries for the fiscal year ending December 31, 1996
and the unaudited financial statements of Grand Parent and its Subsid
iaries and the Company and its Subsidiaries for the fiscal quarter ending
September 30, 1997.
(v) Environmental Matters. The Purchasers shall (i) be satisfied
---------------------
that no Omnipoint Note Party is subject to any Environmental Claim which
could have a Material Adverse Effect and (ii) have received an envi
ronmental audit report in form and substance satisfactory to the Purchasers
7
<PAGE>
prepared by an independent environmental consultant acceptable to the
Purchasers with respect to the Real Estate of the Company and its
Subsidiaries.
(w) Access Agreements. The Purchasers shall have received
-----------------
executed copies of the Access Agreements, which shall be in full force and
effect and the terms of which shall not have been waived, amended or
otherwise modified without the prior consent of the Purchasers.
(x) Subordination Agreements. The Purchasers shall have received
------------------------
executed Subordination Agreements subordinating to all Obligations all
Intercompany Indebtedness owed by the Company or any Guarantor, which
documentation shall be consistent with the terms and conditions of this
Agreement. The Holders shall have received documentation satisfactory to
it and the Required Secured Creditors that the Intercompany Indebtedness is
evidenced by notes and is "back to back" or otherwise documented to provide
the intended benefits to the Holders of such subordination.
(y) Consent Agent. The Purchasers shall have received a consent
-------------
letter from the C. T. Corporation System, presently located at 1633
Broadway, New York, New York 10019 (together with any successor thereto,
the "Consent Agent"), indicating its consent to its appointment as agent to
receive service of process on behalf of each of the Omnipoint Note Parties.
(z) CUSIP Number. A CUSIP number issued by Standard & Poor's
------------
CUSIP Service Bureau (in cooperation with the Securities Valuation Office
of the National Association of Insurance Commissioners) shall have been
obtained for the Notes.
(aa) Other Documents. Each Purchaser shall receive all other
---------------
documents, instruments and opinions from the Company and Grand Parent
(including opinions of counsel for the Company and Grand Parent) as each
Purchaser may reasonably request, in form and substance satisfactory to
each Purchaser and their counsel, and which shall be in full force and
effect on the Closing Date.
8
<PAGE>
(ab) Purchase Permitted By Applicable Law, etc. On the Closing
------------------------------------------
Date the purchase of Notes shall (i) be permitted by the laws and
-
regulations of each jurisdiction to which each Purchaser is subject,
without recourse to provisions (such as Section 1405(a)(8) of the New York
Insurance Law) permitting limited investments by insurance companies
without restric tion as to the character of the particular investment,
(ii) not violate any applicable law or regulation (including, without
--
limitation, Regulation G, T or X of the Board of Governors of the Federal
Reserve System) and (iii) not subject any Purchaser to any tax, penalty or
---
liability under or pursuant to any applicable law or regulation, which law
or regulation was not in effect on the date hereof. If requested by such
Purchaser, such Purchaser shall have received an Officer's Certificate
certifying as to such matters of fact as such Purchaser may reasonably
specify to enable it to determine whether such purchase is so permitted.
(ac) Loan Agreement. The Lenders under the Loan Agreement shall
--------------
have made the Tranche A Loans and the Tranche B Loans, or contemporaneously
with the purchase of the Senior Secured Notes shall make such Loans.
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
Each of Grand Parent and the Company represents and warrants to the
Purchasers as follows:
Section 5.1 Corporate Authority.
-------------------
(a) (i) Each Omnipoint Entity is identified on the
organizational chart attached as Schedule 5.1 to the Loan Agreement; is a
corporation (or other entity as indicated thereon) duly organized, validly
existing and in good standing under the laws of its state of incorporation
or organization; and its share or other ownership is as indicated thereon,
(ii) Each Omnipoint Note Party has all requisite corporate power
to own its Property and conduct its business as now conducted and as
presently contemplated, and
9
<PAGE>
(iii)Each Omnipoint Note Party 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 Note Documents to which any Omnipoint Note Party is or is to
become a party and the transactions contemplated hereby and thereby
(i) are within the corporate or other author ity of such
Omnipoint Note Party,
(ii) have been duly authorized by all neces sary corporate or
other proceedings,
(iii)do not conflict with or result in any breach or
contravention of any provision of material law, statute, rule or regulation
to which such Omnipoint Note Party is subject or any judgment, order, writ,
injunction, license (including without limita tion, any License) or permit
applicable to such Omnipoint Note Party or their Property, and
(iv) do not conflict with any provision of the corporate charter
or bylaws of, or any agreement or other instrument binding upon, such
Omnipoint Note Party or its Property.
(c) The execution and delivery of this Agreement and the other
Note Documents to which any Omnipoint Note Party is or is to become a party
will result in valid and legally binding obligations of such Omnipoint Note
Party enforceable against such Omnipoint Note Party 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.
10
<PAGE>
Section 5.2 Governmental Approvals. The execution, delivery and
----------------------
performance by each Omnipoint Note Party of this Agreement and the other Note
Documents to which such Omnipoint Note Party 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 Body other than those already
obtained and for any subsequent informational filing with the Securities and
Exchange Commission.
Section 5.3 Title to Properties. Each Omnipoint Note Party owns
-------------------
through one or more direct and indirect Subsidiaries all of the assets reflected
in the consolidated balance sheet of Grand Parent as at December 31, 1996 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 5.4 Financial Statements.
--------------------
(a) The Purchasers have been provided the audited consol idated
balance sheet of Grand Parent and its Subsidiaries and the Company and its
Subsidiaries, as at December 31, 1996, and the audited consolidated
statement of income and cash flow statement of Grand Parent and its Subsid
iaries and the Company and its Subsidiaries for the fiscal year then ended,
and such balance sheet and statement of income and cash flow have been
certified by Grand Parent's and the Company's respective independent certi
fied 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 Grand Parent and its Subsidiaries and the Company and its
Subsidiaries, respectively, as at the close of business as of such date and
the results of operations for the fiscal year then ended. There are no
Contingent Obligations of Grand Parent or its Subsidiaries or the Company
or its Subsid iaries as of such date involving material amounts, known to
the officers of Grand Parent or the Company, respectively, that were not
disclosed in such balance sheet and the notes related thereto.
(b) The Purchasers have been provided the unaudited consolidated
balance sheet of Grand Parent and its Subsidiaries and the
11
<PAGE>
Company and its Subsidiaries as of September 30, 1997, and the unaudited
consolidated statement of income and cash flow statement of Grand Parent
and its Subsidiaries and the Company and its Subsidiaries for the nine
months then ended. Such balance sheet and statement of income and cash flow
have been prepared in accordance with GAAP and fairly present the financial
condition of Grand Parent and its Subsidiaries and the Company and its
Subsidiaries, respectively, as at the close of business on the date thereof
and the results of operations for the nine months then ended, subject to
year-end adjustments. There are no Contingent Obligations of Grand Parent
or its Subsidiaries or the Company or its Subsidiaries as of such date
involving material amounts known to the officers of Grand Parent or the
Company, respectively, that were not disclosed in such balance sheet and
the notes related thereto.
Section 5.5 No Material Adverse Effect, Etc. Since December 31,
-------------------------------
1996, there has occurred no Material Adverse Effect (other than continuing
losses of the Company (x) as disclosed in the Company's unaudited consolidated
balance sheet and statement of cash flow delivered to the Administrative Agent
pursuant to Section 5.4(b) and (y) materially in compliance with such losses as
projected to continue in the Full-Term Operating Business Plan).
Section 5.6 Franchises, Patents, Copyrights, Etc. Except for the
------------------------------------
FCC Licenses for the New York PCS Network and the other Intellectual Property
set forth on Schedule 5.6 to the Loan Agreement, 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
Company's business as now conducted or as presently contemplated to be
conducted.
Section 5.7 License, Etc. The Company (or the License Subsid iary)
------------
has secured
(a) with respect to the construction, installation and
development of facilities for the New York PCS Network, the FCC Licenses
for the New York PCS Network 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
FCC Licenses for the New York PCS Network, and
12
<PAGE>
(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 FCC Licenses for the New York PCS Network nor any such material
Necessary Authorization is the subject of any pending or, to the best of any
Omnipoint Entity's knowledge, threatened appeal, revocation, revocation
proceeding or any other similar action or proceeding. The Company (or the
License Subsidiary, as the case may be) is in compliance with the FCC Licenses
for the New York PCS Network and all material Necessary Authorizations. The
Company (or the License Subsidiary, as the case may be) reasonably expects to
obtain, in the ordinary course of business, without the imposition of burdensome
conditions all Necessary Authorizations not currently obtained, that will be
required under the License in the future or that will be required to operate the
Company's or the License Subsidiary's business substantially in accordance with
the Full-Term Operating Business Plan.
Section 5.8 Litigation. There are no actions, suits, proceedings
----------
or investigations of any kind pending or, to the best of any Omnipoint Entity's
knowledge, threatened, against any Omnipoint Note Party 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 any Omnipoint Note
Party to carry on business substan tially as now conducted, or result in any
substantial and material liability not ade quately covered by insurance, or for
which adequate reserves are not maintained on the balance sheet of such
Omnipoint Note Party, or that questions the validity of this Agreement or any of
the other Note Documents, or any action taken or to be taken pursuant hereto or
thereto.
Section 5.9 Compliance with Other Instruments, Laws, Etc. No
--------------------------------------------
Omnipoint Note Party is 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 (including, without limitation, any License), rule or regulation, in any
of the forego ing cases in a manner that could result in the imposition of
substantial penalties or have a Material Adverse Effect.
13
<PAGE>
Section 5.10 Tax Status. Each Omnipoint Entity
----------
(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;
(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 for which such Omnipoint Entity has set aside on its books
adequate reserves; and
(c) has set aside on its books provisions reasonably adequate for
the payment of all taxes for all elapsed periods.
There are no unpaid taxes in any material amount claimed to be due by the taxing
authority of any jurisdiction, and the officers of each Omnipoint Entity know of
no basis for any such claim.
Section 5.11 No Default. No Default has occurred and is continu
----------
ing.
Section 5.12 Holding Company and Investment Company Acts. No
-------------------------------------------
Omnipoint Note Party is 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 5.13 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 any Omnipoint Note Party or any rights
relating thereto.
Section 5.14 FCC Matters. Each Omnipoint Note Party 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
14
<PAGE>
Material Adverse Effect and is in all material respects in compliance with the
Communica tions 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 5.15 Tariffs. No action to change, alter, rescind or other
-------
wise 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 any Omnipoint Note
Party to be under consideration.
Section 5.16 Disclosure. This Agreement, the Confidential Memo
----------
randum regarding the Notes, dated as of January, 1998, and the statements and
documents referred to herein or therein or delivered to the Purchasers by or on
behalf of any Omnipoint Entity 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.
Section 5.17 Burdensome Obligations. No Omnipoint Note Party is 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
Grand Parent or the Company, 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 such Omnipoint Note Party, or the
ability of such Omnipoint Note Party to perform obligations under the Note
Documents. No Omnipoint Note Party presently anticipates that future
expenditures by such Omnipoint Note Party 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 such Omnipoint Note Party.
Section 5.18 Solvency. Each Omnipoint Note Party is, and after
--------
giving effect to the incurrence of all Indebtedness as and when contemplated by
the Note Documents will be, Solvent.
Section 5.19 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
15
<PAGE>
that have priority under applicable law) in favor of the Collateral Agent for
the benefit of the Secured Creditors.
Section 5.20 Certain Transactions. Except as set forth in Schedule
--------------------
5.20 to the Loan Agreement, none of the officers, directors, or employees of any
Omnipoint Note Party is presently a party to any transaction with any other
Omnipoint Note Party (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 Omnipoint Note Party, 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 Company has delivered a complete and correct copy of
the Expense Allocation Agreement to each Purchaser. No Omnipoint Note Party is 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 Section 10.10.
Section 5.21 Employee Benefit Plans.
----------------------
(a) 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 the provisions
thereunder respecting prohibited transactions. Grand Parent, Company and
each ERISA Affiliate has made all required contributions to each Employee
Benefit Plan and each Multiemployer Plan. To the extent applicable, Grand
Parent, Company and each ERISA Affiliate has heretofore delivered to the
Purchasers the most recently completed annual report, Form 5500, with all
required attachments, and actuarial statements 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). Grand Parent or an ERISA Affiliate, as appropriate,
may terminate each such Plan at any time (or at any time
16
<PAGE>
subsequent to the expiration of any applicable bargaining agreement) in the
discretion of any of Grand Parent 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 Grand Parent or any ERISA Affiliate with respect to any Guaran
teed 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
Guaran teed Pension Plan by the PBGC. Neither Grand Parent 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 Guaran
teed 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 Grand Parent, the Company 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 Grand
Parent, the Company 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.
17
<PAGE>
Section 5.22 Regulations G, T, U and X. No portion of the proceeds
-------------------------
of any Note 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 G,
T, U and X of the Board of Governors of the Federal Reserve System, 12 C.F.R.
Parts 221 and 224.
Section 5.23 Environmental Compliance. Each Omnipoint Entity has
------------------------
taken all steps as are reasonable for companies in similar lines of business and
size with respect to similarly situated and like Real Estate to investigate the
past and present condition and usage of its and its Subsidiaries' Real Estate
and the operations conducted thereon and, based upon such diligent
investigation, makes the following representations:
(a) Except as set forth in the Current Phase I Audit and the
Action Letter, each Omnipoint Entity is, to the best of its knowledge, 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, to the best of its knowledge, threatened civil or criminal
litiga tion, written notice of violation, administrative proceeding, or
investigation, inquiry or information request by any person, entity or
governmental author ity relating to any applicable Environmental Law
(collectively "Environmen tal Claims") involving such Omnipoint Entity or
---------------------
any person or entity for whom an Omnipoint Entity may be responsible by law
or contract.
(b) Except as set forth in Schedule 5.23 to the Loan Agreement,
there are no past or present actions, activities, circumstances,
conditions, events or incidents, including, without limitation, the
release, emission, discharge, presence or disposal of any Material of
Environmental Concern, that could form the basis of any Environmental Claim
against the Company or, to the Company's best knowledge after due inquiry,
against any person or entity whose liability for any Environmental Claim
the Company has retained or assumed either contractually or by operation of
law.
(c) Set forth in Schedule 5.23 to the Loan Agreement is a list of
all environmental reports, investigations and audits relating to premises
currently or previously owned or operated by any Omnipoint Loan
18
<PAGE>
Party (whether conducted by or on behalf of any Omnipoint Loan Party or a
third party, and whether done at the initiative of any Omnipoint Loan Party
or directed by a governmental entity or other third party) which such
Omnipoint Loan Party 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 Purchasers.
(d) Each Omnipoint Entity has filed all reports and returns re quired
to be filed by such Omnipoint Entity under any applicable Environ mental
Laws. Each Omnipoint Entity has obtained and is in compliance with all
licenses, permits, registrations, certificates, consents, approvals or
authori zations (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 require, any
modification or termination of any Environmental Permit. No Omnipoint
Entity (i) has received any notice asserting the absence of any
Environmental Permit or (ii) has knowledge of any environmental law
proposed or under consideration, which, if effective, could have a Material
Adverse Effect.
(e) Except as set forth in the Current Phase I Audit and the Action
Letter, no Omnipoint Entity 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 govern
mental agency or the recording or delivery to other Persons of an environ
mental 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 5.24 Material Contracts. As of the date of this Agreement,
------------------
no Omnipoint Note Party is a party to any Material Contract or any agreement
with any director, officer or employee of any Omnipoint Note Party, and no
shareholder of any Omnipoint Note Party is a party to any shareholder, share-
voting or similar agreement relating to any Omnipoint Note Party, except as set
forth in Schedule 5.24 to the Loan Agreement.
Section 5.25 Payment of Existing Debt. After giving effect to the
------------------------
use of the proceeds of the Notes issued on the Closing Date, all obligations in
19
<PAGE>
respect of the Existing Bank Debt shall have been repaid in full and all
documents and agreements in connection therewith shall have been irrevocably
terminated, other than customary indemnification provisions which by the terms
thereof survive repayment.
Section 5.26 Private Offering by the Company. Neither the Com pany
-------------------------------
nor anyone acting on its behalf has offered the Notes or any similar securities
for sale to, or solicited any offer to buy any of the same from, or otherwise ap
proached or negotiated in respect thereof with, any person other than the
Purchasers and not more than 30 other Institutional Investors, each of which has
been offered the Notes at a private sale for investment. The Company shall not
have offered any other securities which offering could be integrated with the
placement of the Notes hereunder. Neither the Company nor anyone acting on its
behalf has taken, or will take, any action that would subject the issuance or
sale of the Notes to the registra tion requirements of Section 5 of the
Securities Act.
Section 5.27 Foreign Assets Control Regulations, etc. Neither the
----------------------------------------
sale of the Notes by the Company hereunder nor its use of the proceeds thereof
will violate the Trading with the Enemy Act, as amended, or any of the foreign
assets control regulations of the United States Treasury Department (31 CFR,
Subtitle B, Chapter V, as amended) or any enabling legislation or executive
order relating thereto.
6. REPRESENTATIONS OF THE PURCHASER.
Section 6.1 Purchase for Investment. Each Purchaser represents
-----------------------
that it has received all information necessary to make its investment decision
with respect to its purchase of the Notes and as it may have otherwise requested
(including without limitation the Confidential Memorandum referred to in Section
5.16) and that it is purchasing the Notes for its own account or for one or more
separate accounts maintained by it or for the account of one or more pension or
trust funds and not with a view to the distribution thereof except in accordance
with the Securi ties Act, provided that the disposition of such Purchaser's
--------
property shall at all times be within its control. Each Purchaser understands
that the Notes have not been registered under the Securities Act and may be
resold only if registered pursuant to the provisions of the Securities Act or if
an exemption from registration is available, except under circumstances where
neither such registration nor such an exemption is required by law, and that the
Company is not required to register the Notes under the Securities Act. Each
Purchaser represents that it is not
20
<PAGE>
an "affiliate" (as defined in Rule 144 under the Securities Act) of the Company,
it is not acting on behalf of the Company and it is a "Qualified Institutional
Buyer" within the meaning of Rule 144A promulgated under the Securities Act or
an institutional "Accredited Investor" within the meaning of Rule 501(a)(1),
(2), (3) or (7) promulgated under the Securities Act. Such acquisition will be
for its own account or for the account of another Qualified Institutional Buyer.
Section 6.2 Source of Funds. Each Purchaser represents that at
---------------
least one of the following statements is an accurate representation as to each
source of funds (a "Source") to be used by it to pay the purchase price of the
Notes to be purchased by it hereunder:
(a) if such Purchaser is an insurance company, the Source does
not include Plan assets allocated to any separate account maintained by
such Purchaser in which any employee benefit plan (or its related trust)
has any interest, other than a separate account that is maintained solely
in connec tion with such Purchaser's fixed contractual obligations under
which the amounts payable, or credited, to such plan and to any participant
or benefi ciary of such plan (including any annuitant) are not affected in
any manner by the investment performance of the separate account; or
(b) the Source is either (i) an insurance company pooled separate
account, within the meaning of Prohibited Transaction Exemption ("PTE") 90-
1 (issued January 29, 1990), or (ii) a bank collective investment fund,
within the meaning of the PTE 91-38 (issued July 12, 1991) and, except as
such Purchaser has disclosed to the Company in writing pursuant to this
paragraph (b), no employee benefit plan or group of plans maintained by the
same employer or employee organization beneficially owns more than 10% of
all assets allocated to such pooled separate account or collective
investment fund; or
(c) the Source constitutes assets of an "investment fund" (within
the meaning of Part V of the QPAM Exemption) managed by a "qualified
professional asset manager" or "QPAM" (within the meaning of Part V of the
QPAM Exemption), no employee benefit plan's assets that are included in
such investment fund, when combined with the assets of all other employee
benefit plans established or maintained by the same employer or by an
affiliate (within the meaning of Section V(c)(1) of the
21
<PAGE>
QPAM Exemption) of such employer or by the same employee organization and
managed by such QPAM, exceed 20% of the total client assets managed by such
QPAM, the conditions of Part I(c) and (g) of the QPAM Exemption are
satisfied, neither the QPAM nor a person controlling or controlled by the
QPAM (applying the definition of "control" in Section V(e) of the QPAM
Exemption) owns a 5% or more interest in the Company and (i) the identity
-
of such QPAM and (ii) the names of all employee benefit plans whose assets
--
are included in such investment fund have been disclosed to the Company in
writing pursuant to this paragraph (c); or
(d) the Source is a governmental plan; or
(e) the Source is one or more employee benefit plans, or a
separate account or trust fund comprised of one or more employee benefit
plans, each of which has been identified to the Company in writing pursuant
to this paragraph (e); or
(f) the Source does not include Plan assets of any em ployee
benefit plan, other than a plan exempt from the coverage of ERISA.
As used in this Section 6.2, the terms "EMPLOYEE BENEFIT PLAN", "GOVERNMENTAL
PLAN", "PARTY IN INTEREST" and "SEPARATE ACCOUNT" shall have the respective
meanings assigned to such terms in Section 3 of ERISA.
7. INFORMATION AS TO COMPANY.
Section 7.1 Financial and Business Information. Grand Parent or
----------------------------------
the Company, as appropriate, shall deliver or cause to be delivered to each
Holder the following:
(a) No later than 10 days after the end of each fiscal year of
the Company an Annual Operating Business Plan containing the informa tion
listed in items (i) through (vi) in this paragraph and the exhibits con
tained in the Annual Operating Business Plan delivered pursuant to clause
(o) of Article 4 for the next-succeeding fiscal year. The Annual Operating
Business Plan shall contain
22
<PAGE>
(i) internally prepared statements of in come and expense of the
Company in reasonable detail for the appli cable 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 the Company
needs to raise additional capital to meet its obligations when due during
the period,
(iv) a projected balance sheet of the Com pany,
(v) a projected cash flow statement of the Company, and
(vi) a statement listing all material assump tions which formed
the basis for all information provided pursuant to clauses (i) through (v),
each together with supporting schedules in sufficient detail as needed and
in all material aspects in accordance with the Annual Operating Business
Plan delivered pursuant to clause (o) of Article 4 and on a consistent
basis.
(b) No later than August 14 of each fiscal year of the Company, a
report, certified as true and correct by the chief or principal financial
or accounting officer of the Company, that shows in reasonable detail,
variances, if any, between the actual operating performance of the Company
and what was estimated for the first six months of such fiscal year in the
Annual Operating Business Plan for such fiscal year and explains in
reasonable detail in form satisfactory to the Required Secured Creditors
the reasons for the discrepancies between them, if any.
(c) (i) 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 Company, copies of the internally prepared unaudited
consolidated balance sheet of the Company, as at the end of such quarter,
and the related consolidated statement of income and statement of cash flow
23
<PAGE>
for the portion of the Company's fiscal year then elapsed, all in
reasonable detail and each setting forth in comparative form
(A) the figures for the prior year's corresponding fiscal
quarter and
(B) any variances from the Annual Operating Business Plan,
prepared in all material respects in accordance with GAAP, together with a
certifica tion by the principal financial or accounting officer of the Company
that the informa tion contained in such financial statements fairly presents
the financial position of the Company on the date thereof (subject to year-end
adjustments).
(ii) 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 Grand Parent, copies of the internally prepared unaudited
consolidated balance sheet of Grand Parent, as at the end of such quarter,
and the related consolidated statement of income and statement of cash flow
for the portion of Grand Parent's fiscal year then elapsed, all in
reasonable detail, prepared in all mate rial respects in accordance with
GAAP, together with a certification by the principal financial or
accounting officer of Grand Parent that the information contained in such
financial statements fairly presents the financial position of Grand Parent
on the date thereof (subject to normal year-end adjustments).
(d) (i) As soon as practicable, but in any event no later than
90 days after the end of each fiscal year (commencing with the fiscal year
ended December 31, 1997) of the Company, the audited consolidated balance
sheet of the Company as at the end of such year, and the related audited
consolidated statement of income and audited consolidated statement of cash
flow for such year prepared in accordance with GAAP, and a separate
variance analysis setting forth in comparative form the figures for the
previ ous fiscal year and any variances from the applicable period of the
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 satisfactory to the Holders, such satisfaction being
acknowledged
24
<PAGE>
by the execution of this Agreement, which report shall contain
an unqualified opinion of such accounting firm. The annual financial
statements shall also be accompanied by a management letter of the
Company's accountants (only to the extent otherwise obtained by the
Company).
(ii) As soon as practicable, but in any event no later than 90
days after the end of each fiscal year (commencing with the fiscal year
ended December 31, 1997) of Grand Parent, the audited consolidated balance
sheet of Grand Parent as at the end of such year, and the related audited
consolidated statement of income and audited consolidated statement of cash
flow for such year pre pared in accordance with GAAP. Such balance sheet
shall contain a certified audit report of a nationally recognized
independent certified public accounting firm satisfactory to the Holders,
such satisfaction being acknowledged by the execution of this Agreement,
which report shall contain an unqualified opinion of such accounting firm.
The annual financial statements shall also be accompanied by a manage ment
letter of Grand Parent's accountants (only to the extent otherwise obtained
by Grand Parent).
(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 Grand Parent or the Com pany,
as the case may be, substantially in the form of Exhibit D to the Loan
Agreement setting forth in reasonable detail computations evidencing compli
ance with the covenants contained in Section 10.19, 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
Company, a report on
(i) the number of cell sites constructed,
(ii) the total number of Subscribers,
(iii) the average net revenue per subscriber,
25
<PAGE>
(iv) payments to Parent, Grand Parent and other Affiliates of
Grand Parent, whether under the Expense Alloca tion Agreement or otherwise
and
(v) equity contributions to and Indebtedness incurred by the
Company or any of its Subsidiaries, and the Persons providing the same,
during such fiscal quarter, together with a report showing variances from the
esti mates previously provided to each Holder in the Annual Operating Business
Plan, 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
any Omnipoint Note Party;
(ii) information sent to the stockholders of any Omnipoint Note
Party or lenders to any Omnipoint Note Party (exclusive of proprietary
information); or
(iii) information and reports directly and materially related to
the Company 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 Exchange Act, if Parent or Grand Parent were public companies subject
to the reporting require ments of such Act; provided that, if the
--------
information or reports covered by this clause (iii) contain proprietary
information, the Company shall not be obligated to provide the proprietary
information hereunder unless the Person that is the source of the
information or reports is required to file periodic reports with the
Securities and Exchange Commission pursuant to the Exchange Act and such
Person would be required to report such information as part of such
filings.
(h) Within three Business Days after any director or officer of
any Omnipoint Note Party shall have knowledge of the occurrence
26
<PAGE>
and continuance thereof, written notice of the occurrence and continuance
of a Default, together with a statement of what action Grand Parent, the
Company or such Omnipoint Note Party 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 Agree ment or any other note, evidence of indebtedness,
indenture or other obliga tion to which or with respect to which any
Omnipoint Note Party 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 the documents governing
such indebtedness to accelerate such indebtedness, and such acceleration
would have a Material Adverse Effect, Grand Parent or the Company shall, or
shall cause such other Omnipoint Note Party to, forthwith give written
notice thereof to the Holders, describing the notice or action and the
nature of the claimed default.
(i) 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 any Omnipoint Note Party reports in
writing or is reportable by any Omnipoint Note Party 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 any Omnipoint Note Party shall become aware thereof,
written notice of any inquiry, proceeding, investigation, or other
action, including a notice from any agency of potential environ
mental liability, or any Federal, state or local environmental agency
or board, that, has the potential to (x) materially affect the assets,
liabilities, financial condition or operations of any Omnipoint Note
Party or the Liens and security interests for the benefit of the
Holders granted pursuant to the Collateral Documents or (y) result in
a Material Adverse Effect.
(j) As soon as possible, and in any event within 10 days after
the Grand Parent, Company or any ERISA Affiliate knows or has reason to
know or believes that any ERISA Affiliate knows or has reason to
27
<PAGE>
know or believes that any ERISA Event has occurred, a statement of the
chief finan cial officer of Grand Parent 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 Grand
Parent, Company or such ERISA Affiliate proposes to take with respect
thereto.
(k) 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 any Holder),
(ii) receipt or dispatch thereof, a copy of any notice, report or
demand sent or received in respect of a Guaran teed 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 imposi tion of a penalty under (S)
502(i) of ERISA or an excise tax under (S) 4975 against Company, Grand
Parent or an ERISA Affiliate; (B) any partial or complete withdrawal from a
Multiemployer Plan by any of Company, Grand Parent or an ERISA Affiliate;
(C) a failure by any of Company, Grand Parent 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.
(l) Within three Business Days after becoming aware of any
setoff, claims (including, with respect to the Real Estate, environmental
28
<PAGE>
claims), withholdings or other defenses to which any of the Collateral, or
the Holders' rights with respect to the Collateral, are subject, written
notice thereof.
(m) Within 10 days after becoming aware of
(i) any litigation or proceedings threatened in writing or any
pending litigation and proceedings affecting any Omnipoint Entity or to
which any Omnipoint Note Party is or be comes a party that could
reasonably be expected to have a Material Adverse Effect, written notice
thereof (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 any Omnipoint Note Party in an amount in excess of $1,000,000,
written notice thereof.
(n) Within 100 days after the end of each fiscal year of Grand
Parent, beginning with its fiscal year ended December 31, 2000, a report
that includes calculations showing in reasonable detail Grand Parent's
Excess Cash Flow for such fiscal year, if any, certified as correct by
Grand Parent's chief or principal accounting or financial officer.
(o) Within three Business Days after its receipt or dispatch
thereof, copies of all material notices and correspondence received from or
sent to the FCC relating to the New York PCS Network License.
(p) Not later than 30 days prior to the occurrence thereof,
written notice to the Holders of a change in (i) the business of any
Omnipoint Entity, (ii) the location of the Collateral (subject to the
provisions of the relevant Collateral Document), or (iii) the location
where any Omnipoint Note Party's books and records are kept.
(q) As may be reasonably requested by the Holders (but in no
event more frequently than once per year) an update of the Full-Term
Operating Plan, including projections of the Company's performance through
the Maturity Date.
29
<PAGE>
(r) Promptly upon request of any Holder, the Company shall
provide such holder, and any qualified institutional buyer designated by
such holder, such financial and other information (including, but not
limited to, copies of all Note Documents, as amended and of the most recent
financial statements delivered to the Holders pursuant to Section 7.1) as
is necessary in order to permit compliance with the information
requirements of Rule 144A(d)(4) under the Securities Act in connection with
the resale of Notes, except at such times as the Company is subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act. For
purposes of this paragraph, the term "qualified institutional buyer" shall
have the meaning specified in Rule 144A under the Securities Act.
(s) Such other information concerning its or any other Omnipoint
Note Party's business, operations or financial condition as shall be
reasonably requested by any Holder.
(t) Notwithstanding the delivery requirements of the Company and
the Grand Parent pursuant to this Section 7.1, any Holder may notify the
Company and the Grand Parent that such Purchaser elects not to receive any
or all material non-public documentation of the Omnipoint Entities referred
to in this Section 7.1 without affecting the Company's compliance with this
clause (f).
Section 7.2 Inspection of Properties and Books.
----------------------------------
(a) Grand Parent and the Company shall, and shall cause each
other Omnipoint Note Party to, permit the Holders and their other
designated representatives to visit and inspect any of the Properties of
the Omnipoint Note Parties, to examine the books of account of the
Omnipoint Note Parties (and to make copies thereof and extracts therefrom),
and to discuss the affairs, finances and accounts of the Omnipoint Note
Parties with, and to be advised as to the same by, its officers, all at
such reasonable times and intervals as any Holder may reasonably request.
(b) Grand Parent and the Company authorize each Holder to
communicate directly with Grand Parent's and the Company's independent
certified public accountants and authorizes such accountants to disclose to
the Holders any and all financial statements and other supporting financial
documents and schedules including copies of any management letter
30
<PAGE>
with respect to the business, financial condition and other affairs of
Grand Parent and the Company. At the reasonable request of the Required
Secured Credi tors, Grand Parent or the Company shall deliver a letter
addressed to such accountants instructing them to comply with the
provisions of this Section 7.2(b).
8. PREPAYMENT OF THE NOTES.
Section 8.1 Term/Amortization. The Company shall repay the
-----------------
outstanding principal amount of the Notes on the Initial Payment Date and each
Payment Date thereafter until (and including) the Maturity Date, in an amount
equal to the Installment Amount for each such date.
Section 8.2 Required Prepayments.
--------------------
(a) The Company shall prepay the outstanding Notes (and Loans in
accordance with Section 3.2 of the Loan Agreement) in an amount equal to
100% of the amount of the Net Cash Proceeds of a Permitted Asset Sale
(other than a sale described in clauses (i) and (ii) of the definition of
"Permitted Asset Sales") in excess of $5,000,000 from all such sales in the
aggregate to the extent such excess Net Cash Proceeds have not been rein
vested or otherwise applied in accordance with clause (iii) or (iv), as
applicable, of the definition of "Permitted Asset Sales."
(b) No later than 100 days after the end of any fiscal year
commencing on or after January 1, 2000 during which Grand Parent shall have
any Excess Cash Flow, the Company shall prepay the outstanding Notes (and
Loans in accordance with Section 3.2 of the Loan Agreement) in an amount
equal to 50% of such Excess Cash Flow.
(c) All prepayments of the Notes required by Section 8.2(a) and
(b) shall be applied against the Installment Amounts on a pro rata basis
among (i) all such Installment Amounts and (ii) Tranche A Amounts and
Tranche B Amounts.
Section 8.3 Optional Prepayments. (a) Subject to Section 8.3(b),
--------------------
upon provision of written notice to the Holders and the Lenders (in accordance
with Section 3.3 of the Loan Agreement), the Company shall have the right to
prepay the Notes and Loans in whole or in part from time to time in an aggregate
31
<PAGE>
principal amount of $5,000,000 or any integral multiple of $1,000,000 in excess
thereof, in accordance with Section 8.4.
(b) Any prepayment by the Company pursuant to Section 8.3(a)
shall be subject to a prepayment premium to be paid to the Holders
determined in accordance with the table set forth below (a "Prepayment
Premium") and payable at the time of such prepayment, which Prepayment
Premium shall not reduce the principal amount owed by the Company.
<TABLE>
<CAPTION>
Date of Prepayment Amount of Premium (percentage
amount multiplied by principal amount
From and To and to be repaid)
Including Including
- --------------------------------------------------------------------------------
<S> <C>
The Closing Date to the 6 month 4.00%
anniversary thereof
- --------------------------------------------------------------------------------
The day after the 6 month anniversary 3.00%
of the Closing Date to the 12 month
anniversary thereof
- --------------------------------------------------------------------------------
The day after the 12 month anniversary 2.00%
of the Closing Date to the 18 month
anniversary thereof
- --------------------------------------------------------------------------------
The day after the 18 month anniversary 1.50%
of the Closing Date to the 24 month
anniversary thereof
- --------------------------------------------------------------------------------
The day after the 24 month anniversary 0.50%
of the Closing Date to the 30 month
anniversary thereof
- --------------------------------------------------------------------------------
At any time after the 30 month 0.0%
anniversary of the Closing Date
- --------------------------------------------------------------------------------
</TABLE>
Section 8.4 Allocation of Partial Prepayments.
----------------------------------
In the case of each partial prepayment of the Notes, the principal
amount of the Notes to be prepaid shall be allocated among all of the Notes at
the
32
<PAGE>
time outstanding in proportion, as nearly as practicable, to the respective
unpaid principal amounts thereof not theretofore called for prepayment.
Section 8.5 Maturity; Surrender, etc.
-------------------------
In the case of each prepayment of Notes pursuant to this Article 8,
the principal amount of each Note to be prepaid shall mature and become due and
payable on the date fixed for such prepayment, together with interest on such
principal amount accrued to such date and the applicable Prepayment Premium, if
any. From and after such date, unless the Company shall fail to pay such
principal amount when so due and payable, together with the interest and
Prepayment Pre mium, if any, as aforesaid, interest on such principal amount
shall cease to accrue. Any Note paid or prepaid in full shall be surrendered to
the Company and cancelled and shall not be reissued, and no Note shall be issued
in lieu of any prepaid principal amount of any Note.
Section 8.6 Certain Matters Relating to Repayments and Prepayments.
-------------------------------------------------------
(a) All prepayments and repayments pursuant to this Article 8 shall be
accompanied by such additional amounts as are sufficient to pay accrued and
unpaid interest on the principal amount of the Notes then being prepaid or
repaid.
(b) All prepayments and repayments of outstanding Loans and Notes
shall be paid to the Lenders and Holders, respectively, on a pro rata basis
according to the sum of (i) aggregate outstanding principal amount of Loans
and Commitments owed to the Lenders (ratably among all Installment Amounts)
and (ii) amounts owing under the Notes to the Holders ratably according to
the aggregate outstanding principal amount of Notes owed to such Holders.
9. AFFIRMATIVE COVENANTS.
Each of Grand Parent and the Company covenants and agrees that, so long as
any Note is outstanding or any of the Obligations remain unsatisfied:
33
<PAGE>
Section 9.1 Maintenance of Office. Each Omnipoint Note Party's
---------------------
chief executive office shall be located at its address for notices specified in
Section 18, except that any Omnipoint Note Party may change its chief executive
office on not less than 30-days' advance written notice to the Holders and the
Paying Agent and after taking all such action as may be necessary or appropriate
or requested by the Required Secured Creditors to continue the perfection of the
Holder's security interest in the Collateral.
Section 9.2 Records and Accounts. Grand Parent and the Com pany
--------------------
shall, and shall cause the other Omnipoint Note Party to:
(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
amortiza tion of its Properties, contingencies and other reserves.
Section 9.3 Corporate Existence; Maintenance of Licenses.
--------------------------------------------
(a) Grand Parent and the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect its
corporate existence and shall cause the other Omnipoint Note Parties to do
or cause to be done all things necessary to preserve and keep in full force
and effect their existence. Grand Parent and/or the Company shall maintain
or cause to be maintained in full force and effect,
(b) with respect to the construction, installation and
development of facilities for the New York PCS Network, the FCC Licenses
for the New York PCS Network 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 require
ments under the FCC Licenses for the New York PCS Network, and
(c) 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
34
<PAGE>
Authorizations and other rights as are necessary and sufficient to operate
such completed portions.
Grand Parent and the Company will, and will cause the other Omnipoint Entities
to, at all times perform and observe all covenants and conditions on its part to
be performed and observed under FCC rules and regulations or with respect to the
FCC License for the New York PCS Network and not cause or permit to exist any
grounds for the FCC to revoke or suspend or not to renew such License.
Section 9.4 Maintenance of Properties. Grand Parent and the
-------------------------
Company shall, and shall cause the other Omnipoint Note Parties to, do or cause
to be done all things necessary to preserve and keep in full force and effect
its fran chises, employment contracts and permits. Each of Grand Parent and
the Company shall, and shall cause the other Omnipoint Note Parties to
(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 Grand Parent or the Company may be necessary so that the business
carried on in connection therewith may be properly and advantageously
conducted at all times;
(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, each Omnipoint Note Party shall not be required to do any of the
foregoing set forth in clauses (a) or (b) if any such requirement is no longer
desirable or necessary in the conduct of such Omnipoint Note Party's business
and no Material Adverse Effect could reasonably be expected to occur as a result
thereof.
35
<PAGE>
Section 9.5 Insurance. Grand Parent and the Company shall, and
---------
shall cause each other Omnipoint Note Party, to the extent such Omnipoint Note
Party owns applicable Properties, to, 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) be at least in such amounts and against at least such risks
as are customarily insured against by companies engaged in the same or a
similar business, which insurance shall in any event not provide for materi
ally less coverage than the insurance in effect on the Closing Date;
(b) with respect to all liability insurance (other than with
respect to the Property of Grand Parent), name the Collateral Agent for the
benefit of the Secured Creditors as an additional insured;
(c) with respect to casualty insurance (other than with respect
to Grand Parent), name the Collateral Agent as loss payee for the benefit
of the Secured Creditors as its interest may appear; and
(d) provide that the insurer will give the Holders 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 Company shall deliver to the Holders, no later than March 31 in each
calendar year and otherwise promptly on request by the Required Holders,
certificate(s) of insurance confirming compliance with the requirements of this
Section 9.5 and setting forth any deductibles applicable to any insurance
coverage.
Section 9.6 Taxes. Grand Parent and the Company shall, and shall
-----
cause each other Omnipoint Entity to, 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 FCC Licenses for the New York PCS
Network) 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 the relevant Omnipoint Entity has set
aside on its books adequate
36
<PAGE>
reserves with respect thereto; and provided further that each Omnipoint Entity
-------- -------
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 9.7 Compliance with Laws, Contracts, License, and Permits.
-----------------------------------------------------
Each of Grand Parent and the Company shall, and shall cause each other Omnipoint
Note Party to, 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;
(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 any Omnipoint Note Party may fulfill any of the Obligations
hereunder or under any of the other Note Documents to which such Omnipoint Note
Party is a party, Grand Parent and the Company shall, and cause each other
Omnipoint Note Party to, immediately take or cause to be taken all reasonable
steps within the power of Grand Parent, the Company or such other Omnipoint Note
Party to obtain such authoriza tion, consent, approval, permit or license and
furnish the Holders evidence thereof.
Section 9.8 Further Assurances.
------------------
(a) Grand Parent and the Company shall, and shall cause each other
Omnipoint Note Party to, cooperate with the Holders and shall execute and
pay for the filing of all such further instruments and documents,
37
<PAGE>
including UCC financing statements and other security documents, as the
Required Secured Creditors shall reasonably deem appropriate in order to
effectuate the grant of the Liens and security interests to the Collateral
Agent for the benefit of the Secured Creditors contemplated by the Note
Documents and to carry out to their satisfaction the transactions
contemplated by the Note Documents.
(b) If the Holders shall so request, Grand Parent and the Company
shall, and shall cause each other Omnipoint Note Party to, cooperate with
the Holders and shall execute, and pay all costs and expenses in connection
with, the establishment, execution and delivery of an indenture and related
documentation, as the Holders shall deem appropriate. The Company shall
elect a trustee in connection with any such indenture as may be reasonably
acceptable to the Required Secured Creditors.
(c) Promptly after the Closing Date, the Company and the Grand Parent
shall have filed with the Securities and Exchange Commission this Agreement
and the Loan Agreement as Form 8-K exhibits.
Section 9.9 Authorization from Landlord/Mortgagee, Etc. The
------------------------------------------
Company shall request that any landlord, mortgagee and easement grantor of the
Company agree to give the Collateral Agent, on a best-efforts basis, notice of
any default by the Company under the terms or conditions of any agreement
between the Company and any landlord, mortgagee of any such landlord or easement
grantor, and allow the Collateral Agent or any Holder to inspect or remove any
Property of the Company after the occurrence and continuance of an Event of
Default.
Section 9.10 Attornment and Recognition Agreements. The Company
-------------------------------------
shall obtain all attornment and recognition agreements from any landlord or
landlord's mortgagee of Real Estate leased or owned by the Company upon which
any Collateral (with a fair value in excess of $1,000,000) is stored or located,
in form and substance reasonably satisfactory to the Required Secured Creditors.
The Company shall use its best efforts to obtain all attornment and recognition
agree ments from any landlord or landlord's mortgagee of Real Estate leased or
owned by the Company upon which all other Collateral not covered by the
immediately preceding sentence is stored or located, in form and substance
reasonably satisfactory to Required Secured Creditors.
38
<PAGE>
Section 9.11 Allocation Agreement. The Company shall comply with
--------------------
the terms of the Expense Allocation Agreement and not consent to any waiver,
modification or amendment thereto.
Section 9.12 Certified Copies of Insurance Policies. Within 30
--------------------------------------
days after the Closing Date, the Company shall, to the extent not otherwise
delivered on the Closing Date pursuant to clause (t) of Article 4, deliver to
the Holders copies of all insurance policies that shall have been required to
have been delivered to the Purchasers by the Closing Date pursuant to clause (i)
of Article 4, certified by the applicable insurer(s).
Section 9.13 Access Agreements. Grand Parent and the Company shall
-----------------
comply with the provisions of the Access Agreements and shall ensure that the
Access Agreements remain in full force and effect during the term of this
Agreement.
Section 9.14 License Subsidiary. The Company agrees that it shall
------------------
(i) within 30 Business Days after the Closing Date, file all appropriate
applications and other regulatory filings necessary in order to transfer all of
the FCC Licences held by the Company to the License Subsidiary, which License
Subsidiary shall hold no other properties and assets other than such FCC
Licenses for the New York PCS Network and engage in no other business other than
holding such License and sublicensing such License to the Company pursuant to
the Operating Agreement, and (ii) use reasonable best efforts to effectuate such
transfer, by taking all reasonable actions as may be necessary, as promptly as
practical after the Closing Date. Upon creation of such License Subsidiary as
of the Closing Date, the License Subsidiary shall guaranty the Obligations of
the Company pursuant to the Subsidiary Guaranty, the License Subsidiary shall
enter into a security agreement substantially in the form of the Borrower
Security Agreement (except for provisions thereof relating to lockbox accounts),
and the Company shall grant a Lien on, and pledge of, all of the Capital Stock
(or membership interests) of the License Subsidiary owned by the Company
(representing 100% of the issued and outstanding Capital Stock or mem bership
interests of the License Subsidiary) to the Collateral Agent for the benefit of
the Secured Creditors, as security for the Obligations of the Company pursuant
to the Borrower Pledge Agreement, and the Company shall, and shall cause such
License Subsidiary to, provide authorizing resolutions, certified organizational
documents and opinions of counsel in connection with the foregoing, in each case
in form and substance reasonably satisfactory to the Required Holders.
39
<PAGE>
Section 9.15 Proceeds from Notes. (a) The Company shall maintain
--------------------
the proceeds from the Notes either (i) at OIT or (ii) in the account created
under the Borrower Securities Account Control Agreement, and in either case
shall cause the Collateral Agent for the benefit of the Secured Creditors to
have a first priority perfected security interest in such proceeds, until such
time as such proceeds are used for the purposes specified in clause (b).
(b) The proceeds of the Notes shall be available (and the Company
shall use such proceeds)
(i) with respect to the Tranche A Amounts (together with
Tranche A Loans under the Loan Agreement) only, to repay in full the
Existing Bank Debt on the Closing Date;
(ii) subject to Section 7.5 hereof, to make direct or indirect
(through another Subsidiary of Grand Parent) Distributions to Grand
Parent, so long as such Distributions are immediately invested in the
business of Grand Parent's Subsidiaries; and
(iii) for general corporate purposes of the Borrower and the
License Subsidiary;
provided that all proceeds not applied as specified under clauses (i), (ii) or
(iii) above shall, together with any remaining funded amounts under Tranche B
Loans, be held until used for the purposes described in clauses (ii) and (iii)
above, in a cash account of the Borrower pursuant to the Borrower Securities
Account Control Agreement.
Section 9.16 Book-Entry Form. As of the Closing Date, the Notes
---------------
shall be issued in the form of a single typewritten Note representing a Book-
Entry Note, and the Holders shall not receive a Definitive Note representing the
Holders' interest in such Note, except as provided in Section 9.18. Unless and
until Definitive Notes have been issued to the Holders pursuant to Section 9.18:
(a) the provisions of this Section 9.16 shall be in full force
and effect;
40
<PAGE>
(b) the Company may deal with the Clearing Agency for all
purposes (including the payment of principal of and interest on, or any
other amounts with respect to, the Book Entry Note) as the authorized
representative of such Holder;
(c) to the extent that the provisions of this Section 9.16
conflict with any other provisions of this Agreement, the provisions of
this Section 9.16 shall control;
(d) the rights of the Holders of such Note shall be exer cised
only through the Clearing Agency and shall be limited to those estab
lished by law and agreements between such Holders and the Clearing Agency
and/or the Clearing Agency Participants. Pursuant to the DTC Agreement,
unless and until Definitive Notes are issued pursuant to Section 9.18, the
initial Clearing Agency will make book-entry transfers among the Clearing
Agency Participants and receive and transmit payments of principal and
interest on, or any other amounts with respect to, the Notes to such
Clearing Agency Participants;
(e) whenever this Agreement requires or permits actions to be
taken based upon instruction or directions of the Required Holders, the
Clearing Agency shall be deemed to represent such percentage only to the
extent that it has received instructions to such effect from Holders and/or
Clearing Agency Participants owning or representing, respectively, such
required percentage of the beneficial interest in the Notes has delivered
such instructions to the Company.
Section 9.17 Notices to Clearing Agency. With respect to any Book-
--------------------------
Entry Note, whenever a notice or other communication to the Holders is required
under this Agreement, unless and until Definitive Notes shall have been issued
to Holders pursuant to Section 9.18, the Company shall give all such notices and
communications specified herein to be given to the Holders to the Clearing
Agency and the Paying Agent.
Section 9.18 Definitive Notes. With respect to any Book-Entry Note,
----------------
if (i)(A) the Company advises the Holders in writing that the Clearing Agency is
no longer willing or able to properly discharge its responsibilities under the
related DTC Agreement, and (B) the Company is unable to locate a qualified
successor, or (ii) after the occurrence of an Event of Default, the Required
Holders
41
<PAGE>
advise the Company and the Clearing Agency Participants in writing that the
continuation of a book-entry system the Clearing Agency is no longer in the best
interests of the Holders, then the Company shall notify all Holders and the
Paying Agent, through the Clearing Agency, of the occurrence of any such event
and of the availability of Definitive Notes to Holders requesting the same. Upon
surrender to the Company of the single typewritten Note representing the Book-
Entry Notes by the Clearing Agency, accompanied by registration instructions,
the Company shall issue the Definitive Notes in accordance with the instructions
of the Clearing Agency. Upon the issuance of Definitive Notes, the Company shall
recognize the Holders of the Definitive Notes as Holders.
Section 9.19 Registered Issue. In the event Notes are not issued as
----------------
Book-Entry Notes, and all of the Holders subsequently request that the Notes be
converted to Book-Entry Notes, the Company hereby agrees to take all steps neces
sary to so convert such Notes, including executing a Letter of Representation
with the Clearing Agency and paying any and all costs and expenses associated
with converting the Notes to Book-Entry Notes.
10. NEGATIVE COVENANTS.
Each of Grand Parent and the Company covenants and agrees that, so long as
any Note is outstanding or any of the Obligations remain unsatisfied:
Section 10. Restrictions on Indebtedness. Grand Parent and the
----------------------------
Company shall not, and shall not permit any other Omnipoint Entity to, create,
incur, assume, suffer to exist or otherwise become or remain directly or
indirectly liable with respect to, any Indebtedness, other than:
(i) Indebtedness hereunder and under the other Note Documents;
(ii) Indebtedness outstanding on the Closing Date and, with
respect to the Omnipoint Loan Parties, set forth on Schedule 7.1 to the
Loan Agreement (on a pro forma basis, after giving effect to the
refinancing, retirement and payment of amounts outstanding under the
Existing Loan Agreement);
(iii) Indebtedness permitted under Section 10.3;
42
<PAGE>
(iv) Additional Loans as permitted pursuant to Section 2.1(b) of
the Loan Agreement;
(v) Indebtedness of Grand Parent that is (i) unsecured or
secured solely by the assets of any one or more Non-Party Subsidiaries,
(ii) not guaranteed or supported by the Company or any Guarantor (other
than limited recourse guaranties by OHI secured by Liens permitted pursuant
to Section 10.2(x), (iii) on terms and conditions at least as favorable as
then prevailing "market terms" and (iv) the proceeds of which are used in
Grand Parent's and its Subsidiaries' telecommunications business.
(vi) Provided that the Holders have received a certificate of
the chief or principal accounting or financial officer of the Company to
the effect that no Default is in existence or would result therefrom,
Indebtedness of the Company (including vendor financing) secured on a pari
passu basis with the Notes (pursuant to an intercreditor arrangement to be
negotiated in good faith and with out unreasonable delay with the Secured
Creditors, providing sharing of the proceeds of collateral on a pro rata
basis similar to the Intercreditor Agreement, which arrangement shall be
satisfactory to the Required Secured Creditors);
(vii) So long as no Default is in existence or would result
therefrom, (A) Indebtedness secured in accordance with Section 10.2(vi),
(vii) and (viii), as applicable, incurred in the acquisition of Real Estate
capital lease obligations and (B) other purchase money financing, in an
aggregate amount (including any refinancing thereof pursuant to clause (x)
below) not to exceed $20,000,000;
(viii) Intercompany Indebtedness of the Guarantors on the terms
and conditions set forth herein;
(ix) Indebtedness of any Non-Party Subsidiary, so long as such
Indebtedness is not secured by any of the Collateral, and neither the
Company nor any Guarantor has any Contingent Obligations with respect to
such Indebtedness;
43
<PAGE>
(x) Indebtedness providing for the refinance, refunding, renewal or
replacement of Indebtedness incurred pursuant to clauses (v), (vi) and
(vii) above (so long as such Indebtedness could have been incurred under
such clauses (v), (vi) and (vii); provided that (i) any such Indebtedness
does not exceed the amount so refinanced, refunded, renewed or replaced
plus the amount of any premium, accrued interest, fees and other related
expenses incurred in connection with the consummation of any such
Indebtedness, (ii) the maturity date of such Indebtedness is no earlier
than the maturity date of such original Indebtedness; (iii) no collateral
is used to secure such Indebtedness other than the collateral pledged in
connection with such original Indebtedness; and (iv) if such refinancing,
refunding, renewal or replacement applies to the Company's FCC Indebtedness
and is incurred by a lender other than the FCC, such refinancing,
refunding, renewal or replacement and any Liens in connection therewith
shall not be senior in any respect to the position of the Secured
Creditors.
(xi) Indebtedness under the Loan Agreement; and
(xii) Indebtedness in respect of performance, surety or appeal bonds
provided in the ordinary course of business.
For purposes of determining compliance with this Section 10.1, in the event
that an item of Indebtedness meets the criteria of more than one of the types of
Indebtedness described in the above clauses, the Company, in its sole
discretion, shall classify such item of Indebtedness and only be required to
include the amount and type of such Indebtedness in one of such clauses.
Section 10.2 Liens. Grand Parent and the Company shall not, and
-----
shall not permit any other Omnipoint Entity to, create, incur, assume or suffer
to exist, directly or indirectly, any Lien on any of its property now owned or
hereafter acquired, other than the following (each a "Permitted Lien"):
(i) Liens existing on the Closing Date and, with respect to
the Omnipoint Loan Parties, set forth on Schedule 7.2 of the Loan
Agreement;
(ii) Liens for taxes not yet due or which are being contested
in good faith by appropriate proceedings diligently
44
<PAGE>
conducted and with respect to which adequate reserves are being maintained
in accordance with GAAP;
(iii) Statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and other Liens imposed by Law (other
than any Lien imposed by ERISA or pursuant to any Environmental Law)
created in the ordinary course of business for amounts not yet due or which
are being contested in good faith by appropriate proceedings diligently
conducted and with respect to which adequate reserves are being maintained
in accordance with GAAP;
(iv) Easements, rights-of-way, zoning and similar restrictions
and other similar charges or encumbrances not interfering with the ordinary
conduct of the business of the Omnipoint Entity subject thereto and which
do not detract materially from the value of the property to which they
attach or impair materially the use thereof by the Omnipoint Entity subject
thereto or materially ad versely affect the security interests of the
Collateral Agent for the benefit of the Secured Creditors;
(v) Liens granted to the Collateral Agent for the benefit of
the Secured Creditors pursuant to the Note Docu ments securing the
Obligations and Liens securing Indebtedness permitted under Section
10.1(iv) and (vi);
(vi) Purchase money security interests on any property acquired
or held by any Omnipoint Note Party in the ordinary course of business,
securing Indebtedness incurred or as sumed for the purpose of financing all
or any part of the cost of acquiring such property; provided that (i) any
such Lien attaches to such property concurrently with or within 20 days
after the acquisition thereof or such longer period as may be permitted
under the applicable Uniform Commercial Code, (ii) such Lien attaches
solely to the property so acquired in such transaction and (iii) the
principal amount of the debt secured thereby does not exceed the purchase
price of the asset so financed;
45
<PAGE>
(vii) Liens created pursuant to Capitalized Leases permitted
under this Agreement, provided that such Liens are only in respect of the
--------
property or assets subject to, and secure only, the respective Capitalized
Lease;
(viii) Mortgage (or deed of trust) Liens to secure the payment of
Indebtedness permitted to be incurred under Section 10.1(vii), provided
that the amount secured by any such Lien shall not exceed the sum of the
acquisition cost of the Real Estate acquired and the cost of any
improvements constructed thereon.
(ix) Liens on the Capital Stock of OTI and ODCI, and the
Intellectual Property of Grand Parent used by OTI and not required for the
operation of the business of any of the other Subsidiaries of Grand Parent,
so long as Grand Parent and has exe cuted and complied with the Access
Agreements;
(x) Liens on the notes made payable by Non-Party Subsidiaries
evidencing the Intercompany Indebtedness owed to OHI;
(xi) Liens on the assets of Non-Party Sub sidiaries;
(xii) Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensa tion, unemployment insurance
and other types of social security;
(xiii) Liens incurred or deposits made to secure the performance
of tenders, bids, leases, statutory or regulatory obligations, bankers'
acceptances, surety and appeal bonds, govern ment contracts, performance
and return of money bonds and other obligations of a similar nature
incurred in the ordinary course of business (exclusive of obligations for
the payment of borrowed money);
(xiv) Liens (including extensions and renew als thereof) upon
real or personal property; provided that such Liens
46
<PAGE>
are created solely for the purpose of securing Indebtedness incurred in
accordance with Section 10.1(x) to refinance refund, renew or replace any
such Indebtedness previously so secured; and provided further that such
Liens were in existence prior to such refinancing;
(xv) Liens arising from filing Uniform Commercial Code
financing statements regarding leases permitted hereunder;
(xvi) Liens arising from the rendering of a final judgment or
order against any Omnipoint Entity that do not give rise to an Event of
Default; and
(xvii) Liens in connection with the Loan Agreement.
Section 10.3 Contingent Obligations. Grand Parent and the Company
----------------------
shall not, and shall not permit any other Omnipoint Entity to, create, incur,
assume, suffer to exist or become or be liable with respect to any Contingent
Obliga tion, except:
(i) Contingent Obligations for the benefit of the Secured
Creditors under the Intercreditor Agreement pursuant to the Collateral
Documents securing or supporting the Obligations, including Indebtedness
permitted under Section 10.1(iv), (vi) and (xi);
(ii) Contingent Obligations which are in existence on the
Closing Date and, with respect to the Omnipoint Loan Parties, which are set
forth on Schedule 7.3 to the Loan Agreement;
(iii) Grand Parent may provide unsecured guarantees of
Indebtedness of its Subsidiaries permitted hereunder;
(iv) Contingent Obligations of the Omnipoint Entities
constituting Indebtedness permitted under Section 10.1; and
47
<PAGE>
(v) Any commitments provided by Grand Parent in favor of any
of its Subsidiaries to make any Investments in any such Subsidiaries
permitted under Section 10.4.
Section 10.4 Restrictions on Investments. Grand Parent and the
---------------------------
Company shall not, and shall not permit any other Omnipoint Entity to, 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 Company 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 thereof, 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
(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 Section 10.4(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, rated AA or better by Standard & Poor's Ratings
Group
48
<PAGE>
or AA or better by Moody's Investors Service, Inc., or (ii) issued by any
Holder;
(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 (other than loans and advances to officers,
directors and employees to be used to exercise options with respect to the
Grand Parent's stock) not to exceed $5,000,000 in the aggregate outstanding
at any time 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 Omnipoint
Entities;
(g) Investments existing on the date hereof and listed on
Schedule 7.4 to the Loan Agreement; and
(h) Investments in the License Subsidiary by the Company
consisting of (x) all FCC Licenses held by the Company, (y) a capital
contribution in an aggregate amount not to exceed $100,000 (including any
previous contribution in connection therewith) in connection with the
organization thereof and (z) capital contributions to the License
Subsidiary to the extent necessary to service scheduled principal and
amortization of the Indebtedness owed to the FCC;
(i) Provided that no Default is in existence (except with regard
to Post Default Investments) or would result therefrom, Investments by
Grand Parent and any of its directly or indirectly owned Subsidiaries; pro
vided that Investments in indirectly owned Subsidiaries shall be made by
way of a direct Investment in either OHI or Parent, which in turn may make
corresponding Investments in any of OHI's or Parent's respective
Subsidiaries;
(j) Investments by Grand Parent or the Company in OHI (and the
corresponding Investment by OHI) which are earmarked for Investments by
OHI in joint ventures with other Persons in an amount not to exceed
$50,000,000 at any one time; provided that such amount shall be
49
<PAGE>
increased by an amount equal to 50% of the cumulative Net Cash Proceeds of
any and all equity capital raised by Grand Parent from and after the
Closing Date through and including any such date of determination, up to a
limit of $200,000,000 less any previous Investments in joint ventures
pursuant to this clause (j) which subsequently become Subsidiaries of Grand
Parent and are in substan tially the same line of business as any one or
more Omnipoint Entities; provided further that such $200,000,000 limit
shall not apply at any time after which EBITDA for the previous 12
consecutive months exceeds $50,000,000;
(k) Transfers of assets of a Non-Party Subsidiary to another
Omnipoint Entity;
(l) Loans or advances to Grand Parent by another Omnipoint Entity
used for the purposes set forth in Section 10.5; and
(m) Seller take-back financing with respect to any dispositions
of assets of any Omnipoint Entity permitted pursuant to Section 10.6
hereof.
Section 10.5 Distributions. Grand Parent and the Company shall not,
-------------
and shall not permit any other Omnipoint Entity to, make any Distributions,
except that, (a) any Non-Party Subsidiary may make Distributions to any
Omnipoint Entity, and (b) provided that the Holders have received a certificate
of the chief or principal accounting or financial officer of the Company to the
effect that no Default under Section 10.19(e) or otherwise is in existence or
would result therefrom, (x) OIT may make distributions to Grand Parent in
respect of Investments by Grand Parent in OIT and (y) the Company and the
Guarantors may make Distributions to Guarantors, and Guarantors may make
corresponding Distributions to Grand Parent (or to OIT for immediate
distribution to Grand Parent) to (i) repay or prepay principal in respect of
Intercompany Indebtedness owing to Grand Parent or any other Omnipoint Note
Party and to pay current interest as and when due in respect of such
Indebtedness, (ii) pay interest on other Indebtedness of Grand Parent, (iii)
make Investments in Subsidiaries of Grand Parent permitted hereunder or repay or
prepay any Indebtedness of Grand Parent to any of its Subsidiaries, or (iii)
prepay (whether optional or mandatory), repurchase, redeem or make scheduled
payments of principal on, the Cap Re Notes.
50
<PAGE>
Section 10.6 Merger, Consolidation, Disposition of Assets, Etc.
-------------------------------------------------
(a) Grand Parent and the Company shall not, and shall not permit
any other Omnipoint Entity to, be a party to any merger or consolidation,
unless (i) the surviving entity is a United States corporation controlled
directly or indirectly by Grand Parent, (ii) no Default is in existence or
would arise immediately after giving effect to such merger or
consolidation, (iii) with respect to any merger or consolidation of any
Omnipoint Note Party, the surviving entity executes and delivers an
assignment and assumption agreement satisfactory to the Required Secured
Creditors and (iv) immediately after giving effect to such transaction, on
a pro forma basis, the consolidated net worth of the Person formed by or
surviving any such consolidation or merger, or to which such sale,
assignment, transfer, lease, conveyance or other disposition will have been
made, will be at least equal to the consolidated net worth of the Omnipoint
Entity prior to such transaction; provided that any Omnipoint Entity (other
than an Omnipoint Note Party) may consolidate with, merge into, sell,
convey, transfer, lease or otherwise dispose of all or part of its Property
to another Omnipoint Entity (other than an Omnipoint Note Party).
(b) Grand Parent and the Company shall not, and shall not permit
any other Omnipoint Entity to, become a party to or agree to or effect any
disposition of assets, other than (i) Permitted Asset Sales, (ii)
dispositions as permitted in accordance with Section 10.16 hereof, (iii)
Permitted C-Block FCC License Transfers and (iv) permitted Investments in
accordance with Section 10.4(k) hereof; provided that nothing contained
herein shall prohibit the issuance and sale of the Capital Stock of Grand
Parent, OHI or any Non Party Subsidiary.
Section 10.7 Sale and Leaseback. Grand Parent and the Company shall
------------------
not, and shall not permit any other Omnipoint Entity to, enter into any arrange
ment, directly or indirectly, whereby such Omnipoint Entity shall sell or
transfer any Property owned by it in order then or thereafter to lease such
Property or lease other property that it intends to use for substantially the
same purpose as the Property being sold or transferred.
Section 10.8 Compliance with Environmental Laws. Except as set
----------------------------------
forth in the Current Phase I Audit and the Action Letter, Grand Parent and the
Company shall not, and shall not permit any other Omnipoint Entity to,
51
<PAGE>
(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 applicable 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 applicable Environmental
Laws;
(c) generate any Materials of Environmental Concern on any of the
Real Estate, except in compliance with applicable 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 applicable Environmental Laws; or
(e) otherwise conduct any activity at any Real Estate, except in
compliance with applicable Environmental Laws, or use any Real Estate in
any manner that would violate any applicable Environmental Law or bring
such Real Estate in violation of any Environmental Law.
Section 10.9 Employee Benefit Plans. Neither Grand Parent, Company
----------------------
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 Company;
(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
52
<PAGE>
which, could result in the imposition of a lien or encumbrance on the
assets of the Company pursuant to (S) 302(f) or (S) 4068 of ERISA;
(d) permit or take any action which would result in the aggregate
benefit liabilities (within 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
Grand Parent 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 Grand Parent 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 Grand Parent or an ERISA
Affiliate.
Section 10.10 Transactions with Affiliates. Grand Parent and the
----------------------------
Company shall not, and shall not permit any other Omnipoint Entity to, enter
into any transaction or series of related transactions, whether or not in the
ordinary course of business, with any Affiliate, other than those (i) in
existence on the date hereof and with respect to the Omnipoint Note Parties set
forth on Schedule 7.10 to the Loan Agreement or (ii) on terms and conditions
substantially as favorable to such Omnipoint Entity as would be obtainable at
the time in a comparable arm's-length transaction with a Person other than an
Affiliate (provided that agreements substan tially similar to those listed on
Schedule 7.10 to the Loan Agreement shall be deemed permitted pursuant to this
Section 10.10) or (iii) on the terms and conditions substan tially as set forth
in forms attached to the Loan
53
<PAGE>
Agreement as the Cash Management Agreement, the Operating Agreement and the
Services Agreement (provided that with regard to the Services Agreement, the
amount of compensation shall be subject to the review and approval of the
Required Holders in accordance with clause (i) above, which approval shall not
be unreasonably withheld, delayed or conditioned) or (iv) the payment of
reasonable and customary fees to directors of an Omnipoint Entity who are not
employees of such Omnipoint Entity and any employment agreement entered into by
such Omnipoint Entity in the ordinary course of business.
Section 10.11 Change in Nature of Business.
----------------------------
(a) Grand Parent and the Company shall not, and shall not permit
any other Omnipoint Entity to, make any fundamental change in its business
as carried on and as proposed to be carried on at the date hereof
(b) Grand Parent and the Company shall not, and shall not permit
OHI or Parent to, conduct any business other than holding the Capital Stock
of its Subsidiaries now or hereafter existing and the other activities
currently conducted by it and associated with its status as a holding
company and, with respect to OHI, making loans and Investment in and to its
Subsidiaries.
(c) Grand Parent and the Company shall not permit OII or OIT to
conduct any business other than cash management and related activities.
(d) Grand Parent and the Company shall not permit the License
Subsidiary to conduct any business other than the holding of the FCC
Licenses for the New York PCS Network and the licensing thereof to the
Company.
Section 10.12 Charter Amendments. Grand Parent and the Company shall
------------------
not, and shall not permit any other Omnipoint Entity to, amend its certificate
of incorporation or bylaws in any manner adverse to the Lenders except as may be
necessary to comply with applicable law. Grand Parent and the Company shall
not, and shall not permit any other Omnipoint Entity to, amend its limited
liability company agreement, operating agreement or other organizational
documents in any manner adverse to the Holders except as may be necessary to
comply with applicable law.
54
<PAGE>
Section 10.13 Accounting Changes. Grand Parent and the Company shall
------------------
not, and shall not permit any other Omnipoint Entity to, make or permit any
change in accounting policies or reporting practices, except as required by
GAAP, or any change in its fiscal year.
Section 10.14 Prepayments, Etc., of Indebtedness. Grand Parent and
----------------------------------
the Company shall not, and shall not permit any other Omnipoint Note Party
(other than Grand Parent) 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
such Omnipoint Note Party (except that Grand Parent may prepay (whether optional
or mandatory) any Indebtedness, owing by it or any of its Non-Party
Subsidiaries, so long as (in the case of a voluntary prepayment) no payment
default exists at the Company under this Agreement or the Loan Agreement), other
than the prepayment of the Notes in accordance with the terms of this Agreement,
the Intercreditor Agreement or as the Required Secured Creditors may otherwise
agree; provided that the foregoing shall not apply to (i) Indebtedness owing to
the FCC; (ii) prepayment of Intercompany Indebtedness to the extent the proceeds
of Distributions may be used in compliance with Section 10.5 and prepayments of
Intercompany Indebtedness existing as of the Closing Date; and (iii)
notwithstanding anything contained in this Section 7.14, Grand Parent may
refinance the Senior Notes provided that such refinancing (x) is unsecured and
is not guaranteed or supported by the Company or any Guarantor, (y) does not
have a maturity date prior to the maturity date of the Senior Notes or any
mandatory amortization provisions more favorable to the lenders thereunder than
those con tained in the Senior Notes and (z) is on terms no more restrictive in
any material respect to Grand Parent or any Affiliate of Grand Parent than the
terms of this Agreement are to Grand Parent or the applicable Affiliate.
Section 10.15 Amendment, Etc., of Material Contracts. Grand Parent
--------------------------------------
and the Company shall not, and shall not permit any other Omnipoint Entity to,
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,
55
<PAGE>
could, at the time thereof, reasonably be expected to have a Material Adverse
Effect on any Omnipoint Note Party.
Section 10.16 Asset Swaps. Grand Parent and the Company shall not,
-----------
and shall not permit any other Omnipoint Entity to, enter into any agreement for
or effect the exchange of its telecommunication assets for the telecommunication
assets of another Person, unless (i) such Omnipoint Entity receives like
telecommunication assets of a fair market value at least equal to the
telecommunication assets it disposes of, as appraised by an independent third
party appraiser acceptable to the Required Holders, and (ii) no Default is in
existence or would result therefrom; provided that no such swap may be made of
any material License of any Omnipoint Note Party.
Section 10.17 Certain Restrictions. Grand Parent and the Company
--------------------
shall not, and shall not permit any other (i) Omnipoint Note Party to, enter
into any agreement (other than the Note Documents and the other agreements set
forth on Schedule 7.17 to the Loan Agreement) which restricts the ability of
such Omnipoint Note Party to enter into amendments, modifications or waivers of
the Note Documents or (ii) any Non-Party Subsidiary to, enter into any agreement
(other than the Note Documents and the other agreements set forth on Schedule
7.17 to the Loan Agreement) which contains (a) covenants exclusively with
respect to the Company which are more restrictive than the Senior Notes or (b)
any other provisions which prohibit or restrict the Company from making any
payment or prepayment under this Agreement or the Loan Agreement.
Section 10.18 No Additional Subsidiaries. The Company shall not form
--------------------------
or acquire any new Subsidiaries, other than the License Subsidiary.
Section 10.19 Financial Covenants.
-------------------
(a) Minimum Subscribers. The Company shall not have fewer
-------------------
Subscribers as of each of the dates indicated below than the number
indicated below opposite each such date:
<TABLE>
<CAPTION>
Date Number of Subscribers
- -------------------- ---------------------
<S> <C>
March 31, 1998 121,000
June 30, 1998 152,000
</TABLE>
56
<PAGE>
<TABLE>
<S> <C>
September 30, 1998 183,000
December 31, 1998 242,000
March 31, 1999 259,000
June 30, 1999 291,000
September 30, 1999 330,000
December 31, 1999 364,000
March 31, 2000 364,000
June 30, 2000 364,000
September 30, 2000 364,000
December 31, 2000 511,000
March 31, 2001 511,000
June 30, 2001 511,000
September 30, 2001 511,000
December 31, 2001 636,000
March 31, 2002 636,000
June 30, 2002 636,000
September 30, 2002 636,000
December 31, 2002 781,000
March 31, 2003 781,000
June 30, 2003 781,000
September 30, 2003 781,000
December 31, 2003 909,000
March 31, 2004 909,000
June 30, 2004 909,000
September 30, 2004 909,000
December 31, 2004 1,015,000
March 31, 2005 1,015,000
June 30, 2005 1,015,000
September 30, 2005 1,015,000
December 31, 2005 1,106,000
</TABLE>
57
<PAGE>
(b) Minimum Revenues. The Company shall not permit its Revenues
----------------
for each of the periods indicated below (tested as of the end of the
relevant fiscal period) to be less than the amount indicated below opposite
each such period:
<TABLE>
<CAPTION>
Period Revenues
------ ------------
<S> <C>
Three months ended March 31, 1998 $18,800,000
Six months ended June 30, 1998 $40,200,000
Nine months ended September 30, 1998 $66,600,000
Twelve months ended December 31, 1998 $101,000,000
Twelve months ended March 31, 1999 $123,000,000
Twelve months ended June 30, 1999 $145,900,000
Twelve months ended September 30, 1999 $169,300,000
Twelve months ended December 31, 1999 $188,100,000
Twelve months ended March 31, 2000 $188,100,000
Twelve months ended June 30, 2000 $188,100,000
Twelve months ended September 30, 2000 $188,100,000
Twelve months ended December 31, 2000 $262,300,000
Twelve months ended March 31, 2001 $262,300,000
Twelve months ended June 30, 2001 $262,300,000
Twelve months ended September 30, 2001 $263,300,000
Twelve months ended December 31, 2001 $360,200,000
Twelve months ended March 31, 2002 $360,200,000
Twelve months ended June 30, 2002 $360,200,000
Twelve months ended September 30, 2002 $360,200,000
Twelve months ended December 31, 2002 $461,900,000
Twelve months ended March 31, 2003 $461,900,000
Twelve months ended June 30, 2003 $461,900,000
Twelve months ended September 30, 2003 $461,900,000
Twelve months ended December 31, 2003 $553,400,000
Twelve months ended March 31, 2004 $553,400,000
</TABLE>
58
<PAGE>
<TABLE>
<CAPTION>
Period Revenues
------ ------------
<S> <C>
Twelve months ended June 30, 2004 $553,400,000
Twelve months ended September 30, 2004 $553,400,000
Twelve months ended December 31, 2004 $630,800,000
Twelve months ended March 31, 2005 $630,800,000
Twelve months ended June 30, 2005 $630,800,000
Twelve months ended September 30, 2005 $630,800,000
Twelve months ended December 31, 2005 $695,200,000
and thereafter the twelve month period
ending on the last day of each fiscal quar-
ter
</TABLE>
(c) Leverage Ratio. (i) The Company shall not permit the ratio
---------------
of Total Covenant Indebtedness to Adjusted Annualized EBITDA to exceed at
any time, during any of the periods indicated below, the ratio set forth
below opposite such period:
<TABLE>
<CAPTION>
Date Ratio
---- -----
<S> <C>
Closing Date to September 30, 1999 11.8
October 1, 1999 to December 31, 1999 10.0
January 1, 2000 to March 31, 2000 10.0
April 1, 2000 to June 30, 2000 9.0
July 1, 2000 to September 30, 2000 6.5
October 1, 2000 to December 31, 2000 5.9
</TABLE>
(ii) The Company shall not permit the ratio of Total Covenant Indebtedness to
EBITDA for the previous consecu tive twelve months to exceed at any time, during
any of the periods indicated below, the ratio set forth below opposite such
date:
<TABLE>
<CAPTION>
Period Ratio
------ -----
<S> <C>
(from and including, to and including)
January 1, 2001 to March 31, 2001 18.0
April 1, 2001 to June 30, 2001 16.0
July 1, 2001 to September 30, 2001 14.0
</TABLE>
59
<PAGE>
<TABLE>
<CAPTION>
Period Ratio
------ -----
<S> <C>
October 1, 2001 to December 31, 2001 11.2
January 1, 2002 to March 31, 2002 11.2
April 1, 2002 to June 30, 2002 11.2
July 1, 2002 to September 30, 2002 11.2
October 1, 2002 to December 31, 2002 6.5
January 1, 2003 to March 31, 2003 6.5
April 1, 2003 to June 30, 2003 6.5
July 1, 2003 to September 30, 2003 6.5
October 1, 2003 to December 31, 2003 4.7
January 1, 2004 to March 31, 2004 4.7
April 1, 2004 to June 30, 2004 4.7
July 1, 2004 to September 30, 2004 4.7
October 1, 2004 and thereafter 4.0
</TABLE>
(d) Fixed Charge Ratio. The Company shall not permit the ratio
------------------
of EBITDA for the previous consecutive twelve months to Fixed Charges at
any time during any of the periods set forth below to be less than the
ratio set forth below with respect to such period.
<TABLE>
<CAPTION>
Period Ratio
------ -----
(from and including, to and including)
<S> <C>
October 1, 2001 to September 30, 2002 0.6
October 1, 2002 to September 30, 2003 1.1
October 1, 2003 to September 30, 2004 1.4
October 1, 2004 to September 30, 2005 1.6
October 1, 2005 to the Maturity Date 1.8
</TABLE>
(e) Total Covenant Indebtedness to Book Capitalization. The
--------------------------------------------------
Company shall not, at any time, permit the ratio of (i) Total Covenant
Indebtedness minus Unrestricted Cash pledged to the Collateral Agent for the
benefit of the Secured Creditors under the Intercreditor Agreement and held by
the Company or OII to (ii) Book Capitalization to exceed 55% or, following any
Equity Issuance, 60%.
60
<PAGE>
11. EVENTS OF DEFAULT.
Section 11. Events of Default and Acceleration. Upon the occur
----------------------------------
rence and during the continuance of any of the following events (each an "Event
of Default"),
(a) the Company shall fail to pay (i) any principal of the Notes
when due or (ii) any fee payable pursuant to Section 15.1 or any interest
on the Notes or any other sum hereunder or under any of the other Note
Documents to which it is a party, in each such case, with respect to this
clause (ii), within three days after the date on which the same shall
become due and payable; or
(b) Grand Parent or the Company shall fail to comply with any of
the covenants contained in Section 7.1(h), 9.14 or Article 10; or
(c) any Omnipoint Note Party shall fail to perform any term,
covenant or agreement contained herein or in any of the other Note
Documents (other than those specified elsewhere in this Section 11.1) and
such failure shall continue for a period of 30 consecutive days after the
earlier of (i) written notice thereof from the Required Secured Parties or
(ii) actual knowledge thereof by such Omnipoint Note Party; or
(d) any representation or warranty of any Omnipoint Entity under
this Agreement or any of the other Note Documents or in any other document
or instrument delivered pursuant to or in connection with this Agreement or
any Note Document shall not be correct in any material respect upon the
date when made or deemed to have been made or repeated; or
(e) (i) any Significant Entity shall
(A) make an assignment for the benefit of creditors, or
(B) generally not pay its debts as such debts become due or
admit in writing its inability to
61
<PAGE>
generally pay or generally fail to pay its debts as they mature or
become due, or
(C) petition or apply for the appoint ment of a trustee or
other custodian, liquidator or receiver for itself or for any
substantial part of its assets, or
(D) shall commence any case or other proceeding under any
bankruptcy, reorganization, ar rangement, insolvency, readjustment of
debt, dissolution or liquidation or similar law of any jurisdiction
providing for the relief of debtors, now or hereafter in effect
(ii) any petition or application described in (i)(C) or (D) above
shall be filed or any such case or other proceeding shall be commenced
against any Significant Entity and (x) any Signif icant Entity shall
indicate its approval thereof, consent thereto or acquiescence therein, or
(y) such petition, application or proceeding is not dismissed within 45
days thereof, or (z) any of the actions sought in such petition,
application or 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
(iii) any Significant Entity shall take any corporate action to
authorize any of the actions set forth above in this subsection (e); or
(f) any Significant Entity shall fail to pay any principal of,
premium or interest on or any other amount payable in respect of any Indebt
edness that is outstanding in a principal amount of at least $10 million in
the aggregate (but excluding Indebtedness outstanding hereunder and
Indebted ness owed to the FCC), 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 of any
Significant Entity, 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
62
<PAGE>
to mature; or any such Indebted ness of any Significant Entity 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, other than (i) the redemption or
repurchase of not more than $15,000,000 of Senior Notes as permitted in the
last sentence of the definition of "Change of Control" in and (ii) from the
Net Cash Proceeds of asset sales, or equity or debt issuances, in each case
prior to the stated maturity thereof; or
(g) any final judgment or order for the payment of money in an
amount of $10,000,000 or more (excluding any portion thereof that an
insurance company of recognized standing and creditworthiness reasonably
satisfactory to the Required Holders has agreed to pay) shall be rendered
against one or more Significant Entities and shall not be paid, discharged
or bonded 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 Note 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
Holders, or any action at law, suit or in equity or other legal proceeding
to cancel, revoke or rescind any of the Note Documents shall be commenced
by or on behalf of any Omnipoint Entity, or any Guarantor shall assert that
its respective guaranty of the Obligations of the Company is invalid, 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 Note Documents is illegal, invalid or unenforceable in any material
respect in accordance with the terms thereof; or
63
<PAGE>
(i) with respect to any Guaranteed Pension Plan: an ERISA Event
shall have occurred and the Required Secured Creditors shall have
determined in their reasonable discretion that such event reasonably could
be expected to result in liability of Grand Parent or any of its
Subsidiaries to the PBGC or such Guaranteed Pension Plan in an aggregate
amount of $10,000,000 or more; or a trustee shall have been appointed by
the United States District Court to administer such Guaranteed Pension
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) any Environmental Claim shall have been asserted against any
Omnipoint Entity or any Environmental Affiliate thereof which, if
determined adversely, could reasonably be expected to have a Material
Adverse Effect, (ii) any release, emission, discharge or disposal of any
Material of Environmental Concern shall have occurred, and such event could
form the basis of an Environmental Claim against any Omnipoint Entity or
any Environmental Affiliate thereof which, if determined adversely, could
have a Material Adverse Effect, or (iii) any Omnipoint Entity or its
Environmental Affiliate shall have failed to obtain any Environmental
Permit necessary for the management, use, control, ownership, or operation
of its business, property or assets or any such Environmental Permit shall
be revoked, terminated, or otherwise cease to be in full force and effect,
in each case, if the existence of such condition could have a Material
Adverse Effect;
(k) the FCC or any other Governmental Body shall cancel, revoke
or suspend (i) any of the Company's Licenses for the New York PCS Network,
or any License held by the License Subsidiary, or fail to renew any such
License or (ii) any other License or group of Licenses held by Grand Parent
or any of its Significant Subsidiaries (other than "C" Block Licenses) the
loss of which could reasonably be expected to have a Material Adverse
Effect on Grand Parent and its Significant Subsidiaries, taken as a whole;
or
(l) the FCC or any other Governmental Body shall commence any
proceeding to cancel, revoke or suspend any of the Company's or the License
Subsidiary's Licenses for the New York PCS Network which proceeding for the
cancellation, revocation or suspension (i)
64
<PAGE>
could reasonably be expected to have a Material Adverse Effect and (ii) has
not been stayed or enjoined by the Company or the License Subsidiary within
five business days after the commencement of any such proceeding; or
(m) the Company or the License Subsidiary shall fail to pay when
due amounts owing the FCC unless (i) such failure to pay can reasonably be
expected, in the sole reasonable judgment of the Required Secured
Creditors, not to result in any cancellation, revocation or suspension of
any of the Company's or the License Subsidiary's Licenses for the New York
PCS Network or (ii) the Company or the License Subsidiary has obtained a
stay or injunction against any action by the FCC to cancel, revoke or
suspend such License notwithstanding such failure to pay; or
(n) the Collateral Agent shall cease to have a valid and
perfected first-priority Lien on any Collateral (subject only to Permitted
Liens) securing the Obligations of the Company (or in the case of
Collateral pledged by Parent, License Subsidiary, OHI or OIT, each such
Person's respective guaranty of the Obligations of the Company) or the
Company, Parent, License Subsidiary, OHI or OIT shall so assert; or
(o) a Change of Control shall occur.
12. REMEDIES ON DEFAULT, ETC.
Section 12.1 Acceleration.
------------
(a) If an Event of Default with respect to the Company described
in paragraph (e) of Section 11 has occurred, all the Notes then outstanding
shall automatically become immediately due and payable.
(b) If any other Event of Default has occurred and is continuing,
the Required Secured Creditors may at any time at its or their option, by
notice or notices to the Company, declare all the Notes then outstanding to
be immediately due and payable.
(c) If any Event of Default described in paragraph (a) or (b) of
Section 11 has occurred and is continuing, any Holder at the time
outstanding affected by such Event of Default may at any time, at its or
65
<PAGE>
their option, by notice or notices to the Company, declare all the Notes
held by it or them to be immediately due and payable.
(d) Upon any Notes becoming due and payable under this Section
12.1, whether automatically or by declaration, such Notes will forthwith
mature and the entire unpaid principal amount of such Notes, plus (x) all
-
accrued and unpaid interest thereon and (y) the Prepayment Premium
-
determined in respect of such principal amount (to the full extent
permitted by applicable law), shall all be immediately due and payable, in
each and every case without presentment, demand, protest or further notice,
all of which are hereby waived. The Company acknowledges, and the parties
hereto agree, that each holder of a Note has the right to maintain its
investment in the Notes free from repayment by the Company (except as
herein specifically provided for) and that the provision for payment of a
Prepayment Premium by the Company in the event that the Notes are prepaid
or are accelerated as a result of an Event of Default, is intended to
provide compensation for the deprivation of such right under such
circumstances.
Section 12.2 Other Remedies.
--------------
If any Default has occurred and is continuing, and irrespective of
whether any Notes have become or have been declared immediately due and payable
under Section 12.1, any Holder at the time outstanding may proceed to protect
and enforce the rights of such holder by an action at law, suit in equity or
other appropriate proceeding, whether for the specific performance of any
agreement contained herein or in any Note, or for an injunction against a
violation of any of the terms hereof or thereof, or in aid of the exercise of
any power granted hereby or thereby or by law or otherwise.
Section 12.3 Rescission.
----------
At any time after any Notes have been declared due and payable
pursuant to clause (b) or (c) of Section 12.1, the Required Secured Creditors,
by written notice to the Company, may rescind and annul any such declaration and
its consequences if (a) the Company has paid all overdue interest on the Notes,
-
all principal of and Prepayment Premium, if any, on any Notes that are due and
payable and are unpaid other than by reason of such declaration, and all
interest on such overdue principal and Prepayment Premium, if any, and (to the
extent permitted by applicable law) any overdue interest in respect of the
Notes, at the
66
<PAGE>
Default Rate, (b) all Defaults, other than non-payment of amounts that have
-
become due solely by reason of such declaration, have been cured or have been
waived pursuant to Section 17.1, and (c) no judgment or decree has been entered
-
for the payment of any monies due pursuant hereto or to the Notes. No rescission
and annulment under this Section 12.3 will extend to or affect any subsequent
Default or impair any right consequent thereon.
Section 12.4 No Waivers or Election of Remedies, Expenses, etc.
--------------------------------------------------
No course of dealing and no delay on the part of any Holder in
exercising any right, power or remedy shall operate as a waiver thereof or
otherwise prejudice such Holder's rights, powers or remedies. No right, power
or remedy conferred by this Agreement or by any Note upon any holder thereof
shall be exclusive of any other right, power or remedy referred to herein or
therein or now or hereafter available at law, in equity, by statute or
otherwise. Without limiting the obligations of the Company under Section 15.1,
the Company will pay to the Holder on demand such further amount as shall be
sufficient to cover all costs and expenses of such Holder incurred in any
enforcement or collection under this Section 12, including, without limitation,
reasonable attorneys' fees, expenses and disbursements.
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES; PAYING AGENT.
Section 13.1 Registration of Notes.
----------------------
The Paying Agent shall keep at its principal executive office a
register (the "Register") for the registration and registration of transfers of
Notes. The name and address of each holder of one or more Notes, each transfer
thereof and the name and address of each transferee of one or more Notes shall
be registered in such Register. Prior to due presentment for registration of
transfer, the Person in whose name any Note shall be registered shall be deemed
and treated as the owner and holder thereof for all purposes hereof, and the
Paying Agent shall not be affected by any notice or knowledge to the contrary.
The Paying Agent shall give to any holder of a Note that is an Institutional
Investor promptly upon request therefor, a complete and correct copy of the
names and addresses of all registered holders of Notes.
67
<PAGE>
In the event that the Notes are in the form of Book-Entry Notes, a
Book-Entry Note may not be transferred as a whole except by the Clearing Agency
to a nominee of the Clearing Agency, by a nominee of the Clearing Agency to the
Clearing Agency or to another nominee of the Clearing Agency, or by the Clearing
Agency or any such nominee to a successor Clearing Agency or a nominee of such
successor Clearing Agency. A Book-Entry Note will be exchanged by the Company
for Definitive Notes only in accordance with Section 9.18.
Section 13.2 Transfer and Exchange of Notes.
------------------------------
Upon surrender of any Note at the principal executive office of the
Paying Agent for registration of transfer or exchange (and in the case of a
surrender for registration of transfer, duly endorsed or accompanied by a
written instrument of transfer duly executed by the registered holder of such
Note or his attorney duly authorized in writing and accompanied by the address
for notices of each transferee of such Note or part thereof), the Company shall
execute and deliver, at the Company's expense (except as provided below), one or
more new Notes (as requested by the holder thereof) in exchange therefor, in an
aggregate principal amount equal to the unpaid principal amount of the
surrendered Note. Each such new Note shall be payable to such Person as such
holder may request and shall be substantially in the form of Exhibit 1. Each
such new Note shall be dated and bear interest from the date to which interest
shall have been paid on the surrendered Note or dated the date of the
surrendered Note if no interest shall have been paid thereon. The Company may
require payment of a sum sufficient to cover any stamp tax or governmental
charge imposed in respect of any such transfer of Notes. Notes shall not be
transferred in denominations of less than $1,000,000, provided that if necessary
--------
to enable the registration of transfer by a holder of its entire holding of
Notes, one Note may be in a denomination of less than $1,000,000, provided
--------
further that any Note issued on the Closing Date in a denomination of less than
- -------
$1,000,000 may be transferred. Any transferee, by its acceptance of a Note
registered in its name (or the name of its nominee), or by acceptance of a
beneficial interest therein, shall be deemed to have made the representations
set forth in Article 6 and to have agreed to be bound by the provisions of the
Intercreditor Agreement and the other Note Documents. Any transferor of a Note
or a beneficial interest therein shall notify any prospective purchaser that
such transferor may be relying on the exemption from Section 5 of the Securities
Act provided by Rule 144A. The Paying Agent shall forward to the Company any
Notes surrendered to it for transfer, exchange or payment.
68
<PAGE>
Section 13.3 Replacement of Notes.
--------------------
Upon receipt by the Company of evidence reasonably satisfactory to it
of the ownership of and the loss, theft, destruction or mutilation of any Note
(which evidence shall be, in the case of an Institutional Investor, notice from
such Institutional Investor of such ownership and such loss, theft, destruction
or mutilation), and
(i) in the case of loss, theft or destruction, of indemnity
reasonably satisfactory to it (provided that if the holder of such Note is,
--------
or is a nominee for, an original Purchaser or another holder of a Note with
a minimum net worth of at least $50,000,000, such Person's own unsecured
agreement of indemnity shall be deemed to be satisfactory), or
(ii) in the case of mutilation, upon surrender and cancellation
thereof,
the Company at its own expense shall execute and deliver, in lieu thereof, a new
Note, dated and bearing interest from the date to which interest shall have been
paid on such lost, stolen, destroyed or mutilated Note or dated the date of such
lost, stolen, destroyed or mutilated Note if no interest shall have been paid
thereon.
Section 13.4 Exchange of Notes for Loans. Each Holder shall have the
---------------------------
right to exchange its Note for a Loan by following the procedures set forth in
this Section. Such Holder (an "Exchanging Holder") shall provide the Company,
the Paying Agent and the Administrative Agent not less than ten Business Days'
written notice of its intention to exchange its Note and the date of such
exchange (the "Exchange Date") and shall deliver therewith an executed Joinder
Agreement. On or prior to the Exchange Date, the Company and the Administrative
Agent shall each execute their respective counterparts to the Joinder Agreement
for delivery to the respective parties thereto. On the Exchange Date, the
Exchanging Holder shall surrender its Note at the principal executive office of
the Company (or in the event the Notes shall be Book-Entry Notes, provide the
Administrative Agent and the Company written evidence confirming delivery of
same to an agent designated by the Company through the Clearing Agency),
whereupon the Company shall provide notice of such exchange to the
Administrative Agent and the Paying Agent (together with a certified copy of the
cancelled Note if applicable). Upon such surrender, such Exchanging Holder
shall cease to be deemed a
69
<PAGE>
"Holder" under this Agreement and, pursuant to the Joinder Agreement, shall (i)
be deemed to be a Lender under the Loan Agreement, (ii) have all the benefits
and obligations of a Lender under the Loan Agreement and (iii) be deemed to have
made a Loan to the Company (such Loan, an "Exchange Loan") in an aggregate
principal amount equal to the unpaid Obligations of the surrendered Note to such
Exchanging Holder. Each such Exchange Loan shall (i) accrue interest from the
date to which interest shall have been paid on the surrendered Note or dated the
date of the surrendered Note if no interest shall have been paid thereon at the
rate provided for in the Loan Agreement and (ii) include a proportion of Tranche
A Loans and Tranche B Loans equal to the proportion of Tranche A Amounts and
Tranche B Amounts, respectively, of the surrendered Note. The Company may
require payment of a sum sufficient to cover any stamp tax or governmental
charge imposed in respect of any such transfer of Notes for Exchange Loans.
Section 13.5 Paying Agent.
------------
The Company shall appoint and at all times maintain a Paying Agent for
the Notes, which Paying Agent shall be reasonably acceptable to the Holders. The
Company hereby initially appoints IBJ Schroder Bank & Trust Company ("IBJ") as
Paying Agent, and IBJ hereby initially agrees so to act. IBJ (and its
successors and assigns) shall maintain an office or agency where Notes may be
presented for payment. The term "Paying Agent" includes any additional Paying
Agent.
The Company shall enter into an appropriate written agency agreement
with any Person not a party to this Agreement, which agreement shall implement
the provisions of this Agreement that relate to such Person. The Company shall
promptly notify the Paying Agent in writing of the name and address of any such
Person.
The Company shall appoint The Depository Trust Company ("DTC") to act
as depository with respect to the Book-Entry Notes.
The Company initially appoints the Paying Agent to act as securities
custodian with respect to the Book-Entry Notes.
The record date for interest payments shall be the 15/th/ day of the
month in which the payment is due.
70
<PAGE>
Section 13.6 Paying Agent to Hold Assets in Trust.
------------------------------------
The Company shall require each Paying Agent to agree in writing that
such Paying Agent shall hold in trust for the benefit of Holders all assets held
by such Paying Agent for the payment of principal of, premium, if any, or
interest on, the Notes (whether such assets have been distributed to it by the
Company or any other obligor on the Notes), and shall notify the Holders in
writing of any Default in making any such payment. The Company at any time may
require the Paying Agent to distribute all assets held by it to the Holders and
account for any assets disbursed and the Holders may at any time during the
continuance of any payment Default, upon written request to the Paying Agent,
require the Paying Agent to distribute all assets held by it to the Holders and
to account for any assets distributed. Upon distribution to the Holders of all
assets that shall have been delivered by the Company to the Paying Agent, the
Paying Agent shall have no further liability for such assets.
Section 13.7 Determination of the Base Rate, LIBO Rate and the
-------------------------------------------------
Interest Rate. (a) Subject to clause (b), the Paying Agent shall, as soon as
- -------------
practicable, but in no event later than 1:00 p.m., Eastern time, two Business
Days before the effectiveness of each LIBO Rate, cause to be determined such
LIBO Rate, the resulting Interest Rate based on such LIBO Rate, and notify each
Holder and the Company thereof by facsimile or other method acceptable to the
Paying Agent; provided that on the Closing Date the Paying Agent shall determine
-------------
the LIBO Rate for the initial interest period, based on the rate in effect two
Business Days before the Closing Date and inform the Company and each Holder of
such LIBO Rate for such interest period on the Closing Date. Each determination
of the LIBO Rate and the resulting Interest Rate shall be conclusive and binding
on the Company and each Holder in the absence of manifest error. In calculating
the Interest Rate, the Paying Agent may assume that the Applicable Margin is (i)
with respect to Base Rate, 2.25% per annum or (ii) with respect to LIBO Rate,
3.25% per annum until otherwise notified in writing by the Company. In the event
of any conflict between the instructions given to the Paying Agent by the
Required Holders and the Company pursuant to Section 13.7, the Paying Agent
shall be entitled to follow the instructions of the Company.
(b) In the event that (i) the LIBOR Rate cannot be determined by the
Paying Agent or (ii) the Paying Agent receives written notice that any Holder is
unable lawfully for any reason whatsoever to hold its Note accruing interest at
the LIBO Rate plus the Applicable Margin, the Paying Agent shall determine the
71
<PAGE>
Interest Rate based on the sum of the Base Rate and the Applicable Margin and
shall promptly notify each Holder and the Company thereof provided in the case
of clause (ii), the foregoing shall only apply with respect to that portion of
the Indebtedness outstanding under the Notes held by the affected Holder.
Section 13.8 Nature of Duties. The Paying Agent shall have no
----------------
duties or responsibilities except those expressly set forth herein and in the
Note Documents. Neither the Paying Agent nor any of its officers, directors,
employees or agents shall be liable for any action taken or omitted by it as
such under the Note Documents or hereunder or in connection herewith or
therewith, unless caused by its or their gross negligence or willful misconduct.
The duties of the Paying Agent shall be mechanical and administrative in nature;
the Paying Agent shall not have by reason of the Note Documents a fiduciary
relationship in respect of any Holder or any Omnipoint Entity; and nothing in
the Note Documents, expressed or implied, is intended to or shall be so
construed as to impose upon the Paying Agent any obligations in respect of the
Note Documents except as expressly set forth herein or therein.
Section 13.9 Reliance. The Paying Agent shall be entitled to rely,
--------
and shall be fully protected in relying, upon any note, writing, resolution,
notice, statement, certificate, teletype or telecopier message, cablegram,
radiogram, order or other document or telephone message signed, sent or made by
the proper Person or entity, and, with respect to all legal matters pertaining
to the Note Documents and its duties thereunder and hereunder, upon advice of
counsel selected by it.
Section 13.10 Compensation and Indemnification. (a) The Company
--------------------------------
covenants and agrees from time to time to pay, and the Paying Agent shall be
entitled to, compensation as agreed in writing between the Company and the
Paying Agent and the Company covenants and agrees to pay or reimburse the Paying
Agent upon its request for all reasonable expenses, disbursements and advances
incurred or made by or on behalf of it in accordance with any of the provisions
of this Agreement except to the extent any such expense, disbursement or advance
may arise from the Paying Agent's own gross negligence or bad faith.
(b) To the extent the Paying Agent is not reimbursed and indemnified
by the Company in accordance with Section 15.1(c), the Holders will reimburse
and indemnify the Paying Agent, in proportion to their respective principal
amounts of Obligations, for and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
72
<PAGE>
disbursements of any kind or nature whatsoever which may be imposed on, incurred
by or asserted against the Paying Agent in performing its duties hereunder or
under the Note Documents, or in any way relating to or arising out of the Note
Documents except for those resulting solely from the Collateral Agent's own
gross negligence or willful misconduct. The indemnities set forth in this
Section 13.10 shall survive the repayment of all Obligations.
Section 13.11 Duties and Responsibilities of Paying Agent. The
-------------------------------------------
Paying Agent undertakes to perform such duties and only such duties as are
specifically set forth in this Agreement, and no implied covenants or
obligations shall be read into this Agreement against the Paying Agent.
Section 13.12 Resignation by the Paying Agent. The Paying Agent
-------------------------------
may resign from the performance of all its functions and duties hereunder and
under the Note Documents at any time by giving 30 Business Days' prior written
notice to the Company and the Holders. Such resignation shall take effect upon
the appointment of a successor Paying Agent by the Company pursuant to Section
13.5. If the Paying Agent consolidates, merges or converts into, or transfers
all or substantially all of its corporate trust business to another corporation,
the successor corporation without any further act shall become the Paying Agent
hereunder. If a successor Paying Agent is not appointed within such 30 Business
Days after the giving of such notice, the Paying Agent may apply to a court of
competent jurisdiction for the appointment of a successor Paying Agent.
Section 13.13 Certain Other Matters Relating to the Paying Agent.
--------------------------------------------------
The Paying Agent shall be required to make payments only out of immediately
available funds supplied to it by the Company on a timely basis. The Paying
Agent shall not have any liability for interest on any moneys received by it
pursuant to this Agreement, and the Paying Agent shall not be obligated to
invest any funds held by it. The Paying Agent shall not be liable for any
action it takes or omits to take in good faith that it believes to be authorized
or within the rights or powers conferred upon it by this Agreement or the Notes.
The Paying Agent shall not be deemed to have notice or knowledge of any matter
unless a Responsible officer assigned to and working in the Paying Agent's
Corporate Trust Administration has actual knowledge thereof or unless written
notice thereof is received by the Paying Agent, Attention: Corporate Trust
Administration, and such notice references the Notes generally, the Company or
this Agreement. As used herein the term "Responsible Officer" means any officer
within the Corporate Trust Administration of the Paying Agent (or any successor
group of the Paying Agent)
73
<PAGE>
or any other officer of the Paying Agent customarily performing functions
similar to those performed by any of the above designated officers. The Paying
Agent shall be entitled to consult with counsel satisfactory to it (including
counsel to the Company) and the advice or opinion of such counsel shall be full
and complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in accordance with the
advice or opinion of such counsel. Notwithstanding Section 17.1, no amendment to
this Agreement or the Notes affecting the rights or obligations of the Paying
Agent shall be effective as to the Paying Agent without the written consent of
the Paying Agent.
14. PAYMENTS ON NOTES.
Section 14.1 Deposit of Payment Amounts.
--------------------------
On or prior to the date of payment hereunder or pursuant to Article 8,
the Company shall deposit with the Paying Agent cash sufficient to pay the
repayment price of, including accrued and unpaid interest on, all Notes to be
repaid or prepaid on such date. The Paying Agent shall promptly return to the
Company any cash so deposited which is not required for that purpose upon the
written request of the Company. An installment of principal of or interest on
the Notes shall be considered paid on the date it is due if the Paying Agent
holds for the benefit of the Holders, on or before 11:00 a.m. New York City time
on that date, cash deposited and designated for and sufficient to pay the
installment.
Section 14.2 Home Office Payment.
-------------------
So long as any Purchaser or its nominee shall be the holder of any
Note (other than a Book-Entry Note), and notwithstanding anything contained in
Section 14.1 or in such Note to the contrary, the Company will pay or cause the
Paying Agent to pay all sums becoming due on such Note for principal, Prepayment
Premium, if any, and interest by the method and at the address specified for
such purpose below such Purchaser's name in Schedule A, or by such other method
or at such other address as such Purchaser shall have from time to time
specified to the Company in writing for such purpose, without the presentation
or surrender of such Note or the making of any notation thereon, except that
upon written request of the Company made concurrently with or reasonably
promptly after payment or prepayment in full of any Note, such Purchaser shall
surrender such Note for cancellation, reasonably promptly after any such
request, to the
74
<PAGE>
Company at its principal executive office or at the place of payment most
recently designated by the Company pursuant to Section 14.1. Prior to any sale
or other disposition of any Note (other than a Book-Entry Note) held by any
Purchaser or its nominee such Purchaser will, at its election, either endorse
thereon the amount of principal paid thereon and the last date to which interest
has been paid thereon or surrender such Note to the Company in exchange for a
new Note or Notes pursuant to Section 13.2. The Company will afford the benefits
of this Section 14.2 to any Institutional Investor that is the direct or
indirect transferee of any Note purchased by any Purchaser under this Agreement
and that has made the same agreement relating to such Note as such Purchaser has
made in this Section 14.2. Notwithstanding the foregoing, the Company may
deliver any interest payment to the Paying Agent.
15. EXPENSES, ETC.
Section 15.1 Expenses.
--------
(a) The Company will pay on demand
(i) all costs and expenses of the Holders and the Paying Agent
incurred in connection with the administration, modification and
amendment of the Note Documents and any consents or waivers in
connection therewith (including (A) all search, filing and recording
fees and expenses and (B) the reasonable fees and expenses of counsel
for the Holders and the Paying Agent with respect to the Note
Documents, with respect to advising the Holders and the Paying Agent
as to their rights and responsibilities, or the perfection, protection
or preservation of rights or interests, under the Note Documents and
with respect to negotiations with the Omnipoint Note Parties or with
other creditors of the Omnipoint Note Parties in connection with the
Note Documents, or 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 or negotiation
involving creditors' rights generally and any proceeding ancillary
thereto); provided, however, it is understood that the Company shall
not be liable for the costs and expenses incurred by
75
<PAGE>
counsel to any of the Holders in connection with the preparation,
execution and delivery of the Note Documents, and
(ii) all costs and expenses of the Holders and the Paying Agent
in connection with the enforcement of the Note Documents, including 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 each Holder
and the Paying Agent with respect thereto).
(b) If the Company fails to pay when due any costs, expenses or other
amounts payable by it under any Note Document, including fees and expenses
of counsel and indemnities, such amount may be paid on behalf of the
Company by any Holder and the Paying Agent, in its sole discretion.
(c) The Company will indemnify each Holder and the Paying Agent and
the Paying Agent and its respective Affiliates and their officers,
directors, partners, employees, agents and advisors (each an "Indemnified
-----------
Party") and hold each Indemnified Party harmless from and against any and
-----
all claims, damages, losses, liabilities and expenses (including reasonable
fees and expenses of counsel including, with respect to each other Holder
and the Paying 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 Note Documents and the
enforcement thereof, any of the transactions contemplated herein or
therein or the actual or proposed use of the proceeds of the Notes, or
(ii) the actual or alleged presence of Materials of Environmental
Concern on any property of the Company or any environmental proceeding
relating in any way to the Company,
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
76
<PAGE>
to which the indemnity in this Section 15.1(d) applies, the indemnity shall
be effective whether or not such investigation, litigation or proceeding is
brought by the Company, 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 Company also agrees not to assert any claim against any
other Holder, the Paying Agent, 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 Notes.
(d) Without prejudice to the survival of any other agreement of the
Company hereunder, the agreements and obligations of the Company contained
in this Section 15.1 shall survive the payment in full of principal and
interest hereunder and under the Notes and the termination of this
Agreement.
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.
All representations and warranties contained herein shall survive the
execution and delivery of this Agreement and the Notes, the purchase or transfer
by the Purchasers of any Note or portion thereof or interest therein and the
payment of any Note, and may be relied upon by any subsequent holder of a Note,
regardless of any investigation made at any time by or on behalf of any
Purchaser or any other holder of a Note. All statements contained in any
certificate or other instrument delivered by or on behalf of the Company
pursuant to this Agreement shall be deemed representations and warranties of
the Company under this Agreement. Subject to the preceding sentence, this
Agreement and the Notes embody the entire agreement and understanding between
the Purchasers, the Paying Agent and the Company and supersede all prior
agreements and understandings relating to the subject matter hereof.
77
<PAGE>
17. AMENDMENT AND WAIVER.
Section 17. Amendments, Etc. No amendment or waiver of any provision of
---------------
this Agreement or the Notes, nor consent to any departure by the Company
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Required Secured Creditors (and the terms of effectiveness set
forth in such amendment, waiver or consent shall be satisfied), and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; provided that no amendment, waiver or consent
--------
shall, unless in writing and signed by all the Holders and the Paying Agent, do
any of the following at any time:
(i) waive any of the conditions specified in Article 4;
(ii) change the definition of Required Secured Creditors (or,
without the vote of the Required Holders only, change the definition
of Required Holders)
(iii) release any Collateral, other than as contemplated by the
Note Documents or release any Guarantor from its Guaranty;
(iv) amend this Section 17.1;
(v) subject the Holders to any additional obligations;
(vi) amend or waive any mandatory prepayment provisions;
(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; and
Section 17.2 Notes held by Company, etc.
---------------------------
Solely for the purpose of determining whether the holders of the
requisite percentage of the aggregate principal amount of Notes then outstanding
approved or consented to any amendment, waiver or consent to be given under this
Agreement or the Notes, or have directed the taking of any action provided
herein
78
<PAGE>
or in the Notes to be taken upon the direction of the holders of a specified
percentage of the aggregate principal amount of Notes then outstanding, Notes
directly or indirectly owned by any Omnipoint Entity or any of its Affiliates
shall be deemed not to be outstanding.
18 NOTICES.
All notices and other communications provided for hereunder shall be in
writing (including telegraphic, telecopy or cable communication) and mailed,
telegraphed, telecopied, cabled or delivered,
(a) if to the Company, at:
Omnipoint Communications Inc.
16 Wing Drive
Cedar Knolls, New Jersey 07927
Attn: Harry Plonskier
(fax no. (973) 257-2539) - prior to April 15, 1998
(fax no. (973) 290-2539) - from and after April 15, 1998
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)
(b) if to Grand Parent, at:
Omnipoint Corporation
Three Bethesda Metro Center
Suite 400
Bethesda, MD 20814
Attn: Bradley E. Sparks
(fax no. (301) 951-2518)
79
<PAGE>
with a copy to Piper & Marbury, L.L.P. as set forth under clause
(a) above;
(c) if to OHI, OIT or the License Subsidiary, in care of
Omnipoint Corporation
Three Bethesda Metro Center
Suite 400
Bethesda, MD 20814
Attn: Bradley E. Sparks
(fax no. (301) 951-2518)
(d) if to any Holder, as indicated in the Register; and
(e) if to IBJ Schroder Bank & Trust Company as Paying Agent
IBJ Schroder Bank & Trust Company
Corporate Trust Administration
11/th/ Floor
One State Street
New York, New York 10004
Attention: Thomas J. Bogert
(fax no. (212) 858-2895)
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 or cabled, be effective when
deposited in the mails, delivered to the telegraph company, transmitted by
telecopier or delivered to the cable company, respectively.
19 REPRODUCTION OF DOCUMENTS.
This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
-
executed, (b) documents received by any Purchaser at the Closing (except the
-
Notes themselves), and (c) financial statements, certificates and other
-
information previously or hereafter furnished to any Purchaser, may be
reproduced by such Purchaser by any photographic, photostatic, microfilm,
microcard, miniature
80
<PAGE>
photographic or other similar process and such Purchaser may destroy any
original document so reproduced. The Company agrees and stipulates that, to the
extent permitted by applicable law, any such reproduction shall be admissible in
evidence as the original itself in any judicial or administrative proceeding
(whether or not the original is in existence and whether or not such
reproduction was made by the Purchaser in the regular course of business) and
any enlargement, facsimile or further reproduction of such reproduction shall
likewise be admissible in evidence. This Section 19 shall not prohibit the
Company or any other holder of Notes from contesting any such reproduction to
the same extent that it could contest the original, or from introducing evidence
to demonstrate the inaccuracy of any such reproduction.
20 CONFIDENTIAL INFORMATION.
For the purposes of this Section 20, "Confidential Information" means
information delivered to any Purchaser by or on behalf of the Company or any
Subsidiary in connection with the transactions contemplated by or otherwise
pursuant to this Agreement that is proprietary in nature and that was clearly
marked or labeled or otherwise adequately identified when received by such
Purchaser as being confidential information of the Company or such Subsidiary,
provided that such term does not include information that (a) was publicly known
- -------- -
or otherwise known to such Purchaser prior to the time of such disclosure, (b)
-
subsequently becomes publicly known through no act or omission by such Purchaser
or any person acting on such Purchaser's behalf, (c) otherwise becomes known to
-
such Purchaser other than through disclosure by the Company or any Subsidiary or
(d) constitutes financial statements delivered to such Purchaser under Section
-
7.1 that are otherwise publicly available. Each Purchaser will maintain the
confidentiality of such Confidential Information in accordance with procedures
adopted by such Purchaser in good faith to protect confidential information of
third parties delivered to such Purchaser; provided that any Purchaser may
--------
deliver or disclose Confidential Information to (i) its directors, officers,
-
employees, agents, attorneys and affiliates, (to the extent such disclosure
reasonably relates to the administration of the investment represented by its
Notes), (ii) its financial advisors and other professional advisors who agree to
--
hold confidential the Confidential Information substantially in accordance with
the terms of this Section 20, (iii) any other holder of any Note, (iv) any
--- --
Institutional Investor to which such Purchaser may sell or offer to sell such
Note or any part thereof or any participation therein (if such Person has agreed
in writing prior to its receipt of such Confidential Information to be bound by
the provisions of this Section 20), (v) any Person from
-
81
<PAGE>
which such Purchaser may offer to purchase any security of the Company (if
such Person has agreed in writing prior to its receipt of such Confidential
Information to be bound by the provisions of this Section 20), (vi) any federal
--
or state regulatory authority having jurisdiction over any Purchaser, (vii) the
---
National Association of Insurance Commissioners or any similar organization, or
any nationally recognized rating agency that requires access to information
about such Purchaser's investment portfolio, or (viii) any other Person to which
----
such delivery or disclosure may be necessary or appropriate (w) to effect
-
compliance with any law, rule, regulation or order applicable to any Purchaser,
(x) in response to any subpoena or other legal process, (y) in connection with
- -
any litigation to which any Purchaser is a party or (z) if an Event of Default
-
has occurred and is continuing, to the extent any Purchaser may reasonably
determine such delivery and disclosure to be necessary or appropriate in the
enforcement or for the protection of the rights and remedies under its Notes and
this Agreement. Each holder of a Note, by its acceptance of a Note, will be
deemed to have agreed to be bound by and to be entitled to the benefits of this
Section 20 as though it were a party to this Agreement. On reasonable request by
the Company in connection with the delivery to any holder of a Note of
information required to be delivered to such holder under this Agreement or
requested by such holder (other than a holder that is a party to this Agreement
or its nominee), such holder will enter into an agreement with the Company
embodying the provisions of this Section 20.
21 SUBSTITUTION OF PURCHASER.
Each Purchaser shall have the right to substitute any one of its
Affiliates as the purchaser of the Notes that such Purchaser has agreed to
purchase hereunder, by written notice to the Company, which notice shall be
signed by both such Purchaser and such Affiliate, shall contain such Affiliate's
agreement to be bound by this Agreement and shall contain a confirmation by such
Affiliate of the accuracy with respect to it of the representations set forth in
Section 6. Upon receipt of such notice, wherever the word "Purchaser" is used
in this Agreement (other than in this Section 21), such word shall be deemed to
refer to such Affiliate in lieu of such Purchaser. In the event that such
Affiliate is so substituted as a Purchaser hereunder and such Affiliate
thereafter transfers to such Purchaser all of the Notes then held by such
Affiliate, upon receipt by the Company of notice of such transfer, wherever the
word "Purchaser" is used in this Agreement (other than in this Section 21), such
word shall no longer be deemed to refer to such Affiliate, but shall refer to
such Purchaser, and such Purchaser shall have all the rights of an original
holder of the Notes under this Agreement.
82
<PAGE>
22 MISCELLANEOUS.
Section 22.1 Successors and Assigns. All covenants and other
----------------------
agreements contained in this Agreement by or on behalf of any of the parties
hereto bind and inure to the benefit of their respective successors and assigns
(including, without limitation, any subsequent holder of a Note) whether so
expressed or not.
Section 22.2 Payments Due on Non-Business Days. Anything in this
---------------------------------
Agreement or the Notes to the contrary notwithstanding, any payment of principal
of or Prepayment Premium or interest on any Note that is due on a date other
than a Business Day shall be made on the next succeeding Business Day without
including the additional days elapsed in the computation of the interest payable
on such next succeeding Business Day.
Section 22.3 Severability. Any provision of this Agreement that
------------
is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall (to the full
extent permitted by law) not invalidate or render unenforceable such provision
in any other jurisdiction.
Section 22.4 Construction. Each covenant contained herein shall
------------
be construed (absent express provision to the contrary) as being independent of
each other covenant contained herein, so that compliance with any one covenant
shall not (absent such an express contrary provision) be deemed to excuse
compliance with any other covenant. Where any provision herein refers to action
to be taken by any Person, or which such Person is prohibited from taking, such
provision shall be applicable whether such action is taken directly or
indirectly by such Person.
Section 22.5 Counterparts. This Agreement may be executed in any
------------
number of counterparts, each of which shall be an original but all of which
together shall constitute one instrument. Each counterpart may consist of a
number of copies hereof, each signed by less than all, but together signed by
all, of the parties hereto.
83
<PAGE>
Section 22.6 Governing Law. This Agreement shall be construed and
-------------
enforced in accordance with, and the rights of the parties shall be governed by,
the law of the State of New York excluding choice-of-law principles of the law
of such State that would require the application of the laws of a jurisdiction
other than such State.
Section 22.7 Grand Parent Not a Guarantor. The parties hereto
----------------------------
acknowledge and agree that Grand Parent shall be a party hereto solely for the
purposes of providing the covenants and representations expressly specified
herein, and shall not be a guarantor of the Obligations of any Loan Party under
the Loan Documents.
Section 22.8 Appointment of Collateral Agent. Each Holder hereby
-------------------------------
appoints and authorizes the Collateral Agent to take such action as agent on its
behalf and to exercise such powers and discretion under the Intercreditor
Agreement and the Collateral Documents as are delegated to the Collateral Agent
by the terms thereof, together with such powers and discretion as are reasonably
incidental thereto.
84
<PAGE>
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., as Company
By /s/ Harry Plonskier
----------------------------------
Name: Harry Plonskier
Title: Vice President Finance
S-1
<PAGE>
OMNIPOINT CORPORATION, as a party for the
purposes set forth in Section 22(g) of this
Agreement
By /s/
------------------------------------
Title:
S-2
<PAGE>
IBJ SCHRODER BANK & TRUST COMPANY, as Paying
Agent
By /s/
------------------------------------
Title: Vice President
S-3
<PAGE>
DREYFUS PREMIER LIMITED
TERM HIGH INCOME FUND
By /s/
-------------------------------
Title:
S-4
<PAGE>
KZH HOLDING CORPORATION III
By /s/ Virginia Conway
--------------------------------
Title: Authorized Agent
S-5
<PAGE>
SUNAMERICA HIGH INCOME FUND
By /s/
----------------------------
Title: VP - Portfolio Mgr.
S-6
<PAGE>
POLARIS SERIES TRUST HY
PORTFOLIO
By /s/
---------------------------------
Title: VP - Portfolio Mgr.
S-7
<PAGE>
THE PRUDENTIAL INSURANCE COMPANY OF
AMERICA
By /s/
---------------------------------
Title:
S-8
<PAGE>
CAPITAL RESEARCH AND MANAGEMENT COMPANY
on behalf of AMERICAN VARIABLE INSURANCE
SERIES HIGH YIELD BOND FUND
By /s/
Title:
S-9
<PAGE>
CAPITAL RESEARCH AND MANAGEMENT COMPANY
on behalf of THE INCOME FUND OF AMERICA,
INC.
By /s/
------------------------------------
Title: Secretary
S-10
<PAGE>
CAPITAL RESEARCH AND MANAGEMENT COMPANY
on behalf of THE BOND FUND OF AMERICA,
INC.
By
-----------------------------
Title: Secretary
S-11
<PAGE>
ANCHOR PATHWAY FUND HIGH-YIELD BOND
SERIES
By /s/
---------------------------------
Title:
S-12
<PAGE>
CAPITAL RESEARCH AND MANAGEMENT COMPANY
on behalf of AMERICAN HIGH-INCOME TRUST
By /s/
----------------------------------
Title: Secretary
S-13
<PAGE>
PUTNAM VARIABLE TRUST on behalf of
PUTNAM VT HIGH YIELD FUND
By /s/
----------------------------------
Title: Vice President
S-14
<PAGE>
PUTNAM HIGH YIELD TRUST II
By /s/
-------------------------------
Title: Vice President
S-15
<PAGE>
PUTNAM HIGH YIELD TRUST
By /s/
-------------------------------
Title: Vice President
S-16
<PAGE>
PUTNAM HIGH YIELD ADVANTAGE FUND
By /s/
------------------------------------
Title: Vice President
S-17
<PAGE>
PUTNAM DIVERSIFIED INCOME TRUST
By /s/
----------------------------------
Title: Vice President
S-18
<PAGE>
PUTNAM MASTER INCOME TRUST
By /s/
-------------------------------------
Title: Vice President
S-19
<PAGE>
PUTNAM MASTER INTERMEDIATE INCOME TRUST
By /s/
----------------------------------
Title: Vice President
S-20
<PAGE>
PUTNAM PREMIER INCOME TRUST
By /s/
------------------------------------
Title: Vice President
S-21
<PAGE>
IDS
By /s/
---------------------------------
Title:
S-22
<PAGE>
SEABOARD PARTNERS, LP
By /s/
---------------------------------
Title: Managing Partner
S-23
<PAGE>
SEABOARD FUND LIMITED
By /s/
----------------------------------
Title: Managing Partner
S-24
<PAGE>
SEABOARD CAPITAL PARTNERS, LP
By /s/
-----------------------------------
Title: Managing Partner
S-25
<PAGE>
DONALDSON, LUFKIN & JENRETTE SECURITIES
CORPORATION
By /s/ Eric Swanson
------------------------------------
Title: Eric Swanson
Managing Director
S-26
<PAGE>
HIGH YIELD PORTFOLIO
By: /s/
------------------------------------
Title: Vice President
IDS BOND FUND, INC.
By: /s/
------------------------------------
Title: Vice President
IDS LIFE INCOME ADVANTAGE FUND
By: /s/
------------------------------------
Title: Vice President
Note Purchase Agreement
